Income Tax Appellate Tribunal - Mumbai
Gaurav Omprakash Goenka, Mumbai vs Acit Cen Cir 14, Mumbai on 13 July, 2017
आयकर अपीलीय अिधकरण, मुबं ई "बी" खंडपीठ म Income-tax Appellate Tribunal -"G"Bench Mumbai सव ी राजे ,लेखा सद य एवं सी. एन. साद, याियक सद य Before S/Sh.Rajendra,Accountant Member and C. N. Prasad,Judicial Member आयकर अपील सं./I.T.A./4946/Mum/2015, /Assessment Year: 2011-12 िनधा रण वष Mr. Gaurav Omprakash Goenka ACIT, CC-14 317/318, Parvati Indl. Estate, Sunmill (Restructured Designation Central Circle-2(4) Compound,Lower Parel (W) Vs. Pratishtha Bhavan, 8th Floor Mumbai-400 013. Mumbai.
PAN:ABIPG 3139 P
(अपीलाथ /Appellant) ( यथ / Respondent)
रा
ज व क ओर से / Revenue by: Shri Vidyadhar-DR
अपीलाथ क ओर से /Assessee by: Shri Hiro Rai -Advocate
सुनवाई तारीख
क / Date of Hearing: 13/07/2017
घोषणा तारीख
क / Date of Pronouncement: 13/07/2017
लेखा सद य,
सद य राजे
के अनुसार/
ार PER Rajendra A.M.-
Challenging the order dated 6/8/2015 of CIT(A)-48, Mumbai the assessee has filed the present appeal.Assessee an individual ,a commission agent,filed his return of income on 30/ 09/2011declaring total income of Rs.66.14 lakhs.The Assessing Officer (AO)completed the assessment u/s. 143(3) of the Act,on 30/09/2013,determining the income at Rs.66.14 lakhs.
2.Effective Ground of appeal is about disallowance made u/s.14A r.w. Rule 8D of the Income tax Rules,1962(Rules).amounting to Rs.22.81 lakhs.During the assessment proceedings the AO found that the assessee had earned dividend income of Rs.4.36 lakhs and had claimed exemption u/s.10(34) of the Act for the same.The AO disallowed Rs.22.81 lakhs (Rs.21,00, 532/- under the head expenditure directly related to income not forming part of total income + Rs.1.81 lakhs @ 0.05% of the average value of the investment.)
3.Aggrieved by the order of the AO the assessee preferred an appeal before the First Appellate Authority (FAA) and made submissions before him. He relied upon the case of Twinkle Enviro Tech Ltd. one of the group concern cases.
After considering the submission of the assessee and the assessment order the FAA held that during the year under appeal there was an increase in loan to Rs.11.55 cores as against Rs. 6.35 crores of earlier year,that there was increased investment in shares also to Rs.4.57 crores, that he had paid interest of Rs.73.31 lakhs, that the interest bearing funds were utilised for making investment in shares, that he had made investment for acquiring the strategic interest in sister concern and investment in listed companies or in mutual funds, that the value of investment made for acquiring strategic advance had to be excluded while completing disallowance u/s.14A, that the assessee had not brought on record to show investment was for growth of business, that there was no need to interfere with the order of the AO .
4946/M/15(11-12) Gaurav Omprakash Goenka
4.Before us,the Authorised Representative (AR) argued that the disallowance u/s.14A cannot exceed the exempt income,that the AO had made disallowance of 22.81 lakhs whereas the assessee had claimed exempt income of 4.36 lakhs only.He relied upon the case of Empire Package (P.) Ltd. (286 CTR 457); Tacpro Systems Limited (96CCH0087Che.HC) and Daga Global Chemicals P.Ltd.(46ITR(Trib)70) . The Departmental Representative (DR) supported the order of the AO.
5.We have heard the rival submissions and perused the material on record. We find that the Assessing Officer had made the addition following the decision of Special Bench of the Tribunal in the case of Daga Capital Management P. Ltd., that the FAA had upheld the order of the AO,that the order of the Tribunal was reversed by the Hon'ble Bombay High Court, that the assessee had claimed exemption of Rs.4.36 lakhs. In our opinion the disallowance e should not exceed the claim of exempt income.The provisions of Sec.14A r.w.r8D of the Rules were introduced to discourage the assessees who used to claim double deductions i.e. claiming exemption u/s.10 and simultaneously claiming expenditure against such exempt income.As per established taxation principles double deductions/double taxation are not allowable.We find that,in the cases relied upon by the assess,it has been held that disallowance u/s. 14A should be restricted to the income not forming part of total income. Therefore, we dierect the AO to restrict the disallowance to the extent of 4.36 lakhs only for which the assessee had not objected to during the course of hearing before us. Accordingly, effective GOA is decided in favour of the assessee,in part As a result appeal filed by assessee stands partly allowed.
फलतःिनधा रती ारा दािखल क गई अपील अंशतः मंजूर क जाती है.
Order pronounced in the open court on 13th , July, 2017.
आदेश क घोषणा खुले यायालय म दनांक 13 ,जुलाई , 2017 को क गई ।
Sd/- Sd/-
(सी. एन. साद / C.N.Prasad ) (राजे / Rajendra)
याियक सद
य / JUDICIAL MEMBER लेखा सद य / ACCOUNTANT MEMBER
मुंबई Mumbai; दनांक/Dated : 13.07.2017.
Jv.Sr.PS.
आदेश क ितिलिप अ ेिषत/Copy of the Order forwarded to :
1.Appellant /अपीलाथ" 2. Respondent /#$यथ"
3.The concerned CIT(A)/संब' अपीलीय आयकर आयु*, 4.The concerned CIT /संब' आयकर आयु*
5.DR "A " Bench, ITAT, Mumbai /िवभागीय #ितिनिध, खंडपीठ,आ.अ. याया.मुंबई
6.Guard File/गाड फाईल स$यािपत #ित //True Copy// आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार Dy./Asst. Registrar आयकर अपीलीय अिधकरण, मुंबई /ITAT, Mumbai.2