Pranava Electronics Private Limited, Bangalore V. DCIT, Bangalore

ITA 1312/BANG/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 9469 (ITAT-BANGALORE)
• Duration Of Justice: 2 year(s) 11 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 25-07-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 05-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A R V SREENIVASAN JT
• Assessee Lawyers: K R PRADEEP
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : BANGALORE BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.1312/BANG/2013 ASSESSMENT YEAR : 2009-10 PRANAVA ELECTRONICS PVT. LTD., NO.20, EDEN PARK, FLAT NO.101, 1 ST FLOOR, VITTAL MALLYA ROAD, BANGALORE 560 001. PAN: AADCP 2196C VS. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 12(2), BANGALORE. APPELLANT RESPONDENT APPELLANT BY : SHRI K.R. PRADEEP, CA RESPONDENT BY : SHRI A.R.V. SREENIVASAN, JT. CIT(DR) DATE OF HEARING : 04.08.2016 DATE OF PRONOUNCEMENT : 12.08.2016 O R D E R PER SUNIL KUMAR YADAV, JUDICIAL MEMBER THIS IS AN APPEAL PREFERRED BY THE ASSESSEE AGAIN ST THE ORDER OF THE CIT(APPEALS)-III, BANGALORE DATED 16.07.2013 ON THE SOLITARY GROUND THAT THE CIT(APPEALS) HAS ERRED IN UPHOLDING THE DISALLO WANCE OF RS.32,31,799 U/S. 14A OF THE INCOME-TAX ACT, 1961 [THE ACT], W ITHOUT ESTABLISHING NEXUS BETWEEN THE FUNDS AND INVESTMENTS. 2. DURING THE COURSE OF HEARING, THE LD. COUNSEL F OR THE ASSESSEE HAS CANDIDLY ADMITTED THAT MIXED FUNDS WERE INVESTED IN SHARES AND MUTUAL ITA NO.1312/BANG/2013 PAGE 2 OF 3 FUNDS. WHILE MAKING THE DISALLOWANCE, THE ASSESSIN G OFFICER HAS NOT MADE COMPUTATION AS PER RULE 8D OF THE I.T. RULES. THER EFORE, THE MATTER MAY BE RESTORED BACK TO THE AO FOR COMPUTATION OF DISAL LOWANCE AS PER RULE 8D OF THE I.T. RULES. 3. THE LD. DR DID NOT OBJECT TO THIS CONTENTION OF THE ASSESSEE. 4. HAVING HEARD THE RIVAL SUBMISSIONS, WE ARE OF TH E VIEW THAT THERE IS NO DISPUTE WITH RESPECT TO DISALLOWANCE U/S. 14A OF THE ACT, BUT THE SOLE CONTROVERSY REVOLVES AROUND THE APPLICATION OF THE PROVISIONS OF RULE 8D OF THE I.T. RULES. WE, THEREFORE, SET ASIDE THE ORDER OF THE CIT(APPEALS) AND RESTORE THE MATTER TO THE ASSESSING OFFICER, WITH A DIRECTION TO RECOMPUTE THE DISALLOWANCE U/S. 14A OF THE ACT AS PER THE PRO VISIONS OF RULE 8D OF THE I.T. RULES. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THIS 12 TH DAY OF AUGUST, 2016. SD/- SD/- ( A.K. GARODIA ) (SUNIL KUMAR YA DAV ) ACCOUNTANT MEMBER JUDIC IAL MEMBER BANGALORE, DATED, THE 12 TH AUGUST, 2016. /D S/ ITA NO.1312/BANG/2013 PAGE 3 OF 3 COPY TO: 1. APPELLANT 2. RESPONDENTS 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR, ITAT, BANGALORE.