DCIT, Circle-16(2), Hyderabad, Hyderabad V. Ocimum Bio Solutions (India) Pvt. Ltd., Hyd, Hyderabad

ITA 1199/HYD/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 5874 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-12-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 12-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: U MINICHANDRAN
• Assessee Lawyers: P MURALI MOHAN RAO
• Keywords: Earning of tax free income
• Section: 14A

Judgement Text

ITA NO 1199 OF 2016 OCIMUM BIO SOLUTIONS INDIA LT D HYDERABAD PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD B BENCH, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER ITA NO.1199/HYD/2016 (ASSESSMENT YEAR: 2009-10) DY. COMMISSIONER OF INCOME TAX, CIRCLE 16(2) HYDERABAD VS M/S. OCIMUM BIO SOLUTIONS (INDIA) LTD HYDERABAD PAN: AAACO 4095 L FOR REVENUE : SMT. U. MINICHANDRAN, DR FOR ASSESSEE : SHRI P. MURALI MOHAN RAO O R D E R PER SMT. P. MADHAVI DEVI, J.M. THIS IS REVENUES APPEAL FOR THE A.Y 2009-10. IN TH IS APPEAL, THE ASSESSEE HAS RAISED THE FOLLOWING GROUN DS OF APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT (A) ERRED IN HOLDING THAT TELECOMMUNICATION CHARGES SHOULD BE EXCLUDED FROM THE TOTAL TURNOVER FOR THE PURPOSE OF COMPUTING DEDUCTION U/S 10A. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT (A) ERRED IN DELETING THE DISALLOWANCE MADE U/S 14A BY HOLDING THAT ASSESSEE DID NOT EARN ANY EXEMPT INCOME. DATE OF HEARING : 14.12.2016 DATE OF PRONOUNCEMENT : 30.12.2016 ITA NO 1199 OF 2016 OCIMUM BIO SOLUTIONS INDIA LT D HYDERABAD PAGE 2 OF 3 3. THE APPELLANT PRAYS THAT THE ORDER OF THE CIT (A) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT OF THE AO BE RESTORED . 2. AS REGARDS GROUND NO.1, WE FIND THAT THIS ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION O F THE HON'BLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. TATA EL XSI LTD & ANR. REPORTED IN 349 ITR 98 (KAR) AND THE CIT (A) HAS FO LLOWED THE SAME FOR GIVING RELIEF TO THE ASSESSEE. IN VIEW OF THE SAME, WE SEE NO REASON TO INTERFERE WITH THE SAME. GROUND OF APP EAL NO.1 IS ACCORDINGLY REJECTED. 3. AS REGARDS GROUND NO.2 WE FIND THAT THE AO HAS M ADE THE DISALLOWANCE U/S 14A OF THE ACT STATING THAT TH E ASSESSEE HAS MADE INVESTMENT BY ACQUIRING SHARES AND HAS ALSO BO RROWED FUNDS FROM DIFFERENT BANKS ON WHICH THE ASSESSEE HA S PAID INTEREST AND CLAIMED THE SAME AS A DEDUCTION. THE LEARNED CIT (A) HAS BROUGHT OUT IN HIS ORDER THAT THERE IS NO I NCOME DERIVED BY THE ASSESSEE WHICH IS NOT PART OF THE TOTAL INCOME DURING THE RELEVANT A.Y. THE CIT (A) HAS ALSO RELIED UPON THE D ECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF PR ATHISTA INDUSTRIES LTD TO HOLD THAT WHERE THERE IS NO EXEMP T INCOME DURING THE RELEVANT A.Y, THE PROVISIONS OF SECTION 1 4A WILL NOT APPLY. THE TRIBUNAL IN THE CASE OF PRATHISTA INDUST RIES LTD HAD FOLLOWED THE HON'BLE DELHI HIGH COURT JUDGMENT IN T HE CASE OF CHEMINVEST LTD REPORTED IN (2015) 378 ITR 33 (DEL.) . THEREFORE, WE SEE NO REASON TO INTERFERE WITH THE ORDER OF THE CIT (A) ON THIS ISSUE AS WELL AND GROUND NO.2 IS ALSO REJECTED. ITA NO 1199 OF 2016 OCIMUM BIO SOLUTIONS INDIA LT D HYDERABAD PAGE 3 OF 3 4. IN THE RESULT, REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH DECEMBER, 2016. SD/- SD/- (B. RAMAKOTAIAH) ACCOUNTANT MEMBER (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED 30 TH DECEMBER, 2016. VINODAN/SPS COPY TO: 1 DY. CIT, CIRCLE 16(2), 2 ND FLOOR, B BLOCK, I.T. TOWERS, AC GUARDS, MASAB TANK. HYDERABAD 2 M/S. OCIMUM BIO SOLUTIONS (INDIA) LTD, ROYAL DEME UR, PLOT NO.12/2, SECTOR-1, HUDA TECHNO ENCLAVE HYDERABAD 3 CIT (A)-4 HYDERABAD 4 PR. CIT 4 HYDERABAD 5 THE DR, ITAT HYDERABAD 6 GUARD FILE BY ORDER