Rajnish Garg, Ludhiana V. ACIT, C-6, Ludhiana

ITA 1085/CHANDI/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 7360 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 23-10-2018
• Assessment Year: 2011-2012
• Appeal Filed On: 28-06-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Assessee Lawyers: K J SHELLY
• Keywords: Earning of tax free income; Tangible material; Rule 8D; Set aside
• Section: 14A

Judgement Text

1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BEN CH B, CHANDIGARH , ! . .., # $, %& BEFORE: SH. SANJAY GARG, JUDICIAL MEMBER & DR. B.R. R. KUMAR, ACCOUNTANT MEMBER ./ ITA NO. 562/CHD/2017 / ASSESSMENT YEARS : 2009-10 RAJNISH GARG 536-LSE BUILDING, FEROZE GANDHI MARKET, LUDHIANA ASST. CIT CENTRAL 6, LUDHIANA ./ PAN NO: ASFG2620N / APPELLANT / RESPONDENT ./ ITA NO. 288/CHD/2018 / ASSESSMENT YEARS : 2010-11 RAJNISH GARG 524-B, AGGAR NAGAR LUDHIANA JCIT RANGE- VI, LUDHIANA ./ PAN NO: ADFPG2620N / APPELLANT / RESPONDENT ./ ITA NO. 1085/CHD/2017 / ASSESSMENT YEARS : 2011-12 RAJNISH GARG 524-B, AGGAR NAGAR LUDHIANA ASSTT. CIT CIRCLE-6, LUDHIANA ./ PAN NO: ADFPG2620N / APPELLANT / RESPONDENT ./ ITA NO. 563/CHD/2017 / ASSESSMENT YEARS : 2009-10 TWENTY FOUR CARAT STOCK & SHARE BROKERS LTD. 172-C, B.R.S. NAGAR LUDHIANA DCIT CIRCLE-7, LUDHIANA ./ PAN NO: AACCT7641M / APPELLANT / RESPONDENT ./ ITA NO. 565/CHD/2017 / ASSESSMENT YEARS : 2009-10 M/S NIRMAN FINCAP PVT. LTD. 534, L.S.E. BUILDING, FEROZE GANDHI MARKET, LUDHIANA DCIT CIRCLE-VII CHANDIGARH ./ PAN NO: AABCA3952F / APPELLANT / RESPONDENT 2 ./ ITA NO. 259/CHD/2018 / ASSESSMENT YEARS : 2011-12 M/S NIRMAN FINCAP PVT. LTD. 534, L.S.E. BUILDING, FEROZE GANDHI MARKET, LUDHIANA ASSTT. CIT CIRCLE-VII LUDHIANA ./ PAN NO: AABCA3952F / APPELLANT / RESPONDENT ! ' / ASSESSEE BY : SHRI. K.J. SHELLY # ! ' / REVENUE BY : SHRI. MANJIT SINGH $ % ! &/ DATE OF HEARING : 14/02/2019 '()* ! &/ DATE OF PRONOUNCEMENT : 29/04/2019 %'/ ORDER PER PER PER PER DR. B.R.R. KUMAR, A.M: DR. B.R.R. KUMAR, A.M: DR. B.R.R. KUMAR, A.M: DR. B.R.R. KUMAR, A.M: ALL THE ABOVE APPEALS HAVE BEEN FILED BY THE DIFFER ENT ASSESSEES AND WERE HEARD TOGETHER THEREFORE THEY ARE BEING DISPOS ED OFF BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. APPEAL WISE GROUNDS REPRODUCED HEREUNDER: ITA NO. 562/CHD/2017 1. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) IS NO T JUSTIFIED IN LAW AND FACTS OF THE CASE BY CONFIRMING DISALLOWANCE OF EXP ENSES TO THE TUNE OF RS. 384162/- ON ACCOUNT OF DISALLOWANCE MADE U/S 14A RE AD WITH RULE 8-D IN APPELLANT'S CASE. 2. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) IS AL SO NOT JUSTIFIED IN LAW AND FACTS OF THE CASE BY CONFIRMING DISALLOWANCE OF EXPENDITURE TO THE TUNE OF RS. 77401/- ON ACCOUNT OF L/5 TH EXPENSES OF TELEPHONE, MOBILE AND CAR EXPENSES WITHOUT ANY BASIS. SPECIALLY IN A CASE WHEN THERE W AS NO INCRIMINATING MATERIAL, OR ADVERSE EVIDENCE WAS FOUND DURING THE COURSE OF ASS ESSMENT PROCEEDINGS TO ESTABLISH THAT THESE EXPENDITURE HAVE BEEN INCURRED ON ACCOUNT OF PERSONAL USE. 3. THAT LD. COMMISSIONER OF INCOME TAX HAS MISCONSTRUE D AND MISAPPLIED THE PROVISIONS OF SECTION 14A OF THE INCOME TAX ACT 196 1 IN APPELLANT'S CASE. THAT LD. COMMISSIONER OF INCOME TAX HAS CLEARLY HELD IN HIS ORDER THAT THERE IS NO SET LANGUAGE WHICH CAN BE USED FOR RECORDING DISSATISFA CTION FOR THE CLAIM MADE BY THE ASSESSEE, WHEREAS IN LANDMARK JUDGMENT OF HON'B LE JURISDICTIONAL HIGH COURT IN THE CASE OF C.L.T. VS. ABHISHEK INDUSTRIES LIMITED DATED 27-01-2015 CLEARLY HOLD THAT SECTION 14A OF THE ACT CANNOT BE APPLICABLE UNLESS AND UNTIL SATISFACTION IS RECORDED. THE ONUS, THEREFORE, TO PROVE THE APPLICA BILITY OF SECTION 14A, LIES SQUARELY ON THE SHOULDERS OF THE REVENUE. 4. