Daily Archives: July 2, 2013


M/s TATA AUTOCOMP SYSTEMS LTD v ACIT IT (TP)A No.7596/Mum/2012) Mumbai ITAT Background: During the year under consideration, the assessee received dividend income of Rs. 16,83,27,131 which was claimed to be exempt from tax. A disallowance of Rs. 1,34,95,120 was made u/s 14-A of the Act on account of expenses attributable to the said exempt income. The said disallowance comprises of interest at Rs. 1,28,72,969/- being 35% of the total interest which, according to the assessee, was the ratio between the investment fetching tax free income and total investment. The balance disallowance of Rs. 6,22,151/- was made on account of salary paid to a treasury person who, according to the assessee, was looking after the activity of earning tax free income.

Rule 8D upheld even after assessee had disallowed staff salary as attributable to exempt income ...