RELIANCE NATURAL RESOURCES LTD, NAVI MUMBAI V. DCIT 7(2), MUMBAI

ITA 1926/MUM/2017

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 6788 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-12-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Assessment Year: 2010-2011
• Appeal Filed On: 17-03-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Earning of tax free income
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D , BENCH MUMBAI BEFORE SHRI R.C.SHARMA, AM & SHRI SANDEEP GOSAIN , JM ITA NO. 1926 / MUM/20 1 7 ( ASSESSMENT YEAR : 2010 - 11 ) M/S. RELIANCE NATURAL RESOURCES LTD., H BLOCK 1 ST FLOOR DHIRUBHAI AMBANI KNOWELDGE CITY NAVI MUMBAI VS. DY. COMMISSIONER OF INCOME TAX - 7(2), MUMBAI NOW - DEPUTY COMMISSIONER OF INCOME TAX 8(1)(1) ROOM NO.624, 6 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD MUMBAI 400 020 PAN/GIR NO. AABCR7656P ( APPELLANT ) .. ( RESPONDENT ) ASSESSEE BY SHRI JITENDRA SANGHVI REVENUE BY SHRI MANOJKUMAR SINGH DATE OF HEARING 07 / 12 /201 8 DATE OF PRONOUNCEMENT 20 / 12 /201 8 / O R D E R PER R.C.SHARMA (A.M) : THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) - 14, MUMBAI DATED 19 /01/2017 FOR A.Y.2010 - 11 IN THE MATTER OF ORDER PASSED U/S.143(3) OF THE IT ACT, 1961. 2. THE ONLY GRIEVANCE OF ASSESSEE RELATES TO ADDITION OF DISALLOWANCE MADE U/S.14A WHILE COMPUTING BOOK PROFIT U/S.115JB OF THE ACT. 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. ITA NO. 1926/MUM/2017 M/S. RELIANCE NATURAL RESOURCES LTD., 2 4. FACTS IN BRIEF ARE THAT THE ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF PROVIDING FUEL AND FACILITATION SERVICES OF FUEL IN VARIOUS FORMS TO POWER PLANTS. THE COMPANY ALSO PROVIDES COAL FREIGHT LIASIONING SERVICES AND RAW COAL WA SHING SERVICES. IN THE COURSE OF SCRUTINY ASSESSMEN T, AO ADDED THE DISALLOWANCE MADE U/S.14A WHILE COMPUTING BOOK PROFIT U/S.115JB. 5. BY THE IMPUGNED ORDER, CIT(A) CONFIRMED THE ACTION OF AO AGAINST WHICH ASSESSEE IS IN FURTHER APPEAL BEFORE US. 6. AT T HE OUTSET, LEARNED AR PLACED ON RECORD THE ORDER OF ITAT SPECIAL BENCH IN CASE OF VIREET INVESTMENT PVT. LTD., 82 TAXMANN.COM 415 WHEREIN AT PARA 6 TO 6.22, HONBLE TRIBUNAL OBSERVED AS UNDER: - SECTION 115JB. READ WITH SECTION 14A. OF THE INCOME - TAX ACT, 1961 AND RULE 8D OF THE INCOME - TAX RULES, 1962 MINIMUM ALTERNATE TAX (SECTION 14A APPLICATION) - ASSESSMENT YEAR 2008 - 09 COMPUTATION UNDER CLAUSE (F) OF EXPLANATION 1 TO SECTION 115JB(2) IS TO BE MADE WITHOUT RESORTING TO / COMPUTATION AS CONTEMPLATED UN DER SECTION 14A READ WITH RULE 8 D - HELD, YES (PARA 22). 7. LEARNED AR ALSO PLACED ON RECORD THE ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR THE IMMEDIATELY PRECEDING A.Y.2009 - 10 WHEREIN THE TRIBUNAL UPHELD ADDITION OF 10% OF DIVIDEND INCOME WHILE C OMPUTING BOOK PROFIT U/S.115JB. IN THE INSTANT CASE, WE FOUND THAT EXEMPT INCOME EARNED BY THE ASSESSEE WAS RS.23,38,94,020/ - , 10% THEREOF WORKS OUT TO BE RS.2,33,89,402/ - . RES P ECTFULLY FOLLOWING THE ORDER OF THE SPECIAL BENCH AS WELL AS THE ORDER OF THE T RIBUNAL IN ASSESSEES OWN CASE, WE DIRECT THE ITA NO. 1926/MUM/2017 M/S. RELIANCE NATURAL RESOURCES LTD., 3 AO TO ADD RS.2,33,89,402/ - WHILE COMPUTING BOOK PROFIT U/S.115JB OF THE IT ACT. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED IN PART. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 20 / 12 /201 8 SD/ - ( SANDEEP GOSAIN ) SD/ - (R.C.SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED 20 / 12 /201 8 KARUNA SR. PS COPY OF THE ORDER FORWARDED TO : BY ORDER, ( ASSTT. REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RES PONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//