Yama Finance Ltd., New Delhi V. ITO, New Delhi

ITA 4144/DEL/2011

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 8194 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 7 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-04-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 27-01-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 15-09-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJIV RANKA
• Assessee Lawyers: SUBODH GUPTA
• Keywords: Business income; Earning of tax free income
• Section: 14A; 28

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H NEW DELHI BEFORE SHRI R.S. SYAL, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA NO. 4144/DEL/2011 AY: 20 08-09 YAMA FINANCE LTD., VS INCOME TAX OFFICER, B-6/5, LOCAL SHOPPING CENTRE, COY. CIRCLE-18(1), NEW HDFC BANK, 2 ND FLOOR, C.R. BUILDING, SAFDARJUNG ENCLAVE, I.P. ESTATE, NEW DELHI. NEW DELHI. (PAN: AAACY1847Q) (APPELLANT) (RESPONDENT ) APPELLANT BY : SHRI SUBODH GUPTA, CA RESPONDENT BY : SHRI RAJIV RANKA, SR. DR DATE OF HEARING: 27.01.2016 DATE OF PRONOUNCEMENT: 18.04.2016 ORDER PER SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER THE PRESENT APPEAL IS PREFERRED BY THE ASSESSEE AGA INST THE ORDER PASSED BY THE LD.CIT(A)-XXI, NEW DELHI WHEREI N BY THE ORDER DATED 26.07.2011 THE FIRST APPELLATE AUTHORIT Y HAS CONFIRMED THE ACTION OF THE ASSESSING OFFICER IN TR EATING AN AMOUNT OF RS. 40,04,179/- AS BUSINESS INCOME INSTE AD OF CAPITAL GAINS (AS CLAIMED BY THE ASSESSEE) AND ALSO UPHOLDING THE DISALLOWANCE OF RS. 4,90,274/- U/S 14A OF THE I NCOME TAX I.T.A. NO. 4144/DEL/2011 ASSESSMENT YEAR: 2008-09 2 ACT, 1961 (HEREINAFTER CALLED THE ACT). THE APP EAL PERTAINS TO ASSESSMENT YEAR 2008-09. 2. IT IS SEEN FROM THE RECORDS THAT THE ASSESSEE COMPA NY HAD FILED IT RETURN OF INCOME DECLARING AN INCOME OF RS . 35,43,560/- WHICH WAS PROCESSED U/S 143(1) OF THE ACT AND THE C ASE WAS LATER SELECTED FOR SCRUTINY. THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD SHOWN GAINS FROM SALE OF MUTUAL FUNDS/ PORTFOLIO MANAGEMENT SCHEME (PMS) UNDER THE HEAD INCOME FROM CAPITAL GAINS. THE ASSESSING OFFICER WAS OF THE OPINION T HAT SINCE THE MEMORANDUM OF THE ASSESSEE COMPANY AUTHORIZED THE A SSESSEE TO CARRY ON THE BUSINESS OF SALE/PURCHASE OF SECURI TIES, THE ASSESSEE COULD BE SAID TO BE CARRYING ON THE BUSINE SS OF SALE/PURCHASE OR SECURITIES. THE ASSESSING OFFICER RELIED ON A PLETHORA OF CASE LAWS AND CONCLUDED THAT EVEN A SIN GLE TRANSACTION MAY CONSTITUTE TRADING INCOME AND IN VI EW OF THE PATTERN OF INVESTMENTS AND FREQUENT TRANSACTIONS OF SALE/PURCHASE OF MUTUAL FUNDS/ PMS BY THE ASSESSEE COMPANY, IT COULD BE CONCLUDED