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) I S GROSSLY ERRED BY HOLDING THAT ONCE THE ASSESSEE HAS EARNED EXEMPT IN COME, THE PROVISIONS OF SECTION 14A ARE ATTRACTED AND DISALLOWANCE HAS TO B E WORKED OUT BY APPLYING RULE 8D. WHEREAS. IT IS SETTLED BY VARIOUS JUDICIAL PRON OUNCEMENTS THAT INVOKING RULE 8D IS NOT MANDATORY, IT WILL BE RESORTED TO ONLY IF LD . ASSESSING OFFICER IS NOT SATISFIED AS 3 TO THE CORRECTNESS OF THE CLAIM OF EXPENSES MADE BY THE ASSESSEE AS STIPULATED AND MANDATED IN SECTION 14A; AND INVOKING RULE 8D I S NOT AUTOMATIC. 5. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS P ASSED THE ORDER IN UTTER HASTE AND WITHOUT CONSIDERING THE RECORDS OF THE CASE. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS HELD THAT NO DECISION O F ANY HON'BLE HIGH COURT HAS BEEN DELIVERED AFTER CONSIDERING CIRCULAR NO. 5 OF 2014 ISSUED BY CBDT. WHEREAS NUMBER OF RECENT JUDGMENTS WERE PRODUCED IN FAVOUR OF ASSESSEE'S CASE AT THE TIME OF HEARING OF APPEAL AND THE SAME WERE TOTALLY IGNORED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS). FURTHER THE R EFERENCE OF JUDGEMENTS HAVE BEEN CLEARLY MENTIONED IN THE LD. COMMISSIONER OF I NCOME TAX (APPEALS)'S ORDER. 6. THAT ADDITION HAS BEEN MADE WHOLLY ON ADHOC BASIS W HICH COULD NOT BE SUSTAINED IN LAW. THAT WITHOUT POINTING OUT ANY DEF ICIENCY AND WITHOUT VERIFYING RECORDS, LD. ASSESSING OFFICER STRAIGHTWAY CAME TO THE CONCLUSION THAT PERSONAL USE OF EXPENSES BY THE ASSESSEE CAN NOT BE RULED OUT AN D L/5 TH OF THESE EXPENSES ARE DISALLOWED. 7. THAT THE ORDER OF THE LD. COMMISSIONER OF INCOME TA X (APPEALS) IS CONTRARY TO LAW AND FACTS OF THE CASE. 8. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR AL TER ANY GROUNDS OF APPEAL BEFORE THE APPEAL IS HEARD AND DISPOSED OFF. ITA NO. 288/CHD/2018 1. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) IS NO T JUSTIFIED IN LAW AND FACTS OF THE CASE BY CONFIRMING DISALLOWANCE OF EXP ENSES TO THE TUNE OF RS. 538917/- ON ACCOUNT OF DISALLOWANCE MADE U/S 14A READ WITH R ULE 8-D IN APPELLANT'S CASE. 2. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) I S ALSO ERRED BY CONFIRMING THE PROVISIONS OF SECTION 14-A READ WITH RULE 8-D ON DIVIDEND INCOME EARNED ON THE TRADING BUSINESS OF SHARES. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) CONSIDERED THE ENTIRE DIVIDEND EARNED FRO M INVESTMENTS IN SHARES ONLY, WHEREAS ASSESSEE HAS ALSO EARNED DIVIDEND INCOME FR OM TRADING BUSINESS OF SHARES, WHICH WAS DULY EXPLAINED BY THE APPELLANT DURING TH E COURSE OF ASSESSMENT PROCEEDINGS .THEREFORE ADDITION CONFIRMED BY THE LD . COMMISSIONER OF INCOME TAX WAS WITHOUT VERIFYING THE FACTS OF THE CASE. 3. IT IS WELL SETTLED LAW THAT NO DISALLOWANCE OF EXPE NSES CAN BE MADE UNLESS IT IS PROVED THAT THE RELATED EXPENSES WERE INCURRED T O EARN EXEMPT INCOME. WHEREAS THE LD. ASSESSING OFFICER FAILED TO DISCHARGE SUCH NEXUS. IN THE ABSENCE OF NEXUS OF EXPENDITURE INCURRED AND INCOME EARNED, DISALLOWANC E CANNOT BE MADE. 4. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) I S GROSSLY ERRED BY HOLDING THAT ONCE THE ASSESSEE HAS EARNED EXEMPT IN COME, THE PROVISIONS OF SECTION 14A ARE ATTRACTED AND DISALLOWANCE HAS TO B E WORKED OUT BY APPLYING RULE 8D. WHEREAS. IT IS SETTLED BY VARIOUS JUDICIAL PRON OUN-CEMENTS THAT INVOKING RULE 8D IS NOT MANDATORY, IT WILL BE RESORTED ONLY IF LD. ASSE SSING OFFICER IS NOT SATISFIED AS TO THE CORRECTNESS OF THE CLAIM OF EXPENSES MADE BY THE AS SESSEE AS STIPULATED AND MANDATED IN SECTION 14A: AND INVOKING RULE 8D IS NO T AUTOMATIC. 5. THAT THE ORDER OF THE LD. COMMISSIONER OF INCOME TA X (APPEALS) IS CONTRARY TO LAW AND FACTS OF THE CASE. 6. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR AL TER ANY GROUNDS OF APPEAL BEFORE THE APPEAL IS HEARD AND DISPOSED OFF. ITA NO. 1085/CHD/2017 1. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) IS NO T JUSTIFIED IN LAW AND FACTS OF THE CASE BY CONFIRMING DISALLOWANCE OF EXP ENSES TO THE TUNE OF RS. 4 707517/- ON ACCOUNT OF DISALLOWANCE MADE U/S 14A RE AD WITH RULE 8-D IN APPELLANT'S CASE. 2. THAT LD. COMMISSIONER OF INCOME TAX HAS MISCONSTRUE D AND MISAPPLIED THE PROVISIONS OF SECTION 14A OF THE INCOME TAX ACT 196 1 IN APPELLANT'S CASE. THAT LD. COMMISSIONER OF INCOME TAX HAS NEVER VERIFIED FACTS OF THE ASSESSMENT ORDER AND TOTALLY IGNORED THE ASSESSMENT ORDER, WHEREIN DETAI LS OF EXPENDITURE INCURRED FOR EARNING DIVIDEND INCOME WAS DUELY FURNISHED AND SUC H AMOUNT WAS DUELY TAKEN WHILE COMPUTING THE DISALLOWANCE. FURTHER LD. COMMI SSIONER OF INCOME TAX HAS CLEARLY HELD IN HIS ORDER THAT THERE IS NO SET LANG UAGE WHICH CAN BE USED FOR RECORDING DISSATISFACTION FOR THE CLAIM MADE BY THE ASSESSEE, WHEREAS IN LANDMARK JUDGMENT OF HON'BLE JURISDICTIONAL HIGH COURT IN TH E CASE OF C.L.T. VS. ABHISHEK INDUSTRIES LIMITED DATED 27-01-2015 CLEARLY HOLD TH AT SECTION 14A OF THE ACT CANNOT BE APPLIED UNLESS AND UNTIL SATISFACTION IS RECORDE D. THE ONUS, THEREFORE, TO PROVE THE APPLICABILITY OF SECTION 14A, LIES SQUARELY ON THE SHOULDERS OF THE REVENUE. 3. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) I S GROSSLY ERRED BY HOLDING THAT ONCE THE ASSESSEE HAS EARNED EXEMPT IN COME, THE PROVISIONS OF SECTION 14A ARE ATTRACTED AND DISALLOWANCE HAS TO B E WORKED OUT BY APPLYING RULE 8D. WHEREAS. IT IS SETTLED BV VARIOUS JUDICIAL PRON OUNCEMENTS THAT INVOKING RULE 8D IS NOT MANDATORY, IT WILL BE RESORTED TO ONLY IF LD . ASSESSING OFFICER IS NOT SATISFIED AS TO THE CORRECTNESS OF THE CLAIM OF EXPENSES MADE BY THE ASSESSEE AS STIPULATED AND MANDATED IN SECTION 14A: AND INVOKING RULE 8D I S NOT AUTOMATIC. 4. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS P ASSED THE ORDER IN UTTER HASTE AND WITHOUT CONSIDERING THE RECORDS OF THE CASE. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS HELD THAT JUDICIAL PRON OUNCEMENT RELIED BY THE ASSESSEE PERTAINS TO PERIOD PRIOR TO INTRODUCTION O F RULE 8D, WHEREAS LATEST JUDGMENT OF HON'BLE JURISDICTIONAL IN THE CASE OF P R. C.L.T. VS GANESHAY OVERSEAS DATED 20-02-2017 WAS DUELY PRODUCED IN FAVOUR OF AS SESSEE'S CASE AT THE TIME OF HEARING OF APPEAL AND THE SAME WAS TOTALLY IGNORED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS). 5. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) IS AL SO NOT JUSTIFIED IN LAW AND FACTS OF THE CASE BY CONFIRMING DISALLOWANCE OF EXPENDITURE TO THE TUNE OF RS. 70885/- ON ACCOUNT OF L/5 TH EXPENSES OF TELEPHONE, MOBILE AND CAR EXPENSES WITHOUT ANY BASIS OR EVIDENCE. SPECIALLY I N A CASE WHEN THERE WAS NO INCRIMINATING MATERIAL, OR ADVERSE EVIDENCE WAS FOU ND DURING THE COURSE OF ASSESSMENT PROCEEDINGS TO ESTABLISH THAT THESE EXPE NDITURE HAVE BEEN INCURRED ON ACCOUNT OF PERSONAL USE. 6. THAT ADDITION HAS BEEN CONFIRMED BY THE LD. COMMISS IONER OF INCOME TAX (APPEALS) WHOLLY ON ADHOC BASIS WHICH COULD NOT BE SUSTAINED IN LAW. THAT WITHOUT POINTING OUT ANY DEFICIENCY AND WITHOUT VER IFYING RECORDS, LD. ASSESSING OFFICER STRAIGHTWAY CAME TO THE CONCLUSION THAT PER SONAL USE OF EXPENSES BY THE ASSESSEE CANNOT BE RULED OUT AND L/5 TH OF THESE EXPENSES ARE DISALLOWED. 7. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) I S ALSO NOT JUSTIFIED IN LAW AND FACTS OF THE CASE BY DISALLOWING THE INTERE ST OF RS. 18434/- IN APPELLANT'S CASE. IT IS WELL SETTLED LAW THAT NO DI SALLOWANCE OF INTEREST CAN BE MADE WHEN SUCH ADVANCES HAVE BEEN MADE FROM ASSESSE E'S OWN FUNDS AND RESERVES & SURPLUS. IN ASSESSEE'S CASE SURPLUS OWN FUNDS ARE AVAILABLE AND THE SAME IS VERIFIABLE FROM THE BALANCE SHEET. MOREOVER THESE ADVANCES HAVE BEEN MADE IN PROMOTING ITS BUSINESS AND INCURRED FO R EARNING MORE PROFITS, IN SUCH CASES NO DISALLOWANCE CAN BE MADE WHERE FUNDS HAVE BEEN ADVANCED EXCLUSIVELY FOR BUSINESS PURPOSES. 8. THAT THE ORDER OF THE LD. COMMISSIONER OF INCOME TA X (APPEALS) IS CONTRARY TO LAW AND FACTS OF THE CASE. 9. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR AL TER ANY GROUNDS OF APPEAL BEFORE THE APPEAL IS HEARD AND DISPOSED OFF. 5 ITA NO. 563/CHD/2017 1. THAT LD. COMMISSIONER OF INCOME TAX IS NOT JUSTIFIE D IN LAW AND FACTS OF THE CASE BY CONFIRMING DISALLOWANCE OF EXPENSES TO THE TUNE OF RS. 86163/- ON ACCOUNT OF DISALLOWANCE MADE U/S 14A READ WITH RULE 8-D IN APPELLANT'S CASE. 2. THAT LD. COMMISSIONER OF INCOME TAX HAS MISCONSTRUE D AND MISAPPLIED THE PROVISIONS OF SECTION 14A OF THE INCOME TAX ACT 196 1 IN APPELLANT'S CASE. THAT LD. COMMISSIONER OF INCOME TAX HAS CLEARLY HELD IN HIS ORDER THAT THERE IS NO SET LANGUAGE WHICH CAN BE USED FOR RECORDING DISSATISFA CTION FOR THE CLAIM MADE BY THE ASSESSEE, WHEREAS IN LANDMARK JUDGMENT OF HO N'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF C.L.T. VS. ABHISHEK INDUSTRIES LIMITED DATED 27-01-2015 CLEARLY HOLD THAT SECTION 14A OF THE ACT CANNOT BE APPLICABLE UNLESS AND UNTIL SATISFACTION IS RECORDED. THE ONUS, THEREFORE, TO P ROVE THE APPLICABILITY OF SECTION 14A, LIES SQUARELY ON THE SHOULDERS OF THE REVENUE. 3. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) I S GROSSLY ERRED BY HOLDING THAT ONCE THE ASSESSEE HAS EARNED EXEMPT IN COME, THE PROVISIONS OF SECTION 14A ARE ATTRACTED AND DISALLOWANCE HAS TO B E WORKED OUT BY APPLYING RULE 8D. WHEREAS. IT IS SETTLED BY VARIOUS JUDICIAL PRONOUNCEMENTS THAT INVOKING RULE 8D IS NOT MANDATORY, IT WILL BE RESORTED TO ON LY IF LD. ASSESSING OFFICER IS NOT SATISFIED AS TO THE CORRECTNESS OF THE CLAIM OF EXP ENSES MADE BY THE ASSESSEE AS STIPULATED AND MANDATED IN SECTION 14A: AND INVOKIN G RULE 8D IS NOT AUTOMATIC. 4. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS P ASSED THE ORDER IN UTTER HASTE AND WITHOUT CONSIDERING THE RECORDS OF THE CA SE. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS HELD THAT NO DECISION OF A NY HON'BLE HIGH COURT HAS BEEN DELIVERED AFTER CONSIDERING CIRCULAR NO. 5 OF 2014 ISSUED BY CBDT. WHEREAS NUMBER OF RECENT JUDGMENTS WERE PRODUCED IN FAVOUR OF ASSESSEE'S CASE AT THE TIME OF HEARING OF APPEAL AND THE SAME WERE TOTALLY IGNORED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS). FURTHER THE R EFERENCE OF JUDGEMENTS HAVE BEEN CLEARLY MENTIONED IN THE LD. COMMISSIONER OF INCOME TAX (APPEALS)'S ORDER. 5. THAT THE ORDER OF THE LD. COMMISSIONER OF INCOME TA X (APPEALS) IS CONTRARY TO LAW AND FACTS OF THE CASE. 6. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR ALTER ANY GROUNDS OF APPEAL BEFORE THE APPEAL IS HEARD AND DISPOSED OFF. ITA NO. 565/CHD/17 1. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) IS NOT JUSTIFIED IN LAW AND FACTS OF THE CASE BY CONFIRMING DISALLOWANCE OF EXP ENSES TO THE TUNE OF RS. 1161750/- ON ACCOUNT OF DISALLOWANCE MADE U/S 14A R EAD WITH RULE 8-D IN APPELLANT'S CASE. 2. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HA S MISCONSTRUED AND MISAPPLIED THE PROVISIONS OF SECTION 14A OF THE INC OME TAX ACT 1961 IN APPELLANT'S CASE. THAT LD. COMMISSIONER OF INCOME T AX HAS CLEARLY HELD IN HIS ORDER THAT THERE IS NO SET LANGUAGE WHICH CAN BE US ED FOR RECORDING DISSATISFACTION FOR THE CLAIM MADE BY THE ASSESSEE, WHEREAS IN LANDMARK JUDGMENT OF HON'BLE JURISDICTIONAL HIGH COURT IN TH E CASE OF C.L.T. VS. ABHISHEK INDUSTRIES LIMITED DATED 27-01-2015 CLEARLY HOLD TH AT SECTION 14A OF THE ACT CANNOT BE APPLICABLE UNLESS AND UNTIL SATISFACTION IS RECORDED. THE ONUS, THEREFORE, TO PROVE THE APPLICABILITY OF SECTION 14 A, LIES SQUARELY ON THE SHOULDERS OF THE REVENUE. 3. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS ) IS GROSSLY ERRED BY HOLDING THAT ONCE THE ASSESSEE HAS EARNED EXEMPT IN COME, THE PROVISIONS OF SECTION 14A ARE ATTRACTED AND DISALLOWANCE HAS TO B E WORKED OUT BY APPLYING 6 RULE 8D. WHEREAS. IT IS SETTLED BY VARIOUS JUDICIAL PRONOUNCEMENTS THAT INVOKING RULE 8D IS NOT MANDATORY, IT WILL BE RESORTED TO ON LY IF LD. ASSESSING OFFICER IS NOT SATISFIED AS TO THE CORRECTNESS OF THE CLAIM OF EXP ENSES MADE BY THE ASSESSEE AS STIPULATED AND MANDATED IN SECTION 14A: AND INVOKIN G RULE 8D IS NOT AUTOMATIC. 4. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HA S PASSED THE ORDER IN UTTER HASTE AND WITHOUT CONSIDERING THE RECORDS OF THE CASE. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS HELD THAT NO DECISION OF ANY HON'BLE HIGH COURT HAS BEEN DELIVERED AFTER CONSIDERING CIR CULAR NO. 5 OF 2014 ISSUED BY CBDT. WHEREAS NUMBER OF RECENT JUDGMENTS WERE PRODU CED IN FAVOUR OF ASSESSEE'S CASE AT THE TIME OF HEARING OF APPEAL AN D THE SAME WERE TOTALLY IGNORED BY THE LD. COMMISSIONER OF INCOME TAX (APPE ALS). FURTHER THE REFERENCE OF JUDGEMENTS HAVE BEEN CLEARLY MENTIONED IN THE LD . COMMISSIONER OF INCOME TAX (APPEALS)'S ORDER. 5. THAT THE ORDER OF THE LD. COMMISSIONER OF INCOME TA X (APPEALS) IS CONTRARY TO LAW AND FACTS OF THE CASE. 6. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR AL TER ANY GROUNDS OF APPEAL BEFORE THE APPEAL IS HEARD AND DISPOSED OFF. ITA NO. 259/CHD/2018 1. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS)-4 IS NOT JUSTIFIED IN LAW AND FACTS OF THE CASE BY CONFIRMING DISALLOWANC E OF EXPENSES TO THE TUNE OF RS. 1011306/- ON ACCOUNT OF DISALLOWANC E MADE U/S 14A READ WITH RULE 8-D IN APPELLANT'S CASE. 2. THAT LD. COMMISSIONER OF INCOME TAX (APPEALS)-4 HAS MISCONSTRUED AND MISAPPLIED THE PROVISIONS OF SECTION 14A OF THE INC OME TAX ACT 1961 IN APPELLANT'S CASE. THAT LD. COMMISSIONER OF INCOME TAX IS GROSSL Y ERRED BY CONFIRMING THAT OPERATING EXPENSES I.E. VEHICLE REPAIR, LEGAL EXPEN SES, TRAVELLING EXPENSES ETC. HAS HELPED IN EARNING EXEMPT INCOME TO THE ASSESSEE COMPANY. HOWEVER OPERATIVE EXPENSES HAVE NO LINK WITH THE INVESTMENT MADE BY THE ASSESSEE COMPANY. 3. IT IS WELL SETTLED LAW THAT NO DISALLOWANCE OF EXPE NSES CAN BE MADE UNLESS IT IS PROVED THAT THE RELATED EXPENSES WERE INCURRED TO E ARN EXEMPT INCOME. WHEREAS THE LD. ASSESSING OFFICER FAILED TO DISCHAR GE SUCH NEXUS. IN THE ABSENCE OF NEXUS OF EXPENDITURE INCURRED AND INCOME ENERATE D, DISALLOWANCE CANNOT BE MADE. MOREOVER THE EXPENSES INCURRED , DETAIL OF TH E SAME WERE SUBMITTED DURING THE COURSE OF ASSESSMENT PROCEEDINGS BEFORE THE LD. ASSESSING OFFICER AND NO DEFECT OR DEFICIENCY WAS POINTED OUT ABOUT THESE EXPENSES INCURRED FOR EARNING DIVIDEND ON INVESTMENT OF SECURITIES AND IT WAS NEVER HELD THAT BY WHICH DEFICIENCY LD. ASSESSING OFFICER WAS NOT SATISFIED FOR THE EXPENSES INCURRED FOR EARING EXEMPT INCOME . WHEREAS LD .ASSESSING OFFICE R HAS GENERALIZED ALL THE EXPENSES DEBITED TO PROFIT AND LOSS ACCOUNT FOR EAR NING EXEMPT INCOME BY THE APPELLANT. NO SPECIFIC EXPENSES WERE POINTED FOR EA RNING EXEMPT INCOME ON INVESTMENTS. 4. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-4 IS GROSSLY ERRED BY HOLDING THAT ONCE THE ASSESSEE HAS EARNED EXEMPT IN COME, THE PROVISIONS OF SECTION 14A ARE ATTRACTED AND DISALLOWANCE HAS TO B E WORKED OUT BY APPLYING RULE 8D. WHEREAS. IT IS SETTLED BY VARIOUS JUDICIAL PRONOUN CEMENTS THAT INVOKING RULE 8D IS NOT MANDATORY, IT WILL BE RESORTED TO ONLY IF LD. A SSESSING OFFICER IS NOT SATISFIED AS TO THE CORRECTNESS OF THE CLAIM OF EXPENSES MADE BY THE ASSESSEE AS STIPULATED AND MANDATED IN SECTION 14A: AND INVOKING RULE 8D I S NOT AUTOMATIC. 5. THAT THE ORDER OF THE LD. COMMISSIONER OF INCOME TA X (APPEALS)-4 IS CONTRARY TO LAW AND FACTS OF THE CASE. 7 6. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR AL TER ANY GROUNDS OF APPEAL BEFORE THE APPEAL IS HEARD AND DISPOSED OFF. 3. GROUNDS RELATING TO DISALLOWANCE UNDER SECTION 14A R.W.R 8D IS COMMON FOR ALL THE APPEALS HENCE BEING DEALT TOGETHER. 4. FACTS TAKEN FROM THE ORDERS OF THE LD. CIT(A) AR E THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF TRADING IN SECURITIES AN D DERIVATIVE PRODUCTS AND ALSO HAS INVESTMENT IN SHARES AND FILED HIS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION ON 30.09.2009 DECLARING THEREIN INCOME OF (-)RS.3,24,92,528 /-. WHILE COMPLETING THE ASSESSMENT, THE ASSESSING OFFI CER HAS MADE AN ADDITION OF RS.3,84,162/- TO THE RETURNED OF THE ASSESSEE COMPANY ON ACCOUNT OF DISALLOWANCE OF EXPENSES BY INVOKING PROVISIONS OF SECTION 14A OF THE ACT READ WITH RULE 8D OF THE INCOME TAX RULES, 1962 ON THE AGROUND THAT THE ASSESSEE