Allowing the appeal of the assessee, the Court held that\u00a0 The Central Board of Direct Taxes circular dated February 11, 2014 ([2014] 361 ITR (St.) 94) cannot override the express provisions of section\u00a014A\u00a0read with rule\u00a08D. The circular does not refer to rule\u00a08D(1)\u00a0of the Rules at all but only refers to the word \u201dincludible\u201d occurring in the title to rule\u00a08D\u00a0as well as the title to section\u00a014A. The circular concludes that it is not necessary that exempt income should necessarily be included in a particular year\u2019s income for the disallowance to be attracted. Hence where dividends are earned in calculating the disallowance under section\u00a014A\u00a0only those investments are to be considered for computing the average value of investments which yielded exempt income during the relevant.(ITA No. 5944\/ Delhi\/ 2016 dt. 31-7 -2019)\u00a0 (AY. 2013 -14)<\/p>\n","protected":false},"excerpt":{"rendered":"
S. 14A : Disallowance of expenditure – Exempt income – Only Investments yielding income can only be taken into account -CBDT Circular dated 11-2-2014(2014) 361 ITR 94 (St), cannot override provisions of Section 14A and Rule 8D. [S. 119, R.8D(2)(iii)] <\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-37386","post","type-post","status-publish","format-standard","hentry","category-income-tax-act"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-9J0","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/37386","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=37386"}],"version-history":[{"count":1,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/37386\/revisions"}],"predecessor-version":[{"id":37387,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/37386\/revisions\/37387"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=37386"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=37386"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=37386"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}