M/s Moonstar Securities Trading & Finance Co. Pvt. Ltd., New Delhi v. Addl. CIT, New Delhi

ITA 138/DEL/2011 | 2007-2008
Pronouncement Date: 16-03-2011 | Result: Allowed

Appeal Details

RSA Number 13820114 RSA 2011
Assessee PAN AAACM8415A
Bench Delhi
Appeal Number ITA 138/DEL/2011
Duration Of Justice 2 month(s) 5 day(s)
Appellant M/s Moonstar Securities Trading & Finance Co. Pvt. Ltd., New Delhi
Respondent Addl. CIT, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 16-03-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted E
Tribunal Order Date 16-03-2011
Date Of Final Hearing 16-03-2011
Next Hearing Date 16-03-2011
Assessment Year 2007-2008
Appeal Filed On 10-01-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH E NEW DELHI) BEFORE SHRI RAJPAL YADAV AND SHRI B.C. MEENA ITA NO.138/DEL/2011 ASSESSMENT YEAR: 2007-08 MOONSTAR SECURITIES TRADING & VS. ADDITIONAL CIT ROOM NO.20 E BLOCK 4 TH FLOOR RANGE-5 INTERNATIONAL TRADE TOWER NEW DELHI. NEHRU PLACE NEW DELHI. (PAN: AAACM8415A) (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI ASHWANI KUMA R CA RESPONDENT BY: SHRI PEEYUSH SONKAR SR.DR ORDER PER RAJPAL YADAV: JUDICIAL MEMBER PER RAJPAL YADAV: JUDICIAL MEMBER PER RAJPAL YADAV: JUDICIAL MEMBER PER RAJPAL YADAV: JUDICIAL MEMBER THE ASSESSEE IS IN APPEAL BEFORE US AGAINST THE OR DER OF LEARNED CIT(APPEALS) DATED 2.12.2010 PASSED FOR ASSESSMENT YEAR 2007-08. IN GROUND NO.1 ASSESSEE HAS PLEADED THAT LEARNED CIT( APPEALS) HAS ERRED IN SUSTAINING THE ADDITION OF ` 33 259 WHICH WAS DISALLOWED OUT OF CLAIM OF DE- MAT CHARGES. THE LEARNED COUNSEL FOR THE ASSESSEE D ID NOT PRESS THIS GROUND OF APPEAL THEREFORE IT IS REJECTED. 2. IN GROUND NO.2 THE ASSESSEE HAS SUBMITTED THAT LEARNED CIT(APPEALS) HAS ERRED IN CONFIRMING THE ADDITION O F ` 7 54 929 WITH THE AID 2 OF SEC. 14A OF THE INCOME-TAX ACT 1961 READ WITH R ULE 8D OF THE IT RULES 1962. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE HAS DECLARED A DIVIDEND INCOME OF `39 15 750 WHICH WAS CLAIMED EXEMPT. ASSESSING OFFICER 39 15 750 WHICH WAS CLAIMED EXEMPT. ASSESSING OFFICER 39 15 750 WHICH WAS CLAIMED EXEMPT. ASSESSING OFFICER 39 15 750 WHICH WAS CLAIMED EXEMPT. ASSESSING OFFICER HAS DIRECTED THE ASSESSEE TO FURNISH THE WORKING OF DIS ALLOWANCE FOR THE PURPOSE OF HAS DIRECTED THE ASSESSEE TO FURNISH THE WORKING OF DIS ALLOWANCE FOR THE PURPOSE OF HAS DIRECTED THE ASSESSEE TO FURNISH THE WORKING OF DIS ALLOWANCE FOR THE PURPOSE OF HAS DIRECTED THE ASSESSEE TO FURNISH THE WORKING OF DIS ALLOWANCE FOR THE PURPOSE OF SEC. 14A