HAS EARNED DIVIDEND INCOME FROM INVESTMENT IN SHARES TO THE EXTENT OF RS.3,70,73,052/- WHICH WILL NOT FORM PART OF TAXABLE INCOME AND WILL BE EXEMPT FROM TAX. 5. THE ASSESSEE HAS SUBMITTED THAT HE HAS DEBITED A N AMOUNT OF RS. 60,000/- @ RS. 5,000/- PER MONTH TOWARDS SALARY EXPENSES TO EARN DIVIDEND. THE ASSESSING OFFICER HELD THAT THE EXPENSES OF RS. 60,000/- INCU RRED BY THE ASSESSEE TO BE WITHOUT ANY LOGIC OR CORRELATION WITH THE INVESTME NT MADE. WHILE COMPUTING THE DISALLOWANCE THE ASSESSING OFFI CER HELD AS UNDER: 'THE REPLY OF THE ASSESSEE HAS BEEN CONSIDERED AND IS FOUND TO BE WITHOUT ANY LOGIC OR CORRELATION WITH THE INVESTMENT MADE. AT THIS JU NCTURE, IT IS WORTHWHILE TO HAVE A LOOK AT THE PROVISIONS OF SECTION 14 A'. IN THE SUBSEQUENT PARAS OF THE ASSESSMENT ORDER, TH E ASSESSING OFFICER HAS OBSERVED AS UNDER;- 'AS CAN BE SEEN ABOVE, RULE 8D PROVIDES FOR DISALLO WANCE U/S 14A, ON INVESTMENTS, INCOME FROM WHICH DOES NOT OR SHALL NOT FORM PART OF THE TOTAL INCOME. THE ASSESSEE HAS INVESTED IN SHARES AND MUTUAL FUNDS AND INCOME FROM THESE WHETHER THE DIVIDEND OR LONG-TERM CAPITAL GAIN ON SALE IS EXEMP T INCOME. 'THOUGH, THE ASSESSEE HAS PROVIDED DETAILS OF EXPENSES (COMPUTER & SALARY ONLY) INCURRED ON MAKING THESE INVESTMENTS BUT THESE EXPENSES ARE CERTAINLY ON LOW ER SIDE KEEPING IN VIEW THE MAGNITUDE OF THE INVESTMENT MADE BY THE ASSESSEE AS PER ** JJRULE 8D, IF THE AO IS NOT SATISFIED WITH THE CORRECTNESS OF THE CLAIM OF EXPENDITURE MADE BY THE ASSESSEE OR THE CLAIM BY THE ASSESSEE THAT NO EXPENDITURE HA S BEEN INCURRED, HE SHALL APPLY PROVISIONS OF RULE 8D(2) TO COMPUTE THE DISALLOWANC E. SINCE, THE ASSESSEE HAS NOT BEEN ABLE TO SUBSTANTIATE HIS CLAIMS, THE UNDERSIGN ED IS CONSTRAINED TO APPLY THE PROVISIONS OF RULE 8D IN MAKING THE SAID DISALLOWAN CE, WHICH IS COMPUTED AS UNDER:'. 6. IN THIS BACKGROUND OF THE OBSERVATIONS OF THE AS SESSING OFFICER, THE ASSESSEE TOOK THE PLEA THAT THE ASSESSING OFFICER H AS NOT MENTIONED HIS DISSATISFACTION MANDATED AS PER PROVISIONS OF SECTI ON 14A(2). THE LD. CIT(A) HELD 8 THAT FROM THE PARAS OF THE ASSESSMENT ORDER WHICH H AVE BEEN REPRODUCED ABOVE, IT CAN BE DECIPHERED THAT THE ASSESSING OFFI CER HAS CLEARLY RECORDED HIS DISSATISFACTION WITH REGARD TO THE CLAIM OF EXPENDI TURE STATED TO BE INCURRED BY THE ASSESSEE FOR EARNING DIVIDEND INCOME. IT WOULD BE NECESSARY TO NOTE THAT TO DETERMINE THE AMOUNT OF EXPENDITURE INCURRED IN REL ATION TO SUCH INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THE AC T, BY APPLYING THE METHOD WHICH IS PRESCRIBED IN RULE 8D, THE ASSESSING OFFIC ER MUST NOT BE SATISFIED WITH THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE, HAVING RE GARD TO THE ACCOUNTS OF THE ASSESSEE. THE SAME PROVISION IS CONTAINED IN SUB-RU LE (1) OF THE RULE 8D OF THE INCOME TAX RULES, 1962 WHICH STIPULATES THAT THE AS SESSING OFFICER, IF HE IS NOT SATISFIED, HAVING REGARD TO THE ACCOUNTS OF THE ASS ESSEE WITH THE CORRECTNESS OF THE CLAIM OF THE EXPENDITURE MADE BY THE ASSESSEE O R THE CLAIM OF THE ASSESSEE THAT NO EXPENDITURE HAS BEEN INCURRED, SHALL DETERM INE THE AMOUNT OF EXPENDITURE IN RELATION TO SUCH INCOME IN ACCORDANC E WITH THE PROVISIONS OF SUB- RULE (2) OF RULE 8D OF THE INCOME TAX RULES, 1962. THE LD. CIT(A) FURTHER HELD THAT IN THE PRESENT CASE, THE SUBMISSION OF THE ASSESSEE I S THAT THERE IS NOTHING IN THE ORDER OF THE ASSESSING OFFICER TO INDICATE THAT THE ASSESSING OFFICER WAS NOT SATISFIED WITH THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE, AND IN BOTH UNDER SUB-SECTION (2) OF SECTION 14A OF THE ACT AND UNDER SUB-RULE (1) OF RULE 8D OF THE INCOME TAX RULES, 1962, THE ASSESSING OFFICER IS EM POWERED TO APPLY THE METHOD AS PRESCRIBED IN THE RULES IF, HAVING REGARD TO THE ACCOUNTS OF THE ASSESSEE, HE IS NOT SATISFIED WITH THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE IN RESPECT OF THAT PART OF THE EXPENDITURE WHICH IS IN CURRED IN RELATION TO INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME. THE L D. CIT(A) ALSO HELD THAT THE SATISFACTION OF THE ASSESSING OFFICER HAS TO BE DED UCED FROM THE ASSESSMENT ORDER AND THERE IS NO STRAIGHT JACKET FORMULA REQUI RING THE ASSESSING OFFICER TO USE ANY PARTICULAR LANGUAGES OR FORM FOR RECORDING HIS DISSATISFACTION. THE LD. CIT(A) HELD THAT SO LONG AS THE ORDER OF THE ASSESS ING OFFICER INDICATES THAT HE IS NOT SATISFIED WITH THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE OR THE CLAIM OF THE ASSESSEE THAT NO EXPENDITURE HAS BEEN INCURRED, THE ASSESSING OFFICER HAS TO PROCEED IN THE MANNER INDICATED BY RULE 8D(2) OF TH E INCOME TAX RULES 1962. 6.1 THE LD. CIT(A) HELD THAT A CLEAR FULFILLMENT OF THE REQUIREMENT IN SUB- SECTION (2) OF SECTION 14A THE OF THE ACT AS WELL A S SUB-RULE (1) OF RULE 8D OF THE INCOME TAX RULES, 1962 THAT THE ASSESSING OFFICER W AS NOT SATISFIED WITH THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE, ON THE BA SIS OF THE ACCOUNTS OF THE ASSESSEE IS SUFFICIENT TO DETERMINE THE DISALLOWANC E. HE RELIED ON THE JUDGMENT 9 OF HON. HIGH COURT IN THE CASE OF M/S DHAMPUR SUGAR MILLS LIMITED VS. COMMISSIONER OF INCOME TAX (ALLAHABAD) 370 ITR0187. 6.2 THE LD. CIT(A) HAS ALSO HELD THAT THE PROVISIO NS OF SECTION 14A OF THE ACT READ WITH RULE 8D OF THE INCOME TAX RULES, 1962 WIL L ALSO BE APPLICABLE ON THOSE INVESTMENTS FROM WHICH THE ASSSESSEE HAS NOT RECEIV ED ANY EXEMPT INCOME IN VIEW OF CLARIFICATION ISSUED BY THE CBDT, NEW DELHI VIDE CIRCULAR NO. 5 OF 2014 WHEREIN THE LEGISLATIVE INTENTION OF THE PARLIAMENT FOR BRINGING SECTION 14A OF THE ACT TO THE STATUTE HAS BEEN DISCUSSED IN DETAIL. AN D NOT COME ACROSS ANY DECISION OF ANY HON. COURT WHICH HAS BEEN DELIVERED AFTER CONSIDERING CIRCULAR NO. 5 OF 2014 ISSUED BY THE CBDT, NEW DELHI. 7. DURING THE ARGUMENTS BEFORE US, THE LD. AR SUBMI TTED THAT THE ASSESSEE HAD INVESTMENTS OF RS. 3,70,73,052/- AND RECEIVED D IVIDEND OF RS. 30,38,202/- ON INVESTMENTS AS WELL AS DURING THE TRADING OPERATION S. HE ALSO DEBITED AN AMOUNT OF RS. 901691/- TOWARDS THE SALARIES AND RS. 179,80 0/- TOWARDS COMPUTER EXPENSES. THE TOTAL TURNOVER OF THE ASSESSEE WAS RS . 95, 45, 43,106/-. HE ARGUED THAT AN AMOUNT OF RS. 60,000/- HAS BEEN DULY INCURR ED FOR EARNING DIVIDEND WHICH HAS BEEN DULY REFLECTED IN THE ACCOUNTS. HE A RGUED THAT THERE IS NO SATISFACTION RECORDED BY THE ASSESSING OFFICER WHIL E DETERMINING THE EXPENSES UNDER SECTION 14(A). HE RELIED ON THE JUDGMENT OF T HE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. ABHISHEK INDUSTRIES LTD AND OTH ER ARGUMENTS AS TAKEN BEFORE THE LOWER AUTHORITIES. 7.1. ON THE OTHER HAND LD. DR STRONGLY RELIED ON TH E ORDER OF THE LD. CIT(A) AND ARGUED THAT THERE IS AN IMPLICIT SATISFACTION RECOR DED BY THE ASSESSING OFFICER AND THERE CANNOT BE FIXED FORMAT FOR RECORDING THE SATISFACTION AND THE OBSERVATIONS OF THE ASSESSING OFFICER MUST BE CONST ITUTED AS SATISFACTION IN TERMS OF SECTION 14A(2). 8. THAT LEAVES US WITH A QUESTION TO BE ADJUDICATED WHETHER SATISFACTION AS PER THE PROVISIONS OF SECTION 14A HAS BEEN RECORDED OR NOT BY THE ASSESSING OFFICER. IN ORDER TO EXAMINE THIS, THE PROVISIONS O F THE ACT, THE RECORDING OF THE ASSESSING OFFICER, THE JUDICIAL PRONOUNCEMENTS ARE CAREFULLY PERUSED. THE SECTION 14A (2) READS AS UNDER 14A(2): THE ASSE SSING OFFICER SHALL DETERMINE THE AMOUNT OF EXPENDI TURE INCURRED IN RELATION TO SUCH INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THIS ACT IN ACCORDANCE WITH SUCH METHOD AS MAY BE PRESCR IBED, IF THE ASSESSING OFFICER, HAVING REGARD TO THE ACCOUNTS OF THE ASSES SEE, IS NOT SATISFIED WITH THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE IN RESPECT OF SUCH EXPENDITURE IN RELATION TO INCOME WHICH DOES NOT FORM PART OF THE TOTAL INC OME UNDER THIS ACT. 10 FROM THE RECORDS WE FIND THAT THE ASSESSING OFFICER HAS HELD AS UNDER WHILE COMPUTING THE DISALLOWANCE VIDE PARA 4 OF THE ASSES SMENT ORDER WHICH READS AS UNDER: THE REPLY OF