ACIT, C-2(1), Chandigarh V. M/s Punjab State Industrial Development Corporatin Ltd., Chandigarh

ITA 1211/CHANDI/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5229 (ITAT-CHANDIGARH)
• Duration Of Justice: 6 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-02-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 08-08-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHISH ABROL
• Keywords: Earning of tax free income
• Section: 14A

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES B, CHANDIGARH BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER & MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NOS.1211 & 1212/CHD/2017 ASSESSMENT YEARS: 2013-14 & 2012-13 THE ACIT, CIRCLE 2(1), VS. M/S PUNJAB STATE INDUST RIAL CHANDIGARH DEVELOPMENT CORPORATION LTD., PLOT NO. 18, UDYOG BHAWAN, SECTOR 17, CHANDIGARH PAN NO. AABCP1599F (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ASHISH ABROL, CIT DR RESPONDENT BY : SH. ATUL GOYAL, CA DATE OF HEARING : 07.12.2017 DATE OF PRONOUNCEMENT : 23.02.2018 ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE REVENU E AGAINST THE ORDER DATED 17.05.2017 OF THE COMMISSIONER OF I NCOME TAX (APPEALS), [HEREINAFTER REFERRED TO AS CIT(A)]-1, G URGAON. 2. THE SOLE ISSUE RAISED BY THE REVENUE IN BOTH THE APPEALS IS RELATING TO THE ACTION OF THE CIT(A) IN RESTRICTING THE DISALLOWANCE 2 MADE BY THE ASSESSING OFFICER U/S 14A OF THE INCOME -TAX ACT, 1961 (IN SHORT 'THE ACT') READ WITH RULE 8D(2)(II) OF TH E I.T. ACT ON ACCOUNT OF INTEREST EXPENDITURE INCURRED IN RELATIO N TO THE TAX EXEMPT INCOME EARNED BY THE ASSESSEE TO THE EXTENT OF EXEM PT INCOME EARNED BY THE ASSESSEE. 3. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE ISSUE IS SQUARELY COVERED BY THE DECISIONS OF V ARIOUS HIGH COURTS INCLUDING THAT OF THE JURISDICTIONAL HIGH COURT OF PUNJAB AND HARYANA IN THE CASE OF CIT VS. WINSOME TEXTILES (2009) 319 ITR 204 (P&H) AND HON'BLE DELHI HIGH COURT IN THE CASE OF CHEMINVEST LTD VS. ITO (2015) 378 ITR 33 (DELHI) AND OF THE HON'BLE GUJA RAT HIGH COURT IN THE CASE OF CORRTECH ENERGY P. LTD. (2014) 45 TAXM AN.COM 116 AND FURTHER OF THE HON'BLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. M/S SHIVAM MOTORS (P) LTD (2014) 272 CTR (ALL) 277 AN D VARIOUS OTHER CASE LAWS. IN ALL THE ABOVE REFERRED TO CASE LAWS, THE HON'BLE HIGH COURTS HAVE BEEN UNANIMOUS TO HOLD THAT NO DISALLOW ANCE IS ATTRACTED U/S 14A IN CASE THE ASSESSEE HAS NOT EARNED ANY INCOME NOT FORMING PART OF THE TOTAL INCOME. 4. THE LD. CIT(A) IN THE LIGHT OF THE ABOVE DECISIO NS HAS RESTRICTED THE DISALLOWANCE U/S 14A READ WITH RULE 8D(2)(II) T O THE EXTENT OF EXEMPT INCOME EARNED BY THE ASSESSEE. THE ASSESSEE HAS NOT PREFERRED ANY APPEAL AGAINST CONFIRMATION OF DISALLOWANCE BY THE CIT(A) U/S 14A READ WITH RULE 8D(2)(III) OF THE ACT. 3 5. IN VIEW OF THE ABOVE, WE DO NOT FIND ANY MERIT I N THE APPEALS OF THE REVENUE AND THE SAME ARE ACCORDINGLY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 23.02.2018. SD/- SD/- (ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 23..02.2018 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR