Sundaram Textiles Ltd., Madurai V. DCIT, Madurai

ITA 825/CHNY/2019

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 1523 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-06-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 27-03-2019
• Court: TRIBUNAL

Judgement Text

0 , , IN THE INCOME TAX APPELLATE TRIBUNAL , A BENCH, CHENNAI [ , , BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ I.T.A.NO.825/CHNY/2019 ( [ [ / ASSESSMENT YEAR:2014-15) M/S. SUNDARAM TEXTILES LIMITED, 160/232, LAKSHMI BUILDING, USILAMPATTI ROAD, KOCHADAI, MADURAI -625 016. VS THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE 2, MADURAI. PAN: AACCS1479A ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : SHRI R. SRINIVASAN, ADVOCATE / RESPONDENT BY : SHRI AR.V. SREENIVASAN, JCIT /DATE OF HEARING : 11.06.2019 /DATE OF PRONOUNCEMENT : 11.06.2019 / O R D E R PER GEORGE MATHAN, JUDICIAL MEMBER: THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-1, MADURAI IN APPEAL NO.246/2016-17 DATED 28.01.2019 FOR THE ASSESSMENT YEAR 2014-15. 2 ITA NO.825/CHNY/2019 2. SHRI R.SRINIVASAN REPRESENTED ON BEHALF OF THE ASSESSEE AND SHRI AR.V. SREENIVASAN REPRESENTED ON BEHALF OF THE REVENUE. 3. IN THE ASSESSEES APPEAL, THE ASSESSEE HAS CHALLENGED THE DISALLOWANCE MADE BY THE LD.AO AND UPHELD BY THE LD.CIT(A) OF AN AMOUNT OF RS.1,40,897/- U/S.14A OF THE ACT, AS ALSO THE CONSEQUENTIAL INCLUSION OF THE SAME IN COMPUTING THE BOOK PROFIT U/S.115JB OF THE ACT. 4. IT WAS SUBMITTED BY THE LD.AR THAT THE ASSESSEE HAS NOT EARNED ANY EXEMPT INCOME AND CONSEQUENTIALLY THE PROVISIONS OF SECTION 14A WOULD NOT APPLY TO THE ASSESSEES CASE. IT WAS THE SUBMISSION THAT BEFORE THE LD.AO ALSO, MORE SPECIFICALLY IN PARA-2 OF THE ASSESSMENT ORDER, THE ASSESSEE HAS SPECIFICALLY BROUGHT TO THE ATTENTION OF THE LD.AO THAT THE ASSESSEE HAS NOT EARNED ANY EXEMPT INCOME. IT WAS THE SUBMISSION THAT IN VIEW OF THE DECISIONS OF THE HONBLE SUPREME COURT IN THE CASE OF M/S. CHETTINAD LOGISTICS (P.) LTD., REPORTED IN [2018] 95 TAXMANN.COM 250 (SC) AND OIL INDUSTRY DEVELOPMENT BOARD REPORTED IN [2019] 3 ITA NO.825/CHNY/2019 103 TAXMANN.COM 326 (SC), AS THE ASSESSEE HAS NOT EARNED ANY EXEMPT INCOME, NO DISALLOWANCE U/S.14A OF THE ACT WAS LIABLE TO BE MADE. IT WAS THE SUBMISSION THAT ONCE THE ADDITION MADE U/S.14A OF THE ACT IS DELETED, CONSEQUENTIAL DELETION WOULD ALSO HAVE TO BE DONE IN RESPECT OF THE COMPUTATION OF BOOK PROFIT U/S.115JB OF THE ACT. IN REPLY, THE LD.DR VEHEMENTLY SUPPORTED THE ORDER OF THE LD.CIT(A) AND LD.AO. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. IT IS NOTICED THAT BEFORE THE LD.AO ITSELF, THE ASSESSEE HAS SPECIFICALLY RAISED THE GROUND THAT IT HAS NOT EARNED ANY EXEMPT INCOME AND AS IT IS NOTICED THAT THE ISSUE IS NOW SQUARELY COVERED BY THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF M/S. CHETTINAD LOGISTICS (P.) LTD., AS ALSO IN M/S. OIL INDUSTRY DEVELOPMENT BOARD REFERRED SUPRA, THE LD.AO IS DIRECTED TO DELETE THE ADDITION MADE BY INVOKING THE PROVISIONS OF SECTION 14A OF THE ACT. CONSEQUENTIALLY THE COMPUTATION OF BOOK PROFIT U/S.115JB OF THE ACT IS ALSO TO BE DONE EXCLUDING THE DISALLOWANCE WHICH HAS NOW BEEN DELETED IN RESPECT OF THE PROVISIONS OF THE SECTION 14A OF THE ACT. 4 ITA NO.825/CHNY/2019 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 11 TH JUNE, 2019 AT CHENNAI. SD/- SD/- /CHENNAI, /DATED 11 TH JUNE, 2019 RSR /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. ( ) /CIT(A) 4. /CIT 5. /DR 6. [ /GF ( ) (S. JAYARAMAN) /ACCOUNTANT MEMBER ( ) (GEORGE MATHAN) /JUDICIAL MEMBER