DCIT, New Delhi V. M/s Renuka Financial Services Ltd., New Delhi

ITA 3467/DEL/2011

• Counselvise Citation: 346720114 RSA 2011
• Duration Of Justice: 1 year(s) 1 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-08-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 03-07-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 07-07-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH F FF F : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND SHRI SHRI SHRI SHRI RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV, JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER ITA NO. ITA NO. ITA NO. ITA NO.3467/DEL/2011 3467/DEL/2011 3467/DEL/2011 3467/DEL/2011 ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR : : : : 2008 2008 2008 2008- -- -09 0909 09 DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CIRCLE CIRCLE CIRCLE CIRCLE- -- -15(1), 15(1), 15(1), 15(1), C.R.BUIL C.R.BUIL C.R.BUIL C.R.BUILDING, DING, DING, DING, I.P.ESTATE, I.P.ESTATE, I.P.ESTATE, I.P.ESTATE, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. VS. VS. VS. VS. M/S RENUKA FINANCIAL SERVICES LTD., M/S RENUKA FINANCIAL SERVICES LTD., M/S RENUKA FINANCIAL SERVICES LTD., M/S RENUKA FINANCIAL SERVICES LTD., 86, SHAKTI APARTMENTS, 86, SHAKTI APARTMENTS, 86, SHAKTI APARTMENTS, 86, SHAKTI APARTMENTS, ASHOK VIHAR, ASHOK VIHAR, ASHOK VIHAR, ASHOK VIHAR, PHASE PHASE PHASE PHASE- -- -III, III,III, III, DELHI DELHI DELHI DELHI 110 052. 110 052. 110 052. 110 052. PAN : AAACR4748M. PAN : AAACR4748M. PAN : AAACR4748M. PAN : AAACR4748M. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SHASHI BHUSHAN SHUKLA, SR.DR. RESPONDENT BY : NONE. ORDER ORDER ORDER ORDER PER G. PER G. PER G. PER G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VP VPVP VP : : : : THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(A)-XVIII, NEW DELHI DATED 20 TH APRIL, 2011 FOR THE AY 2008- 09. 2. NOBODY APPEARED ON BEHALF OF THE ASSESSEE AT THE TIME OF HEARING FIXED ON 7.9.2011, 24.11.2011 & 12.4.2012 A ND THE DEPARTMENT WAS ASKED TO SERVE THE NOTICE AND PRODUC E THE EVIDENCE. THE DEPARTMENT, VIDE ITS LETTER DATED 6 TH JUNE, 2012, HAS INTIMATED THAT THE NOTICE HAS DULY BEEN SERVED UPON THE AR OF THE ASSESSEE. THE COPY OF THE NOTICE SERVED HAS BEEN ENCLOSED WITH TH E SAID LETTER. HOWEVER, ON THE DATE OF HEARING, NONE APPEARED ON B EHALF OF THE ASSESSEE. SINCE THE NOTICE HAS ALREADY BEEN SERVED , WE PROCEED TO DECIDE THE APPEAL OF THE REVENUE EX-PARTE QUA THE A SSESSEE- RESPONDENT AFTER HEARING THE ARGUMENTS OF LEARNED D R. 3. THE GROUNDS RAISED BY THE REVENUE READ AS UNDER: - ITA-3467/DEL/2011 2 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) HAS ERRED IN DELETING THE ADD ITION OF RS.14,43,248/- MADE U/S 14A OUT OF TOTAL ADDITION O F RS.1,62,73,596/-. 2. THAT THE LD.CIT(A) FAILED TO APPRECIATE THAT THE DISALLOWANCE WAS MADE BY APPLYING RULE 8D WHICH WAS MANDATORY FOR THE ASSESSING OFFICER. 