Polaris Banyan Holding Pvt Ltd., CHENNAI V. ACIT Corporate Circle 5(2), CHENNAI

MA 19/CHNY/2020

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 3235 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 6 month(s) 15 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 11-08-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 11-08-2022
• Assessment Year: 2015-2016
• Appeal Filed On: 27-01-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Earning of tax free income; Rule 8D

Judgement Text

आयकर अपीलȣय अͬधकरण,‘बी’ Ûयायपीठ, चेÛनई IN THE INCOME TAX APPELLATE TRIBUNAL , ‘B’ BENCH, CHENNAI Įी वी. द ु गा[ राव, ÛयाǓयक सदèय एवं Įी जी. मंज ु नाथ, लेखा सदèय के सम¢ BEFORE SHRI V.DURGA RAO, JUDICIAL MEMBER AND SHRI G. MANJUNATHA, ACCOUNTANT MEMBER Misc. Application No.19/Chny/2020 [In ITA No.896/Chny/2019] (Ǔनधा[रणवष[ / Assessment Year: 2015-16) M/s. Polaris Banyan Holding Pvt.Ltd. 244, Carex Centre, Anna Salai, Chennai-600 006. Vs The Asst. Commissioner of Income Tax, Corporate Circle-5(2), Chennai PAN: AAJCA 4622N (ᮧाथᭅक /Petitioner) (Ĥ×यथȸ/Respondent) ᮧाथᭅककȧओरसे/ Petitioner by : Mr. G.Sivasubramanian, C.A. Ĥ×यथȸकȧओरसे/Respondent by : Mr. Sajit Kumar, JCIT स ु नवाईकȧतारȣख/Date of hearing : 12.08.2022 घोषणाकȧतारȣख /Date of Pronouncement : 12.08.2022 आदेश / O R D E R PER G.MANJUNATHA, AM: The present Miscellaneous Petition is filed by the assessee against the order of this Tribunal dated 11.12.2019 in ITA No.896/Chny/2019 relevant to the assessment year 2015-16. 2. We have heard both the parties and considered petition filed by the assessee u/s.254(2) of the Income Tax Act, 1961, and we find that there is a prima-facie mistake in the order of the Tribunal, inasmuch as on the issue of disallowance u/s.14A read with Rule 8D of the I.T.Rules, 1962, because the 2 M.A. No.19/Chny/2020 Tribunal had given vague finding without any quantification as to what is amount of disallowances required to be made u/s.14A in light of the findings of the lower authorities. Although, the Tribunal has directed the Assessing Officer to restrict disallowances to the extent of exempt income, but fact remains that in the present case exempt income earned for the relevant assessment year is at Rs.12,51,30,863/-, whereas total expenses debited into profit & loss account was only at Rs.1,10,82,956/- which can be linked to exempt income. If you go by directions of the Tribunal, the Assessing Officer can work out expenses u/s.14A r.w. Rule 8D of Income Tax Rules, 1962, and restrict such expenses to the extent of exempt income, which may exceed amount of total expenses incurred by the assessee for the relevant assessment year. The Tribunal, without considering the above aspect gave vague findings. In our considered view, said findings of the Tribunal constitute mistake apparent on record, which needs to be rectified u/s.254(2) of the Income Tax Act, 1961. Hence, we recall order of the Tribunal dated 11.12.2019 for the assessment year 3 M.A. No.19/Chny/2020 2015-16 and direct the Registry to post appeal in due course and inform both the parties. 3. In the result, Misc. Application filed by the assessee is allowed. Order pronounced in the open court on 12 th August, 2022 Sd/- Sd/- ( वी. द ु गा[ राव) (जी. मंज ु नाथ) (V.Durga Rao) (G.Manjunatha) ÛयाǓयक सदèय /Judicial Member लेखा सदèय / Accountant Member चेÛनई/Chennai, Ǒदनांक/Dated 12 th August, 2022 DS आदेश कȧ ĤǓतͧलͪप अĒेͪषत/Copy to: 1. Appellant 2. Respondent 3. आयकर आय ु Èत (अपील)/CIT(A) 4. आयकर आय ु Èत/CIT 5. ͪवभागीय ĤǓतǓनͬध/DR 6. गाड[ फाईल/GF.