NAVI MUMBAI SEZ P.LTD, MUMBAI V. DCIT RG 7(1), MUMBAI

ITA 3428/MUM/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 93188 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-07-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 19-05-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 15-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S T SINGH
• Keywords: Opportunity of being heard
• Section: 14A

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE S/SHRI G.S.PANNU , ACCOUNTANT MEMBER AND SANJAY GARG, JUDICIAL MEMBER . . , , ./ I.T.A. NO. 3428 /MUM/20 1 2 ( / ASSESSMENT YEA R : 200 7 - 08 ) NAVI MUMBAI SEZ PRIVATE LIMITED, 1 ST FLOOR, JAI CENTRE, 34, P D MELLO ROAD, OPP, RED GATE, MASJID, MUMBAI - 400009 / VS. THE DY. COMMISSIONER OF INCOME TAX, RANGE 7(1) M UMBAI . ( / APPELLANT ) .. ( / RESPONDENT ) ./ ./PAN/GIR NO. : AACCN0042N / APPELLANT BY : SHRI VIJAY MEHTA / RESPONDENT BY : SHRI S T SINGH / DATE OF HEARING : 1 9. 5 .201 5 / DATE OF PRONOUNCEMENT : 24. 7.2015 / O R D E R P ER SANJAY GARG , JUDICIAL MEMBER : THE ASSESSEE HAS PREFERRED THIS APPEAL AGAINST THE ORDER OF LD. CIT(A) - 20, MUMBAI PASSED ON 3.2.2012 FOR THE ASSESSMENT YEAR 2007 - 08. 2. THE ASSESSEE HAS AGITATED THE CONFIRMATION OF DISALLOWANCE MADE BY THE AO UNDER SECTION 14A OF THE INCOME TAX ACT, 1961 (THE ACT) READ WITH RULE 8D OF THE INCOME TAX RULES, 1962 (THE RULES) . 3. AT THE OUTSE T, THE LD.AR OF THE ASSESSEE HAS STATED THAT THE AO WHILE COMPUTING THE DISALLOWANCE UNDER SECTION 14A OF THE ACT R.W.R 8D(2)(III) IN RELATION TO ADMINISTRATIVE EXPENSES HAS INCLUDED THE INVESTMENTS INCOME FROM WHICH WAS TAXABLE AND NOT EXEMPT UNDER THE A CT. HE HAS FURTHER STATED THAT THE AO HAS NOT PROPERLY TAK EN THE AVERAGE VALUE OF INVESTMENT AS APPEARING IN I.T.A. NO. 3428 /MUM/2012 2 THE BALANCE SHEET OF THE ASSESSEE ON T HE FIRST DAY AND THE LAST DAY OF THE PREVIOUS YEAR. HE HAS BROUGHT OUR ATTENTION, IN THIS RESPECT, TO PAGE 6 OF THE PAPER BOOK TO SHOW THAT INCOME FROM CERTAIN INVESTMENTS SHOWN IN THE BALANCE SHEET WAS TAXABLE IN NATURE AND WAS NOT EXEMPT. HE HAS STRESSED THAT THE PROVISIONS OF SECTION 14A ARE NOT ATTRACTED TO SUCH INCOME OR INVESTMENTS. IN VIEW OF TH E ABOVE SUBMISSIONS OF THE ASSESSEE, WE RESTORE THIS ISSUE TO THE FILE OF THE AO TO DECIDE THE SAME AFRESH IN ACCORDANCE WITH THE PROVISIONS OF SECTION 14A R.W.R.8D BY EXCLUDING THE INVESTMENT S INCOME FROM THE INCOME WHICH IS NOT EXEMPT AND TAKING AVERAGE VALUE OF ASSETS AS APPEARING IN THE BALANCE SHEET OF THE ASSESSEE ON THE FIRST DAY AND THE LAST DAY OF THE PREVIOUS YEAR FOR THE PURPOSE OF CALCULATION OF DISALLOWANCE AT THE RATE OF 0.5% OF THE AVERAGE VALUE OF INVESTMENT FOR COMPUTING THE DISALLOWANCE U /R 8D(2)(III). NEEDLESS TO SAY THAT THE AO WILL PROVIDE PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE TO SUBMIT THE DETAILS / ACCOUNTS IN THIS RESPECT. 4 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED I N THE OPEN COURT ON 24TH JULY,2015 24TH JULY, 2015 SD SD ( . . / G.S.PANNU ) ( / SANJAY GARG ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; DATED : 24TH JULY, 2015 . . ./ SRL , SR. PS / CO PY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) , /ITAT, MUMBAI