TMI Blog2017 (12) TMI 807X X X X Extracts X X X X X X X X Extracts X X X X ..... IT(Appeals) are erroneous and contrary to facts law. 2. That on the fact in the circumstances of the case in law, the Ld. CIT(A) is erred in deleting the addition of ₹ 1,33,31,898/- made u/s 14A r.w. Rule 8D. 3. That the order of the Ld. CIT(A) is erroneous and is not tenable on facts and in law. 4. That the grounds of appeal are without prejudice to each other. 5. That the appellant craves leave to add, alter, amend or forego any ground(s) of the appeal raised above at the time of hearing. 2. Facts in brief of the case are that the assessee company made investment in shares of its own subsidiary M/s Lite Eat out Foods Private Limited, amounting to ₹ 9,69,67,027/- as on 31/03/2012. The assessee did not earn any dividend income during the year under consideration. According to the Ld. Assessing Officer, not earning any dividend income was not a bar for implementing the section 14A of the Income-tax Act, 1961 (in short the Act ) read with Rule 8D of Income-tax Rules, 1962 (in short the Rules ) in disallowing the expenses in relation to future tax free dividend income. The Ld. Assessing Officer relied upon the circular No. 5/2014 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses before the Delhi High Court in Holcim India (P) Ltd. and Cheminvest Ltd. The operative part of the appellate order for AY 2011-12 is reproduced herein under for the sake of ready reference: I have perused the assessment order and the impugned financial statements. The appellant has invested a sum of ₹ 7.02 crores in subsidiary companies mainly, Lite Eatout Foods Pvt. Ltd. and Wrapster Foods Pvt. Ltd. in the previous year and there are no fresh investments this year. The statutory audit report prepared u/s 44AB clause 17(1) concerning the amount of deduction inadmissible in terms of section 14A has been mentioned as Nil. The related party investments are also mentioned in the Schedules forming part of the accounts of the auditors' report. However the appellant company is not an investment company but is in the business of hospitality and therefore the interest expenditure of ₹ 3.03 crores that has been incurred during the year cannot be said to have been incurred for holding and maintaining investments. The decisions rendered by the Delhi High Court in Holcim India Pvt. Ltd and Cheminvest Ltd. were rendered in the context of holding companies who had inves ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... like cases are to be treated alike. Thus, the doctrine of precedent ensures certainty of law, uniformity of law and fairness meeting some of the essentials ingredients of Rule of Law. In fact, the Supreme Court in Union of India v. Raghuvir Singh 1989(2) SCC 754 while setting out the objectives of the doctrine of Precedent observes at para 7, 8 and 9 thereof as under:- 7, India is governed by a judicial system identified by a hierarchy of courts, where the doctrine of binding precedent is a cardinal feature of its jurisprudence. 8. Taking note of the hierarchical character of the judicial system in India, it is of paramount importance that the law declared by this Court should be certain, dear and consistent. It is commonly known that most decisions of the courts are of significance not merely because they constitute an adjudication on the rights of the parties and re-solve the dispute between them, but also because in doing so they embody a declaration of law operating as a binding principle in future cases. In this latter aspect lies their particular value in developing the jurisprudence of the law. 9. The doctrine of binding precedent has the merit of promotin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th equal force would apply to the decisions of the High Court within the State over which it exercises jurisdiction. This issue is long settled by the Apex Court in East India Commercial Co. Ltd. Calcutta and Anr. v. Collector of Customs, Calcutta 1962 SC SC 1893 wherein it has been held as under: - 29 ..This raises the question whether an administrative tribunal can ignore the law declared by the highest court in the State and initiate proceedings in direct violation of the law so declared. Under Art.215, every High Court shall be a court of record and shall have all the powers of such a court including the power to punish for contempt of itself. Under Art. 226, it has a plenary power to issue orders or writs for the enforcement of the fundamental rights and for any other purpose to any person or authority, including in appropriate cases any Government, within its territorial jurisdiction. Under Art. 227, it has jurisdiction over all courts and tribunals throughout the territories in relation to which it exercises jurisdiction. It would be anomalous to suggest that a tribunal over which the High Court has superintendence can ignore the law declared by that court and start ..... X X X X Extracts X X X X X X X X Extracts X X X X
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