DCIT, Circle-6(1), Kolkata, Kolkata V. M/s Integrated Coal Mining Ltd., Kolkata

ITA 1031/KOL/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 0143 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 6 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-12-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 12-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R CHOWDHURY
• Assessee Lawyers: A GOENKA LD; D MUKHERJEE
• Keywords: Earning of tax free income; Commercial expediency
• Section: 43B; 14A; 115JB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D, BENCH KOLKATA BEFORE SHRI S.S. GODARA, JM & DR. A.L. SAINI, AM ITA NO.1031/KOL/2017 (ASSESSMENT YEAR: 2012-13) DCIT, CIRCLE 6(1), KOLKATA P-7, CHOWRINGHEE SQUARE, KOLKATA 700 069. VS. M/S. INTEGRATED COAL MINING LTD. 6, CHURCH LANE, KOLKATA 700 001. ./ ./PAN/GIR NO. : AAACI 5584 L ( /APPELLANT ) .. ( / RESPONDENT ) REVENUE BY : SHRI R. CHOWDHURY, ADDL. CIT, ASSESSEE BY : SHRI D. MUKHERJEE & A. GOENKA, LD. AR / DATE OF HEARING : 26/11/2018 /DATE OF PRONOUNCEMENT: 07/12/2018 / O R D E R PER DR. A. L. SAINI, AM: THE CAPTIONED APPEAL FILED BY THE REVENUE, PERTAINING TO ASSESSMENT YEAR 2012-13, IS DIRECTED AGAINST AN ORDER PASSED BY LD. COMMISSIONER OF INCOME TAX (APPEALS)-6, KOLKATA, DATED 24.02.2017. 2. THE GRIEVANCES RAISED BY THE REVENUE ARE AS FOLLOWS: 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN DELETING THE RE CESS AND PE CESS AGGREGATING TO RS. 49,99,13,357/- WITHOUT APPRECIATING THE FACTS OF THE CASE IN THE LIGHT OF CLEAR CUT PROVISION MADE U/S 43B OF THE I.T. ACT, 1961. 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN APPRECIATING THE CLEAR PROVISIONS OF SECTION 115JB OF THE I.T. ACT BY DELETING THE DISALLOWANCE UNDER SECTION 14A. 3. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW BY DELETING THE DISALLOWANCE OF RS. 49,66,000/- OF THE ASSESSEE WITHOUT CONSIDERING THE PROVISION OF SECTION 14A READ WITH RULE 8D AND THE RELEVANT CIRCULAR NO. 5/2014. 4. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW IN DELETING THE DISALLOWANCE OF RS. 51,22,210/- U/S 14A OF THE I.T. ACT IN COMPUTATION OF BOOK PROFIT U/S 115JB. 5. FOR THAT THE APPELLANT CRAVES FOR LEAVE TO ADD, DELETE, AMEND OR MODIFY ANY GROUNDS BEFORE OR AT THE TIME OF APPELLATE PROCEEDINGS. M/S. INTEGRATED COAL MINING LTD. ITA NO.1031/KOL/2017 ASSESSMENT YEAR: 2012-13 2 3. GROUND NO. 1 RELATES TO DISALLOWANCE OF RURAL EMPLOYMENT CESS (RE CESS) AND PRIMARY EDUCATION CESS (PE CESS) AGGREGATING TO RS. 49,99,13,357/-. 4. WHEN THIS APPEAL WAS CALLED OUT FOR HEARING, LEARNED COUNSEL FOR THE ASSESSEE INVITED OUR ATTENTION TO THE ORDER DATED 30.11.2015 IN ITA NO. 1146/KOL/2012, FOR ASSESSMENT YEAR 2008-09, WHEREBY THE ISSUE RELATING TO PE CESS AND RE CESS HAVE BEEN DISCUSSED AND ADJUDICATED. