Chowgule and Company (Salt) Pvt. Ltd, Vasco V. Assistant Commissioner of Income Tax, Circle - 2(1), Panaji

ITA 22/PAN/2024

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 1441 (ITAT-PANAJI)
• Duration Of Justice: 4 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2024
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: WT(D)
• Next Hearing Date: 19-06-2024
• Assessment Year: 2017-2018
• Appeal Filed On: 04-02-2024
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Earning of tax free income

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH : PANAJI [THROUGH VIRTUAL HEARING AT ITAT : PUNE] BEFORE SHRI RAMA KANTA PANDA, VICE PRESIDENT AND SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER ITA.No.22/PAN/2024 Assessment Year - 2017-2018 Chowgule and Company (Salt) Pvt. Ltd., Chowgule House, Mormugao Harbour, Vasco da Gama, GOA – 403 803 PAN AABCC5595J vs. The ACIT, Circle-2(1), Aaykar Bhawan, Plot No.5, EDC Complex, Patto Plaza, Panaji, Goa – 403 001. (Appellant) (Respondent) For Assessee : Smt. Hiral Sejpal For Revenue : Shri N. Shrikanth Date of Hearing : 20.06.2024 Date of Pronouncement : 26.06.2024 ORDER PER SATBEER SINGH GODARA, J.M. : This assessee’s appeal for assessment year 2017-18, arises against the National Faceless Faceless Appeal Centre [in short the “NFAC”) Delhi’s Din and Order No.ITBA/ NFAC/S/250/2023-24/1058645279(1), dated 11.12.2023, in proceedings u/s.143(3) of the Income Tax Act, 1961 (in short ‘the Act”). Heard both the parties at length. Case file perused. 2 ITA No.22/PAN/2024 2. The assessee’s twin substantive grounds pleaded herein seeks to reverse both the learned lower authorities action inter alia making sec.14A disallowance of Rs.61,73,390/- in the course of assessment dated 26.12.2019 as upheld in the CIT(A)-NFAC's lower appellate discussion to the extent of the dividend income of Rs.35,66,350/- only followed by the consequential computation of sec.234B interest; respectively. 3. It emerges with the able assistance coming from both the sides that the Assessing Officer herein had computed the impugned disallowance @ 1% of the annual average of the opening and closing balance(s) of the corresponding investments coming to Rs.61,73,390/-. A perusal of the case file reveals that this is a recurring issue between the parties wherein the earlier learned coordinate bench’s order in it’s appeal ITA.No.390/PAN./2017 dated 29.04.2022 at pages 24 to 45; and more particularly; in para-11.4 had upheld the departmental stand to the extent of the investments actually yielding the exempt income in the relevant previous year. This clinching fact has gone un-rebutted from the Revenue side. Learned counsel next submits that the factual position is hardly any different in the impugned assessment year once the corresponding average value of the corresponding investments yielding exempt income in the relevant previous year comes to Rs.6,94,020/- only @ 1% of Rs.6,94,01,990/-. Learned DR 3 ITA No.22/PAN/2024 further fails to rebut that the assessee had indeed filed it’s relevant computation in para-1.25.3 page-33 of the lower appellate discussion which has been simply brushed aside since the CIT(A)-NFAC has restricted the impugned disallowance of Rs.61,73,390/- to the extent of exempt income only. Faced with this situation, we adopt judicial consistency and hold that the impugned disallowances herein deserves to be upheld only to the extent of Rs.6,94,020/- than the exempt income sum of Rs.35,66,350/- (supra) in very terms. Necessary computation and factual verification shall follow as per law at the assessing authorities end. The assessee succeeds in it’s instant first and foremost substantive grounds therefore. Ordered accordingly. 4. Coming to the latter issue of sec.234B interest computation, both the learned representatives submitted very fairly that the same is consequential in nature once lower authorities had calculated as per the foregoing sec.14A read with Rule 8D disallowance figures. We thus treat this latter issue as consequential in nature in very terms. Ordered accordingly. 5. This assessee’s appeal is partly allowed in above terms. 4 ITA No.22/PAN/2024 Order pronounced in the open Court on 26.06.2024 Sd/- Sd/- [RAMA KANTA PANDA] [SATBEER SINGH GODARA] ACCOUNTANT MEMBER JUDICIAL MEMBER Pune, Dated 26 th June, 2024 VBP/- Copy to 1. The applicant 2. The respondent 3. The Pr. CIT, Panaji concerned 4. D.R. ITAT, Panaji-Bench, Panaji. 5. Guard File. //By Order// //True Copy // Sr. Private Secretary, ITAT, Pune Benches, Pune.