ACIT, Circle- 11(1), New Delhi V. Hero Wind Energy (P) Ltd., New Delhi

ITA 7721/DEL/2019

AI Insights

The case involves an appeal by the Assistant Commissioner of Income Tax (ACIT), Circle-11(1), New Delhi against M/s Hero Wind Energy Pvt. Ltd. concerning the assessment year 2016-17. The dispute centered on the disallowance made by the Assessing Officer under section 14A of the Income Tax Act, 1961, which was related to the expenses incurred in earning exempt income. The CIT(A) had deleted this disallowance, which the revenue challenged in the Tribunal. The Tribunal's decision affirmed the CIT(A)'s order, supporting the assessee's position that the disallowance should not exceed the exempt income, as established in the cited High Court judgment.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 121939 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 8 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-06-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 26-04-2023
• Assessment Year: 2016-2017
• Appeal Filed On: 19-09-2019
• Other Referred Cases: Joint Investment Pvt. Ltd. vs CIT
• Laws Referred To: Income Tax Act 1961, Income Tax Rules 1962
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RAKESH GUPTA
• Keywords: Earning of tax free income; Set aside
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: B: NEW DELHI BEFORE SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER AND M.BALAGANESH, ACCOUNTANT MEMBER ITA No.7721/Del/2019 Assessment Year: 2016-17 ACIT, Circle-11(1), New Delhi 110001 vs. M/s Hero Wind Energy Pvt. Ltd. 201, Third Floor, Okhla Industrial Estate, Phase-III, New Delhi 110020. PAN AADCH 1677 G (Appellant) (Respondent) For Revenue: Ms. Maimun Alam, Sr. DR For Assessee: Dr. Rakesh Gupta, Adv. Shri Deepesh Garg, Adv. Shri Shrey Jain, Adv. Date of Hearing : 27.04.2023 Date of Pronouncement : 07.06.2023 ORDER PER CHANDRA MOHAN GARG, J.M. This appeal has been filed against the order of CIT(A)-4 New Delhi dated 15.07.2019 for AY 2016-17. 2. The ld. Senior DR supporting the action of the Assessing Officer submitted that the Assessing Officer was correct and justified in making disallowance and adding the same to the income of the assessee under section 14A of the I.T Act 1961 (for short the ‘ Act’) r.w.r 8D of the I.T Rules 1962 which was deleted by the ld. CIT(A) without any basis therefore impugned first appellate order may kindly be set aside by restoring that of the Assessing Officer. 3. Replying to the above, the ld. counsel of assessee drew our attention towards relevant paras 6 to 6.4 of first appellate order and submitted that the ld. CIT(A) was quite correct and justified in deleting the addition by following the judgment of Hon’ble Jurisdictional High Court of Delhi in the case of Joint Investment Pvt. Ltd. vs CIT reported as 372 ITR 694 (Del.). ITA No.7721/Del/2019 2 4. On careful consideration of above submission, first of all, from relevant part of first appellate order we note that the ld. CIT(A) noted that the appellant has suo motto disallowed the entire amount of exempt income of Rs. 5,08,788/- and thus, the assessee has not claimed any exempt income in the return of income. Thereafter, the ld. CIT(A) by referring to the judgment of Hon’ble jurisdictional High Court of Delhi in the case of Joint Investment Pvt. Ltd. vs CIT(supra) held that the disallowance u/s. 14A r.w.r 8D of the Rules cannot exceed to the exempt income and hence suo motto disallowance made by the assessee is reasonable and justified and no further disallowance is required to be made. We are unable to see any valid reason to interfere with the findings recorded by the ld. CIT(A) while deleting the addition and hence we uphold the same. Accordingly grounds of revenue are dismissed. 5. In the result, the appeal of revenue is dismissed. Order pronounced in the open court on 07.06.2023. Sd/- Sd/- (M.BALAGANESH) (CHANDRA MOHAN GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 07 th June, 2023. NV/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR // By Order // Asstt. Registrar, ITAT, New Delhi