TATA SONS PVT LTD., MUMBAI V. DCIT CIR. - 2(3)(1), MUMBAI

MA 133/MUM/2022

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 3474 (ITAT-MUMBAI)
• Duration Of Justice: 1 month(s) 25 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 20-07-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: J
• Next Hearing Date: 14-07-2022
• Assessment Year: 2010-2011
• Appeal Filed On: 25-05-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: AARTI VASANJI
• Keywords: Earning of tax free income; Rule 8D
• Section: 14A; 115JB

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL “J” BENCH, MUMBAI BEFORE SHRI PAVAN KUMAR GADALE, HON’BLE JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, HON’BLE ACCOUNTANT MEMBER M.A.No. 133/MUM/2022 [ARISING OUT OF ITA No. 6418/MUM/2016 (A.Y. 2010-11)] M/s. Tata Sons Pvt. Ltd., 24, Bombay House Homi Modi Street, Fort Mumbai - 400001 PAN: AAACT4060A v. ACIT –2(3)(1) Mumbai (Appellant) (Respondent) Assessee by : Aarti Vasanji Department by : Mahita Nair Date of hearing : 15.07.2022 Date of pronouncement : 21.07.2022 ORDER PER S. RIFAUR RAHMAN (AM) 1. Through this miscellaneous application assessee requested to rectify certain mistakes crept in ITAT order in ITA.No. 6418/Mum/2016 (A.Y.2010-11) order dated 27.01.2022. 2 M.A.No. 133/MUM/2022 M/s. Tata Sons Pvt. Ltd., 2. At the time of hearing, it is brought to our notice that assessee has raised additional ground in its appeal in ITA.No. 6418/Mum/2019 along with grounds of appeal. Assessee has also filed a chart and brought to the notice of the bench that the additional Ground No. 4A and 5 raised by the assessee are covered in favour of the assessee. It was submitted that ITAT has not adjudicated the above said additional ground raised by the assessee. It is prayed that additional Ground No. 4A may be adjudicated and additional Ground No.5 is not pressed. 3. On the other hand, Ld. DR did not made any objection to the above submissions. 4. Considered the rival submissions and material placed on record, after considering the submissions and after verifying the records submitted by the assessee, it is apparent on record that the bench has failed to adjudicate the additional Ground Nos. 4A and 5 while adjudicating the appeal of the assessee. Accordingly, these grounds raised by the assessee are covered in favour of the assessee, particularly Ground No.4A, with regard to Ground No. 5 it is relating to education cess and assessee has preferred not to press this ground. 3 M.A.No. 133/MUM/2022 M/s. Tata Sons Pvt. Ltd., 5. Accordingly, we admitted the grounds for adjudication and we heard the submissions of both counsels. Accordingly, the additional Ground 4A is taken up for adjudication. 6. Ld. AR submitted that the issue involved is relating to determination of book profits u/s. 115JB of the Act and as per clause (f) to Explanation 1 to s.115JB of the Act, the amount, if any, is increased only by direct expenditure incurred relatable to exempt income in terms of clause (i) of sub-rule (2) of Rule 8D and not the estimated disallowance made under Rule 8D(2)(ii) and (iii) of I.T. Rules. She brought to our notice that this issue is squarely covered in favour of the assessee in assessee’s own case in A.Y. 2009-10 and A.Y. 2008-09. 7. On the other hand, Ld. DR relied on the orders of the authorities below. 8. Considered the rival submissions and material placed on record, we observe that in A.Y. 2008-09 the Coordinate Bench has decided the issue observing as under: - “3.7. We find that the assessee had raised an additional ground vide Ground No. 2A in respect of disallowance u/s 14A of the Act while computing the book profits u/s 115JB of the Act. We find that this is a legal issue and goes into the root of the matter and does 4 M.A.No. 133/MUM/2022 M/s. Tata Sons Pvt. Ltd., not involve any verification of facts and hence the same is admitted herein. We find that the Hon‟ble Special Bench of Delhi Tribunal in the case of Vireet Investments reported in 165 ITD 27 had categorically held that the computation mechanism provided in Rule 8D(2) of the Rules cannot be imputed in clause (f) of Explanation 1 to Section 115JB(2) of the Act. We find that the Special Bench further held that only the actual expenses debited to the profit and loss account that are relatable to earning of exempt income should be considered for the said purpose. We direct the ld AO to compute the disallowance in the light of the said Special Bench decision. Accordingly the Additional Ground No.2 A raised by the assessee is allowed for statistical purposes.” 9. Respectfully following the above said decision, we also deem it fit and proper to remit this issue back to the file of the Assessing Officer to compute the disallowance in the light of the above said Special Bench decision. Accordingly, additional Ground No. 4A raised by the assessee is allowed for statistical purpose. 10. In the result, Miscellaneous Application filed by the assessee is partly allowed as indicated above. Order pronounced in the open court on 21.07.2022. Sd/- Sd/- (PAVAN KUMAR GADALE) (S. RIFAUR RAHMAN) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai / Dated 21/07/2022 Giridhar, Sr.PS 5 M.A.No. 133/MUM/2022 M/s. Tata Sons Pvt. Ltd., Copy of the Order forwarded to: 1. The Appellant 2. The Respondent. 3. The CIT(A), Mumbai. 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. //True Copy// BY ORDER (Asstt. Registrar) ITAT, Mum