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE PRESENT APPEAL IS SQUARELY COVERED BY THE AFORESAID ORDER OF THE TRIBUNAL, A COPY OF WHICH WAS ALSO PLACED BEFORE THE HONBLE BENCH. 5. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE DID NOT HAVE MUCH TO SAY BUT HE NEVERTHELESS RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. WE SEE NO REASONS TO TAKE ANY OTHER VIEW OF THE MATTER THAN THE VIEW SO TAKEN BY THE DIVISION BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE VIDE ITA NO. 1146/KOL/2012, ORDER DATED 30.11.2015. IN THIS ORDER THE TRIBUNAL HAS INTER ALIA OBSERVED AS FOLLOWS: FROM THE AFORESAID PROVISIONS, IT COULD BE SEEN THAT WHAT IS CONTEMPLATED IN SECTION 43(B)(A) READ WITH EXPLANATION 2 IS TAX DUTY OR CESS SHOULD BECOME PAYABLE UNDER THE RELEVANT ACT. THE EXPRESSION PAYABLE UNDER THE RELEVANT ACT IN THE CONTEXT OF THE IMPUGNED ISSUE MEANS THE CESS PAYABLE BY THE ASSESSEE UNDER THE PROVISIONS OF THE WEST BENGAL RURAL EMPLOYMENT AND PRODUCTION ACT, 1976 AND THE WEST BENGAL PRIMARY EDUCATION ACT, 1973. HENCE IN THE FACTS AND CIRCUMSTANCES, THE VERSION OF THE LEARNED CIT(A) THAT THE OTHER ACTS SHALL NOT OVERRIDE THE PROVISIONS OF INCOME TAX ACT IS NOT AT ALL RELEVANT. WE HOLD THAT THE CESS COLLECTED FROM CUSTOMERS OUT OF SALE PRICE IN THE FACTS AND CIRCUMSTANCES OF THE INSTANT CASE CANNOT BE CONSTRUED AS TRADING RECEIPTS CHARGEABLE TO TAX AS THE SAME ARE COLLECTED IN ADVANCE FOR PAYMENT TO THE EXCHEQUER IN THE SUCCEEDING YEAR UNDER THE RELEVANT ACT. HENCE WE CANNOT IMPORT A DIFFERENT MEANING OF ACCRUAL OF LIABILITY FOR PAYMENT OF CESS INTO THIS RELEVANT ACT WHEN MORE SO THE PROVISIONS OF SECTION 43B OF THE ACT ITSELF SPECIFICALLY STATES THAT AMOUNTS PAYABLE UNDER THE RELEVANT LAW SHALL BE ALLOWED AS DEDUCTION ONLY ON PAYMENT BASIS. HENCE IN THESE FACTS AND CIRCUMSTANCES, THE DECISION OF THE HONBLE APEX COURT IN THE CASE OF CHOWRINGHEE SALES BUREAU PVT. LTD. VS CIT REPORTED IN 87 ITR 542 (SC) IS NOT APPLICABLE TO THE FACTS OF THE ASSESSEE. M/S. INTEGRATED COAL MINING LTD. ITA NO.1031/KOL/2017 ASSESSMENT YEAR: 2012-13 3 IN THE FACTS OF THE INSTANT CASE, THE ASSESSEE HAD COMMENCED ITS OPERATION FROM A.Y.2003-04 AND IN THE VERY FIRST YEAR, THIS ISSUE WAS TAKEN UP FOR DISALLOWANCE AND THE CASE WAS DELETED BY THE LEARNED CIT(A) AND THE REVENUE CHOSE NOT TO FILE AN APPEAL BEFORE THIS TRIBUNAL. THE NEXT SCRUTINY ASSESSMENT WAS MADE FOR A.Y. 2006-07 WHEREIN NO ADDITION ON THIS ACCOUNT WAS MADE. THIS GOES TO PROVE THAT THE REVENUE HAD ALREADY ACCEPTED TO THE CONTENTIONS OF THE ASSESSEE ON THE IMPUGNED ISSUE AND SATISFIED THAT THE CESS COLLECTED FROM CUSTOMERS HAVE BEEN DULY REMITTED IN THE SUCCEEDING YEAR IN ACCORDANCE