JINDAL SOUTH WEST HOLDINGS LTD, MUMBAI V. DCIT 5(2), MUMBAI

ITA 5311/MUM/2010

• Counselvise Citation: 531119914 RSA 2010
• Duration Of Justice: 1 year(s) 5 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-12-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Next Hearing Date: 29-11-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 28-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: O A MAO
• Assessee Lawyers: A V SONDE
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH I MUMBAI BEFORE SHRI B.R. MITTAL (JUDICIAL MEMBER) AND SHRI PRAMOD KUMAR (ACCOUNTANT MEMBER) ITA NO.5311/MUM/2010 ASSESSMENT YEAR-2007-08 M/S. JINDAL SOUTH WEST HOLDINGS LTD., 5A, JINDAL MANSION, DR. G. DESHMUKH MARG, MUMBAI-400 026 PAN-AABCJ 1531F VS. THE DCIT 5(2), AAYAKAR BHAVAN, MUMBAI-400 020 (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI A.V. SONDE RESPONDENT BY: SHRI O.A. MAO DATE OF HEARING :29.11.2011 DATE OF PRONOUNCEMENT: 2.12.2011 O R D E R PER B.R. MITTAL, JM : THE ASSESSEE HAS FILED THIS APPEAL FOR ASSESSMENT Y EAR 2007-08 AGAINST ORDER OF LD. CIT(A) DT. 24.5.2010 ON FOLLOWING GROU ND: THE LD. CIT(A) ERRED IN LAW AND FACTS OF THE CASE WHILE CONFIRMING THE DISALLOWANCE OF RS. 81,03,631/- U/S. 14A OF THE ACT . THE LD. CIT(A) WAS NOT JUSTIFIED IN REJECTING THE ASSESSEES CONT ENTION THAT THE SAID EXPENSES WERE INCURRED DURING THE NORMAL COURS E OF ITS BUSINESS TO COMPLY WITH VARIOUS STATUTORY REQUIREMENTS AND FOR RUNNING THE OPERATIONS OF THE ASSESSEE COMPANY. THEREFORE, THE DISALLOWANCE OF RS. 81,03,631 U/S. 14A BE DELETED. 2. WE HAVE HEARD LD. REPRESENTATIVES OF THE PARTIES AND HAVE PERUSED THE ORDERS OF AUTHORITIES BELOW. WE OBSERVE THAT A O MADE DISALLOWANCE U/S. 14A R.W. RULE 8D OF I.T. RULES IN RESPECT OF EXEMPT ED INCOME BY FOLLOWING DECISION OF SPECIAL BENCH IN THE CASE OF DAGA CAPIT AL MANAGEMENT PVT. LTD . VS ITO 312 ITR (AT) 01 (SB)(MUM). ITA NO. 5311/M/2010 2 3. IN THE FIRST APPEAL, LD. CIT(A) HAS CONFIRMED AC TION OF AO. 4. HOWEVER, SAID DECISION OF SPECIAL BENCH OF ITAT HAS BEEN REVERSED BY HONBLE BOMBAY HIGH COURT IN THE CASE OF GODREJ & B OYCE MFG. CO. LTD. VS DCIT 328 ITR 81, WHEREIN IT HAS BEEN HELD THAT RULE 8D OF I.T. RULE IS PROSPECTIVE IN NATURE AND IS APPLICABLE FROM ASSESS MENT YEAR 2008-09. IN VIEW OF ABOVE, WE SET ASIDE THE ORDERS OF AUTHORITI ES BELOW AND RESTORE THE MATTER TO AO WITH A DIRECTION TO RE-DECIDE THE DISA LLOWANCE TO BE MADE, IF ANY, IN RESPECT OF EXEMPTED INCOME AFTER GIVING DUE OPPORTUNITY OF HEARING TO ASSESSEE AND CONSIDERING SUCH EVIDENCES AS MAY BE F ILED AS PER LAW. THEREFORE GROUND OF APPEAL TAKEN BY ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. 5. IN THE RESULT, APPEAL FILED BY ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 2 ND DAY OF DECEMBER, 2011 SD/- SD/- ( PRAMOD KUMAR) (B.R. MITTAL ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 2 ND DECEMBER, 2011 RJ COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT-CONCERNED 4. THE CIT(A)-CONCERNED 5. THE DR I BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR, I.T.A.T, MUMBAI ITA NO. 5311/M/2010 3 ITA NO. 5311/M/2010 4 DATE INITIALS 1. DRAFT DICTATED ON: 29.11.2011 SR. PS/PS 2. DRAFT PLACED BEFORE AUTHOR: 29.11.2011 SR. PS/PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER: JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER: JM/AM 5. APPROVED DRAFT COMES TO THE SR. PS/PS: SR. PS/PS 6. ORDER PRONOUNCED ON: SR. PS/PS 7. FILE SENT TO THE BENCH CLERK: 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK: SR. PS/PS 9. DATE ON WHICH FILE GOES TO AR 10. DATE OF DISPATCH OF ORDER: