SSL CONSOLIDATED LIMITED,HOWRAH V. I.T.O., WARD - 13(4), KOLKATA NOW WARD - 13(1), KOLKATA, KOLKATA

ITA 1333/KOL/2024

AI Insights

The case involves SSL Consolidated Limited appealing against the orders of the National Faceless Appeal Centre, Delhi, which confirmed the additions made by the AO under Section 14A read with Rule 8D of the Income Tax Rules for the assessment years 2012-13 and 2013-14. The primary contention was the disallowance amount which exceeded the exempt income earned by the assessee. The Tribunal found that the disallowance made by the AO was not in accordance with the law, as it exceeded the exempt income, and thus allowed the appeal for statistical purposes, directing the AO to adjust the disallowance accordingly.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 41273 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-04-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Other Referred Cases: Principal commissioner of Income Vs Reliance Chemotex Industries Ltd (2022) 138 tamann.com 199 (Cal), Deputy Commissioner of Income Tax Vs Jite Shipyard Ltd.(2023) 157 taxmann.com 733(Delhi)
• Laws Referred To: Income Tax Act, Rule 8D of the Rules
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: ARCHANA GUPTA
• Assessee Lawyers: SIDDARTH AGARWAL
• Keywords: Set aside; Earning of tax free income; Rule 8D
• Section: 14A

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “A(SMC)” BENCH, KOLKATA BEFORE SHRI RAJESH KUMAR, AM ITA Nos. 1332 & 1333/KOL/2024 (Assessment Years: 2012-13 & 2013-14) SSL Consolidated Limited 2nd Netaji Subash Road, Liluah, Howrah-711204 Vs. ITO, Ward 13(4) 110 Shantipally, E.M. By pass, Kolkata-700107 (Appellant) (Respondent) PAN No. AADCS5478G Assessee by : Shri Siddarth Agarwal, AR Revenue by : Shri Archana Gupta, DR Date of hearing: 27.03.2025 Date of pronouncement : 01.04.2025 O R D E R These are appeals preferred by the assessee against the orders of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 14.05.2024 for the AYs 2012-13 & 2013-14. ITA No. 1332/KOL/2024 02. The only issue raised by the assessee in the various grounds of appeal is against the confirmation of addition of ₹33,41,021/- by the ld. CIT (A) as made by the ld. AO u/s 14A of the Act r.w.r. 8D of the Rules. 03. The facts in brief are that this is a second round of litigation before us. The order passed by the ld. CIT (A) is an ex-parte order, for which the assessee filed the affidavit stating therein that only single notice for both the assessment years, was issued by the ld. CIT (A) for which the adjournment was sought by the assessee on the ground that office of the ld. AR was closed since the whole country was reeling under Covid pandemic. Thereafter, no notice was issued by the ld. CIT (A). Page | 2 ITA Nos.1332 & 1333/KOL/2024 SSL Consolidated Limited; A.Y. 2012-13 & 2013-14 and on 14.05.2024, the ld. CIT (A) passed ex-parte order without giving any further opportunity to the assessee. 04. Considering the issue involved being an open and shut case in favor of the assessee, we are not inclined to restore the issue to the file of the ld. CIT (A) though the ld CIT(A) decided these appeals ex-parte. The issue involved in the present case is that the assessee has earned exempt income of ₹13,18,219/- against which the ld. AO made disallowance u/s 40(A) Rule 8D of the Rules of ₹33,41,021/-. In our opinion, the disallowance cannot exceed the amount of exempt income as has been held in the cases of Principal commissioner of Income Vs Reliance Chemotex Industries Ltd (2022) 138 tamann.com 199 (Cal) and Deputy Commissioner of Income Tax Vs Jite Shipyard Ltd.(2023) 157 taxmann.com 733(Delhi).Therefore, we set aside the appeal to the file of the ld. AO with a direction to restrict the disallowance to the exempt income. Accordingly, the appeal of the assessee is allowed for statistical purpose. ITA No. 1333/KOL/2024 05. The issue raised by the assessee is against the confirmation of disallowance of ₹43,65,537/- by the ld. CIT (A) as made by the ld. AO u/s 14A of the Act. The facts in brief are that the assessee had exempt income of ₹ Rs. 13,88,399/-while the disallowance made by the AO was ₹ 43,65,537/-.The identical issue has been decided by us in ITA No. ITA No. 1332/KOL/2024 A.Y. 2012-13 and same would be ,mutatis mutandis, applicable to this appeal as well. Consequently the appeal is allowed for statistical purpose. Page | 3 ITA Nos.1332 & 1333/KOL/2024 SSL Consolidated Limited; A.Y. 2012-13 & 2013-14 06. In the result, both the appeals of the assessee are allowed for statistical purposes. Order pronounced in the open court on 01.04.2025. Sd/- (RAJESH KUMAR) (ACCOUNTANT MEMBER) Kolkata, Dated: 01.04.2025 Sudip Sarkar, Sr.PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, 5. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Kolkata "