DCIT, Circle- 11(1), New Delhi V. Hero Solar Energy (P) Ltd., New Delhi

ITA 387/DEL/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 1189 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2014-2015
• Appeal Filed On: 12-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RAKESH GUPTA
• Keywords: Earning of tax free income; Rule 8D
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH C, NEW DELHI BEFORE SH. N. K. BILLAIYA, ACCOUNTANT MEMBER AND SH. K.N CHARY, JUDICIAL MEMBER ITA NO.387/DEL/2018 ASSESSMENT YEAR: 2014-15 DCIT CIRCLE 11 (1) NEW DELHI VS M/S. HERO SOLAR ENERGY PVT. LTD. 212, GROUND FLOOR OKHLA, INDUSTRIAL ESTATE, PHASE-III, NEW DELHI -110020 PAN NO. AADCH1476P (APPELLANT) (RESPONDENT) ASSESSEE BY DR. RAKESH GUPTA, ADVOCATE SH. SOMIL AGGARWAL, ADVOCATE REVENUE BY SH. AMIT KATOCH, SR. DR DATE OF HEARING: 19/03/2019 DATE OF PRONOUNCEMENT: 20/03/2019 ORDER PER N. K. BILLAIYA, AM: THIS APPEAL IS PREFERRED AGAINST THE ORDER OF THE C IT(A)-35, NEW DELHI DATED 05.10.2017 PERTAINING TO A. Y.2014- 15. 2. THE SUM AND SUBSTANCE OF THE GRIEVANCE OF THE RE VENUE IS THAT THE CIT(A) ERRED IN DELETING THE DISALLOWANCE OF RS.2,03,30,249/-MADE U/S. 14A OF THE IT ACT R.W. RU LE 8D. 2 3. THE FACTS ON RECORD SHOW THAT DURING THE YEAR UN DER CONSIDERATION THE ASSESSEE DID NOT EARN ANY EXEMPT INCOME. THE ASSESSING OFFICER WAS OF THE FIRM BELIEF THAT EVEN THERE IS NO EXEMPT INCOME STILL EXPENSES HAVE TO BE DISALLOWED U/S 14A R.W RULE 8D OF THE IT RULES. HE ACCORDINGLY COMPUTED TH E DISALLOWANCE AT RS.2,03,30,249/- AND ADDED TO THE I NCOME OF THE ASSESSEE. 4. THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A ) AND POINTED OUT THAT THE HONBLE HIGH COURT OF DELHI IN THE CASE OF CHEM INVEST PVT. LTD. VS. CIT REPORTED 378 ITR 33 H AS HELD THAT IF THERE IS NO EXEMPT INCOME NO DISALLOWANCE CAN BE MADE. 5. AFTER CONSIDERING THE REPLY OF THE ASSESSEE, THE CIT(A) FOUND THAT THE RATIO LAID DOWN BY HONBLE DELHI HIGH COUR T CLEARLY APPLIES IN THE CASE OF THE ASSESSEE AND ACCORDINGLY DELETED THE ADDITION. 6. BEFORE US THE DR STRONGLY SUPPORTED THE FINDINGS OF THE ASSESSING OFFICER BUT COULD NOT BRING ANY DISTINGUI SHING DECISION. 7. IT IS AN UNDISPUTED FACT THAT DURING THE YEAR TH E ASSESSEE DID NOT EARN ANY EXEMPT INCOME. THE HONBLE HIGH C OURT OF DELHI IN THE CASE OF CHEM INVEST PVT. LTD. VS. CIT (SUPRA) HAS CLEARLY HELD THAT IF THERE IS NO EXEMPT INCOME NO D ISALLOWANCE CAN BE MADE. THIS WAS SUBSEQUENTLY FOLLOWED BY THE HONBLE HIGH COURT OF DELHI IN THE CASE OF PCIT VS. IL & FS ENERGY DEVELOPMENT COMPANY LIMITED REPORTED 399 ITR 483. 3 8. RESPECTFULLY FOLLOWING THE DECISIONS OF HONBLE JURISDICTIONAL HIGH COURT OF DELHI WE DECLINE TO IN TERFERE WITH THE FINDINGS OF THE CIT(A), IN THE RESULT THE APPEAL FI LED BY THE REVENUE IS ACCORDINGLY DISMISSED. 9. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S ACCORDINGLY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 20.03.2019. SD/- SD/- (K. NARSIMHA CHARY ) (N. K. BILLAIYA) JUDICIAL MEMBER ACCOUNTAN T MEMBER *NEHA* DATE:- 20.03.2019 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGI STRAR ITAT NEW DELHI DATE OF DICTATION 19.03.2019 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/ PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 20.03.2019 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH FILE GOES TO THE HEAD CLERK. THE DATE ON WHICH FILE GOES TO THE ASSISTANT REGIST RAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER