DCIT, New Delhi V. Excel Infotech Ltd., New Delhi

MA 556/DEL/2018

• Counselvise Citation: [2022] 103 COUNSELVISE.COM (IT) 9593 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 1 month(s) 27 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 27-10-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 27-10-2022
• Assessment Year: 2011-2012
• Appeal Filed On: 30-08-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Earning of tax free income
• Section: 14A; 254(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES “B” : DELHI BEFORE SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER M.A.Nos.554, 555 & 556/Del./2018 Arising out of ITA.Nos.3492, 3493 & 3494/Del./2014 Assessment Years 2009-10, 2010-11 & 2011-12 The ACIT, Central Circle-30, New Delhi. vs. Excel Infotech Ltd., 910, Ansal Bhawan, K.G. Marg, New Delhi PAN AAACE2098K (Applicant) (Respondent) For Revenue : Shri Sanjay Kumar, Sr. D.R For Assessee : -None- Date of Hearing : 28.10.2022 Date of Pronouncement : 28.10.2022 ORDER PER ANIL CHATURVEDI, A.M. : By these Miscellaneous Applications [“M.As.”] the Revenue seeks for recall of the consolidated order of the Tribunal dated 25.04.2018 passed in ITA.Nos.3492 to 3494/Del./2014 for the A.Y. 2009-10 to 2011-12, for a fresh hearing on the ground that the Tribunal has decided 2 M.A.Nos.554, 555 & 556/Del./2018 Excel Infotech Ltd., New Delhi. the issue of disallowance under section 14A of the I.T. Act, 1961 without taking into consideration of the CBDT Circular No.05/2014 dated 11.02.2014, which is a mistake apparent from record. 2. During the course of hearing, none appeared on behalf of the assessee though the notice for hearing was issued, but, the same were returned undelivered by postal authorities with the remark “Left”. In such a situation, we proceed to hear the M.As of the Revenue ex-parte qua the assessee. 3. Before us, Ld. D.R. pointed to the Misc. Applications filed by Revenue and submitted that the Hon’ble ITAT has decided the issue of disallowance under section 14A without considering CBDT Circular No.05/2014 dated 11.02.2014 which is a mistake apparent from record as contemplated under section 254(2) of the I.T. Act, 1961. 4 We have heard the Ld. D.R. and perused the material available on record. We find that in Revenue’s appeal ITA.No.3492/Del./2014 for the A.Y. 2009-2010, the 3 M.A.Nos.554, 555 & 556/Del./2018 Excel Infotech Ltd., New Delhi. Tribunal in its order dated 25.04.2018 at para no.10 deleted the addition by treating the A.Y. 2009-10 as ‘completed assessment’ as no incriminating material was found during the course of search concerning the disallowance under section 14A of the I.T. Act, 1961, by following the Judgment of Hon’ble jurisdictional Delhi High Court in the case of Kabul Chawla vs., Commissioner of Income Tax [2016] 380 ITR 573 (Del.), to which the Ld. D.R. has no dispute before us in it’s M.A. We, therefore, dismiss the M.A.No.554/Del./ 2018 of Revenue as Revenue could not point out any mistake apparent on record. 5. As far as M.A.Nos. 555 & 556/Del./2018 in ITA.Nos.3493 & 3494/Del./2014 for the A.Ys. 2010-11 & 2011-12 are concerned, the Ld. D.R. submitted that the Tribunal in its order dated 25.04.2018 at para no.19 for the A.Y. 2010-11 and at para no.23 for the A.Y. 2011-12 restricted the disallowance to the extent of exempt income by following the Judgments of Hon’ble jurisdictional Delhi High Court in the case of Cheminvest Ltd., vs., CIT [2015] 378 ITR 33 (Del.) and in the case of CIT vs., Holcim India P. 4 M.A.Nos.554, 555 & 556/Del./2018 Excel Infotech Ltd., New Delhi. Ltd., [2014] 90CCH-081-Del-HC, without considering the CBDT Circular No.5/2014 dated 11.02.2014 and thus, there is a mistake apparent on record, which needs to recall of the order of the Tribunal dated 25.04.2018 in ITA.Nos. 3493 & 3494/Del./ 2014 for the A.Ys. 2010-11 & 2011-12. 6. We have heard the Ld. D.R. and perused the material available on record. We find that the Tribunal restricted the disallowance under section 14A of the I.T.Act to the extent of exempt income earned by the assessee by following the Judgments of Hon’ble jurisdictional Delhi High Court (supra) for the A.Ys. 2010-11 and 2011-12. The contention of the Ld. D.R. is that the Tribunal did not consider the CBDT Circular No.5/2014 dated 11.02.2014, while passing the order dated 25.04.2018 (supra) on this issue. We find that the Hon’ble jurisdictional Delhi High Court in the case of PCIT vs., IL & FS Energy Development Company Ltd., [2017] 84 taxmann.com 186 (Delhi) has held that CBDT Circular No.5/2014 dated 11.02.2014 cannot override the express provisions of Section 14A, read with Rule 8D and where no exempt income was earned in 5 M.A.Nos.554, 555 & 556/Del./2018 Excel Infotech Ltd., New Delhi. relevant assessment year, there could be no disallowance. Meaning thereby, Section 14A is clearly relatable to the earning of the actual income and not notional income or anticipated income. We are, therefore, of the view that the CBDT Circular No.5/2014 dated 11.02.2014 is not applicable to the facts of the present case and, as such, there is no mistake apparent on record in the order of the Tribunal dated 25.04.2018. Accordingly, M.As of the Revenue for the A.Ys. 2010-11 and 2011-12 are dismissed. 7. In the result, M.As of the Revenue are dismissed. Order pronounced in the open Court on 28.10.2022. Sd/- Sd/- (CHALLA NAGENDRA PRASAD) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER Delhi, Dated 28 th October, 2022 VBP/- 6 M.A.Nos.554, 555 & 556/Del./2018 Excel Infotech Ltd., New Delhi. Copy to 1. The appellant 2. The respondent 3. CIT(A) concerned 4. CIT concerned 5. D.R. ITAT ‘B’ Bench, Delhi 6. Guard File. // By Order // Assistant Registrar : ITAT Delhi Benches : Delhi.