READ WITH RULE 8D OF THE INCOME SEC. 14A READ WITH RULE 8D OF THE INCOME SEC. 14A READ WITH RULE 8D OF THE INCOME SEC. 14A READ WITH RULE 8D OF THE INCOME- -- -TAX ACT 1961. IN RE TAX ACT 1961. IN RE TAX ACT 1961. IN RE TAX ACT 1961. IN RESPONSE TO THE QUERY OF SPONSE TO THE QUERY OF SPONSE TO THE QUERY OF SPONSE TO THE QUERY OF ASSESSING OFFICER IT WAS CONTENDED THAT TOTAL EXPENSES OF `2 93 25 232 WAS ASSESSING OFFICER IT WAS CONTENDED THAT TOTAL EXPENSES OF `2 93 25 232 WAS ASSESSING OFFICER IT WAS CONTENDED THAT TOTAL EXPENSES OF `2 93 25 232 WAS ASSESSING OFFICER IT WAS CONTENDED THAT TOTAL EXPENSES OF `2 93 25 232 WAS CLAIMED BY THE ASSESSEE WHICH IS ATTRIBUTABLE TO INVEST MENT ON WHICH SECTION 14A CLAIMED BY THE ASSESSEE WHICH IS ATTRIBUTABLE TO INVEST MENT ON WHICH SECTION 14A CLAIMED BY THE ASSESSEE WHICH IS ATTRIBUTABLE TO INVEST MENT ON WHICH SECTION 14A CLAIMED BY THE ASSESSEE WHICH IS ATTRIBUTABLE TO INVEST MENT ON WHICH SECTION 14A WOULD BE APPLICABLE. THE ASSESSEE ITSELF HAS DISALLOWED A SUM OF `2 90 96 78 WOULD BE APPLICABLE. THE ASSESSEE ITSELF HAS DISALLOWED A SUM OF `2 90 96 78 WOULD BE APPLICABLE. THE ASSESSEE ITSELF HAS DISALLOWED A SUM OF `2 90 96 78 WOULD BE APPLICABLE. THE ASSESSEE ITSELF HAS DISALLOWED A SUM OF `2 90 96 781. 1. 1. 1. THEREFORE THERE SHOULD NOT BE ANY OTHER DISALLOWANCE UNDER SEC. 14A READ WITH THEREFORE THERE SHOULD NOT BE ANY OTHER DISALLOWANCE UNDER SEC. 14A READ WITH THEREFORE THERE SHOULD NOT BE ANY OTHER DISALLOWANCE UNDER SEC. 14A READ WITH THEREFORE THERE SHOULD NOT BE ANY OTHER DISALLOWANCE UNDER SEC. 14A READ WITH RULE 8D OF THE IT RULES. ASSESSING OFFICER DID NOT AC CEPT THE CONTENTION OF THE RULE 8D OF THE IT RULES. ASSESSING OFFICER DID NOT AC CEPT THE CONTENTION OF THE RULE 8D OF THE IT RULES. ASSESSING OFFICER DID NOT AC CEPT THE CONTENTION OF THE RULE 8D OF THE IT RULES. ASSESSING OFFICER DID NOT AC CEPT THE CONTENTION OF THE ASSESSEE. WITH THIS HELP OF RULE 8D HE HAS WORKED OUT A DISALLOWANCE OF ASSESSEE. WITH THIS HELP OF RULE 8D HE HAS WORKED OUT A DISALLOWANCE OF ASSESSEE. WITH THIS HELP OF RULE 8D HE HAS WORKED OUT A DISALLOWANCE OF ASSESSEE. WITH THIS HELP OF RULE 8D HE HAS WORKED OUT A DISALLOWANCE OF `7 54 929. `7 54 929. `7 54 929. `7 54 929. 4. APPEAL TO THE LEARNED CIT(APPEALS) DID NOT BRING ANY RELIEF TO THE ASSESSEE. 