ITO, Ward-16(2), Hyderabad, Hyderabad v. Phoenix Infratech (India) Pvt Ltd., Hyd, Hyderabad

ITA 720/HYD/2016 | 2010-2011
Pronouncement Date: 28-09-2016 | Result: Dismissed

Appeal Details

RSA Number 72022514 RSA 2016
Assessee PAN AACCC2322G
Bench Hyderabad
Appeal Number ITA 720/HYD/2016
Duration Of Justice 4 month(s) 12 day(s)
Appellant ITO, Ward-16(2), Hyderabad, Hyderabad
Respondent Phoenix Infratech (India) Pvt Ltd., Hyd, Hyderabad
Appeal Type Income Tax Appeal
Pronouncement Date 28-09-2016
Appeal Filed By Department
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 28-09-2016
Date Of Final Hearing 21-09-2016
Next Hearing Date 21-09-2016
Assessment Year 2010-2011
Appeal Filed On 16-05-2016
Judgment Text
ITA 720 TO 722 OF 2016 PHOENIX INFRATECH INDIA P LT D HYDERABAD PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD B BENCH HYDERABAD BEFORE SMT. P. MADHAVI DEVI JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH ACCOUNTANT MEMBER ITA NO.720 TO 722/HYD/2016 (ASSESSMENT YEARS: 2010-11 TO 2012-13) INCOME TAX OFFICER WARD 16(2) HYDERABAD VS M/S PHOENIX INFRATECH INDIA PRIVATE LIMITED HYDERABAD PAN: AACCC 2322 G FOR REVENUE: SMT. U. MINICHANDRAN DR FOR ASSESSEE: SHRI P. MURALI MOHAN RAO O R D E R PER SMT. P. MADHAVI DEVI J.M. ALL THESE APPEALS ARE FILED BY THE REVENUE FOR THE A.YS 2010-11 2011-12 AND 2012-13 RESPECTIVELY. IN THESE APPEALS THE COMMON GROUND RAISED BY THE REVENUE IS THAT THE LEA RNED CIT (A) HAS ERRED IN DELETING THE ADDITION MADE BY THE AO O N ACCOUNT OF DISALLOWANCE U/S 14A OF THE I.T. ACT. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE CO MPANY ENGAGED IN THE BUSINESS OF INFRASTRUCTURE DEVELOPME NT FILED ITS RETURN OF INCOME FOR THE RELEVANT A.YS. DURING THE A SSESSMENT PROCEEDINGS U/S 143(3) OF THE ACT THE AO NOTICED T HAT THE ASSESSEE HAS MADE INVESTMENTS IN SEVERAL GROUP COMP ANIES BY ACQUIRING SHARES AND NO DIVIDEND INCOME WAS SHOWN F ROM THE SAID COMPANIES DURING THE RELEVANT FINANCIAL YEAR. HE ALSO DATE OF HEARING : 21.09.2016 DATE OF PRONOUNCEMENT : 28.09.2016 ITA 720 TO 722 OF 2016 PHOENIX INFRATECH INDIA P LT D HYDERABAD PAGE 2 OF 3 OBSERVED THAT THE ASSESSEE HAS BORROWED FUNDS FROM DIFFERENT BANKS AND OTHERS ON WHICH THE ASSESSEE PAID INTERES T AND CLAIMED THE SAME AS DEDUCTION. HE OBSERVED THAT AS PER THE PROVISIONS OF SECTION 14A OF THE ACT WHEN ANY EXPE NDITURE IS FOUND TO HAVE BEEN CLAIMED AS DEDUCTION UNDER ANY O F THE HEADS OF INCOME IN RELATION TO INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THE I.T. ACT IT WILL FALL IN TH E CONSIDERATION ZONE OF SECTION 14A OF THE ACT FOR DISALLOWANCE. HE THEREFORE INVOKED THE PROVISIONS OF SECTION 14A OF THE ACT AN D APPLIED THE PROVISIONS OF RULE 8D AND MADE DISALLOWANCE U/S 14A FOR ALL THE A.YS. 3. AGGRIEVED THE ASSESSEE PREFERRED APPEALS BEFORE THE CIT (A) WHO DELETED THE SAME BY OBSERVING THAT THE ASSESSEE HAS NOT CLAIMED ANY EXEMPT INCOME DURING THE RELEVANT A .YS. THE CIT (A) HAS FOLLOWED VARIOUS DECISIONS OF THE COORDINAT E BENCHES OF THIS TRIBUNAL AND ALSO OF THE HON'BLE DELHI HIGH CO URT IN THE CASE OF M/S ACB INDIA LTD VS. ACIT (2015) 62 TAXMANN.COM 71 (DELHI) TO DELETE THE DISALLOWANCE MADE BY THE AO. AGGRIEVE D BY THE RELIEF GRANTED BY THE CIT (A) THE REVENUE IS IN APPEAL BE FORE US. 4. THE LEARNED DR RELIED UPON THE ORDERS OF THE AO WHILE THE LEARNED COUNSEL FOR THE ASSESSEE HAS RELIED UPO N THE DECISIONS OF THE COORDINATE BENCH OF THIS TRIBUNAL AND ALSO OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF M/S ACB IND IA LTD (SUPRA). 5. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE M ATERIAL ON RECORD WE FIND THAT DURING THE RELEVANT A.YS AD MITTEDLY THE ASSESSEE HAS NOT CLAIMED ANY INCOME AS EXEMPT FROM TAX. THE ITA 720 TO 722 OF 2016 PHOENIX INFRATECH INDIA P LT D HYDERABAD PAGE 3 OF 3 PROVISIONS OF SECTION 14A WOULD APPLY ONLY WHERE AN ASSESSEE CLAIMS ANY INCOME AS EXEMPT FROM TAX AND THE EXPEND ITURE IN RELATION TO SUCH EXEMPT INCOME CANNOT BE ALLOWED U/ S 14A OF THE ACT. AS THE ASSESSEE HAS NOT CLAIMED ANY INCOME TO BE EXEMPT AS CLEARLY RECORDED BY THE AO IN THE ASSESSMENT ORDERS NO DISALLOWANCE U/S 14A R.W.RULE 8D CAN BE MADE. THIS PROPOSITION HAS BEEN UPHELD BY VARIOUS BENCHES OF THIS TRIBUNAL AND ALSO BY THE HON'BLE DELHI HIGH COURT IN THE CASE OF CHEMINV EST LTD VS. CIT IN ITA NO.749/2014 DATED 2.9.2015 AND ALSO IN T HE CASE OF M/S. ACB INDIA LTD (CITED SUPRA). IN VIEW OF THE SA ME WE DO NOT SEE ANY REASON TO INTERFERE WITH THE ORDER OF THE C IT (A). REVENUES APPEALS ARE ACCORDINGLY DISMISSED. 6. IN THE RESULT REVENUES APPEALS ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH SEPTEMBER 2016. SD/- SD/- (B. RAMAKOTAIAH) ACCOUNTANT MEMBER (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD DATED 28 TH SEPTEMBER 2016. VINODAN/SPS COPY TO: 1 INCOME TAX OFFICER WARD 16(2) ROOM NO.5 BLOCK-B 7 TH FLOOR AAYAKAR BHAVAN BASHEERBAGH HYDERABAD 500004 2 M/S. PHOENIX INFRATECH (INDIA) PVT. LTD PLOT NO. 1335 PHOENIX HOUSE ROAD NO.45 JUBILEE HILLS HYDERABAD 3 CIT (A)-4 HYDERABAD 4 PR.CIT 4 HYDERABAD 5 THE DR ITAT HYDERABAD 6 GUARD FILE BY ORDER