WITH THE PROVISIONS OF THE WEST BENGAL RURAL EMPLOYMENT AND PRODUCTION ACT,1976 AND THE WEST BENGAL PRIMARY EDUCATION ACT, 1973 AND WAS ALSO SATISFIED WITH THE MANNER OF TREATMENT OF THE SAME BY THE ASSESSEE FOR TAX PURPOSES. HAVING DONE SO, THERE IS NO GOOD REASON FOR THE REVENUE TO SHIFT ITS STAND IN THE ASSESSMENT YEAR UNDER APPEAL. TO THIS EXTENT, THE DECISIONS OF THE HON`BLE APEX COURT (SUPRA) ARE RELEVANT TO THE FACTS OF THE INSTANT CASE. IN VIEW OF THE AFORESAID FACTS AND CIRCUMSTANCES AND IN THE VIEW OF JUDICIAL PRECEDENTS RELIED UPON HEREINABOVE, WE HOLD THAT THE CESS COLLECTED FROM CUSTOMERS IN THE SALE INVOICES SHALL NOT BE CHARGEABLE TO TAX IN THE YEAR OF COLLECTION AND ACCORDINGLY, THE GROUNDS RAISED BY THE ASSESSEE IN THIS REGARD ARE ALLOWED. AS THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE DIVISION BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE AND THERE IS NO CHANGE IN FACTS AND LAW AND THE REVENUE IS UNABLE TO PRODUCE ANY MATERIAL TO CONTROVERT THE AFORESAID FINDINGS OF THE DIVISION BENCH. WE FIND NO REASON TO INTERFERE IN THE SAID ORDER OF THE LD CIT(A), AND THE SAME IS HEREBY UPHELD AND THEREFORE GROUND NO 1 RAISED BY THE REVENUE IS DISMISSED. 6. GROUND NO. 3 RAISED BY THE REVENUE RELATES TO DISALLOWANCE OF RS.49,66,000/-UNDER SECTION 14A READ WITH RULE 8D OF THE IT RULES. 7. WHEN THIS APPEAL WAS CALLED OUT FOR HEARING, THE LEARNED COUNSEL FOR THE ASSESSEE INVITED OUR ATTENTION TO THE ORDER OF THE DIVISION BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO. 1146/KOL/2012, VIDE ORDER DATED 30.11.2015. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE PRESENT ISSUE IN APPEAL IS SQUARELY COVERED BY THE AFORESAID JUDGMENT OF THE TRIBUNAL, A COPY OF WHICH WAS ALSO PLACED BEFORE THE HONBLE BENCH. 8. THE LEARNED DEPARTMENTAL REPRESENTATIVE DID NOT HAVE MUCH TO SAY BUT HE NEVERTHELESS RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. WE SEE NO REASONS TO M/S. INTEGRATED COAL MINING LTD. ITA NO.1031/KOL/2017 ASSESSMENT YEAR: 2012-13 4 TAKE ANY OTHER VIEW OF THE MATTER THAN THE VIEW SO TAKEN BY THE DIVISION BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE VIDE ITA NO. 1146/KOL/2012, ORDER DATED 30.11.2015, FOR ASSESSMENT YEAR 2008-09 WHEREIN THE DIVISION BENCH HAS INTER ALIA HELD AS FOLLOWS: 2.6. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD INCLUDING THE VARIOUS CASE LAWS RELIED UPON BY BOTH THE SIDES. WE FIND FROM THE FACTS ARE THAT THE LEARNED AO HAS NOT EXAMINED THE ACCOUNTS OF THE ASSESSEE AND THERE IS NO SATISFACTION RECORDED BY THE LEARNED AO ABOUT THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE AND WITHOUT THE SAME , HE INVOKED RULE 8D OF IT RULES. WHILE REJECTING THE CLAIM OF ASSESSEE WITH REGARD TO EXPENDITURE