5. THE LEARNED COUNSEL FOR THE ASSESSEE POINTED OUT THAT RULE 8D IS NOT APPLICABLE IN THE PRESENT YEAR IN VIEW OF THE DECIS ION OF HON'BLE MUMBAI HIGH COURT RENDERED IN THE CASE OF GODREJ BOYCE VS. ACIT REPORTED IN 328 3 ITR 81. IF THE DISALLOWANCE IS NOT TO BE WORKED OUT ON THE BASIS OF A MATHEMATICAL FORMULA PROVIDED IN RULE 8D THEN DISAL LOWANCE HAS TO BE WORKED OUT KEEPING IN VIEW THE REASONABLE EXPENSES ATTRIBUTABLE TO EARNING OF DIVIDEND INCOME. IN THAT SITUATION ASSESSEE ITS ELF HAS DISALLOWED `2 90 96 781 OUT OF THE TOTAL EXPENSES OF `2 93 25 232 . THE DIFFERENCE BETWEEN `2 90 96 781 OUT OF THE TOTAL EXPENSES OF `2 93 25 232 . THE DIFFERENCE BETWEEN `2 90 96 781 OUT OF THE TOTAL EXPENSES OF `2 93 25 232 . THE DIFFERENCE BETWEEN `2 90 96 781 OUT OF THE TOTAL EXPENSES OF `2 93 25 232 . THE DIFFERENCE BETWEEN THESE TWO AMOUNTS IS LESS THAN `2 LACS. THEREFORE IT I S NOT DESIRABLE TO SET ASIDE THE THESE TWO AMOUNTS IS LESS THAN `2 LACS. THEREFORE IT I S NOT DESIRABLE TO SET ASIDE THE THESE TWO AMOUNTS IS LESS THAN `2 LACS. THEREFORE IT I S NOT DESIRABLE TO SET ASIDE THE THESE TWO AMOUNTS IS LESS THAN `2 LACS. THEREFORE IT I S NOT DESIRABLE TO SET ASIDE THE ISSUE TO THE FILE OF THE ISSUE TO THE FILE OF THE ISSUE TO THE FILE OF THE ISSUE TO THE FILE OF THE ASSESSING OFFICER FOR READJUDICATION. LEARNED DR ON T HE OTHER ASSESSING OFFICER FOR READJUDICATION. LEARNED DR ON TH E OTHER ASSESSING OFFICER FOR READJUDICATION. LEARNED DR ON TH E OTHER ASSESSING OFFICER FOR READJUDICATION. LEARNED DR ON TH E OTHER HAND RELIED UPON THE ORDER OF THE ASSESSING OFFICER AND SUBMITTED THAT THE ISSUE HAND RELIED UPON THE ORDER OF THE ASSESSING OFFICER AND SUBMITTED THAT THE ISSUE HAND RELIED UPON THE ORDER OF THE ASSESSING OFFICER AND SUBMITTED THAT THE ISSUE HAND RELIED UPON THE ORDER OF THE ASSESSING OFFICER AND SUBMITTED THAT THE ISSUE MAY BE SET ASIDE TO THE FILE OF THE ASSESSING OFFICER FOR REEXAMINATION. MAY BE SET ASIDE TO THE FILE OF THE ASSESSING OFFICER FOR REEXAMINATION. MAY BE SET ASIDE TO THE FILE OF THE ASSESSING OFFICER FOR REEXAMINATION. MAY BE SET ASIDE TO THE FILE OF THE ASSESSING OFFICER FOR REEXAMINATION. 6. 6.6. 6. WE HAVE DULY CONSIDERED THE RIVAL WE HAVE DULY CONSIDERED THE RIVAL WE HAVE DULY CONSIDERED THE RIVAL WE HAVE DULY CONSIDERED THE RIVAL CONTENTIONS AND GONE THR OUGH THE RECORD CONTENTIONS AND GONE THROUGH THE RECORD CONTENTIONS AND GONE THROUGH THE RECORD CONTENTIONS AND GONE THROUGH THE RECORD CAREFULLY. IN PARAGRAPH 4.3 LEARNED CIT(APPEALS) HA S RECORDED A FINDING THAT OUT CAREFULLY. IN PARAGRAPH 4.3 LEARNED CIT(APPEALS) HA S RECORDED A FINDING THAT OUT CAREFULLY. IN PARAGRAPH 4.3 LEARNED CIT(APPEALS) HA S RECORDED A FINDING THAT OUT CAREFULLY. IN PARAGRAPH 4.3 LEARNED