INCOME TAX OFFICER, WARD-1-1, KOTA V. SHRI PRAKASH GWALERA, KOTA

ITA 812/JPR/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 1860 (ITAT-JAIPUR)
• Duration Of Justice: 1 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-12-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 06-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: POONAM RAI
• Keywords: Earning of tax free income
• Section: 14A

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH HKKXPUN] YS[KK LNL; DS LE{K BEFORE: SHRI BHAGCHAND, AM VK;DJ VIHY LA-@ ITA NO. 812/JP/2017 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2013-14. INCOME - TAX OFFICER, WARD-1(1), KOTA. CUKE VS. SHRI PRAKASH GWALERA, 28/311, GUMANPURA, KOTA. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. ACIPG 3840 Q VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SMT. POONAM RAI (DCIT) FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : NONE LQUOKBZ DH RKJH[K@ DATE OF HEARING : 06.12.2017. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 06.12.2017 VKNS'K@ ORDER PER SHRI BHAGCHAND, AM. THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER OF LD. CIT (A), KOTA DATED 01/08/2017 PERTAINING TO A.Y. 2013-14. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APP EAL AS UNDER:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , THE CIT(A) HAS ERRED IN:- (1) DELETING THE ADDITION OF RS. 3,75,183/- MADE BY AO U/S 14A R.W RULE 8D. RECEIPTS. (2) THE APPELLANT CRAVES LIBERTY TO RAISE ADDITIONAL GR OUND AND TO MODIFY/AMEND THE GROUND OF APPEAL AT THE TIME OF HE ARING. THE CASE FALLS UNDER EXCEPTION AS MENTIONED IN PARA 8(B) OF BOARDS CIRCULAR NO. 21/2015. 2 ITA NO. 812/JP/2017. SHRI PRAKASH GWALERA. 2. THE ONLY ISSUE IS INVOLVED IN THE APPEAL IS AGAI NST DELETING THE ADDITION OF RS. 3,75,183/- MADE U/S 14A R.W. RULE 8D OF THE INCOME TAX RULES. NONE ATTENDED ON BEHALF OF THE ASSESSEE. 3. LD. D/R WAS HEARD. THE LD. CIT HAS GRANTED RELIE VE OF THE ASSESSEE BY HOLDING AS UNDER:- ACCORDING TO THE FACTS THIS CASE IN RESPECT OF INV ESTMENT IN SHARES OF ENTITIES/COMPANIES FOR ACQUIRING A CONTROLLING INTE REST THEREIN INTEREST ETC. WAS DISALLOWABLE UNDER SECTION 14A OF THE ACT, IF ANY E XEMPT INCOME ON ACCOUNT OF THE SAME HAD BEEN EARNED. IN THE SAID CASE NO DI VIDEND EARNED ON SUCH INVESTMENT AND NO INTEREST LIABILITY COULD BE ATTRI BUTED TO THE SAID INVESTMENT AS THERE WERE SUFFICIENT FUNDS AVAILABLE FOR THE IN VESTMENT WITH THE ASSESSEE- HIMSELF. BASED ON THE ABOVE LEGAL PRECEDENTS IT HAS BEEN MADE CLEAR THAT SECTION 14A ENVISAGES THAT THERE SHOULD BE AN ACTUA L RECEIPT OF INCOME WHICH IS NOT INCLUDIBLE IN TOTAL INCOME; HENCE, SECTION 1 4A WILL NOT APPLY WHERE NO EXEMPT INCOME IS RECEIVED OR RECEIVABLE DURING RELE VANT PREVIOUS YEAR AS PER THE PROVISIONS LAID DOWN U/S 14A RWR 8D, THEREFORE, NO ADDITION IS JUSTIFIABLE IN THIS CASE AS WELL. ACCORDINGLY, THE ADDITION OF RS. 3,75,183/- IS ACCORDINGLY DIRECTED TO BE DELETED. THIS GROUND OF APPEAL IS TREATED AS ALLOWED. AFTER HEARING THE LD. D/R, THE BENCH IS OF THE VIEW THAT RELIEF HAS BEEN GRANTED TO THE ASSESSEE BY HOLDING THAT THERE WERE SUFFICIENT OWN FUNDS WERE AVAILABLE WITH ASSESSEE FOR MAKING SUCH INVESTMENTS. THE LD. D/R HAS NOT CONTROVERTED THIS FINDING OF FACT RECORDED BY CIT(A) WITH SUPPORTING DOCUMENTS. THEREFORE, THE BENCH FIND NO FAULT IN THE ORDER OF THE LD. CIT(A). THEREFORE THE APPEAL OF THE REVENUE IS DISMISSED. 3 ITA NO. 812/JP/2017. SHRI PRAKASH GWALERA. 4. IN THE RESULT, APPEAL OF THE REVENUE STAND DISMI SSED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 06/12/2 017. SD/- ( HKKXPUN ( BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER JAIPUR DATED: 06/12/2017 POOJA VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- INCOME-TAX OFFICER, WARD-1(1), KOTA. 2. THE RESPONDENT SHRI PRAKASH GWALERA, KOTA. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 812/JP/2017) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR