DY. COMMISSIONER OF INCOME TAX (TDS), LUCKNOW V. M/S U.P POWER CORP. LTD., LUCKNOW

ITA 622/LKW/2019

AI Insights

The case involves an appeal by the Deputy Commissioner of Income Tax against M/s. UP Power Corporation, challenging the decision of the Learned Commissioner of Income-tax (Appeals)-2, Lucknow, which had deleted an addition of Rs.17,37,17,756 under section 14A of the Income Tax Act, 1961. The Revenue contended that the CIT(A) erred in law and facts by not considering the expenses relatable to earning exempt income for disallowance, irrespective of whether such income was earned during the financial year. However, the dispute was resolved as the assessee opted for the Direct Tax Vivad Se Vishwas Scheme, 2024, leading to the withdrawal of the appeal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 46973 (ITAT-LUCKNOW)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-04-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NITIN NIJHAWAN; CHIEF FIN
• Assessee Lawyers: NAMITA S. PANDEY
• Keywords: Earning of tax free income
• Section: 14A

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH “A”, LUCKNOW BEFORE SHRI KUL BHARAT, VICE PRESIDENT AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER ITA No.622/LKW/2019 (Assessment Year: 2013-14) Dy Commissioner of Income Tax, Range-6, 27/2, Raja Ram Mohan Rai Marg, P.K. Complex, 3rd Floor, Lucknow-226001. v. M/s. UP Power Corporation Shakti Bhawan, 14, Ashok Marg, Hazratganj, Lucknow- 226010. PAN:AAACU5088M (Appellant) (Respondent) Appellant by: Shri Nitin Nijhawan, Chief Fin. Officer Respondent by: Smt Namita S. Pandey, CIT(DR) Date of hearing: 03 04 2025 Date of pronouncement: 08 04 2025 O R D E R PER KUL BHARAT, VICE PRESIDENT.: This appeal, by the Revenue, is directed against the order of the Learned Commissioner of Income-tax (Appeals)-2, Lucknow dated 07.08.2019 pertaining to the assessment year 2013-14. The Revenue has raised the following grounds of appeal: - 1. That the Ld. CIT(A)-2, Lucknow had erred in law and facts in deleting the addition of Rs.17,37,17,756/- u/s 14A of Income Tax Act, 1961 without appreciating the fact that section 14A does not use the word “income of the year” but ‘income under the act’ and CBDT circular no. 05/2014 dated 11.02.2014 makes it clear that the expenses, which are relatable to earning of exempt income have to be considered for disallowance irrespective of the fact whether such income has been earned during the financial – year or not. 2. The appellant craves leave to add or amend any one or more of the grounds of appeal, as stated above, as and when need to doing so arise with the prior permission of the Hon'ble Court.” 2. At the outset, the Ld. Counsel for the assessee submitted that the dispute has been settled under the Direct Tax Vivad se ITA No.622/LKW/2019 Page 2 of 3 Vishwas Scheme, 2024 and prayed for withdrawal of the appeal. And a letter dated 18.01.2025 along with Form no.1 & 2 are placed on record. The relevant contents of the letter dated 18.01.2025 is reproduced as under: - “1. This subject appeal in ITA. No.622/LKW/2019 is fixed for hearing before your honour. 2. In this regard, it is respectfully submitted that the assessee has opted for Direct Tax Vivad Se Vishwas Scheme, 2024 and have filed the declaration and undertaking in Form No. 1 for A.Y. 2013-14 and have also obtained Form 2 under Direct Tax Vivad Se Vishwas Scheme 2024 from the Principal Commissioner of Income Tax-1, Lucknow vide DIN/Ackowledgement No.809470091080125 dated 08.01.2025 (Copy of Form 2 is enclosed herewith for your kind perusal). 3. Since the assessee has opted for the Direct Tax Vivad Se Vishwas Scheme, 2024, it is humbly prayed that the subject appeal may be treated as withdrawn.” 3. The Learned Departmental Representative has no objection to the aforesaid request of the assessee. 4. In the light of the aforesaid facts discussed, since the tax disputes has been settled by the assessee’s for A.Y. 2013-14, the aforesaid captioned departmental appeal will not survive and therefore it is to be treated as dismissed. However, with abundant precaution liberty is granted to Revenue for seeking recalling of this order and restoration of the present appeal at its original number if the disputed tax is not deposited in the Government account and tax dispute is not settled to the satisfaction of AO. 5. In the result, the appeal of the Revenue is dismissed. Order pronounced in the open Court on 08/04/2025. Sd/- Sd/- [ANADEE NATH MISSHRA] [KUL BHARAT] ACCOUNTANT MEMBER VICE PRESIDENT DATED: 08/04/2025 Vijay Pal Singh, (Sr. PS) ITA No.622/LKW/2019 Page 3 of 3 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. DR 5. Guard file By order //True Copy// Assistant Registrar "