M/s Aarti Steels Limited, Ludhiana V. Addl. CIT, R-5 , Ludhiana

ITA 1552/CHANDI/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 6067 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-01-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 09-11-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Earning of tax free income; Rule 8D; Set aside
• Section: 14A

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BE NCH A, CHANDIGARH , . '.., # $, %& BEFORE: SH.SANJAY GARG, JM & DR. B.R.R. KUMAR, AM ./ ITA NO. 1620/CHD/2017 ( ) / ASSESSMENT YEAR : 2010-11 THE ASSTT. CIT CIRCLE-4, LUDHIANA M/S AARTI STEELS LTD. G.T. ROAD, MILLER GANJ LUDHIANA ./ PAN NO: AABCA4455D / APPELLANT / RESPONDENT ./ ITA NO. 1552/CHD/2017 ( ) / ASSESSMENT YEAR : 2010-11 M/S AARTI STEELS LTD. G.T. ROAD, MILLER GANJ LUDHIANA THE ASSTT. CIT CIRCLE-4, LUDHIANA ./ PAN NO: AABCA4455D / APPELLANT / RESPONDENT / ASSESSEE BY : SHRI. SUBHASH AGARWAL / REVENUE BY : SMT. CHANDRAKANTA, SR. DR SHRI. ASHISH GUPTA, CIT(DR) ! ' # / DATE OF HEARING: 22/10/2018 $%&'() # / DATE OF PRONOUNCEMENT : 16/01/2019 %*/ ORDER PER DR. B.R.R. KUMAR, A.M: THE PRESENT APPEAL HAS BEEN FILED BY THE REVENUE AN D CROSS APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT(A) -2, LUDHIANA DT. 08/09/2017. REVENUE HAS RAISED ONLY ONE GROUNDS IN ITS APPEAL W HICH READS AS UNDER: WHETHER UPON FACTS AND CIRCUMSTANCES OF THE CASE, LD. CIT(A) IS JUSTIFIED IN DELETING THE DISALLOWED MADE U/S 14A OF THE INCOME TAX ACT, 1961 R.W. RULE 8D(II) ? ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1. THAT THE LD. CIT(A)-2 HAS ERRED IN CONFIRMING THE D ISALLOWANCE OF RS. 57,596/- U/S 14A / RULE 8D (RS. 38,224/- UNDER RULE 8D (2)(II) & RS. 7,933/- UNDER RULE 8D (2)(III) IGNORING THE FACTS THAT THE INVESTMENTS WERE MADE OUT OF OWN FUNDS AND NO DISALLOWANCE WAS CALLED FOR WITHOUT RECORDING AN Y SATISFACTION AS TO WHY DISALLOWANCE BE MADE. 2. THAT LD. CIT(A) WHILE UPHOLDING THE ABOVE DISALLOWA NCE HAS IGNORED THE SUBMISSIONS FILED THE APPELLANT. 3. THAT THE CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN MAKING EXCESS ALLOCATION OF EXPENSES OF RS. 1,31 ,98,384/- IN THE EXEMPTED UNIT IGNORING THE ALLOCATION MADE BY THE APPELLANT. 4. THAT IN ANY CASE THE ORDER OF THE CIT(A) DESERVES T O BE SET ASIDE. 2 ITA NO. 1620/CHD/2017 2. THE FACTS OF THE CASE IN BRIEF ARE THAT THE ASSE SSEE COMPANY WHICH IS ENGAGED IN THE BUSINESS OF MANUFACTURING OF IRON & STEEL PRODUCTS, FERRO ALLOYS & GENERATION AND DISTRIBUTION OF POWER HAS FILED ITS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION ON 29.09.2010 DECLARING THEREIN AN INCOME OF RS.36,13,207/- . 3. DURING THE YEAR THE ASSESSING OFFICER HAS DISALL OWED RS. 10.54 LACS UNDER SECTION 14A R.W.R 8D(1) CALCULATING THE EXPENDITUR E AGAINST THE DIVIDEND EARNED / EXEMPT INCOME OF RS. 57,595/-. 4. THE LD. CIT(A) RESTRICTED THE DISALLOWANCE TO RS . 57,595/- DILIGENTLY FOLLOWING THE ORDER OF THE TRIBUNAL IN THE ASSESSEE S OWN CASE FOR THE A.Y. 2009- 10. SINCE THE ORDER OF THE LD. CIT(A) IS BASED ON T HE EARLIER ORDER OF THE TRIBUNAL, WE HEREBY CONFIRMED THE ORDER OF THE LD. CIT(A). ITA NO. 1552/CHD/2017 5. IN THE APPEAL OF THE ASSESSEE THE GROUND NO. 3 H AS NOT BEEN PRESSED AND IN THE CASE OF GROUND NO. 2 SINCE THE MATTER STANDS ADJUDICATED IN THE GROUND TAKEN BY THE REVENUE RESTRICTING THE DISALLOWANCE T O THE EXTENT OF EXEMPT INCOME EARNED WHICH WAS BASED ON THE ORDER OF THIS TRIBUNAL FOR THE A.Y. 2009- 10, THE DECISION ON THIS GROUNDS STANDS MERGED WITH THE DECISION OF GROUNDS OF APPEAL OF THE REVENUE. 6. AS A RESULT APPEAL OF THE REVENUE AND CROSS APPE AL OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- / (SANJAY GARG ) . '.., # $ / ( DR. B.R.R. KUMAR) / JUDICIAL MEMBER %& / ACCOUNTANT MEMBER DATE: 16/01/2019 AG COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT, 2. THE RESPONDENT 3. CIT, 4. DR, ITAT, CHANDIGARH, 5. GUARD FILE