Feedback   New User   Login      
Tax Management India. Com TMI - Tax Management India. Com
Acts / Rules Notifications Circulars Tariff/ ITC HSN Forms Case Laws Manuals Short Notes Articles SMS News Highlights
        Home        
Extracts
Home List
← Previous Next →

Devkant Synthetics (India) Pvt Ltd. Versus Income Tax Officer 3 (1) (2) , Mumbai

2017 (11) TMI 633 - ITAT MUMBAI

Revision u/s 263 - AO by following the Tribunal Order for the assessment years 2010-11 and 2011-12 held that the disallowance u/s 14A r.w.8D on 5% of the exempt income - Held that:- AO during the course of assessment proceedings, has raised the specific query on the issue of disallowance u/s14A r.w.r 8D which was replied by the assessee. Another factor which is worth mentioning is that the assessee has not made any investments in the security yielding the tax free income but was holding the shar .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

out of two views and applied the decision of the Tribunal in assessee‟s own case in the earlier years. The mere fact that the revenue has challenged the decision of the Tribunal in assessee‟s own case for the assessment years 2010-11 and 2011-12 is not rendered the decision of the AO as erroneous and prejudicial to the interest of revenue as the AO has taken a possible view after examining and considering the reply and arguments of the assessee as rendered during the course of assess .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

by the assessee challenging the order dated 19.4.2017 passed by the Principal Commissioner of Income Tax-3, Mumbai for the assessment year 2013-14. 2. The only issue raised by the assessee in all the grounds of appeal is against the exercising the revisionary jurisdiction under section 263 of the Income Tax Act, 1961 by the PCIT setting aside the assessment order by holding that the same is erroneous and prejudicial to the interest of Revenue. 3. Brief facts of the case are that the assessment w .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

2.2017 u/s 263 of the Act which is reproduced below : On verification, certain discrepancies were found in the assessment order dated 29.03.2016, which are as under: The disallowance made u/ s. 14A was @ 5% of the dividend of ₹ 44,22,416/ - received and the same was not in accordance with rule 8D of the I. T. Rules 1962. On perusal it was observed that the said disallowance was made in view of the decision of the Hon‟ble ITAT in assessee's own case for. AY. 2010-11 and 2011-12 wh .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

erroneous and prejudicial to the interest of Revenue and it is evident that the AO has committed the lapse of not applying his mind to the issues discussed above. I therefore, propose to pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment, or cancelling the Assessment and directing a fresh assessment under the provisions of section 263. 4. Finally, the OCIT, after considering the contentions and submissions of the assessee an .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e Jurisdictional High Court. The ld. PCIT noted that it is a case of complete non-application of mind by the AO as the inquiry conducted is exceedingly inadequate and hence fall in the category of no-inquiry‟ conducted by the AO thereby resulting into incorrect assumption of facts makes the order erroneous and prejudicial to the interest of the revenue. 5. The ld. AR vehemently submitted that the revisionary jurisdiction u/s 263 of the Act was wrongly assumed by the PCIT as the twin condit .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

der in assessee‟s own case. Therefore, the observations and assumption of section 263 by the ld.PCIT on the ground that there was no application of mind and inadequate inquiry on the part of AO leading to incorrect examination of facts was totally wrong. In support its contention, the ld. AR relied upon the series of case laws which are as under : a) Gabriel India Ltd., 203 ITR 108 Bom b) S S Muddanna V/s State of Karnataka reported 89 STC 90 c) Paul Mathews and Sons V/s CIT 263 ITR 101. T .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

igher forum, the AO has committed the error by a by accepting the order in assessee‟s own case for the assessment years 2010-11 and 2011-12 applied the rate of 5% exempt income to make u/s 14A r.w.r.8D despite the fact that there is a specific mechanism provided under the Act to deal with such type of disallowances. The ld. DR relied on the following decisions : a) Rajrnandir Estates Pvt Ltd -386 ITR 162 b) Subhlakshmi Vanijya Pvt. Ltd -155 ITD 171 c) Kalwa Devadattam & Ors-49 ITR 165 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of mind and also by following the Tribunal Order for the assessment years 2010-11 and 2011-12, wherein the Tribunal has held that the disallowance u/s 14A r.w.8D on 5% ofmthe exempt income. The ld.PCIT observed that since the said order was not accepted by the revenue and was challenged before the Higher Forum, the AO has committed error in not applying the mind and by following the ratio laid down by the Tribunal in assessee‟s own case specifically when there is a clear cut mechanism prov .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ssessee was making purchase of shares for the purpose of trading in shares and securities. Having all the facts of the case and in the light of various decisions as cited by both the parties, we are not in agreement with the ld. PCIT that the order of the AO is erroneous and prejudicial to the interest of revenue as the AO after calling for information from the assessee on the issue of disallowance u/s 14A r.w.r 8D has taken a conscious view which is a possible view out of two views and applied .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

uding our findings, we take a shelter of following decisions : * In the case of Seimens India Ltd (supra) it has been observed and held as under : So far as the legal position is concerned, the ITO would be bound by a decision of the Supreme Court as also by a decision of the High Court of the State within whose jurisdiction he is, irrespective of the pendency of any appeal or special leave application against that judgment. He would equally be bound by a decision of another High Court on the po .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

Discussion Forum
what is new what is new
 


Share:            

|| Home || About us || Feedback || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version