4. WE HAVE HEARD THE ARGUMENTS OF LEARNED DR AND PE RUSED THE MATERIAL PLACED BEFORE US. THE FACTS OF THE CASE A RE THAT THE ASSESSING OFFICER DISALLOWED THE SUM OF ` 1,62,73,596/- UNDER SECTION 14A. THE LEARNED CIT(A) ALLOWED THE RELIEF OF ` 14,43,248/- WITH THE FOLLOWING FINDING:- 5.2 CONSIDERING THE ABOVE, THE IMPUGNED ADDITION M ADE BY THE AO BY APPLYING RULE 8D READ WITH SECTION 14A OF THE ACT IN RESPECT OF INTEREST AMOUNT OF RS.1,44,80,996 /- IS CONFIRMED. HOWEVER, AS REGARDS THE ADMINISTRATIVE EXPENSES, I FIND THAT THE DISALLOWANCE MADE BY THE AO AT RS.17,19,600/- EXCEEDS THE TOTAL EXPENDITURE OF RS.2,76,352/- INCURRED BY THE APPELLANT ON ACCOUNT OF ADMINISTRATIVE EXPENSES. THIS ACTION OF THE AO IN MY VIEW IS NOT LOGICAL AS WHAT IS TO BE DISALLOWED U/S 14A OF THE ACT IS EXPENDITURE INCURRED BY THE ASSESSEE IN RELATIO N TO INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THIS ACT. THEREFORE, ANY DISALLOWANCE IN EXCESS O F THE EXPENDITURE INCURRED BY THE ASSESSEE IS NOT WARRANT ED UNDER THE LAW. IN VIEW OF THE ABOVE, THE DISALLOWA NCE IN RESPECT OF ADMINISTRATIVE EXPENSES IS RESTRICTED TO ITA-3467/DEL/2011 3 RS.2,76,352/- AND THE BALANCE DISALLOWANCE OF RS.14,43,248/- IS DELETED. 5. AFTER CONSIDERING THE ARGUMENTS OF THE LEARNED D R AND THE FACTS OF THE CASE, WE DO NOT FIND ANY INFIRMITY IN THE OR DER OF LEARNED CIT(A). THE LEARNED CIT(A) HAS RECORDED THE FINDING THAT TH E TOTAL ADMINISTRATIVE EXPENSES CLAIMED BY THE ASSESSEE WER E ONLY ` 2,76,352/-. THE DISALLOWANCE OF EXPENDITURE CANNOT EXCEED THE EXPENDITURE INCURRED AND CLAIMED BY THE ASSESSEE. SINCE THE DEDUCTION FOR THE EXPENDITURE CLAIMED BY THE ASSESS EE WAS ONLY ` 2,76,352/-, THE DISALLOWANCE OF ` 17,19,600/- WAS RIGHTLY REDUCED TO ` 2,76,352/- BY THE LEARNED CIT(A). THE SAME IS UPHE LD AND THE APPEAL OF THE REVENUE IS DISMISSED. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. DECISION PRONOUNCED IN THE OPEN COURT ON 9 TH AUGUST, 2012. SD/- SD/- ( (( (RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV) )) ) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) JUDICIAL JUDICIAL JUDICIAL JUDICIAL MEMBER MEMBER MEMBER MEMBER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT DATED : 09.08.2012 VK. COPY FORWARDED TO: - 1. APPELLANT : DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE INCOME TAX, CIRCLE INCOME TAX, CIRCLE INCOME TAX, CIRCLE- -- -15(1), C.R 15(1), C.R 15(1), C.R 15(1), C.R.BUILDING, .BUILDING, .BUILDING, .BUILDING, I.P.ESTATE, NEW DELHI. I.P.ESTATE, NEW DELHI. I.P.ESTATE, NEW DELHI. I.P.ESTATE, NEW DELHI. 2. RESPONDENT : M/S RENUKA FINANCIAL SERVICES LTD., M/S RENUKA FINANCIAL SERVICES LTD., M/S RENUKA FINANCIAL SERVICES LTD., M/S RENUKA FINANCIAL SERVICES LTD., 86, SHAKTI APARTMENTS, 86, SHAKTI APARTMENTS, 86, SHAKTI APARTMENTS, 86, SHAKTI APARTMENTS, ASHOK VIHAR, PHASE ASHOK VIHAR, PHASE ASHOK VIHAR, PHASE ASHOK VIHAR, PHASE- -- -III, III,III, III, DELHI DELHI DELHI DELHI 110 052. 110 052. 110 052. 110 052. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR