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2016 (1) TMI 659 - ITAT DELHI

2016 (1) TMI 659 - ITAT DELHI - TMI - Disallowance u/s 14A - CIT(A) deleted the disallowance - Held that:- As relying on CIT vs. Hero Cycles Limited [2009 (11) TMI 33 - PUNJAB AND HARYANA HIGH COURT] and CIT vs. Winsome Textile Industries Ltd. [2009 (8) TMI 220 - PUNJAB AND HARYANA HIGH COURT ] to hold that Section 14A cannot be invoked when no exempt income was earned. Thus note that the Ld. CIT(A) has rightly observed that in the assessee’s case there was no exempt income earning during the ye .....

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s, explanation and other relevant documentary evidence and related bills and vouchers, audited books of accounts of the assesse and the AO has made the addition without making any adverse material or facts against the assessee and without rejecting the audited books of account of the assessee. In the present case all the details and submissions of the assessee has been considered by the AO and AO has made the addition only on the basis of similar addition made in the assessment year 2009-10. The .....

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ommissioner of Income Tax (Appeals)-I, New Delhi dated 15.5.2015 pertaining to assessment year 2010-11. 2. The grounds of appeal read as under:- i) The Ld. CIT(A) has erred in law and on facts in deleting addition made on account of disallowance of expenses u/s. 14A read with Rule 8D. (ii) The Ld. CIT(A) has erred in law and on facts, in not apprecaiting the fact that the assessee has earned dividend income during the year which does not form part of taxable income u/s. 10 of the Income Tax Act .....

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leave for reserving the right to amend, modify, alter, add or forego any ground(s) of appeal at any time before or during the hearing of this appeal. 3. The brief facts of the case are that the Return of income declaring loss of Rs. (-) 2046768/- was filed through e-filing on 24.9.2010 and the same was processed u/s. 143(1) of the I.T. Act, 1961 at the returned income itself. The case was selected for scrutiny on the basis of CASS list for selection of cases for AY 2011-12. Notice u/s. 143(2) da .....

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on record. Books of accounts consisting of cash book, bank book, ledger etc. were called for an examined on test check basis. 3.1 In the assessment order the AO applied Rule 8D read with section 14A for working out disallowance of ₹ 3,71,95,803/-. On perusal of profit and loss account AO was observed that the assessee has debited ₹ 21,58,387/- towards various expense as per Schedule 10 & 11 of Balance Sheet. As the assessee has incurred some statutory expenses with regard the co .....

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11.3.2014 u/s. 143(3) of the Act. 4. Aggrieved with the aforesaid assessment order, assessee appealed before the Ld. CIT(A), who vide impugned order dated 15.5.2015 deleted the addition in dispute and partly allowed the appeal of the assessee. 5. Against the above mentioned impugned order dated 15.5.2015, the Revenue is in appeal before the Tribunal. 6. Ld. DR relied upon the order of the AO and reiterated the contentions raised in the grounds of appeal. 7. On the other hand, Ld. Counsel of the .....

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he assessee, regarding the expenses incurred for earning exempt income. However, from perusal of the record, I find that AO has not given any finding as to why he was not satisfied with the correctness of the account. I further find that the Ld. CIT(A) has rightly referred the judgment of the Jurisdictional High Court in the case of CIT vs. Holcim India Pvt. Ltd. In their judgment dated 5.9.2014 in ITA No. 486/2014 and in ITA No. 299/2014 wherein, it has been held that an assesse had to incur ex .....

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ference to two earlier decisions of the same Court in CIT vs. Hero Cycles Limited 323 ITR 518 and CIT vs. Winsome Textile Industries Ltd. 319 ITR 204 to hold that Section 14A cannot be invoked when no exempt income was earned. I note that the Ld. CIT(A) has rightly observed that in the assessee s case there was no exempt income earning during the year. Respectfully following the decision of the Jurisdictional High Court in the case of CIT vs. Holcim Pvt. Ltd. (Supra), Ld. CIT(A) has rightly held .....

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by ITAT. At the time of hearing, Ld. Counsel of the assessee has stated that the ITAT vide order dated 17.4.2015 in assessee s own case for the asstt. Year 2009-10 vide ITA No. 1164/Del/2013 in Department Appeal has set aside the issue to the AO. The relevant para no. 12 is reproduced as under:- 12. Under facts and circumstances as noted above, we are inclined to hold that the revenue authorities below has not properly considered submissions, details, explanation and other relevant documentary .....

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