V.V.V.R. SATHIYAM, VIRUDHUNAGAR V. DCIT, CENTRAL CIRCLE-1, MADURAI

ITA 261/CHNY/2020

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 8092 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-02-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: C
• Assessment Year: 2010-2011
• Appeal Filed On: 30-01-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SASHANK SRIVATSAN. S LD
• Keywords: Earning of tax free income; Rule 8D
• Section: 143(3); 14A

Judgement Text

आयकर अपीलीय अिधकरण ’सी’ ायपीठ चे ई म । IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, CHENNAI माननीय ,ी महावीर िसंह, उपा12 एवं माननीय ,ी मनोज कु मार अ7वाल ,लेखा सद: के सम2। BEFORE HON’BLE SHRI MAHAVIR SINGH, VICE PRESIDENT AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकर अपील सं./ ITA No.261/Chny/2020 (िनधाCरण वषC / Assessment Year: 2010-11) Sh. V.V.V.R. Sathiyam 443, Main Bazaar, Virudhu Nagar – 626 001. बनाम / V s . DCIT Central Circle -1, Madurai – 625 002. थायी लेखा सं. /जीआइ आर सं. /P AN/ G I R N o . AHN P S - 9 2 8 4 - N (अपीलाथ /Appellant) : ( थ / Respondent) अपीलाथ की ओरसे/ Appellant by : Shri Sashank Srivatsan. S (FCA) – Ld. AR थ की ओरसे/Respondent by : Shri P. Sajit Kumar (JCIT) –Ld. DR सुनवाई की तारीख/ D a t e of He a r i n g : 24-02-2022 घोषणा की तारीख / Date of Pronouncement : 24-02-2022 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2010-11 arises out of the order of learned Commissioner of Income Tax (Appeals)-19, Chennai [CIT(A)] dated 13-08-2019 in the matter of ITA No.261/Chny/2020 - 2 - assessment framed by Ld. Assessing Officer [AO] u/s 143(3) r.w.s. 254 of the Act on 31-12-2018. 2. The Ld. AR submitted that the only issue is disallowance u/s 14A which may be restricted to the extent of exempt income earned by the assessee. The Ld. DR supported the orders of lower authorities. 3. The material facts are that the assessee was assessed u/s 143(3) which was subjected to revision u/s 263. In an order u/s 143(3) r.w.s. 263, the assessee was saddled with disallowance u/s 14A for Rs.12.98 Lacs. Upon further appeal, Ld. CIT(A) restricted the disallowance to Rs.0.73 Lacs, being exempt income earned by the assessee. Upon further appeal, Tribunal directed Ld. AO to render findings as to whether the assessee had actually incurred any expenditure during the year. Pursuant to the same, Ld. AO passed an order on 31-12-2018 wherein the disallowance has again been computed at Rs.12.99 Lacs as per Rule 8D. The same is interest disallowance u/r 8D(2)(ii) for Rs.1.58 Lacs and indirect expense disallowance u/r 8D(2)(iii) for Rs. 11.41 Lacs. The stand of Ld. AO, upon confirmation by Ld. CIT(A), is in further appeal before us. 4. It is undisputed fact that the assessee has earned exempt income of Rs.73,062/- only against which it has been saddled with unjustified disallowance of Rs.12.99 Lacs. It is settled law that the amount of disallowance would not exceed the exempt income earned by the assessee. Concurring with the submissions of Ld. AR, we direct Ld. AO to restrict the disallowance to Rs.73,062/-. The balance disallowance stand deleted. ITA No.261/Chny/2020 - 3 - 5. The appeal stand partly allowed. Order pronounced on 24 th February, 2022. Sd/- (MAHAVIR SINGH) उपा12 /VICE PRESIDENT Sd/- (MANOJ KUMAR AGGARWAL) लेखा सद: / ACCOUNTANT MEMBER चे)ई / Chennai; िदनांक / Dated : 24-02-2022 JPV JPVJPV JPV आदेश की Wितिलिप अ 7ेिषत/Copy of the Order forwarded to : 1. अपीलाथ /Appellant 2. यथ /Respondent 3. आयकर आयु (अपील)/CIT(A) 4. आयकर आयु /CIT 5. िवभागीय ितिनिध/DR 6. गाड फाईल/GF