TMI Blog2022 (1) TMI 335X X X X Extracts X X X X X X X X Extracts X X X X ..... ITAT DELHI] , it is held by the Special Bench of the Tribunal that the disallowance made under section 14A of the Act read with Rule 8D of the Rules cannot be considered for the purpose of enhancing the book profits under section 115JB of the Act. Learned Assessing Officer will take note of it. Accordingly, ground No. 1 is allowed and ground No. 2 is allowed for statistical purpose. Addition invoking the provisions of section 50C - scope of amendment in section 50C - HELD THAT:- Coming to the retrospective nature of the amendment to section 50C of the Act by inserting the proviso, we find that in the case of CIT vs. Shri Vummudi Amarendran [ 2020 (10) TMI 517 - MADRAS HIGH COURT] as held that the amendment made by the Finance Act, 201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9,347/-on account of disallowance under section 14A of the Act read with Rule 8D of the Income Tax Rules1962 ( the Rules ), ₹ 4,88,515/-on account of disallowance under section 36 (1)(iii) of the Act and a sum of ₹ 24,59,941/-under section 50C of the Act. 3. All these three additions were challenged before the Ld. CIT(A) but without any success. Hence the assessee is before us in this appeal. 4. Insofar as ground No. 1 and 2 are concerned, they are against the addition by invoking section 14A of the Act read with Rule 8D of the Rules and enhancing the book profits under section 115 JB of the Act by such amount of addition. During the year the assessee received a dividend income to the tune of ₹ 38,41,508/-from the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h all the funds are held in the same account. 7. Record does not reveal the quantum of the investment which yielded exempt income. We therefore, restore the issue to the file of the learned Assessing Officer to consider only such investments which yielded the tax free income, but not the entire investments. Further in Vireet Investments Private Limited 165 ITR 27, it is held by the Special Bench of the Tribunal that the disallowance made under section 14A of the Act read with Rule 8D of the Rules cannot be considered for the purpose of enhancing the book profits under section 115JB of the Act. Learned Assessing Officer will take note of it. Accordingly, ground No. 1 is allowed and ground No. 2 is allowed for statistical purpose. 8. Gr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sale deed it was ₹ 3.30 crores. Since there is difference in the consideration mentioned in the sale deed and the prevailing collector s rate as on the date was ₹ 3.30 crores, learned Assessing Officer sought to add a sum of ₹ 24,59,941/-. 10. Submissions on behalf of the assessee are twofold. Firstly, that according to the proviso to section 50C of the Act, as inserted by finance Act, 2016, when the date of registration for the transfer of capital asset is not the same as the date of agreement, for fixing the amount of consideration, then the stamp value rates as existing on the date of agreement to sell are required to be adopted. Ld. AR submits that the retrospective effect of the amendment to section 50C of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r side. Coming to the retrospective nature of the amendment to section 50C of the Act by inserting the proviso, we find that in the case of CIT vs. Shri Vummudi Amarendran (supra), Hon ble High Court held that the amendment made by the Finance Act, 2016 inserting proviso to section 50C is clarificatory in nature and therefore, had the retrospective application. For the sake of completeness, we extract the relevant observations of the Hon ble High Court at paragraph No. 10 and 12 therein, which read as under : 10. Reading of the above proviso would show that the legislature took note of the fact that there are several occasions where the Agreements are entered into between a willing vendor and willing purchaser on an agreed sale conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te Limited Vs. CIT[1997 (224) ITR 677 (SC)], Whirlpool of India Limited Vs. CIT, New Delhi [2000 (245) ITR 3], CIT Vs. Amrid Banaspati Company Limited [2002 (255) ITR 114] and CIT vs. Alom Enterprises [2009 (319) ITR 306] and held that the new proviso should be given retrospective effect from the insertion on the ground that the proviso was added to remedy unintended consequences and supply an obvious omission. -The proviso ensured reasonable interpretation and retrospective effect would serve the object behind the enactment. Thus by taking note of the above decisions, we have no hesitation to hold that the proviso to Section 50C(1) of the Act should be taken to be retrospective from the date when the proviso exists. The CIT(A) while a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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