IN RELATION TO EXEMPT INCOME, THE LEARNED AO HAS TO INDICATE COGENT REASONS FOR THE SAME. WE FIND THAT THE EARNED AO HAD STRAIGHT AWAY EMBARKED UPON COMPUTING DISALLOWANCE UNDER RULE 8D(2) OF THE RULES. WE FIND THAT THE CASE LAWS RELIED UPON BY THE LEARNED AR ON THE DECISION OF THE JURISDICTIONAL HIGH COURT ARE DIRECTLY ON THIS POINT AND IN FAVOUR OF THE ASSESSEE. CIT VS ASHISH JHUNJHUNWALA IN G.A.NO. 2990(2013 IN ITAT NO. 157 OF 2013 DATED 8.1.2014 RENDERED BY CALCUTTA HIGH COURT 'WHILE REJECTING THE CLAIM OF THE ASSESSEE WITH REGARD TO EXPENDITURE OR NO EXPENDITURE, AS THE CASE MAY BE, IN RELATION TO EXEMPTED INCOME, THE AO HAS TO INDICATE COGENT REASONS FOR THE SAME. FROM THE FACTS OF THE PRESENT CASE, IT IS NOTICED THAT THE AO HAS NOT CONSIDERED THE CLAIM OF THE ASSESSEE AND STRAIGHT AWAY EMBARKED UPON COMPUTING DISALLOWANCE UNDER RULE 8D OF THE RULES ON PRESUMING THE AVERAGE VALUE OF INVESTMENT AT % OF THE TOTAL VALUE. IN VIEW OF THE ABOVE AND RESPECTFULLY FOLLOWING THE COORDINATE BENCH DECISION IN THE CASE OF JK INVESTORS (BOMBAY) LTD., SUPRA, WE UPHOLD THE ORDER OF CIT (A)'. CIT VS R.E.I. AGRO LTD. IN GA 3022 OF 2013 IN ITAT 161 OF 2013 DATED 23.12.2013 RENDERED BY CALCUTTA HIGH COURT 'THE ASSESSING OFFICER ALSO DISALLOWED THE EXPENDITURE UNDER SECTION 14A OF THE INCOME TAX ACT, 1961 WITHOUT FIRST RECORDING THAT HE WAS NOT SATISFIED WITH THE CORRECTNESS OF THE CLAIM AS REGARDS THE CLAIM THAT 'NO EXPENDITURE WAS MADE BY THE ASSESSEE. CHALLENGING THE ORDER OF THE TRIBUNAL, THE PRESENT APPEAL HAS BEEN FILED. WE HAVE HEARD MR. BHOWMIK AND ARE OF THE OPINION THAT NO POINT OF LAW HAS BEEN RAISED. THEREFORE, THIS APPEAL IS DISMISSED'. THE AFORESAID TWO DECISIONS OF THE JURISDICTIONAL HIGH COURT ARE BINDING ON THIS TRIBUNAL AND HENCE THE CASE LAWS ADDRESSED BY THE LEARNED CITA IN HIS ORDER ARE NOT CONSIDERED IN THIS ORDER. WE ALSO FIND THAT ONE OF THE DECISIONS RELIED UPON BY THE LEARNED CITA IS THAT OF JURISDICTIONAL HIGH COURT IN THE CASE OF DHANUKA & SONS (SUPRA). WE FIND THAT THE FACTS IN THE CASE OF DHANUKA & SONS ARE TOTALLY DIFFERENT FROM THE FACTS OF THE INSTANT CASE AND MOREOVER, WHEN THERE ARE TWO CONFLICTING DECISIONS OF THE SAME COURT OR DIFFERENT COURTS ON THE SAME ISSUE, THEN THE DECISION FAVOURABLE TO THE ASSESSEE HAS TO BE FOLLOWED. RELIANCE IN THIS REGARD IS PLACED ON THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF VEGETABLE PRODUCTS REPORTED IN 88 ITR172 (SC). M/S. INTEGRATED COAL MINING LTD. ITA NO.1031/KOL/2017 ASSESSMENT YEAR: 2012-13 5 HENCE WE HOLD THAT THE ACTION OF THE LEARNED AO IN DIRECTLY EMBARKING ON RULE 8D(2) OF THE RULES IS NOT APPRECIATED AND HENCE NO DISALLOWANCE U/S 14A OF THE ACT COULD BE MADE IN THE FACTS OF THE INSTANT CASE. 2.6.1. WE ALSO FIND THAT THE ASSESSEE HAS GOT SUFFICIENT OWN FUNDS TO MAKE THESE INVESTMENTS AND THE LEARNED AO HAD NOT BROUGHT ANY NEXUS BETWEEN THE BORROWED FUNDS VIS-A-VIS THE INVESTMENTS MADE BY THE ASSESSEE. WITHOUT DOING THE SAME, HE CANNOT DIRECTLY PRESUME THAT THE INVESTMENTS WERE MADE OUT OF BORROWED FUNDS. IF THE ACTION OF THE LEARNED AO AND LEARNED CIT(A) ARE TO BE UPHELD, THEN NO ASSESSEE COULD MAKE ANY INVESTMENTS WHEN THERE IS A INTEREST BEARING LOAN TO BE REPAID. THE FACT OF MAKING THE INVESTMENTS HAS TO BE VIEWED FROM THE POINT OF COMMERCIAL EXPEDIENCY AND FROM THE POINT OF VIEW OF BUSINESSMAN AND NOT FROM THE VIEW POINT OF THE REVENUE. IT IS WELL SETTLED THAT BUSINESSMAN KNOWS HIS INTEREST BEST. WE PLACE RELIANCE ON THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS RELIANCE UTILITIES & POWER LTD. (313 ITR 340) (BOM) IN SUPPORT OF OUR VIEW THAT IF THE OWN FUNDS ARE AVAILABLE AND IF THE SAME ARE MORE THAN THE INVESTMENTS MADE BY THE ASSESSEE, THEN IT HAS TO BE PRESUMED THAT THE INVESTMENTS WERE MADE OUT OF OWN FUNDS BORROWED FUNDS. HENCE WE HOLD THAT NO DISALLOWANCE U/S 14A OF THE ACT COULD BE MADE IN THESE CIRCUMSTANCES. 2.6.2. WE ALSO FIND THAT THE INVESTMENTS MADE IN SUBSIDIARIES BY THE ASSESSEE ARE ONLY STRATEGIC INVESTMENTS AND WERE MADE WITH A PRIMARY OBJECT TO ACQUIRE CONTROLLING INTEREST IN GROUP CONCERNS AND NOT FOR EARNING ANY INCOME OUT OF THAT INVESTMENT. RELIANCE IN THIS REGARD IS PLACED ON THE DECISION OF THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF -DCIT VS SELVEL ADVERTISING P LTD REPORTED IN (2015) 58 TAXMANN.COM 196 (KOLKATA TRIB.), WE HOLD THAT EVEN ON THIS COUNT, NO DISALLOWANCE U/S 14A OF THE ACT COULD BE MADE BY THE LEARNED AO. 2.6.3. WE ALSO FIND THAT THE INVESTMENTS THAT DID NOT YIELD ANY DIVIDEND INCOME NEEDS TO BE EXCLUDED FROM THE COMPUTATION OF DISALLOWANCE-, IF ANY, U/S 14A OF THE ACT READ WITH RULE 8D OF THE RULES 'AS THE BASIC INTENTION BEHIND INTRODUCTION OF SECTION 14A ITSELF IS ONLY TO DISALLOW THE EXPENDITURE INCURRED FOR EARNING AN INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME. WHEN THERE IS NO INCOME WHICH IS CLAIMED AS EXEMPT, THEN THERE IS NO SCOPE FOR PROVISIONS OF SECTION 14A TO OPERATE. IN THE INSTANT CASE, THE ASSESSEE DERIVED DIVIDEND INCOME WHICH IS EXEMPT ONLY FROM CESC LTD AND FROM UTI MUTUAL FUND (WHICH WAS PURCHASED AND SOLD DURING THE YEAR ITSELF). HENCE EVEN ASSUMING IF DISALLOWANCE IS TO BE MADE U/S 14A READ WITH RULE 8D, THE INVESTMENTS WHICH DID NOT YIELD ANY DIVIDEND INCOME DURING THE YEAR HAS TO BE EXCLUDED. WE AGREE WITH THE ARGUMENTS OF THE LEARNED AR IN THIS REGARD. RELIANCE IN THIS REGARD IS PLACED ON THE FOLLOWING DECISIONS:- ALLIANCE INFRASTRUCTURE PROJECTS PVT. LTD. VS. DCIT IN I.T.A. NO. 220 & 1043 (BNG)/2013 FOR ASST YEARS 2009-10 & 2010-11 DATED 12.09.2014 (BANGALORE BENCH) CIT VS. CORRTECH ENERGY PVT. LTD. REPORTED IN 352 ITR 97 (GUJ) CIT VS. SHIVAM MOTORS IN I.T.A. NO. 88 OF 2014 DATED 5.5.2014 RENDERED BY ALLAHABAD HIGH COURT CIT VS. LAKHANI MARKETING IN I.T.A. NO. 970 OF 2008 RENDERED BY PUNJAB & HARYANA HIGH COURT M/S. INTEGRATED COAL MINING LTD. ITA NO.1031/KOL/2017 ASSESSMENT YEAR: 2012-13 6 CIT VS. DELITE ENTERPRISES IN I.T.A. NO. 110 OF 2009 RENDERED BY BOMBAY HIGH COURT THE DECISION OF SPECIAL BENCH OF TRIBUNAL IN THE CASE OF CHEMINVEST LTD. VS. CIT REPORTED IN 121 ITD 318 HAD HELD THAT DISALLOWANCE U/S 14A COULD BE MADE EVEN IN AN YEAR IN WHICH NO EXEMPT INCOME WAS EARNED OR RECEIVED BY THE ASSESSEE. BUT THIS DECISION HAS BEEN OVERRULED BY BANGALORE TRIBUNAL, GUJRAT HIGH COURT AND ALLAHABAD HIGH COURT AS STATED SUPRA. MOREOVER WE ALSO FIND THAT THE SPECIAL BENCH DECISION IN CHEMINVEST LTD. VS. CIT HAS BEEN OVERRULED BY THE RECENT DECISION OF THE DELHI HIGH COURT IN CHEMINVEST LTD. CASE ITSELF AND HENCE IT IS NO LONGER GOOD LAW. HENCE WE HOLD IN FAVOUR OF THE ASSESSEE THE ALTERNATIVE ARGUMENT OF THE LEARNED AR THAT ONLY INVESTMENTS YIELDING DIVIDEND INCOME DURING THE YEAR SHOULD BE CONSIDERED FOR DISALLOWANCE U/S 14A OF THE ACT. RESPECTFULLY FOLLOWING THE AFORESAID JUDICIAL PRECEDENTS, WE HAVE NO HESITATION IN DIRECTING THE LEARNED AO TO DELETE THE ADDITION MADE U/S 14A OF THE ACT. ACCORDINGLY, THE GROUND NOS. 1 (A) TO (C) RAISED BY THE ASSESSEE ARE ALLOWED. 9. AS THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE DIVISION BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE AND THERE IS NO CHANGE IN FACTS AND LAW AND THE REVENUE IS UNABLE TO PRODUCE ANY MATERIAL TO CONTROVERT THE AFORESAID FINDINGS OF THE DIVISION BENCH. WE FIND NO REASON TO INTERFERE IN THE SAID ORDER OF THE LD CIT(A), AND THE SAME IS HEREBY UPHELD AND THEREFORE GROUND NO 3 RAISED BY THE REVENUE IS DISMISSED. 10. IN GROUND NO 2 AND 4 RAISED BY THE ASSESSEE RELATES TO DISALLOWANCE OF RS. 51,22,210/- UNDER SECTION 14A OF THE INCOME TAX ACT, 1961 IN COMPUTATION OF BOOK PROFIT U/S 115JB OF THE ACT. 11. AT THE OUTSET ITSELF, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED BEFORE US THAT GROUNDS NO. 2 AND 4 RAISED BY THE REVENUE ARE SQUARELY COVERED BY THE JUDGEMENT OF THE HONBLE ITAT KOLKATA IN ASSESSEES OWN CASE IN ITA NO. 1146/KOL/2012, FOR A.Y. 2008-09, ORDER DATED 30.11.2015 WHEREIN THE TRIBUNAL HELD AS FOLLOWS: 3. THE NEXT GROUND TO BE DECIDED IN THIS APPEAL IS THAT WHETHER THE DISALLOWANCE U/S 14A OF THE ACT COULD BE MADE TO THE BOOK PROFITS COMPUTED U/S 115JB OF THE ACT. THE ASSESSEE HAS RAISED THE FOLLOWING GROUND BEFORE US: 1(D) THAT THE FINDING RECORDED BY THE LEARNED CIT(APPEALS) IN THE APPELLATE ORDER WHILE CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN MAKING THE IMPUGNED FURTHER DISALLOWANCE OF EXPENDITURE AMOUNTING TO INR 44,91468/- M/S. INTEGRATED COAL MINING LTD. ITA NO.1031/KOL/2017 ASSESSMENT YEAR: 2012-13 7 U/S.14A OF THE ACT READ WITH RULE 8D OF THE INCOME-TAX RULES, 1962 IS BASED MERELY ON CONJECTURE, SURMISE AND PRESUMPTIONS.' 