TMI Blog2023 (8) TMI 872X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 (7) TMI 1450 - ITAT CHENNAI] The explanation inserted in the provisions of section 14A by the Finance Act, 2022 is prospective and not retrospective and since the assessee has not earned any exempt income, the addition made towards disallowance u/s 14A of the Act is deleted in view of the decision in the case of CIT v. Chettinad Logistics (P) Ltd. [ 2017 (4) TMI 298 - MADRAS HIGH COURT] as well as the decision of Chettinad Logistics (P) Ltd. [ 2018 (7) TMI 567 - SC ORDER] . This ground of appeal is allowed. Nature of expenses - ROC fees - revenue or capital expenditure - HELD THAT:- Due to increase in share capital, the assessee has incurred expenses on account of ROC fees and the AO has treated the same as capital in nature and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has filed the return of income for the assessment year 2012-13 on 30.09.2012 with returned income of ₹. Nil. The return of income was processed under section 143(1) of the Income Tax Act, 1961 [ Act in short] dated 15.03.2013. Thereafter, the case was selected for scrutiny through and notice under section 143(2) of the Act dated 23.09.2013 was issued and duly served on the assessee. After considering the submissions of the assessee, the Assessing Officer has completed the assessment under section 143(3) of the Act dated 27.03.2015 by making additions towards disallowance under section 14A of the Act of ₹. 39,61,902/-, disallowance of ROC fees of ₹. 72,412/- and addition made towards TDS difference of ₹. 2,18,830/-. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Assessing Officer and confirmed by the ld. CIT(A). 5. On the other hand, the ld. DR has supported the order passed by the ld. CIT(A). 6. Heard both the sides, perused the materials available on record and gone through the orders of authorities below. In this case, the assessee has not earned any exempt income. However, the ld. CIT(A) confirmed the addition made towards disallowance under section 14A of the Act by considering the amendment brought out in the Finance Act, 2022 to the provisions under section 14A of the Act as retrospective. Whereas, perusal of the Memorandum of the Finance Bill, 2022 reveals that it explicitly stipulates that the amendment made to section 14A of the Act will take effect from 1 st April, 2022 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has not accrued or arisen or has not been received during the previous year relevant to an assessment year and the expenditure has been incurred during the said previous year in relation to such exempt income. 5. This amendment will take effect from 1 st April, 2022. 6. It is also proposed to amend sub-section (1) of the said section, so as to include a non-obstante clause in respect of other provisions of the Income-tax Act and provide that no deduction shall be allowed in relation to exempt income, notwithstanding anything to the contrary contained in this Act. 7. This amendment will take effect from 1 st April, 2022 and will accordingly apply in relation to the assessment year 2022- 23 and subsequent assessment yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssor Division Bench in PCIT vs. IL FS Energy Development Company Ltd (supra) and Cheminvest Limited vs. Commissioner of Income Tax-VI, (2015) 378 ITR 33. 10. Accordingly, the appeal and application are dismissed. However, it is clarified that the order passed in the present appeal shall abide by the final decision of the Supreme Court in the SLP filed in the case of PCIT vs. IL FS Energy Development Company Ltd (supra). 7. After hearing rival contentions and going through the decision of Hon ble Delhi High Court in the case of Era Infrastructure (India) Ltd., supra, we are of the view that the explanation inserted in the provisions of section 14A of the Act by the Finance Act, 2022 is prospective and not retrospective. Accor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... On being aggrieved, the assessee is in appeal before the Tribunal. The ld. Counsel for the assessee has submitted that the assessee has incurred expenses on account of ROC fees and depited to the profit and loss account. However, the Assessing Officer has treated the expenses as capital in nature and disallowed. It was further submission that once the Assessing Officer has treated the expenses as capital in nature, depreciation has to be allowed. 10. On the other hand, the ld. DR fairly conceded that the matter may be remitted back to the Assessing Officer for fresh consideration. 11. Heard both the sides, perused the materials available on record and gone through the orders of authorities below. Due to increase in share capital, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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