DCIT 3(2) (1), Mumbai V. M/S. MUKUND LTD, MUMBAI

MA 29/MUM/2023

AI Insights

The case revolves around a miscellaneous application filed by the Deputy Commissioner of Income Tax, Mumbai, seeking to recall an earlier Tribunal order concerning the disallowance under section 14A and section 115JB of the Income Tax Act. The Revenue argued that an amendment by the Finance Act, 2022, which allows disallowance under section 14A even in the absence of exempt income, should apply retrospectively to the assessment year 2017-18. The respondent, Mukand Limited, opposed this application, citing that the amendment is prospective and not applicable to the year in question. The Tribunal, referencing decisions from the Delhi High Court and its own previous rulings, dismissed the application, affirming that the amendment does not have retrospective effect.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 301260 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 29 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 11-07-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Next Hearing Date: 18-05-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 12-01-2023
• Other Referred Cases: Pr.CIT vs. Era Infrastructure (India) Ltd., ACIT vs. Bajaj Capital Ventures (P.) Ltd.
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: JITENDRA SINGH
• Keywords: Earning of tax free income; Retrospective amendment
• Section: 14A; 115JB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH “H”, MUMBAI BEFORE SHRI KULDIP SINGH, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER MA No.29/M/2023 (Arising out of ITA No.1794/M/2021) Assessment Year: 2017-18 DCIT- 3(2)(1), Room No.674, 6 th Floor, Aayakar Bhavan, M.K. Road, Mumbai - 400020 Vs. M/s. Mukand Limited, 3 rd Floor, Bajaj Bhavan, Jamnalal Bajaj Marg, Nariman Point, Mumbai – 400 021 PAN: AAACM5008R (Appellant) (Respondent) Present for: Assessee by : Shri Jitendra Singh, A.R. Revenue by : Shri Milind Chavan, D.R. Date of Hearing : 19 . 05 . 2023 Date of Pronouncement : 12 . 07 . 2023 O R D E R Per : Kuldip Singh, Judicial Member: Heard : Applicant Deputy Commissioner of Income Tax, Mumbai (hereinafter referred to as the Revenue) by filing the present miscellaneous application in ITA No.1794/M/2021sought to recall the order dated 31.05.2022 passed in the appeal (supra) for fresh adjudication primarily on the ground that Tribunal while deciding the issue of 14A & 14A read with section 115JB of the Act held that when there is no exempt income no disallowance can be made under section 14A as well as under section 115JB of the Act is erroneous because as per amendment by Finance Act, 2022 even if there is no exempt income MA No.29/M/2023 (Arising out of ITA No.1794/M/2021) M/s. Mukand Limited 2 earned by the assessee disallowance under section 14A of the Act can be made. 2. Application has been opposed by the Ld. A.R. for the respondent/assessee on the ground that amendment by Finance Act, 2022 sought to be applied by the Ld. D.R. to the present appeal pertaining to A.Y. 2017-18 is not applicable being prospective in nature and relied upon decision rendered by Hon’ble High Court of Delhi in case of Pr.CIT vs. Era Infrastructure (India) Ltd. (2022) 141 taxmann.com 289 (Delhi), order passed by the co-ordinate Bench of the Tribunal in case of ACIT vs. Bajaj Capital Ventures (P.) Ltd. (2022) 140 taxmann.com 1 (Mumbai – Trib.) 3. We have heard the Ld. Authorised Representatives of the parties to the appeal, perused the orders passed by the Ld. Lower Revenue Authorities and documents available on record in the light of the facts and circumstances of the case and law applicable thereto. 4. Solitary question to be decided in this miscellaneous application is: “As to whether amendment by Finance Act, 2022 qua section 14A is applicable to the year under consideration i.e. 2017-18?” 5. This question has already been answered by the Hon’ble High Court of Delhi in case of Era Infrastructure (India) Ltd. (supra) and by the co-ordinate Bench of the Tribunal in case of Bajaj Capital Venture Pvt. Ltd. (supra) whereby it is held by the Hon’ble High Court that “amendment made by Finance Act, 2022 to section 14A by inserting a non-obstante clause and explanation will take effect from 01.04.2022 and cannot be presumed to have retrospective effect.” MA No.29/M/2023 (Arising out of ITA No.1794/M/2021) M/s. Mukand Limited 3 6. In view of the matter the issue in question has been legally and validly decided by the Bench vide order dated 31.05.2022 (supra), hence no ground for recalling the order is made out. 7. Resultantly, miscellaneous application filed by the Revenue is hereby dismissed. Order pronounced in the open court on 12.07.2023. Sd/- Sd/- (AMARJIT SINGH) (KULIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, Dated: 12.07.2023. * Kishore, Sr. P.S. Copy to: The Appellant The Respondent The CIT, Concerned, Mumbai The DR Concerned Bench //True Copy// By Order Dy/Asstt. Registrar, ITAT, Mumbai.