THAT THE ASSESSEE WAS CARRYIN G ON A BUSINESS OF SALE AND PURCHASE WITH A MOTIVE TO EARN PROFIT AND, THEREFORE, THE TRANSACTIONS WOULD FALL UNDER THE PU RVIEW OF SECTION 28 OF THE ACT VIZ. BUSINESS INCOME AND WILL NOT BE TAXABLE I.T.A. NO. 4144/DEL/2011 ASSESSMENT YEAR: 2008-09 3 UNDER CAPITAL GAINS AS CLAIMED BY THE ASSESSEE. THE ASSESSING OFFICER ALSO RELIED ON THE DECISION OF THE ITAT DEL HI BENCH IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2006-07 WHE REIN IN I.T.A. NO. 312/DEL/2010, THE ITAT HAD HELD THAT THE ASSESSEES TRANSACTIONS IN UNITS OF MUTUAL FUNDS WERE IN THE N ATURE OF BUSINESS INCOME AND WERE THUS CHARGEABLE UNDER THE HEAD INCOME FROM BUSINESS OR PROFESSION INSTEAD OF CA PITAL GAINS. THE ASSESSING OFFICER HELD THAT SINCE THERE WAS NO CHANGE IN THE FACTS AND CIRCUMSTANCES OF THE CASE IN THE CURRENT YEAR, THE DECISION OF THE ITAT HAD TO BE FOLLOWED. ACCORDING LY, THE AMOUNT OF RS. 40,04,179/- WAS TREATED AS BUSINESS INCOME A ND AFTER MAKING ADJUSTMENTS FOR OPENING AND CLOSING STOCK OF INVESTMENTS, THE BUSINESS INCOME WAS FINALLY CALCUL ATED AT RS. 31,42,538/- WHICH WAS ADDED BACK TO THE INCOME OF T HE ASSESSEE. SECONDLY, THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAD EARNED EXEMPT INCOME BY WAY OF DIVIDEN DS AMOUNTING TO RS.4,90,274/- AND THAT THE ASSESSEE HA D ITSELF ADDED BACK A SUM OF RS. 31,544/- U/S 14A IN ITS COM PUTATION OF INCOME. THE ASSESSING OFFICER, HOWEVER, OPINED THA T RULE 8D ALSO HAD TO BE FOLLOWED AND HE ACCORDINGLY DISALLOW ED A FURTHER SUM OF RS. 4,58,730/- (RESTRICTING THE DISALLOWANCE TO RS. I.T.A. NO. 4144/DEL/2011 ASSESSMENT YEAR: 2008-09 4 4,90,274/- I.E. THE DIVIDEND EARNED) @ 0.5% ON THE AVERAGE INVESTMENTS. 3. IN APPEAL, THE LD. CIT (A) CONFIRMED BOTH THE DISALLOWANCES/ADJUSTMENTS AND NOW THE ASSESSEE IS I N APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS OF A PPEAL:- 1. THE LOWER AUTHORITIES HAVE ERRED AND WERE NOT JUSTIFIED ON FACTS & CIRCUMSTANCES OF THE CASE AND IN LAW IN REJECTING THE RESULTS AND ACCOUNTING TREATMENT O F IMPUGNED TRANSACTIONS SHOWN IN THE AUDITED ACCOUNTS AS INVESTMENTS IN THE AUDITED ACCOUNTS, INDICATIN G UN- AMBIGUOUSLY THE INTENTIONS OF MAKING INVESTMENTS AND THUS THE ADVERSE INFERENCES ARE LIABLE TO BE REJECT ED. 2. ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LOWER AUTHORITIES HAVE ERRED AND WERE NOT JUSTI FIED IN TREATING THE NET RESULTS OF GAIN, AMOUNTING TO RS 40,04,179/-, FROM INVESTMENTS IN UNITS OF MUTUAL FU NDS & PORTFOLIO MANAGEMENT SCHEME (PMS) AS TRADING, CHARGEABLE UNDER THE HEAD PROFIT & GAINS OF BUSINE SS OF PROFESSION AS AGAINST THE CLAIM OF THE APPELLANT T O CHARGE UNDER THE HEAD CAPITAL GAINS. