Lakshmi Cargo Company Ltd, Chennai V. ACIT, Corporate Circle -4(1), Chennai

ITA 2241/CHNY/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 7977 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 9 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-07-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 19-03-2018
• Assessment Year: 2013-2014
• Appeal Filed On: 14-09-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S SRIDHAR
• Keywords: Condonation of delay; Rule 8D

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , A BENCH, CHENNAI . , , BEFORE SHRI DUVVURU RL REDDY, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ I.T.A.NO.2241/CHNY/2017 ( [ [ / ASSESSMENT YEAR: 2013-14) M/S. LAKSHMI CARGO COMPANY LTD., NO.19, UNIT-5, 3 RD FLOOR, RAJA ANNAMALAI BUILDING, RUKMANI LAKSHMIPATHY ROAD, EGMORE, CHENNAI 600 008. VS THE ACIT, CORPORATE CIRCLE 4(1), CHENNAI PAN: AAACL3756D ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE / RESPONDENT BY : SHRI AR.V. SREENIVASAN, JCIT /DATE OF HEARING : 02.07.2019 /DATE OF PRONOUNCEMENT : 10.07.2019 / O R D E R PER S. JAYARAMAN, ACCOUNTANT MEMBER: THE ASSESSEE FILED THIS APPEAL AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-8, CHENNAI IN ITA NO.41/16- 17 DATED 27.06.2017 FOR THE ASSESSMENT YEAR 2013-14. 2. THE ASSESSEE FILED AN AFFIDAVIT SEEKING CONDONATION OF DELAY OF 9 DAYS. IT IS SUBMITTED THAT THE APPEAL PAPERS WAS MISPLACED BY THE ASSESSEES STAFF AND IT WAS FOUND WITH A DELAY OF 9 DAYS. THEREFORE, IT 2 ITA NO.2241/CHNY/2017 WAS PRAYED THAT THE DELAY IS NOT WANTON AND HENCE IT MAY BE CONDONED. WE HEARD THE RIVAL SUBMISSIONS AND CONDONED THE DELAY IN FILING THE APPEAL. 3. M/S. LAKSHMI CARGO COMPANY LTD., THE ASSESSEE, IS ENGAGED IN CUSTOMS HOUSE AGENCY, FREIGHT FORWARDING, TRANSPORTATION, ETC. WHILE MAKING ASSESSMENT FOR THE ASSESSMENT YEAR 2013-14, THE ASSESSING OFFICER FOUND THAT THE ASSESSEE DISALLOWED RS.3,38,950/- U/S.14A R.W.R. 8D OF THE RULES AS AGAINST THE DIVIDEND INCOME RECEIVED AT RS.4,11,86,725/-. THE ASSESSEE HAS ALSO CLAIMED RS.40,89,137/- TOWARDS INTEREST. THEREFORE ON DUE EXAMINATION, THE LD.AO DISALLOWED RS.10,52,954/- UNDER RULE 8D(II) AND RS.10,74,915/- UNDER RULE 8D(III). AGGRIEVED AGAINST THAT ORDER, THE ASSESSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A) DISMISSED THE APPEAL. AGGRIEVED AGAINST THAT ORDER, THE ASSESSEE FILED THIS APPEAL. 4. THE LD.AR PLEADED THAT THE ASSESSEE HAD RESERVES & SURPLUS WITH IT AT RS.74.80 CRORES AND THE INVESTMENT MADE DURING THE YEAR WITH M/S. LAKSHMI MACHINE WORKS LTD., IS JUST RS.20.58 CRORES ONLY. INVITING OUR ATTENTION TO THE PAPERBOOK, THE LD.AR SUBMITTED THAT THE ASSESSEE TOOK TERM LOAN FOR SPECIFIC PURPOSE AND THE TERM LOAN IS 3 ITA NO.2241/CHNY/2017 UTILIZED FOR SUCH PURPOSE ONLY. THEREFORE, THE ASSESSEE HAS NOT INCURRED ANY EXPENDITURE ON THE IMPUGNED INVESTMENT. INVITING OUR ATTENTION TO THE DECISION OF THE HONBLE JURISDICTIONAL MADRAS HIGH COURT IN THE CASE ROCA BATHROOM PRODUCTS PVT. LTD., VS. PRINCIPAL COMMISSIONER OF INCOME TAX-1, DATED 04.12.2018 IN TAX CASE (APPEAL) NO.775 OF 2018, THE LD.AR PLEADED THAT WHEN THE ASSESSEE HAS INCURRED INTEREST FOR THE SPECIFIC PURPOSE AND NOT FOR THE IMPUGNED INVESTMENT, THE DISALLOWANCE MADE BY THE LD.AO U/S.14A R.W.R.8D REQUIRES TO BE DELETED. HE FURTHER SUBMITTED THAT THE ASSESSEE HAS NOT ACCEPTED THE DISALLOWANCE U/S.14A AS HELD BY THE LD.AO IN THE ASSESSMENT ORDER. FURTHER HE PLEADED EVEN IF THERE WAS AN ACQUIESCENCE AGAINST LAW, IT CANNOT BIND THE ASSESSEE. PER CONTRA, THE LD.DR SUBMITTED THAT THE FACTS CANVASSED BY THE LD.AR WAS NOT TO PUT BEFORE THE LOWER AUTHORITIES. THEREFORE, HE OPPOSED THE ASSESSEES PLEA. 5. WE HEARD THE RIVAL SUBMISSIONS AND GONE THROUGH THE RELEVANT MATERIAL. THE FACTS SUBMITTED BY THE LD.AR ARE NOT CONSIDERED BY THE LOWER AUTHORITIES. THEREFORE, WE DEEM IT FIT TO REMIT THE ISSUES BACK TO THE FILE OF THE LD.AO FOR A FRESH EXAMINATION. THE ASSESSEE SHALL LAY ALL THE MATERIAL IN SUPPORT OF ITS CONTENTION BEFORE THE ASSESSING OFFICER 4 ITA NO.2241/CHNY/2017 AND SHALL COMPLY WITH THE REQUIREMENTS OF THE ASSESSING OFFICER IN ACCORDANCE WITH LAW. THE ASSESSING OFFICER IS FREE TO CONDUCT APPROPRIATE ENQUIRY AS DEEMED FIT. HOWEVER, HE SHALL FURNISH AN OPPORTUNITY TO THE ASSESSEE AGAINST THE MATERIAL, IF ANY, TO BE USED AGAINST IT AND THEN DECIDE THE ISSUES IN ACCORDANCE WITH LAW. 6. IN THE RESULT, THE ASSESSEES APPEAL IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED ON THE 10 TH JULY, 2019 AT CHENNAI. SD/- SD/- /CHENNAI, /DATED 10 TH JULY, 2019 RSR /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. ( ) /CIT(A) 4. /CIT 5. /DR 6. [ /GF ( ) (DUVVURU R.L REDDY) /JUDICIAL MEMBER ( ) (S. JAYARAMAN) /ACCOUNTANT MEMBER