Stainless Investment Ltd., New Delhi v. ACIT, New Delhi

ITA 592/DEL/2010 | 2006-2007
Pronouncement Date: 06-04-2010 | Result: Allowed

Appeal Details

RSA Number 59220114 RSA 2010
Bench Delhi
Appeal Number ITA 592/DEL/2010
Duration Of Justice 1 month(s) 28 day(s)
Appellant Stainless Investment Ltd., New Delhi
Respondent ACIT, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 06-04-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted G
Tribunal Order Date 06-04-2010
Assessment Year 2006-2007
Appeal Filed On 08-02-2010
Judgment Text
ITA NO. 592/DEL/10 A.Y. 2006-07 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G NEW DELHI BEFORE SHRI C.L. SETHI JUDICIAL MEMBER AND SHRI SHAMIM YAHYA ACCOUNTANT MEMBER I.T.A. NO. 592/DEL/2010 A.Y. 2006-07 STAINLESS INVESTMENT LIMITED VS. ASST. C OMMISSIONER OF INCOME TAX 86 SHAKTI APARTMENTS CIRCLE 9(1) NEW DELHI ASHOK VIHAR PHASE-II NEW DELHI (PAN: AAFCS-9433H) [APPELLANT] (RESPONDENT) ASSESSEE BY : SH. K. SAMPATH ADV. DEPARTMENT BY : SH. P.K. PRUSTY SR. DR ORDER PER SHAMIM YAHYA AM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) DATED 24.9.20 09 AND PERTAINS TO ASSESSMENT YEAR 2006-07. 2. THE ISSUE RAISED IS THAT LD. COMMISSIONER OF I NCOME TAX (APPEALS) ERRED IN CONFIRMING THE DISALLOWANCE OF RS. 3736628/- MADE UNDER THE PROVISION OF SECTION 14A OF THE IT ACT. 3. THE ASSESSING OFFICER IN THIS CASE OBSERVED THA T THE MAIN ACTIVITY OF THE ASSESSEES COMPANY IS DEPLOYMENT OF FUNDS EITHER FO R EARNING OF INTEREST OR FOR DIVIDEND. THE ASSESSING OFFICER REQUIRED THE ASSE SSEE TO FILE THE WORKING OF THE ITA NO. 592/DEL/10 A.Y. 2006-07 2 DISALLOWANCE U/S 14A BY FOLLOWING RULE 8D. THE AS SESSEE RESPONDED THAT ASSESSEE HAS NOT INCURRED ANY EXPENSES ATTRIBUTABLE TO THE INCOME. HOWEVER THE ASSESSEE ALSO SUBMITTED THAT A FIGURE OF RS. 348299 /- AS DISALLOWANCE U/S 14A. HOWEVER THE ASSESSING OFFICER DID NOT ACCEPT THE SE CONTENTIONS AND HE WORKED OUT HIS OWN COMPUTATION WHEREBY HE DISALLOWED A SU M OF RS. 3736628/- U/S 14A OF THE ACT. 4. UPON ASSESSEES APPEAL LD. COMMISSIONER OF INCOM E TAX (APPEALS) HELD THAT ASSESSING OFFICER HAS MADE THE SAID ADDITION AFTER APPLYING RULE 8D WHICH IS MANDATORY PROCEDURAL AND RETROSPECTIVELY AS HAS BE EN HELD IN ITO MUMBAI VS. DAGA CAPITAL MANAGEMETN (P) LTD. DATED 20.10.2008 [2008-TIOL-509 MUM-SB). EXAMINATION OF THE COMPUTATION OF 14A DISALLOWANCE REVEALS THAT THE ASSESSING OFFICER HAS PROCEEDED AS PER PROVISION OF RULE8D. HENCE STAND OF THE ASSESSING OFFICER IS CONFIRMED.. 5. AGAINST THIS ORDER THE ASSESSEE IS IN APPEAL BEF ORE US. 6. WE HAVE HEARD BOTH THE COUNSELS AND PERUSED THE RECORDS. LD. COUNSEL OF THE ASSESSEE CLAIMED BEFORE US THAT THE DECISION OF THE ITAT IN THE CASE OF DAGA CAPITAL MANAGEMENT (P) LTD. CASE REFERRED BY THE L D. COMMISSIONER OF INCOME TAX (APPEALS) IS A SUBJECT MATTER OF ADJUDICATION BEF ORE THE MUMBAI HIGH COURT. LD. COUNSEL FURTHER CLAIMED THAT THE ISSUE IS ALSO UNDER ADJUDICATION BY THE HONBLE JURISDICTIONAL HIGH COURT. HE FURTHER SUBM ITTED THAT THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) IS CRYPTIC AND NON-SPEAKING. IN THIS VIEW OF THE MATTER HE REQUESTED THAT THE MATTER MAY BE REM ITTED TO THE FILES OF THE ASSESSING OFFICER TO CONSIDER THE ISSUE AFRESH. LD. DEPARTMENTAL REPRESENTATIVE FAIRLY AGREED TO THIS PROPOSITION. ACCORDINGLY IN THE INTEREST OF JUSTICE WE REMIT ITA NO. 592/DEL/10 A.Y. 2006-07 3 THIS ISSUE TO THE FILES OF THE ASSESSING OFFICER T O CONSIDER THE SAME AFRESH AS PER THE PREVAILING PRECEDENTS AND AS PER LAW. 7. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 06/04/201 0. SD/- SD/- [C.L. SETHI] [SHAMIM YAHYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATE 06/04/2010 SRB COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR ITAT TRUE COPY BY ORDER DEPUTY REGISTRAR ITAT DELHI BENCHES