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, IT IS THE CASE OF THE AP PELLANT THAT CAN ONLY BE CONSTRUED AS INVESTMENT IN UNITS O F MUTUAL FUNDS AND NOT AS BUSINESS. 3. ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, LOWER AUTHORITIES HAVE ERRED AND WERE NOT JUSTIFIED IN APPLYING RULE 8D IN AN ARBITRARY MANNER FOR DETERMI NING THE DISALLOWANCE U/S 14A, WITHOUT ANY FINDING THE NEXUS BETWEEN EXPENSES INCURRED AND DIVIDEND INCOME EARNED AND HAVE FAILED TO OBJECTIVELY APPRAISE THE I.T.A. NO. 4144/DEL/2011 ASSESSMENT YEAR: 2008-09 5 AMBIGUOUS RESULTS OF RULE 8D. 4. ON FACTS AND CIRCUMSTANCES AND IN LAW, LOWER AUTHORITIES HAVE ERRED AND WERE NOT JUSTIFIED IN MA KING A DISALLOWANCE OF RS 4,90,274/- AS EXPENSE INCURRED I N RESPECT OF EXEMPT INCOME BY INVOKING SECTION 14A OF THE ACT IN AN ARBITRARY MANNER, WHICH IS EQUIVALENT TO THE WHOLE OF EXEMPT INCOME, BEING DIVIDEND. 5. THE ABOVE GROUNDS OF APPEAL ARE INDEPENDENT WITH OUT PREJUDICE TO EACH OTHER. 4. THE LD. AR SUBMITTED THAT THE AUTHORITIES BELOW HAVE FOLLOWED THE DECISION OF THE ITAT FOR ASSESSMENT YE AR 2006-07 IN MAKING THE ADJUSTMENTS FOR ASSESSMENT YEAR 2008-09 ALSO. HE FURTHER SUBMITTED THAT THIS DECISION OF THE ITAT HA S SINCE BEEN REVERSED BY THE HON'BLE DELHI HIGH COURT IN I.T.A. NO. 1658/2010 THROUGH THE ORDER DATED 01.04.2014 WHICH HAS BEEN P LACED ON RECORD. 5. THE LD. AR SUBMITTED THAT IN VIEW OF THE DECISIO N OF THE HON'BLE DELHI HIGH COURT, THIS YEARS ADJUSTMENTS A LSO DESERVE TO BE REVERSED AS THERE HAS BEEN NO CHANGE IN THE FACT UAL SITUATION AS COMPARED TO THAT OF AY 2006-07 FOR WHICH THE HON BLE DELHI HIGH COURT HAS RULED IN THE FAVOUR OF THE ASSESSEE. I.T.A. NO. 4144/DEL/2011 ASSESSMENT YEAR: 2008-09 6 6. AS REGARDS THE OTHER ISSUE IN APPEAL VIZ. THE DI SALLOWANCE U/S 14A OF THE ACT, THE LD. AR SUBMITTED THAT THE A SSESSING OFFICER HAS TAKEN ALL THE INVESTMENTS FOR THE PURPO SE OF CALCULATION OF DISALLOWANCE WHEREAS THE MANDATE OF THE ACT REQUIRES THAT ONLY THOSE INVESTMENTS WHICH HAVE YIE LDED EXEMPT INCOME OUGHT TO BE CONSIDERED FOR THE PURPOSE OF CA LCULATING THE DISALLOWANCE. HE SUBMITTED THAT THE ASSESSEE COMPA NY HAD ALREADY ADDED BACK AN AMOUNT OF RS. 31,544/- ON ITS OWN, WHICH WAS THE CORRECT AMOUNT OF DISALLOWANCE AND, THEREFO RE, NO FURTHER DISALLOWANCE COULD BE LEGALLY SUSTAINED. 7. THE LD. DR, IN RESPONSE, RELIED ON THE ORDERS OF THE LOWER AUTHORITIES. ON THE ISSUE OF BUSINESS INCOME VIS- -VIS CAPITAL GAINS, THE LD. DR SUBMITTED THAT THE LD. CIT(A) HAS DEALT WITH THIS ISSUE ON PAGE 8 OF THE IMPUGNED ORDER WHEREIN HE HAS REFERRED TO AND REPRODUCED THE ORDER OF THE ITAT FO R ASSESSMENT YEAR 2006-07. AS REGARDS THE DISALLOWANCE U/S 14A, THE LD. DR SUBMITTED THAT THE ASSESSEE HAS ITSELF NOT DISPUTED THE APPLICATION OF SECTION 14A AND HENCE, THE DISALLOWA NCE HAS BEEN CORRECTLY MADE. 