ITAT says Section 14A Disallowance Cannot Survive Without Exempt Income

Blacksoil Capital Private Limited challenged a ₹61.03 lakh disallowance under Section 14A despite having earned no exempt income during the relevant year. The ITAT held that the 2022 Explanation could not be applied retrospectively to AY 2017–18 and, following judicial precedents, directed deletion of the entire disallowance. The appeal was allowed.