Vikon Engineers Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 21/DEL/2017

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 2668 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-03-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2010-2011
• Appeal Filed On: 02-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRAKASH DUBEY
• Assessee Lawyers: SAURABH ROHTAGI
• Keywords: Rule 8D; Set aside
• Section: 143(3); 14A; 154

Judgement Text

I.T.A.NO.21/DEL/2017 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G NEW DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI B.R.R. KUMAR, ACCOUNTANT MEMBER . . /. I.T.A NO.21/DEL/2017 / ASSESSMENT YEAR: 2010-11 VIKON ENGINEERS PVT. LTD. 31, FF, SUNDER NAGAR, NEW DELHI. VS. DCIT CENTRAL CIRCLE-V NEW DELHI. PAN NO. AABCV7701K APPELLANT / RESPONDENT /ASSESSEE BY SH. SAURABH ROHTAGI, ADV. /REVENUE BY SH. PRAKASH DUBEY, SR. DR / DATE OF HEARING: 10 .03.2021 /PRONOUNCEMENT ON 10 .03.2021 /O R D E R PER BHAVNESH SAINI, J.M. THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF LD. CIT(A)-24, NEW DELHI DATED 27.10.2016 FOR AY 2010-1 1, CHALLENGING THE ENHANCEMENT U/S 14A OF THE I.T. ACT IN PROCEEDINGS U/S 154 OF THE ACT BY AO AS WELL AS FURTHER BY THE LD. CIT(A). 2. WE HAVE HEARD THE LD. REPRESENTATIVES OF BOTH TH E PARTIES. 3. IN THIS CASE, AO PASSED THE ASSESSMENT ORDER U/S 143(3) OF THE I.T. ACT DATED 31.03.2013 FOR ASSESSMENT YEAR UNDER APPE AL AND MADE A I.T.A.NO.21/DEL/2017 2 DISALLOWANCE OF RS. 6,64,271/- U/S 14A OF THE I.T. ACT READ WITH RULE 8D OF THE I.T. RULES. THE AO LATER ON PASSED THE ORDE R U/S 154/143(3) OF THE I.T. ACT DATED 5.05.2014, WHEREBY CAME TO THE FINDI NG THAT DISALLOWANCE U/S 14A SHALL COME TO RS. 20,45,835/- INSTEAD OF RS . 6,64,271/-. THE MISTAKE IN THE ASSESSMENT ORDER WAS RECTIFIED AND D ISALLOWANCE WAS ENHANCED U/S 14A OF THE I.T. ACT. THE LD. CIT(A) N OT ONLY CONFIRM THE ORDER OF THE AO IN ENHANCING THE ADDITION U/S 14A O F THE I.T. ACT IN RECTIFICATION PROCEEDINGS U/S 154 OF THE I.T. ACT, BUT ALSO FURTHER ENHANCED THE DISALLOWANCE U/S 14A OF THE I.T. ACT I N A SUM OF RS. 8,37,413/- AND APPEAL OF ASSESSEE WAS DISMISSED WIT H THE ABOVE ENHANCEMENT. 4. LD. COUNSEL FOR ASSESSEE SUBMITTED THAT THE ASSE SSEE PREFERRED APPEAL BEFORE ITAT AGAINST THE ORIGINAL ORDER IN IT A NO. 3345/DEL/2015 FOR ASSESSMENT YEAR UNDER APPEAL I.E. 2010-11, CHAL LENGING THE DISALLOWANCE U/S 14A OF THE I.T. ACT OF RS. 6,64,27 1/-. THE APPEAL OF ASSESSEE HAS BEEN DECIDED BY THE TRIBUNAL VIDE ORDE R DATED 31.12.2019 AND ADDITION HAS BEEN DELETED BECAUSE NO EXEMPT INC OME WAS CLAIMED BY ASSESSEE IN ASSESSMENT YEAR UNDER APPEAL. THIS GROUND OF APPEAL OF ASSESSEE WAS ALLOWED. ORDER OF THE TRIBUNAL IS PLA CED ON RECORD. 5. IN VIEW OF THE ABOVE FACTS, IT IS CLEAR THAT WHE N SUBSTANTIVE ADDITION MADE BY THE AO IN THE ORIGINAL ASSESSMENT ORDER U/S 14A OF THE I.T. ACT HAS BEEN DELETED BY THE TRIBUNAL, THERE IS NO REASON FOR THE AO OR THE LD. CIT(A) TO ENHANCE THE SAME DISALLOWANCE U/S 14A OF THE I.T. ACT IN THE RECTIFICATION PROCEEDINGS U/S 154 OF THE I.T. ACT. THE ORDER OF THE AUTHORITIES BELOW ON THE FACE OF THE ORDER OF T HE TRIBUNAL DATED 31.12.2019 (SUPRA) CLEARLY NULLIFY THE IMPUGNED ORD ERS. 6. IN VIEW OF THE ABOVE, WE SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND CANCEL THE ENHANCEMENT MADE BY THE AO AND THE LD. CIT(A) U/S 14A OF THE I.T. ACT. I.T.A.NO.21/DEL/2017 3 7. IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 10/03/2021 SD/- SD/- (B.R.R. KUMAR) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 10.03.2021 * KAVITA ARORA, SR. P.S. COPY OF ORDER SENT TO- ASSESSEE/AO/PR. CIT/ CIT (A) / ITAT (DR)/GUARD FILE OF ITAT. BY ORDER ASSISTANT REGISTRAR, ITAT: DELHI BENCHES-DELHI I.T.A.NO.21/DEL/2017 4