CIT(APPEALS) HA S RECORDED A FINDING THAT OUT OF THE TOTAL AMOUNT DISALLOWED BY THE ASSESSEE A SUM OF `2 87 81 717 REPRESENTES OF THE TOTAL AMOUNT DISALLOWED BY THE ASSESSEE A SUM OF `2 87 81 717 REPRESENTES OF THE TOTAL AMOUNT DISALLOWED BY THE ASSESSEE A SUM OF `2 87 81 717 REPRESENTES OF THE TOTAL AMOUNT DISALLOWED BY THE ASSESSEE A SUM OF `2 87 81 717 REPRESENTES THE INTEREST COMPONENTS. ON DUE CONSIDERATION OF THI THE INTEREST COMPONENTS. ON DUE CONSIDERATION OF THI THE INTEREST COMPONENTS. ON DUE CONSIDERATION OF THI THE INTEREST COMPONENTS. ON DUE CONSIDERATION OF THIS ASPECT WE ARE OF THE VIEW S ASPECT WE ARE OF THE VIEW S ASPECT WE ARE OF THE VIEW S ASPECT WE ARE OF THE VIEW THAT THE DIFFERENCE BETWEEN `2 87 81 717 AND THE AMOUNT D ISALLOWED BY THE THAT THE DIFFERENCE BETWEEN `2 87 81 717 AND THE AMOUNT D ISALLOWED BY THE THAT THE DIFFERENCE BETWEEN `2 87 81 717 AND THE AMOUNT D ISALLOWED BY THE THAT THE DIFFERENCE BETWEEN `2 87 81 717 AND THE AMOUNT D ISALLOWED BY THE ASSESSEE I.E. `2 90 96 781 WOULD BE TOWARDS INDIRECT AN ADMINISTRATIVE EXPENSES. ASSESSEE I.E. `2 90 96 781 WOULD BE TOWARDS INDIRECT AN ADMINISTRATIVE EXPENSES. ASSESSEE I.E. `2 90 96 781 WOULD BE TOWARDS INDIRECT AN ADMINISTRATIVE EXPENSES. ASSESSEE I.E. `2 90 96 781 WOULD BE TOWARDS INDIRECT AN ADMINISTRATIVE EXPENSES. THE RULE 8D IS NOT APPLICABLE IN THIS ASSESSMENT YEA R IN VIEW OF THE HON THE RULE 8D IS NOT APPLICABLE IN THIS ASSESSMENT YEA R IN VIEW OF THE HON THE RULE 8D IS NOT APPLICABLE IN THIS ASSESSMENT YEA R IN VIEW OF THE HON THE RULE 8D IS NOT APPLICABLE IN THIS ASSESSMENT YEA R IN VIEW OF THE HON'BLE MUMBAI 'BLE MUMBAI 'BLE MUMBAI 'BLE MUMBAI HIGH COURTS DECISION. HON'BLE HIGH COURT HAS HELD TH AT RULE 8D HAS BEEN BROUGHT HIGH COURTS DECISION. HON'BLE HIGH COURT HAS HELD TH AT RULE 8D HAS BEEN BROUGHT HIGH COURTS DECISION. HON'BLE HIGH COURT HAS HELD TH AT RULE 8D HAS BEEN BROUGHT HIGH COURTS DECISION. HON'BLE HIGH COURT HAS HELD TH AT RULE 8D HAS BEEN BROUGHT ON THE STATUTE W.E.F. 24.3.2008 AND IT WILL BE APPLI CABLE WITH PROSPECTIVE EFFECT. IN ON THE STATUTE W.E.F. 24.3.2008 AND IT WILL BE APPLI CABLE WITH PROSPECTIVE EFFECT. IN ON THE STATUTE W.E.F. 24.3.2008 AND IT WILL BE APPLI CABLE WITH PROSPECTIVE EFFECT. IN ON THE STATUTE W.E.F. 24.3.2008 AND IT WILL BE APPLI CABLE WITH PROSPECTIVE EFFECT. IN THE ABSENCE OF RULE 8D THE EXPENSES ARE TO BE DISALLOW ED BY ESTIMATING SUCH THE ABSENCE OF RULE 8D THE EXPENSES ARE TO BE DISALLOW ED BY ESTIMATING SUCH THE ABSENCE OF RULE 8D THE EXPENSES ARE TO