M/s. Promed Exports Pvt. Ltd, New Delhi v. ACIT, New Delhi

ITA 1782/DEL/2009 | 2006-2007
Pronouncement Date: 30-03-2011 | Result: Allowed

Appeal Details

RSA Number 178220114 RSA 2009
Assessee PAN AAACP1612Q
Bench Delhi
Appeal Number ITA 1782/DEL/2009
Duration Of Justice 1 year(s) 10 month(s) 29 day(s)
Appellant M/s. Promed Exports Pvt. Ltd, New Delhi
Respondent ACIT, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 30-03-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted F
Tribunal Order Date 30-03-2011
Date Of Final Hearing 30-03-2011
Next Hearing Date 30-03-2011
Assessment Year 2006-2007
Appeal Filed On 01-05-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F DELHI BEFORE SHRI I.P. BANSAL AND SHRI K.G. BANSAL ITA NO. 1782(DEL)/2009 ASSESSMENT YEAR: 2006-07 M/S PROMED EXPORTS PVT. LTD. ADDITIONAL COMMISSIONER OF 208 ASHIRWAD COMMERCIAL COMPLEX VS. INCOM E TAX RANGE-14 D-1 GREEN PARK NEW DELHI. NEW DELHI. PAN-AAACP1612Q (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MANU K. GIRI ADVOCATE RESPONDENT BY : SHRI H.K. LAL SR. DR ORDER PER K.G. BANSAL : AM THE ASSESSEE HAS TAKEN UP FIVE GROUNDS IN THIS APPEAL FILED AGAINST THE ORDER OF THE CIT(APPEALS)-XVII NEW D ELHI IN APPEAL NO. 66/08-09 DATED 13.3.2009 THE SUM AND SUBSTAN CE OF WHICH IS THAT THE LD. CIT(APPEALS) ERRED IN SUSTAINING DISALLOWAN CE OF RS. 5 83 765/- BY INVOKING THE PROVISIONS CONTAINED IN SECTION 14A O F THE INCOME-TAX ACT 1961 (THE ACT) AND RULE 8D OF THE INCOME-TAX RULES 1962 ( THE RULES) . ITA NO. 1782(DEL)/2009 2 2. IT IS THE COMMON CONTENTION OF BOTH THE PART IES THAT THE GROUNDS STAND COVERED BY THE DECISION OF HONBLE BOMBA Y HIGH COURT IN THE CASE OF GODREJ & BOYCE MANUFACTURING CO. LTD. VS. DCIT (2010) 194 TAXMAN 203. IN THIS JUDGMENT THE HONBLE C OURT HAS HELD THAT THE PROVISIONS CONTAINED IN SECTION 14A AND RULE 8D ARE NOT ULTRA-VIRES. IT HAS BEEN FURTHER HELD THAT RULE 8D IS OPERATIV E PROSPECTIVELY FROM ASSESSMENT YEAR 2008-09. IT HAS ALSO BEEN HELD T HAT IN ASSESSMENTS OF EARLIER YEARS THE AO CAN CONSIDER ALL THE FACTS AND THEREAFTER MAKE A REASONABLE DISALLOWANCE OUT OF THE EXPENDITURE RE LATABLE TO EARNING OF THE INCOME WHICH IS NOT INCLUDIBLE IN THE TOTAL INCOME OF THE ASSESSEE. IT IS ALSO THE COMMON CASE THAT IN VIEW OF THIS JUDGMENT TH E MATTER MAY BE RESTORED TO THE FILE OF THE AO FOR CONSIDERING DISALLOWANC E OF A REASONABLE PART OF THE EXPENSES RELATABLE TO THE DIVIDEND INCOME WHICH IS NOT INCLUDIBLE IN THE TOTAL INCOME OF THE ASSESSEE. 3. WE HAVE CONSIDERED THE FACTS OF THE CASE AND THE AFORESAID SUBMISSIONS. THE ASSESSMENT PERTAINS TO ASSESSMEN T YEAR 2006-07. THEREFORE THE PROVISIONS OF RULE 8D ARE NOT APPL ICABLE TO THIS YEAR. IN VIEW THEREOF THE MATTER IS RESTORED TO THE FI LE OF THE AO TO CONSIDER THE NATURE OF EXPENSES RELATION THEREOF WITH THE EA RNING OF THE DIVIDEND ITA NO. 1782(DEL)/2009 3 INCOME AND DISALLOW A REASONABLE AMOUNT FROM TH E EXPENSES IF FOUND DIRECTLY OR INDIRECTLY RELATED TO THE EARNING OF DIVIDEND INCOME. 4. IN THE RESULT THE APPEAL IS TREATED AS ALLOW ED FOR STATISTICAL PURPOSES. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT ON 3 0TH MARCH 2011. SD/- SD/- (I.P. BANSAL) (K.G.BANSAL) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE OF ORDER: 30TH MARCH 2011. SP SATIA COPY OF THE ORDER FORWARDED TO: M/S PROMED EXPORTS PVT. LTD. NEW DELHI. ADDITIONAL CIT RANGE-14 NEW DELHI. CIT(A) CIT THE DR ITAT NEW DELHI. ASSISTANT REG ISTRAR.