DCIT, C-6(1), Mohali V. IVY Healthcare & Life Science Pvt. Ltd., Mohali

ITA 1022/CHANDI/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 6697 (ITAT-CHANDIGARH)
• Duration Of Justice: 6 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-02-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2015-2016
• Appeal Filed On: 02-08-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CHANDRA KANTA
• Assessee Lawyers: YOGESH MONGA
• Keywords: Earning of tax free income; Tax effect
• Section: 14A; 20

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, A, CHANDIGARH , !' # $ % &' , '( BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ./ ITA NO. 1022/CHD/2018 / ASSESSMENT YEAR : 2015-16 THE DCIT, CIRCLE 6(1), MOHALI M/S IVY HEALTH & LIFE SCIENCES PVT LTD., # 449, SECTOR 71, MOHALI ./PAN NO: AABC14594F / APPELLANT /RESPONDENT ! /ASSESSEE BY : SHRI YOGESH MONGA, CA ' ! / REVENUE BY : SMT. CHANDRAKANTA, SR. DR # $ % /DATE OF HEARING : 20.02.2019 &'() % / DATE OF PRONOUNCEMENT : 28.02.2019 ') / ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESS EE AGAINST THE ORDER DATED 10.5.2018 OF THE COMMISSIONER OF INCOME TAX (APPEALS )- 2, CHANDIGARH [HEREINAFTER REFERRED TO AS CIT(A)]. 2. AT THE OUTSET, THE LD. COUNSEL OF THE ASSESSEE S UBMITTED THAT THE TAX EFFECT INVOLVED IN THE PRESENT CASE IS LESS THAN RS . 20 LACS AND, THEREFORE, THE APPEAL FILED BY THE REVENUE IS LIABLE TO BE DIS MISSED. 3. THE LD. DR, HOWEVER, HAS SUBMITTED THAT SINCE IN THIS CASE THE ISSUE INVOLVED IS RELATING TO DISALLOWANCE MADE U/S 14A O F THE I.T.ACT AND FURTHER THAT AS PER THE CBDT CIRCULAR, EVEN IF NO EXEMPT INCOME IS EARNED, DISALLOWANCE U/S 14A OF ACT CAN BE MADE AND THAT IN VIEW OF THIS, ITA NO. 1022/CHD/2018- M/S IVY HEALTH & LIFE SCIENCES PVT LTD, CHANDIGARH 2 FINDINGS GIVEN BY THE CIT(A) IS AGAINST THE CIRCULA R OF CBDT NO. 3/2018, HENCE, THE PRESENT CASE FALLS IN THE EXCEPTION CLAU SE. 4. HOWEVER, WE FIND THAT THE LD. CIT(A) HAS DECIDED THE APPEAL FOLLOWING THE DECISIONS OF THE HON'BLE HIGHER COURT S INCLUDING THE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. M/S LAKHANI MARKETING INC, [2014] 49 TAXMANN.COM. 257. THE QUESTION OF VA LIDLY OF THE CBDT CIRCULAR HAS NEITHER BEEN RAISED NOR ADJUDICATED. MOREOVER, THE CIRCULAR OF THE CBDT OTHERWISE IS NOT BINDING ON THIS TRIBUN AL OR THE HIGHER AUTHORITIES INCLUDING OF THE HON'BLE HIGH COURT AN D SUPREME COURT. EVEN OTHERWISE, THE ISSUE IS SQUARELY COVERED BY THE VAR IOUS DECISIONS OF THE HON'BLE HIGH COURTS INCLUDING THAT OF PUNJAB AND HA RYANA HIGH COURT IN CIT VS. KAPSONS ASSOCIATES (2016) 381 ITR 204 (P& H) AND OF THE HON'BLE APEX COURT IN THE CASE OF HERO CYCLES VS. CIT 379 ITR 347 (SC), WHEREIN, IT IS HELD THAT WHERE THERE IS NO TA X EXEMPT INCOME, DISALLOWANCE U/S 14A OF THE ACT IS NOT ATTRACTED. IN VIEW OF THIS, THERE IS NO MERIT IN THE APPEAL OF THE REVENUE AND THE SAME IS ACCORDINGLY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 28.02.201 9. SD/- SD/- ( # $ % &' / ANNAPURNA GUPTA) '( / ACCOUNTANT MEMBER ( / SANJAY GARG) / JUDICIAL MEMBER DATED : 28.02.2019 .. '+ ,- .- / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. # / / CIT 4. # / ( )/ THE CIT(A) 5. -01 2 , % 2 , 34516 / DR, ITAT, CHANDIGARH ITA NO. 1022/CHD/2018- M/S IVY HEALTH & LIFE SCIENCES PVT LTD, CHANDIGARH 3 6. 15 7$ / GUARD FILE '+ # / BY ORDER, 8 ' / ASSISTANT REGISTRAR