Appeal Details
Counselvise Citation
[2017] 128 COUNSELVISE.COM (IT) 2776 (ITAT-DELHI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
3 year(s) 17 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
29-06-2017
Appeal Filed By
Assessee
Order Result
Dismissed
Bench Allotted
A
Next Hearing Date
28-06-2017
Assessment Year
2009-2010
Appeal Filed On
11-06-2014
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : A : NEW DELHI BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND SHRI K. NARASIMHA CHARY, JUDICIAL MEMBER ITA NO.3526/DEL/2014 ASSESSMENT YEAR : 2009-10 AKM SYSTEMS PVT. LTD., FIRST FLOOR, THE GREAT EASTERN CENTRE, 70, NEHRU PLACE, BEHIND IFCI TOWER, NEW DELHI. PAN: AAACA2464K VS. DCIT, CIRCLE-1(1), NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI MUKESH SINGHAL, ADVOCATE DEPARTMENT BY : SHRI R.C. DANDAY, SR. DR DATE OF HEARING : 28.06.2017 DATE OF PRONOUNCEMENT : 29.06.2017 ORDER PER R.S. SYAL, VP: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER PASSED BY THE CIT(A) ON 09.11.2012 IN RELATION TO T HE ASSESSMENT YEAR 2009-10. ITA NO.3526/DEL/2014 2 2. THE ONLY ISSUE RAISED IN THIS APPEAL THROUGH VAR IOUS GROUNDS IS THE CONFIRMATION OF DISALLOWANCE AMOUNTING TO RS.33,83, 185/- MADE BY THE ASSESSING OFFICER U/S 14A OF THE INCOME TAX ACT, 19 61 (HEREINAFTER ALSO CALLED THE ACT). 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE DECLARED DIVIDEND INCOME OF RS.11,93,95,627/- WHICH WAS CLAI MED AS EXEMPT U/S 10(34) OF THE ACT. SUTO MOTU DISALLOWANCE OF RS.15,05,986/- WAS MADE BY THE ASSESSEE U/S 14A ON THE BASIS OF ALLOCATION OF COMMON EXPENSES. THE ASSESSING OFFICER DID NOT AGREE WITH THE ASSESS EES COMPUTATION OF DISALLOWANCE. AFTER RECORDING THE SATISFACTION IN PARA 4.3(I) OF THE ASSESSMENT ORDER, THE ASSESSING OFFICER APPLIED RUL E 8D FOR WORKING OUT ADDITION U/S 14A. SUCH DISALLOWANCE WAS MADE ONLY UNDER CLAUSE (III) OF RULE 8D, BEING 0.5% OF AVERAGE VALUE OF INVESTME NT INCOME WHICH DID NOT FORM PART OF THE TOTAL INCOME. THE AMOUNT OF DISALLOWANCE WAS COMPUTED AT RS.48,89,171/-. AFTER ALLOWING CREDIT FOR THE SUO MOTU DISALLOWANCE MADE BY THE ASSESSEE, THE ASSESSING OF FICER MADE ADDITION ITA NO.3526/DEL/2014 3 FOR THE REMAINING SUM OF RS.33,83,185/-. THE LD. C IT(A) CONFIRMED THE SAME AGAINST WHICH THE ASSESSEE HAS COME UP IN APPE AL BEFORE US. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. THE ASSESSMENT YEAR UNDER CONS IDERATION IS 2009-10. AS SUCH, THE PROVISIONS OF RULE 8D ARE APPLICABLE. IT IS SEEN FROM THE ASSESSMENT ORDER THAT THE ASSESSING OFFICER RECORDE D SATISFACTION ABOUT THE INCORRECTNESS OF THE ASSESSEES COMPUTATION OF DISALLOWANCE U/S 14A. SIMILAR SATISFACTION HAS ALSO BEEN RECORDED BY THE LD. CIT(A) IN PARA 4.3 OF THE IMPUGNED ORDER, WHICH IS NOTHING BUT THE CON TINUATION OF ASSESSMENT PROCEEDINGS. IN VIEW OF THIS, IT IS CLE AR THAT THERE IS NO LACK OF RECORDING OF SATISFACTION BY THE AUTHORITIES BEF ORE PROCEEDING TO MAKE DISALLOWANCE U/S 14A. 5. TURNING TO THE QUANTUM OF DISALLOWANCE, IT IS FO UND THAT THE ASSESSING OFFICER HAS MADE DISALLOWANCE ONLY UNDER CLAUSE (III) OF RULE 8D, BEING 0.5% OF AVERAGE VALUE OF INVESTMENT. THE RE IS NO SEPARATE DISALLOWANCE UNDER CLAUSES (I) AND (II). THE LD. A R HAS NOT POINTED OUT ANY MISTAKE IN THE COMPUTATION OF DISALLOWANCE UNDE R CLAUSE (III) OF ITA NO.3526/DEL/2014 4 RULE 8D. SINCE THE ASSESSMENT YEAR UNDER CONSIDERAT ION IS 2009-10 AND THE PROVISIONS OF RULE 8D ARE APPLICABLE, WE DO NOT FIND ANY REASON FOR NOT APPLYING THE SAME FOR COMPUTING DISALLOWANCE U/ S 14A. AS SUCH, THE DISALLOWANCE IS CONFIRMED AND THE IMPUGNED ORDE R IS UPHELD TO THIS EXTENT. 6. IN THE RESULT, THE APPEAL IS DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 29.06.201 7. SD/- SD/- [K. NARASIMHA CHARY] [R.S. SYAL] JUDICIAL MEMBER VICE PRESIDENT DATED, 29 TH JUNE, 2017. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.
