Sh. Kanhaiya Lal Jain, New Delhi V. ACIT, New Delhi

ITA 340/DEL/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 97906 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 9 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-11-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 2
• Next Hearing Date: 09-11-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 17-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P DAM KANUNJNA
• Assessee Lawyers: VK SABHARWAL
• Section: 234B; 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH SMC-2 , NEW DELHI) BEFORE SHRI P. K. BANSAL, ACCOUNTANT MEMBER I.T.A. NO. 340/DEL/2014 ASSESSMENT YEAR : 2009-10 KANAHIYA LAL JAIN, VS. ACIT, CC-04, KLJ HOUSE, 63, RAMA MARG, NEW DELHI NAJAFGARH ROAD, NEW DELHI. GIR / PAN:AAFPJ3905N (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI V. K. SABHARWAL, ADV. RESPONDENT BY : SHRI P DAM KANUNJNA, SR. DR DATE OF HEARING : 09.11.2015 DATE OF PRONOUNCEMENT : 09.11.2015 ORDER THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. CIT(A) DATED 30.09.2013. THE ONLY ISSUE INVOLVED I N THIS APPEAL RELATES TO THE DISALLOWANCE MADE U/S 14A OF THE I. T. ACT, 196 1. 2. I HEARD RIVAL SUBMISSIONS AND CAREFULLY CONSIDER ED THE SAME. I NOTED THAT IN THIS CASE, THE A.O. HAS APPLIED RULE 8D AND COMPUTED THE DISALLOWANCE ON THE LONG TERM CAPITAL GAIN EARNED B Y THE ASSESSEE. THE PROVISIONS OF SECTION 14A(2) DOES NOT GIVE ABSOLUTE POWER TO THE A.O. TO STRAIGHTAWAY APPLY RULE 8D AND MAKE THE DISALLOWANC E. THIS PROVISION EMPOWERS THE A.O. TO DETERMINE THE AMOUNT OF EXPEND ITURE INCURRED IN RELATION TO THE INCOME WHICH DOES NOT FORM PART OF TOTAL INCOME. IN ACCORDANCE WITH SUCH METHOD AS MAY BE PRESCRIBED I. E. RULE 8D BY THE A.O. HAVING REGARD TO THE ACCOUNT OF ASSESSEE, IS NOT SA TISFIED WITH THE CORRECTNESS ITA NO.340/DEL/2014 2 OF THE CLAIM OF ASSESSEE IN RESPECT OF SUCH EXPENDI TURE VERSUS THE INCOME WHICH DOES NO FORM PART OF THE TOTAL INCOME. 3. I HAVE GONE THROUGH THE ASSESSMENT ORDER AND I D O NOT FIND ANY WHISPER OF RECORDING OF SATISFACTION BY THE A.O. WI TH REGARD TO THE BOOKS OF ACCOUNTS MAINTAINED BY THE ASSESSEE ABOUT THE INCOR RECTNESS OF THE CLAIM OF ASSESSEE. THE SIMILAR VIEW HAS BEEN TAKEN BY THE H ON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF MAXOPP INVESTMENTS LTD. V S CIT 203 TAXMAN 364. IN VIEW OF THE DECISION OF HON'BLE JURISDICTI ONAL HIGH COURT, I DELETE THE DISALLOWANCE. 4. THE OTHER GERUND TAKEN BY THE ASSESSEE RELATES T O CHARGING OF INTEREST WHICH IS CONSEQUENTIAL IN NATURE. ACCORDINGLY, I D IRECT THE A.O. TO RECOMPUTE THE INTEREST U/S 234B AFTER GIVING EFFECT TO THIS ORDER. IN THE RESULT, APPEAL FILED BY ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 5. ORDER PRONOUNCED IN THE OPEN COURT ON 09 TH NOV., 2015. SD./- (P. K. BANSAL) ACCOUNTANT MEMBER DATE: 09.11.2015 SP COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT (A)-, NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DEL HI. TRUE COPY. BY ORDER (ITAT, NEW DELHI). ITA NO.340/DEL/2014 3 S.NO. DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 9.11 SR. PS/PS 2 DRAFT PLACED BEFORE AUTHOR 9.11 SR. PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/AM 5 APPROVED DRAFT COMES TO THE SR. PS/PS 9.11 SR. PS/PS 6 KEPT FOR PRONOUNCEMENT 9.11 SR. PS/PS 7 FILE SENT TO BENCH CLERK 16.11 SR. PS/PS 8 DATE ON WHICH THE FILE GOES TO HEAD CLERK 9 DATE ON WHICH FILE GOES TO A.R. 10 DATE OF DISPATCH OF ORDER