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. AS FAR AS THE ISSUE OF TREATIN G CAPITAL GAINS I.T.A. NO. 4144/DEL/2011 ASSESSMENT YEAR: 2008-09 7 AS BUSINESS INCOME BY THE DEPARTMENT IS CONCERNED, IT IS SEEN THAT THE ISSUE HAS BEEN SETTLED IN FAVOUR OF THE AS SESSEE BY THE HON'BLE DELHI HIGH COURT IN I.T.A. NO. 1658/2010 FO R ASSESSMENT YEAR 2006-07. WE ACCORDINGLY RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR ALLOWING ASSESSEES CLAIM IN TERMS OF THE ORDER OF THE HON'BLE DELHI HIGH COURT. THE GROUNDS OF THE ASSESSEE ON THIS ISSUE ARE ACCORDINGLY ALLOWED. 9. AS REGARDS THE ISSUE OF DISALLOWANCE U/S 14A OF THE ACT, IT IS SEEN THAT THE SCHEME OF SECTION 14A HAS WITHIN IT IMPLICIT NOTION OF APPORTIONMENT IN CASES WHERE THE EXPENDITURE IS INCURRED FOR THE COMPOSITE/INDIVISIBLE ACTIVITIES IN WHICH TAXAB LE AND NON- TAXABLE INCOME IS RECEIVED. BUT WHEN IT IS POSSIBLE TO DETERMINE THE ACTUAL EXPENDITURE IN RELATION TO THE EXEMPT IN COME OR WHEN NO EXPENDITURE HAS BEEN INCURRED IN RELATION TO THE EXEMPT INCOME, THEN PRINCIPLE OF APPORTIONMENT EMBEDDED IN SECTION 14 A HAS NO APPLICATION. THE OBJECTIVE OF SECTION 14 A IS NOT ALLOWING TO REDUCE TAX PAYABLE ON THE NORMAL EXEMPT INCOME B Y DEBITING THE EXPENDITURE INCURRED TO EARN THE EXEMPT INCOME. THUS, THE EXPENSES INCURRED TO EARN EXEMPT INCOME CANNOT BE A LLOWED AND THE EXPENSES SHALL BE ALLOWED ONLY TO THE EXTENT TH EY ARE RELATED TO THE EARNING OF TAXABLE INCOME. IF THERE IS EXPEN DITURE DIRECTLY I.T.A. NO. 4144/DEL/2011 ASSESSMENT YEAR: 2008-09 8 OR INDIRECTLY INCURRED IN RELATION TO EXEMPT INCOME , THE SAME CANNOT BE CLAIMED AGAINST THE INCOME, WHICH IS TAXA BLE AS IT IS HELD BY THE HONBLE SUPREME COURT IN CASE OF COMMIS SIONER OF INCOME-TAX V. WALFORT SHARE AND STOCK BROKERS P. LT D. REPORTED IN 326 ITR 1 (SC) THAT FOR ATTRACTING THE PROVISION S OF SECTION 14 A, THERE SHOULD BE PROXIMATE CAUSE FOR DISALLOWANCE WHICH AS RELATIONSHIP WITH THE TAX EXEMPT INCOME. THE EXPEN DITURE INCURRED IN RELATION TO THE INCOME WHICH DOES NOT F ORM PART OF TOTAL INCOME HAS TO BE DISALLOWED. HOWEVER, IT SHOU LD BE THE PROXIMATE RELATIONSHIP BETWEEN THE EXPENDITURE AND THE INCOME, WHICH DOES NOT FORM PART OF TOTAL INCOME. ONCE SUCH PROXIMITY RELATIONSHIPS EXIST, THE DISALLOWANCE IS TO BE EFFE CTED. THUS, IN ORDER TO DISALLOW THE EXPENDITURE UNDER SECTION 14A , THERE MUST BE A LIVE NEXUS BETWEEN THE EXPENDITURE INCURRED AN D THE INCOME NOT FORMING PART OF TOTAL INCOME. NO NOTIONAL EXPEN DITURE CAN BE APPORTIONED FOR THE PURPOSE OF EARNING EXEMPT INCOM E UNLESS THERE IS AN ACTUAL EXPENDITURE IN RELATION TO EARNI NG THE INCOME NOT FORMING PART OF TOTAL INCOME. 10. ON GOING THROUGH THE RECORDS AND HEARING THE RI VAL SUBMISSIONS, IT IS SEEN THAT THE ASSESSEE HAS CLAIM ED THAT EXPENDITURE AMOUNTING TO RS. 31,154/- HAD BEEN INCU RRED IN I.T.A. NO. 4144/DEL/2011 ASSESSMENT YEAR: 2008-09 9 RELATION TO EARNING OF EXEMPT INCOME. THE ASSESSIN G OFFICER DID NOT BRING ANY EVIDENCE ON RECORD TO RELATE THE EXPE NDITURE INCURRED WITH THE AMOUNT OF EXEMPT INCOME ON ONE HA ND AND RELATE THE EXEMPT INCOME TO THE INVESTMENTS YIELDIN G EXEMPT INCOME ON THE OTHER. HE SIMPLY PROCEEDED TO CALCUL ATE THE DISALLOWANCE UNDER RULE 8D. IN THE ABSENCE OF SUCH EVIDENCE, IT WAS PATENTLY WRONG ON THE PART OF THE ASSESSING OFF ICER TO COMPUTE DISALLOWANCE U/S 14A OF THE ACT BY MECHANIC ALLY APPLYING RULE 8D. THE ASSESSING OFFICER HAS ADOPTE D THE FORMULA FOR ESTIMATING EXPENDITURE ON THE BASIS OF INVESTME NTS BUT THE JUSTIFICATION FOR CALCULATING THE AVERAGE INVESTMEN T IS MISSING. 11. THE HON'BLE DELHI HIGH COURT IN THE CASE OF MAX OPP INVESTMENT LTD. VS CIT (I.T.A. 687/2009) HAS OPINED IN PARA 29 OF THE ORDER AS UNDER:- 29. SUB-SECTION (2) OF SECTION 14 A OF THE SAID ACT PROVIDES THE MANNER IN WHICH THE ASSESSING OFFICER IS TO DETERMINE THE AMOUNT OF EXPENDITURE INCURRED IN RELATION TO INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME. HOWEVER, IF WE EXAMINE THE PROVISION CAREFU LLY, WE WOULD FIND THAT THE ASSESSING OFFICER IS REQUIRE D TO DETERMINE THE AMOUNT OF SUCH EXPENDITURE ONLY IF TH E ASSESSING OFFICER, HAVING REGARD TO THE ACCOUNTS OF THE ASSESSEE, IS NOT SATISFIED WITH THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE IN RESPECT OF SUCH EXPENDITUR E IN RELATION TO INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THE SAID ACT. IN OTHER WORDS, THE I.T.A. NO. 4144/DEL/2011 ASSESSMENT YEAR: 2008-09 10 REQUIREMENT OF THE ASSESSING OFFICER EMBARKING UPON A DETERMINATION OF THE AMOUNT OF EXPENDITURE INCURRED IN RELATION TO EXEMPT INCOME WOULD BE TRIGGERED ONLY I F THE ASSESSING OFFICER RETURNS A FINDING THAT HE IS NOT SATISFIED WITH THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE IN RESPECT OF SUCH EXPENDITURE. THEREFORE, THE CONDITION PRECEDENT FOR THE ASSESSING OFFICER ENTER ING UPON A DETERMINATION OF THE AMOUNT OF THE EXPENDITU RE INCURRED IN RELATION TO EXEMPT INCOME IS THAT THE ASSESSING OFFICER MUST RECORD THAT HE , IS NOT SATI SFIED WITH THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE I N RESPECT OF SUCH EXPENDITURE. SUB-SECTION (3) IS NOT HING BUT AN OFFSHOOT