Opelina Finance & Investment Ltd., New Delhi V. DCIT, New Delhi

ITA 4254/DEL/2010

• Counselvise Citation: [2011] 135 COUNSELVISE.COM (IT) 0216 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 23-02-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 16-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PIYUSH SONKAR
• Assessee Lawyers: GOPAL NATHANI
• Section: 143(3); 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E DELHI BEFORE SHRI R. P. TOLANI AND SHRI K.G. BANSAL ITA NO. 4254(DEL)/2010 ASSESSMENT YEAR: 2007-08 OPELINA FINANCE & INVESTMENTS DEPUTY COMMISSIONER OF LTD., 28, NAJAFGARH ROAD, VS. IN COME-TAX, CIRCLE 13(1), NEW DELHI. NEW DELHI. PAN-AAACO5195R (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI GOPAL NATHANI, CA RESPONDENT BY : SHRI PIYUSH SONKAR, SR. DR ORDER PER K.G. BANSAL : AM THIS APPEAL EMANATES FROM THE ORDER OF THE CIT (APPEALS)-XVI, NEW DELHI, PASSED IN APPEAL NO. 169/2009-10 ON 22.06.2010, AND IT PERTAINS TO ASSESSMENT YEAR 2007-08. THE CORRES PONDING ASSESSMENT ORDER WAS FRAMED BY THE DEPUTY COMMISSIONER OF INCOME-T AX, CIRCLE 13(1), NEW DELHI, ON 10.2.2009 UNDER THE PROVISIONS OF SEC TION 143(3) OF THE INCOME- TAX ACT, 1961. THE ASSESSEE HAS TAKEN UP THREE GROUNDS IN THE APPEAL, THE SUM AND SUBSTANCE OF WHICH IS THAT THE LD. CIT(AP PEALS) ERRED IN DISALLOWING EXPENDITURE OF RS. 55,19,125/- BY INVOK ING THE PROVISION CONTAINED IN SECTION 14A READ WITH RULE 8D, AGAINST THE ACTUAL DISALLOWANCE OF RS. 13,04,227/- MADE BY THE ASSESSEE IN THE RETURN OF INCOME. IT ITA NO. 4254(DEL)/2010 2 IS THE COMMON CASE OF BOTH THE PARTIES THAT THE ISSUE STANDS COVERED BY THE DECISION OF HONBLE BOMBAY HIGH COURT IN TH E CASE OF GODREJ & BOYCE MANUFACTURING CO. LTD., (2010) 194 TAXMAN 2 03. IT WAS INTER-ALIA HELD THAT THE PROVISIONS CONTAINED IN SECTION 14 A AND RULE 8D ARE NOT ULTRA VIRES. IT HAS BEEN FURTHER HELD THAT RULE 8D OPERATES PROSPECTIVELY FROM ASSESSMENT YEAR 2008-09. IT WAS ALSO HEL D THAT THE AO CAN CONSIDER OVERALL FACTS AND MAKE REASONABLE D ISALLOWANCE IN RESPECT OF EXPENDITURE INCURRED FOR EARNING THE INCOME, W HICH IS NOT INCLUDED IN THE TOTAL INCOME. IT IS ALSO THE COMMON CASE OF B OTH THE PARTIES THAT THE ISSUE IS PENDING BEFORE HONBLE DELHI HIGH COUR T ALSO FOR DECISION, WHICH IS THE JURISDICTIONAL HIGH COURT IN THIS CAS E. IT IS ALSO THEIR COMMON CASE THAT THE MATTER MAY BE RESTORED TO THE FILE OF THE AO TO COMPUTE THE DISALLOWANCE AS PER DECISION IN THE CASE OF GOD REJ & BOYCE MANUFACTURING CO. LTD. AND IN CASE THE DECISION O F JURISDICTIONAL HIGH COURT BECOMES AVAILABLE BEFORE PASSING THE ORDER, THE SAME MAY BE TAKEN INTO ACCOUNT. 2. WE HAVE CONSIDERED THE FACTS OF THE CASE AN D SUBMISSIONS MADE BEFORE US. IN VIEW OF THE SUBMISSIONS MADE BEFO RE US, THE MATTER IS RESTORED TO THE FILE OF THE AO TO MAKE FRESH DE CISION AS PER LAW AFTER ITA NO. 4254(DEL)/2010 3 CONSIDERING VARIOUS DECISIONS AVAILABLE IN THE M ATTER TILL THE PASSING OF THE ORDER INCLUDING THAT OF GODREJ & BOYCE MANUFACT URING CO. LTD. (SUPRA). 3. IN THE RESULT, THE APPEAL IS TREATED AS ALLO WED FOR STATISTICAL PURPOSES. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT ON 11 MARCH, 2011. SD/- SD/- (R.P.TOLANI) (K.G.BANSAL) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE OF ORDER: 11TH MARCH, 2011. SP SATIA COPY OF THE ORDER FORWARDED TO: OPELINA FINANCE & INVESTMENT LTD., NEW DELHI. DCIT, CIRCLE 13(1), NEW DELHI. CIT(A) CIT THE DR, ITAT, NEW DELHI. ASSISTANT REG ISTRAR.