Amin Sons Marketing Pvt. Ltd., Baroda V. The Income Tax Officer, Ward-1(1), Baroda

ITA 2690/AHD/2014

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8412 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 6 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-04-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Assessment Year: 2005-2006
• Appeal Filed On: 07-10-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: VILAS SHINDE
• Keywords: Earning of tax free income
• Section: 143(3); 14A; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD SMC BENCH BEFORE: SHR I RAJPAL YADAV , JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER AMIN SONS MARKETING PVT. LTD., AMIN COMPOUND, OLD N.H. 8, CHHANI ROAD, VADODARA PAN: AADCA7105Q (APPELLANT) VS THE ITO, WARD - 1(1), VADODARA (RESPONDENT) REVENUE BY : S H RI VILAS SHINDE , SR. D . R. ASSESSEE BY: S H RI SURESH THAKKAR , A.R. DATE OF HEARING : 22 - 02 - 2 018 DATE OF PRONOUNCEMENT : 23 - 04 - 2 018 / ORDER P ER : AMARJIT SINGH, ACCOUNTANT MEMBER : - THIS ASSESSEE S APPEAL FOR A.Y. 2005 - 06, ARI SES FROM ORDER OF THE CIT(A) - I, BARODA DATED 18 - 07 - 2014 , IN PROCEEDINGS UNDER SECTION 143(3) RWS 147 OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . 2. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: - 1. ON T HE FACTS AND CIRCUMSTANCES OF THE CASE, THE I'D AO IS NOT JUSTIFIED BOTH IN LAW AND ON FACTS IN ISSUING NOTICE U/S 148 OF THE IT ACT FOR REOPENING THE ASSESSMENT AND THE L'D CIT(APPEALS) - !, VADODARA ERRED IN CONFIRMING / UPHOLDING THE DECISION OF REOPENING OF THE ASSESSMENT. IT IS PRAYED THAT THE NOTICE U/S 148 BEING BAD IN LAW REQUIRES TO BE CANCELLED . I T A NO . 2690 / A HD/20 14 A SSESSMENT YEAR 200 5 - 06 I.T.A NO. 2690 /AHD/20 14 A.Y. 2005 - 06 PAGE NO AMIN SONS MARKETING PVT. LTD. 2 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE L'D CIT(APPEALS) - I , VADODARA IS NOT JUSTIFIED BOTH IN LAW AND FACTS IN CONFIRMING DISALLOWANCE OF RS. 2 94860/ - U/S 14A OF THE IT ACT AND THEREBY CONFIRMING THE ADDITION. IT IS PRAYED THAT THE DISALLOWANCE U/S 14A OF RS. 294860/ - BE DELETED. 3. IN THIS CASE, ORIGINAL ASSESSMENT U/S. 143(3) OF THE ACT WAS COMPLETED ON 31 ST DEC, 2007 BY DETERMINING THE TOTA L INCOME OF THE ASSESSEE AT RS. 11 , 07 , 590/ - AGAINST THE INCOME DECLARED IN THE RETURN OF INCOME OF RS. 5 , 31 , 580/ - . SUBSEQUENTLY, THE CASE WAS REOPENED BY ISSUING OF NOTICE U/S. 148 OF THE ACT. ON SCRUTINY , THE ASSESSING OFFICER HAS NOTICED THAT ASSESSEE HAS EARNED EXEMPT INCOME IN THE FORM OF DIVIDEND OF RS. 18 , 695/ - . T HE ASSESSEE HAS NOT DISALLOWED ANY EXPENSES PERTAINING TO EARNING OF EXEMPT INCOME ,T HEREAFTER, THE ASSESSING OFFICER HAS APPLIED PROVISION O F SECTION 14A R.W.S 8D OF THE ACT AND DISALLOWED AN AMOUNT OF RS. 2 , 94 , 860/ - U/S. 14A R.W.S 8D OF THE ACT. 4. AGGRIEVED ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A) WHO HAS DISMISSED THE APPEAL OF THE ASSESSEE BY STATING THAT ASSESSING OFFICER HAS CORRECTLY WORKED OUT THE DISALLOWANCE OF RS. 2 , 94 , 860 / - U/S. 14A OF THE ACT. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE US, THE LD. COUNSEL HAS SUBMITTED PAPER BOOK CONTAINING DETAIL OF SUBMISSION FILED BEFORE THE ASSESSING OFFICER AND THE CIT(A) BY THE ASSESSEE. ON THE OTHER HAND, LD. DEPARTMENTAL R EPRESENTATIVE SUPPORTED THE ORDER OF THE LD. CIT(A). 5. AFTER PERUSAL OF THE INFORMATION ON RECORD, WE OBSERVED THAT THE TOTAL AMOUNT OF EXEMPT INCOME EARNED BY THE A SSESSEE IN THIS CASE IS ONLY RS. 18 , 695/ - . THERE IS NO OTHER EXPENDITURE WHICH IS DIREC TLY OR INDIRECTLY RELATED TO T HE EXEMPT INCOME . A FTER FOLLOWING THE V AR I OUS DECISION S OF THE IT AT BENCHES , WE RESTRICT T HE AMOUNT OF DISALLOWANCE TO THE EXTENT OF EXEMPT INCOME OF RS . 18 , 695/ - . ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED O N THIS ISSUE. I.T.A NO. 2690 /AHD/20 14 A.Y. 2005 - 06 PAGE NO AMIN SONS MARKETING PVT. LTD. 3 6. REGARDING FIRST GROUND OF APPEAL OF T HE ASSESSEE ON THE JUSTIFICATION OF REOPENING OF ASSESS MENT U/S. 148 OF THE ACT, WE OBSERVE THAT IN THE ORIGINAL ASSESSMENT THE ASSESSING OFFICER HAS NOT EXAMINED THE ISSUE OF DISALLOWANCE U/S 14A OF THE ACT. AS PER MATERIAL ON RECORD THE ASSESSING OFFICER HAS ALSO NOT RAISED ANY SPECIFIC QUERY ON THE ISSUE OF BY THE ASSESSEE TOWARDS EARNING EXEMPT INCOME. THEREFORE, WE ARE INCLINED WITH THE FINDINGS OF THE LD. CIT(A) ELABORATED IN HIS ORDE R. ACCORDINGLY THIS GROUND OF APPEAL OF THE ASSESSEE IS DISMISSED . 7. IN THE RESULT , THE APPEAL OF T H E ASSESSEE IS PARTLY ALLOWED. ORDER PR ONOUNCED IN THE OPEN C OURT ON 23 - 04 - 201 8 SD/ - SD/ - ( RAJPAL YADAV ) ( AMARJIT SIN GH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 23 /04 /2018 / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,