OF SUB-SECTION (2) OF SECTION 14A. SUB- SECTION (3) APPLIES TO CASES WHERE THE ASSESSEE CLA IMS THAT NO EXPENDITURE HAS BEEN INCURRED IN RELATION T O INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THE SAID ACT. IN OTHER WORDS, SUB-SECTION (2) DEALS WITH CASES WHERE THE ASSESSEE SPECIFIES A POSITIVE AMOUNT OF EXPENDITURE IN RELATION TO INCOME WHICH D OES NOT FORM PART OF THE TOTAL INCOME UNDER THE SAID AC T AND SUB-SECTION (3) APPLIES TO CASES WHERE THE ASSESSEE ASSERTS THAT NO EXPENDITURE HAD BEEN INCURRED IN RELATION TO EXEMPT INCOME. IN BOTH CASES, THE ASSES SING OFFICER, IF SATISFIED WITH THE CORRECTNESS OF THE C LAIM OF THE ASSESSEE IN RESPECT OF SUCH EXPENDITURE OR NO EXPENDITURE, AS THE CASE MAY BE, CANNOT EMBARK UPON A DETERMINATION OF THE AMOUNT OF EXPENDITURE IN ACCORDANCE WITH ANY PRESCRIBED METHOD, AS MENTIONED IN SUB-SECTION (2) OF SECTION 14A OF THE SAID ACT. IT IS ONLY IF THE ASSESSING OFFICER IS NOT SATISFIED WITH THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE, IN BOTH C ASES, THAT THE ASSESSING OFFICER GETS JURISDICTION TO DET ERMINE THE AMOUNT OF EXPENDITURE INCURRED IN RELATION TO S UCH INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THE SAID ACT IN ACCORDANCE WITH THE PRESCRIBE D METHOD. THE PRESCRIBED METHOD BEING THE METHOD STIPULATED IN RULE 8D OF THE SAID RULES. WHILE REJE CTING THE CLAIM OF THE ASSESSEE WITH REGARD TO THE EXPENDITURE OR NO EXPENDITURE, AS THE CASE MAY BE, IN RELATION TO EXEMPT INCOME, THE ASSESSING OFFICER WO ULD HAVE TO INDICATE COGENT REASONS FOR THE SAME. I.T.A. NO. 4144/DEL/2011 ASSESSMENT YEAR: 2008-09 11 12. THEREFORE, ON AN OVERALL CONSIDERATION OF THE F ACTS OF THE CASE AND RESPECTFULLY FOLLOWING THE RATIO OF THE JU DGMENTS AS AFOREMENTIONED, WE HOLD THAT THE DISALLOWANCE U/S 1 4A WAS MADE WITHOUT DUE DELIBERATION AND ANALYSIS BY THE A SSESSING OFFICER AND THE LD. CIT (A) WAS ALSO PATENTLY WRONG IN CONFIRMING THE DISALLOWANCE. WE, THEREFORE, RESTORE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER FOR CALCULATING THE QUANTUM O F DISALLOWANCE AFRESH AFTER CONSIDERING ALL THE ASPECTS AS ENVISAG ED IN SECTION 14A AND RULE 8D AFTER GIVING DUE OPPORTUNITY TO THE ASSESSEE TO REPRESENT ITS CASE. THE GROUNDS PERTAINING TO THE I SSUE OF DISALLOWANCE U/S 14A ARE ACCORDINGLY ALLOWED FOR ST ATISTICAL PURPOSES. 13. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 18.4.2 016. SD/- SD/- (R.S. SYAL) (SUDHANSHU SRIVASTAVA ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: THE 18 TH OF APRIL, 2016 GS I.T.A. NO. 4144/DEL/2011 ASSESSMENT YEAR: 2008-09 12 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR BY ORDER ASSTT. REGISTRAR