JIGAR COMMODITIES & DERIVATIVES P. LTD, MUMBAI V. DCIT CEN CIR-38, MUMBAI

ITA 2430/MUM/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 8476 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-02-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: J
• Next Hearing Date: 17-02-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 16-04-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRS MALATHI SRIDHARAN
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, J, MUMBAI BEFORE SHRI R V EASWAR, PRESIDENT AND SHRI B RAMAKOTAIAH, ACCOUNTANT MEMBER I T A NO: 2430/MUM/2009 (ASSESSMENT YEAR: 2006-07) M/S JIGAR COMMODITIES & DERIVATIVES APPELLANT PRIVATE LIMITED, MUMBAI (PAN: AAACJ1728P) VS DEPUTY COMMISSIONER OF INCOME TAX RESPONDENT CENTRAL CIRCLE 38, MUMBAI APPELLANT BY: MR VIJAY MEHTA RESPONDENT BY: MRS MALATHI SRIDHARAN O R D E R R V EASWAR, PRESIDENT: THIS APPEAL BY THE ASSESSEE RELATES TO THE ASSESSM ENT YEAR 2006-07 AND THOUGH FIVE GROUNDS HAVE BEEN TAKEN, TH EY ARE IN RESPECT OF A SINGLE ISSUE, NAMELY, WHETHER THE INCO ME TAX AUTHORITIES WERE RIGHT IN DISALLOWING ` 4,49,096/- UNDER SECTION 14A READ WITH RULE 8D OF THE INCOME TAX RULES. THE DIS ALLOWANCE HAS BEEN MADE FOR THE REASON THAT THE ASSESSEE WAS IN R ECEIPT OF DIVIDEND INCOME OF ` 11,90,096/-. 2. WE HAVE CONSIDERED THE GROUNDS IN THE LIGHT OF T HE ARGUMENTS ADVANCED BEFORE US. IN THE RECENT JUDGME NT OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF GODREJ AND BOYCE MFG. CO. LTD. VS. DCIT (2010) 328 ITR 81 (BOM), IT HAS B EEN HELD THAT RULE 8D IS APPLICABLE ONLY FROM THE ASSESSMENT YEAR 2008-09. THE PRESENT APPEAL RELATES TO THE ASSESSMENT YEAR 2006- 07 AND THEREFORE THE RULE CANNOT APPLY. IN RESPECT OF SEC TION 14A, THE ITA NO: 2430/MUM/2009 2 HONBLE HIGH COURT HAS LAID DOWN GUIDELINES AS TO H OW THE SECTION SHOULD BE APPLIED. RESPECTFULLY FOLLOWING THE SAID JUDGMENT, WE SET ASIDE THE ORDERS OF THE DEPARTMENTAL AUTHORITIES AN D RESTORE THE ISSUE TO THE ASSESSING OFFICER WITH A DIRECTION TO HIM TO APPLY THE GUIDELINES LAID DOWN IN THE AFORESAID JUDGMENT AND TAKE A FRESH DECISION WITH REGARD TO SECTION 14A, WITHOUT APPLYI NG RULE 8D. THE ASSESSEE SHALL BE GIVEN ADEQUATE OPPORTUNITY OF BEI NG HEARD. WE HOLD ACCORDINGLY AND ALLOW THE ASSESSEES APPEAL FO R STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON 17 TH FEBRUARY 2011. SD/- SD/- (B RAMAKOTAIAH) (R V EASWAR) ACCOUNTANT MEMBER PRESIDENT MUMBAI, DATED 17 TH FEBRUARY 2011 SALDANHA COPY TO: 1. M/S JIGAR COMMODITIES & DERIVATIVES PVT. LTD. 301-308, BHAGWATI HOUSE, PLOT A/19 VEERA DESAI ROAD, ANDHERI (WEST), MUMBAI 400 058 2. DCIT, CENTRAL CIRCLE 38, MUMBAI 3. CIT-CENTRAL III, MUMBAI 4. CIT(A)-CENTRAL VI, MUMBAI 5. DR J BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI