Manglam Wires Pvt. Ltd., Delhi V. ITO, New Delhi

ITA 4418/DEL/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 7368 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 3
• Next Hearing Date: 22-06-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 12-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: FARHAT KHAN
• Assessee Lawyers: S K MANGLAM
• Keywords: Earning of tax free income
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC-3 NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER I.T.A .NO.-4418/DEL/2014 (ASSESSMENT YEAR-20 11-12) MANGLAM WIRES PVT. LTD., F-3, SHASTRI NAGAR, MAIN ROAD, DELHI-110052. PAN-AAACGM0762G (APPELLANT) VS ITO, WARD-6(2), NEW DELHI (RESPONDENT) APPELLANT BY SH. S.K.MANGLAM RESPONDENT BY SH. FARHAT KHAN, SR.DR. ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE A SSAILING THE CORRECTNESS OF THE ORDER DATED 30.06.2014 OF CIT(A)-IX, NEW DEL HI PERTAINING TO 2011 12 ASSESSMENT YEAR ON THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE LD. COM MISSIONER OF INCOME TAX (APPEALS) WAS NOT JUSTIFIED IN CONFIRMIN G THE ADDITION OF RS.1,05,878/- TO THE INCOME OF THE ASSESSEE, BY ASS ESSING OFFICER U/S 14A OF THE I.T.ACT READ WITH RULE 8D OF THE I.T.RUL ES. 2. IT IS CONTENDED THAT NO DISALLOWANCE IS REQUIRED TO BE MADE UNDER THE PROVISIONS OF SECTION 14A READ WITH RULE 8D OF I.T. ACT IN THE PRESENT CASE, SINCE THERE WAS NO INCOME COVERED U/S 14A AND THERE WERE NO DIRECT OR INDIRECT EXPENSES, INCURRED IN THAT CONNE CTION. 3. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, FORGO OR AMEND ANY GROUNDS OF APPEAL AT THE TIME OF HEARING. 2. THE LD.AR SUBMITTED RIGHT AT THE OUTSET POINT AT ISSUE IS COVERED IN ASSESSEES FAVOUR BY THE DECISION OF THE DELHI HIGH COURT IN THE CASE OF CHEMINVEST LTD. VS CIT [2015] 378 ITR 33 (DEL.). REFERRING TO FACTS, IT WAS SUBMITTED THAT IN THE FACTS OF THE PRESENT CASE ALS O, NO EXEMPT INCOME HAS BEEN RECEIVED BY THE ASSESSEE. THE SPECIFIC FACT IT WAS SUBMITTED IS COMING OUT FROM THE ASSERTIONS MADE IN THE ASSESSMENT ORDER VIDE LETTER DATED 23.03.2013. THE DATE OF HEARING 22.06.2016 DATE OF PRONOUNCEMENT 19.08.2016 I.T.A .NO.-4418/DEL/2014 PAGE 2 OF 2 LD.SR.DR WAS REQUIRED TO ADDRESS WHETHER ANY EXEMPT INCOME HAS BEEN EARNED BY THE ASSESSEE. ON PERUSING THE MATERIAL AVAILABLE O N RECORD, IT WAS SUBMITTED THAT IT APPEARS THAT NO EXEMPT INCOME WAS EARNED BY THE ASSESSEE IN THE YEAR UNDER CONSIDERATION. NO CONTRARY DECISION IN ORDER TO CA NVASS A CONTRARY VIEW WAS CITED BY THE LD.SR DR. IN THE LIGHT OF THE SUBMISSIONS O F THE PARTIES BEFORE THE BENCH, I FIND THAT THE RELIANCE PLACED BY THE AO ON THE DECI SION OF THE SPECIAL BENCH IN THE CASE OF CHEMINVEST LTD. [2009] 317 ITR (AT) 86 (DELHI) (SB) WHICH ADMITTEDLY HAS BEEN OVER-RULED BY THE HONBLE HIGH COURT BY IT S JUDGEMENT DATED 02.09.2015, THE ADDITION MADE IN THE IMPUGNED ORDER QUA THIS IS SUE CANNOT SURVIVE. A PERUSAL OF THE SAID DECISION, IT IS SEEN SHOWS THAT THE HON BLE COURT HAS PLACED RELIANCE ON CIT VS HOLCIM INDIA PVT. LTD. ORDER DATED 05.09.2014 IN ITA NO.486 OF 2014 AS IS EVIDENT FROM PARAS 15 & 16 OF THE SAID DECISION. ACCORDINGLY IN THE ABSENCE OF ANY ARGUMENT ON FACT OR LAW TO CANVASS A CONTRARY V IEW, THE APPEAL OF THE ASSESSEE IS ALLOWED. 3. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 19 TH AUGUST 2016. SD/- (DIVA SINGH ) JUDICIAL ME MBER *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR, ITAT NEW DELHI