ACIT, New Delhi V. M/s Sainik Mining & Allied Services Ltd, New Delhi

ITA 6877/DEL/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 4322 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 8 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-09-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 31-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S K TULSIYAN
• Keywords: Earning of tax free income
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : B : NEW DELHI BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND MS SUCHITRA KAMBLE, JUDICIAL MEMBER ITA NOS.6876 TO 6878/DEL/2015 ASSESSMENT YEARS : 2009-10 TO 2011-12 ACIT, CENTRAL CIRCLE-8 (NOW CC-17), ARA CENTRE, JHANDEWALEN, NEW DELHI. VS. SAINIK MINING & ALLIED SERVICES LTD., 129, TRANSPORT CENTRE, PUNJABI BAGH, NEW DELHI. PAN: AAACS2791P CO NOS.128 TO 130/DEL/2016 (ITA NOS.6876 TO 6878/DEL/2015) ASSESSMENT YEARS : 2009-10 TO 2011-12 SAINIK MINING & ALLIED SERVICES LTD., 129, TRANSPORT CENTRE, PUNJABI BAGH, NEW DELHI. PAN: AAACS2791P VS. ACIT, CENTRAL CIRCLE-8 (NOW CC-17), ARA CENTRE, JHANDEWALEN, NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI S.K. TULSIYAN, ADVOCATE DEPARTMENT BY : MS RACHNA SINGH, CIT, DR ITA NOS.6876 TO 6878/DEL/2015 CO NO.128 TO 130/DEL/2016 2 DATE OF HEARING : 14.09.2017 DATE OF PRONOUNCEMENT : 15.09.2017 ORDER PER BENCH: THESE THREE APPEALS BY THE REVENUE AND EQUAL NUMBE R OF CROSS OBJECTIONS BY THE ASSESSEE RELATE TO THE ASSESSMENT YEARS 2009-10, 2010- 11 AND 2011-12. SINCE ALL THE APPEALS INVOLVE A SO LITARY ISSUE OF DISALLOWANCE U/S 14A OF THE INCOME-TAX ACT, 1961 (H EREIANFTER ALSO CALLED `THE ACT), WE PROCEED TO DISPOSE THEM OFF B Y THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. THE FACTS RELATING TO ASSESSMENT YEAR 2009-10 AR E THAT THE ASSESSEE MADE CERTAIN INVESTMENT IN SHARES ETC. NO DISALLOW ANCE WAS OFFERED U/S 14A OF THE ACT READ WITH RULE 8D. AFTER CONSIDERIN G THE ASSESSEES OBJECTIONS, THE ASSESSING OFFICER MADE DISALLOWANCE U/S 14A READ WITH RULE 8D(2)(III) AT % OF THE AVERAGE VALUE OF INVES TMENTS. THIS RESULTED INTO AN ADDITION OF RS.10,81,627/-. THE LD. CIT(A) DELETED THE ADDITION BY NOTICING THAT THE ASSESSEE HAD NOT EARNED ANY EX EMPT DIVIDEND ITA NOS.6876 TO 6878/DEL/2015 CO NO.128 TO 130/DEL/2016 3 INCOME DURING THE YEAR. THE REVENUE IS AGGRIEVED A GAINST SUCH DELETION. 3. HAVING HEARD BOTH THE SIDES AND PERUSED THE RELE VANT MATERIAL ON RECORD, IT IS FOUND AS AN ADMITTED POSITION THAT TH E ASSESSEE DID NOT EARN ANY EXEMPT INCOME DURING ALL THE THREE YEARS UNDER CONSIDERATION. THE HON'BLE DELHI HIGH COURT IN CHEMINVEST LTD. VS. CIT (2015) 378 ITR 33 (DEL) , HAS HELD THAT IF THERE IS NO EXEMPT INCOME, THERE CAN BE NO QUESTION OF MAKING ANY DISALLOWANCE U/S 14A. SIMIL AR VIEW HAS BEEN TAKEN BY THE HON'BLE JURISDICTIONAL HIGH COURT IN CIT VS. HOLCIM INDIA P. LTD. (2014) 90CCH 081-DEL-HC . IN VIEW OF THESE BINDING PRECEDENTS PROVIDING FOR NOT MAKING ANY DISALLOWANCE U/S 14A I N THE ABSENCE OF ANY EXEMPT INCOME, WHICH ARE SQUARELY APPLICABLE TO THE FACTS OF THE INSTANT CASE, WE COUNTENANCE THE VIEW TAKEN BY THE LD. CIT(A). 4. BOTH THE SIDES ARE IN AGREEMENT THAT THE FAC TS AND CIRCUMSTANCES OF THE OTHER TWO YEARS UNDER CONSIDERATION ARE MUTATIS MUTANDIS SIMILAR TO THE A.Y. 2009-10 DISCUSSED ABOVE INASMUCH AS IN NO NE OF THESE YEARS, ITA NOS.6876 TO 6878/DEL/2015 CO NO.128 TO 130/DEL/2016 4 THE ASSESSEE EARNED ANY EXEMPT INCOME. WE, ERGO, UP HOLD THE IMPUGNED ORDERS FOR THESE YEARS AS WELL. 5. THE CROSS OBJECTIONS FILED BY THE ASSESSEE F OR ALL THE THREE YEARS ARE STATED TO BE IN SUPPORT OF THE IMPUGNED ORDERS. 6. IN THE RESULT, ALL THE APPEALS OF THE REVENUE AN D THE CROSS OBJECTIONS OF THE ASSESSEE ARE DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 15.09.201 7. SD/- SD/- [SUCHITRA KAMBLE] [R.S. SYAL] JUDICIAL MEMBER VICE PRESIDENT DATED,15 TH SEPTEMBER, 2017. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.