BE DISALLOW ED BY ESTIMATING SUCH THE ABSENCE OF RULE 8D THE EXPENSES ARE TO BE DISALLOW ED BY ESTIMATING SUCH EXPENSES. THE EXPENSES DISALLOWED BY THE ASSESSEE ITSELF WOULD INDICATE THAT THEY EXPENSES. THE EXPENSES DISALLOWED BY THE ASSESSEE ITSELF WOULD INDICATE THAT THEY EXPENSES. THE EXPENSES DISALLOWED BY THE ASSESSEE ITSELF WOULD INDICATE THAT THEY EXPENSES. THE EXPENSES DISALLOWED BY THE ASSESSEE ITSELF WOULD INDICATE THAT THEY 4 ARE SUFFICIENT FOR EARNING OF THE DIVIDEND INCOME/INVEST MENT MADE BY THE ASSESSEE. ARE SUFFICIENT FOR EARNING OF THE DIVIDEND INCOME/INVEST MENT MADE BY THE ASSESSEE. ARE SUFFICIENT FOR EARNING OF THE DIVIDEND INCOME/INVEST MENT MADE BY THE ASSESSEE. ARE SUFFICIENT FOR EARNING OF THE DIVIDEND INCOME/INVEST MENT MADE BY THE ASSESSEE. NO FRUITFUL PURPOSE WILL BE SERVED BY SETTING ASIDE TH IS ISSUE TO THE FILE OF THE NO FRUITFUL PURPOSE WILL BE SERVED BY SETTING ASIDE TH IS ISSUE TO THE FILE OF THE NO FRUITFUL PURPOSE WILL BE SERVED BY SETTING ASIDE TH IS ISSUE TO THE FILE OF THE NO FRUITFUL PURPOSE WILL BE SERVED BY SETTING ASIDE TH IS ISSUE TO THE FILE OF THE ASSESSING ASSESSING ASSESSING ASSESSING OFFICER BECAUSE THE DETAILS OF ALL THE EXPENSES I.E. THE EXPENSES OFFICER BECAUSE THE DETAILS OF ALL THE EXPENSES I.E. THE EXPENSES OFFICER BECAUSE THE DETAILS OF ALL THE EXPENSES I.E. THE EXPENSES OFFICER BECAUSE THE DETAILS OF ALL THE EXPENSES I.E. THE EXPENSES DISALLOWED BY THE ASSESSEE AND THE EXPENSES TOWARDS INTERES T COMPONENTS WE HAD DISALLOWED BY THE ASSESSEE AND THE EXPENSES TOWARDS INTERES T COMPONENTS WE HAD DISALLOWED BY THE ASSESSEE AND THE EXPENSES TOWARDS INTERES T COMPONENTS WE HAD DISALLOWED BY THE ASSESSEE AND THE EXPENSES TOWARDS INTERES T COMPONENTS WE HAD ALREADY CONSIDERED. IN VIEW OF THE ABOVE DISCUSSION WE A LLOW THE APPEAL OF THE ALREADY CONSIDERED. IN VIEW OF THE ABOVE DISCUSSION WE A LLOW THE APPEAL OF THE ALREADY CONSIDERED. IN VIEW OF THE ABOVE DISCUSSION WE A LLOW THE APPEAL OF THE ALREADY CONSIDERED. IN VIEW OF THE ABOVE DISCUSSION WE A LLOW THE APPEAL OF THE ASSESSEE AND DELETE THE DISAL ASSESSEE AND DELETE THE DISAL ASSESSEE AND DELETE THE DISAL ASSESSEE AND DELETE THE DISALLOWANCE. LOWANCE. LOWANCE. LOWANCE. 7. 7.7. 7. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED. DECISION PRONOUNCED IN THE OPEN COURT ON 16.03.2011 ( B.C. MEENA ) ( R AJPAL YADAV ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 16/03/2011 MOHAN LAL COPY FORWARDED TO: 1) APPELLANT 2) RESPONDENT 3) CIT 4) CIT(APPEALS) 5) DR:ITAT ASSISTANT REGISTRAR