THE ASSESSEE HAS BEEN CONSIDERED AND I S FOUND TO BE WITHOUT ANY LOGIC OR CORRELATION WITH THE INVESTMENT MADE. AT THIS JU NCTURE IT IS WORTHWHILE TO HAVE A LOOK AT THE PROVISIONS OF THE SECTION 14A . THOUG H, THE ASSESSEE HAS PROVIDED DETAILS OF EXPENSES (COMPUTER & SALARY ONLY) INCURR ED ON MAKING THESE INVESTMENTS BUT THESE EXPENSES ARE CERTAINLY ON LOWER SIDE KEEP ING IN VIEW THE MAGNITUDE OF THE INVESTMENT MADE BY ASSESSE. AS PER RULE 8D, IF THE AO IS NOT SATISFIED WITH THE CORRECTNESS OF THE CLAIM OF EXPENDITURE MADE BY THE ASSESSEE OR THE CLAIM BY THE ASSESSEE THAT NO EXPENDITURE HAS BEEN INCURRED, HE SHALL APPLY THE PROVISIONS OF RULE 8D (2) TO COMPUTE THE DISALLOWANCE. THE JUDICIAL PRONOUNCEMENTS ENVISAGE THAT THE ASSES SING OFFICER HAS TO EXAMINE WHETHER THE DISALLOWANCE OFFERED BY THE ASSESSEE IT SELF WAS SUFFICIENT ON THE FACTS AND CIRCUMSTANCES OF THE CASE NOTWITHSTANDING THAT APPLICABILITY OF RULE 8D. THE ASSESSING OFFICER HAS TO PIN POINT ANY OTHE R IN THE COMPUTATION OF THE DISALLOWANCE MADE BY THE ASSESSING OFFICER. IF THE ASSESSING OFFICER IS UNABLE TO PIN POINT ANY OTHER NO GROUND CAN BE MADE FOR ALTER ING THE COMPUTATION MADE BY THE ASSESSEE {CONSOLIDATED PHOTO & FINVEST LIMIT ED 211 TAXMAN 184 (DEL)}. 8.1 IT WAS ALSO HELD THAT IN THE ABSENCE OF SATISFA CTION RECORDED BEFORE INVOKING SUB RULE 2 OF RULE 8D OF THE RULES, THE CO MPUTATION MADE BY THE ASSESSING OFFICER IS INVALID {(TAIKISHA ENGINEERING INDIA LTD. IN ITA NO. 115/2014 (DEL)}. SIMILARLY THE JURISDICTIONAL HIGH COURT IN THE CASE OF ABHISHEK INDUSTRIES LTD. (APPEAL NO. 320 OF 2013, P&H) HELD THAT SECTION 14A OF THE ACT, BEING IN THE NATURE OF AN EXCEPTION, HAS TO BE CONSTRUED STRICTL Y AND ONLY WHERE THE ASSESSING OFFICER RECORDS SATISFACTION ON THE BASIS OF CLEAR AND COGENT MATERIAL, SHALL AN ORDER PASSED UNDER SECTION 14A OF THE ACT DISALLOWING SUCH CLAIM. IN CASE NO TANGIBLE MATERIAL IS AVAILABLE ON THE RECOR D THAT COULD HAVE BEEN ENABLE THE ASSESSING OFFICER TO RECORD SATISFACTION IN TERMS OF 14A, THE RE- COMPUTATION DONE BY THE ASSESSING OFFICER CANNOT BE TREATED AS VALID. 9. IN THE INSTANT CASE, WE FIND THAT THERE IS NO T ANGIBLE MATERIAL ON RECORD, THERE IS NO RECORD OF EXAMINATION OF ACCOUNTS AS ST IPULATED UNDER SECTION 14A(2), THERE IS NO SATISFACTION RECORDED BY THE AS SESSING OFFICER IN TERMS OF THE EXPENDITURE CLAIMED BY THE ASSESSEE, AND HENCE KEEP ING IN VIEW THE PROVISIONS OF THE ACT, THE PROCESS EMBARKED UPON BY THE ASSESS EE AND THE JUDICIAL PRONOUNCEMENTS, IT IS HEREBY HELD THAT THE RE-COMP UTATION DONE BY THE ASSESSING OFFICER IN THE ABSENCE OF RECORDING OF TH E SATISFACTION IS LIABLE TO BE SET ASIDE. 11 10. THE OTHER GROUNDS TAKEN IN ITA NO. 526 AND 1085 PERTAIN TO DISALLOWANCE OF 1/5TH OF THE EXPENSES OF TELEPHONE, MOBILE AND C AR EXPENSES. IN THIS REGARD THE LD. CIT (A) AFTER CAREFUL CONSIDERATION OF THE FACTS OF THE CASE AND THE CASE LAWS CITED BY THE LD. AR BEFORE HIM DURING THE HEAR INGS HELD THAT THE PERSONAL USE OF CAR AND TELEPHONE CANNOT BE RULED OUT IN THE CASE OF THE ASSESSEE IN THE ABSENCE OF DAY TO DAY DETAILS WITH REGARD TO USE OF TELEPHONE AND CAR AND HELD THAT THE DISALLOWANCE MADE BY THE ASSESSING OF FICER ARE VERY REASONABLE AND CANNOT BE SAID TO BE EXCESSIVE UNDER ANY CIRCUM STANCES. 11. BEFORE US, THE LD. AR HAS TAKEN THE ARGUMENTS T HAT HAVE BEEN TAKEN BEFORE THE LD. CIT(A) WHICH THE LD. CIT(A) HAS DULY CONSIDERED AND DISTINGUISHED THE CASE LAWS. HAVING GONE THROUGH THE ISSUE IN DET AIL, IN THE PECULIAR FACTS AND CIRCUMSTANCES OF THE INSTANT CASE, WE HEREBY DECLIN E TO INTERFERE WITH THE ORDER OF THE LD. CIT(A) ON THIS ISSUE. 12. IN THE RESULT, APPEAL OF THE ASSESSEES ARE PAR TY ALLOWED. SD/- SD/- . .., # $, (SANJAY GARG ) ( DR. B.R.R. KUM AR) / JUDICIAL MEMBER %& / ACCOUNTANT MEMBER AG DATE: 29/04/2019 (+ ! ,- .- / COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT , 2 THE RESPONDENT , 3. CIT, 4. THE CIT(A), 5. DR, ITAT, CHANDIGARH, 6. GUARD FILE