3.1. THE LEARNED AR ARGUED THAT RULE 8D IS MEANT ONLY FOR COMPUTATION OF INCOME UNDER NORMAL PROVISIONS OF THE ACT AND NOT FOR BOOK PROFIT U/S115JB OF THE ACT. THE LEARNED DR ARGUED THAT THE DISALLOWANCE U/S L4A OF THE ACT WOULD AUTOMATICALLY FALL IN CLAUSE (F) OF THE EXPLANATION TO SECTION 115JB OF THE ACT AND HENCE NEEDS TO BE ADDED BACK FOR COMPUTATION OF BOOK PROFITS U/S I L5JB OF THE ACT 3.2. WE HAVE HEARD THE RIVAL SUBMISSIONS. WE FIND LOT OF FORCE IN THE ARGUMENT OF THE LEARNED AR THAT COMPUTATION OF DISALLOWANCE UNDER RULE 8D CAN BE USED ONLY FOR COMPUTATION OF INCOME UNDER NORMAL PROVISIONS OF THE ACT AND NOT FOR BOOK PROFITS U/S 115JB OF THE ACT. UNLESS AN ITEM IS DEBITED IN THE PROFIT AND LOSS ACCOUNT, THE SAME CANNOT BE THE SUBJECT MATTER OF ADDITION TO BOOK PROFITS UNDER CLAUSE (F) OF EXPLANATION TO SECTION 115JB OF THE ACT. THE DISALLOWANCE MADE U/S 14A OF THE ACT READ WITH RULE 8D IS ONLY ARTIFICIAL DISALLOWANCE AND OBVIOUSLY THE SAME IS NOT DEBITED IN THE PROFIT AND LOSS ACCOUNT AND THE SAME CANNOT BE IMPORTED INTO CLAUSE (F) OF EXPLANATION TO SECTION L L5JB OF THE ACT. 3.3. WE HAVE ALREADY HELD THAT NO DISALLOWANCE U/S 14A OF THE ACT WOULD OPERATE IN THE FACTS AND CIRCUMSTANCES OF THE CASE. ACCORDINGLY, THE GROUND NO. 1(D) RAISED BY THE ASSESSEE IS ALLOWED. 12. AS THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE ORDER OF THE DIVISION BENCH IN ASSESSEES OWN CASE IN ITA NO. 1146/KOL/2012 FOR A.Y. 2008-09, ORDER DATED 30.11.2015 (SUPRA) AND THERE IS NO CHANGE IN FACTS AND LAW AND THE LEARNED DR FOR THE REVENUE DID NOT BRING ANY MATERIAL ON RECORD TO CONTROVERT THE AFORESAID FINDINGS. THEREFORE, RESPECTFULLY FOLLOWING THE JUDGEMENT OF THE DIVISION BENCH, WE DISMISS GROUND NO. 2 AND 4 RAISED BY THE REVENUE. 13. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 07/12/2018. SD/- (S. S. GODARA) SD/- (A. L. SAINI) /JUDICIAL MEMBER / ACCOUNTANT MEMBER /KOLKATA; DATED: 07/12/2018 BISWAJIT, SR.PS M/S. INTEGRATED COAL MINING LTD. ITA NO.1031/KOL/2017 ASSESSMENT YEAR: 2012-13 8 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT DCIT, CIRCLE 6(1), KOLKATA. 2. / THE RESPONDENT- M/S. INTEGRATED COAL MINING LTD. 3. ( ) / THE CIT(A), 4. / CIT 5. , , / DR, ITAT, KOLKATA 6. [ / GUARD FILE. //TRUE COPY// BY ORDER SENIOR PRIVATE SECRETARY, HEAD OF OFFICE/D.D.O, I.T.A.T, KOLKATA BENCHES, KOLKATA .