Tribunal held that only those instruments/securities which yielded exempt income during previous year relevant to assessment year would be considered for computing disallowance. The Tribunal also held that if disallowance falls below disallowance under section 14A offered by assessee in return of income, revenue cannot charge tax on income which never was income of assessee chargeable to tax. (AY. 2011-12, 2012-13)
Sajjan India Ltd. v. ADIT (2018) 89 taxmann.com 21 (Mum.) (Trib.)
S. 14A : Disallowance of expenditure – Exempt income -Only those instruments/securities which yielded exempt income during previous year relevant to assessment year would be considered for computing disallowance-If disallowance falls below disallowance under section 14A offered by assessee in return of income, revenue cannot charge tax on income which never was income of assessee chargeable to tax. [S. 139, 143(3), R.8D]