Income Tax Appellate Tribunal - Hyderabad
Dy.Commissioner Of Income Tax, ... vs Med Plus Health Services Private ... on 25 January, 2018
ITA No 1429 of 2017 Medplus Health Services P Ltd Hyderabad.
IN THE INCOME TAX APPELLATE TRIBUNAL
Hyderabad ' A ' Bench, Hyderabad
Before Smt. P. Madhavi Devi, Judicial Member
AND
Shri B. Ramakotaiah, Accountant Member
ITA No.1429/Hyd/2017
(Assessment Year: 2012-13)
DCIT, Circle 16 ( 2 ) Vs M/s. Medplus Health
Hyderabad Services P. Ltd
Hyderabad
PAN: AAECM 9412 H
(Appellant) (Respondent)
For Revenue: Shri B. Suresh Babu, DR
For Assessee : Shri Laxmi Pawan
Date of Hearing: 25.01.2018
Date of Pronouncement: 25.01.2018
ORDER
Per Smt. P. Madhavi Devi, J.M.
This is Revenue's appeal for the A.Y 2012-13. In this appeal, the Revenue is aggrieved by the order of the learned CIT (A)-3, Hyderabad, dated 23.04.2015. The Revenue has raised the following grounds of appeal:
"1. The CIT(A) erred in deleting the disallowance u/s 14A of Rs. 60,73,756/-.
2. The CIT(A) erred in ignoring CBDT's Circular No. 5 of 2014 dated: 11-02-2014.
3. The CIT(A) erred in ignoring the Supreme Court decision in the case of CIT Vs. Walfort Share of Stock Brokers P Ltd [326 ITR 1], wherein it was held that the mandate of section l4A was to curb the practice of claiming deduction of expenses Page 1 of 3 ITA No 1429 of 2017 Medplus Health Services P Ltd Hyderabad.
incurred in relation to exempt income against taxable income and at the same time avail of the tax incentive by way of exempt income without making any apportionment of expenses incurred in relation to exempt income."
2. Brief facts are that the assessee company which is in the business of wholesale trading in pharmaceuticals, medicines, general stores and its related items and running of clinics and pathological services, filed its return of income for the A.Y 2012- 13 on 30.09.2012 declaring a loss of Rs.2,38,03,445. During the assessment proceedings u/s 143(3) of the Act, the AO observed that the assessee has made investment of 139,47,51,280 as on 31.03.2012. He therefore, proposed to make a disallowance u/s 14A of the Act. The assessee submitted that no expenditure has been incurred by it in relation to the income which does not form part of the total income. However, the AO made disallowance u/s 14A r.w.Rule 8D of IT Rules and made a consequential addition of Rs.60,73,756.
3. Aggrieved, the assessee filed an appeal before the CIT (A) who granted relief to the assessee holding that where the assessee has not earned any income, there can be no disallowance u/s 14A of the Act. The CIT (A) has followed the decision of Coordinate Bench of ITAT in the case of Prathista Industries Ltd vs. DCIT in ITA No.1302/Hyd/2015 for the A.Y 2011-12 wherein following the decision of the Hon'ble Delhi High Court in the case of Cheminvest Ltd reported in (2015) 378 ITR 33 (Del.). Aggrieved by the relief granted by the CIT (A), the Revenue is in appeal before us.
Page 2 of 3ITA No 1429 of 2017 Medplus Health Services P Ltd Hyderabad.
4. Having regard to the rival contentions and the material on record, we find that the decision of the CIT (A) is in consonance with the decisions of the Coordinate Benches of this Tribunal in various cases and also the decision of the Hon'ble Delhi High Court in the case of Cheminvest Ltd (cited Supra). Therefore, we see no reason to interfere with the order of the CIT (A) and accordingly the Revenue's appeal is dismissed.
5. In the result, Revenue's appeal is dismissed.
Order pronounced in the Open Court on 25th January, 2018.
Sd/- Sd/-
(B.Ramakotaiah) (P. Madhavi Devi)
Accountant Member Judicial Member
Hyderabad, dated 25th January 2018.
Vinodan/sps
Copy to:
1 DCIT, Circle 16(2) 2nd Floor,B Block, IT Towers, AC Guards,
Masab Tank, Hyderabad
2 M/s. Medplus Health Services P Ltd, 5-9-13, F.No.707, 7th Floor,
Taramandal Complex, Saifabad, Hyderabad 3 CIT (A)-4 Hyderabad 4 Pr. CIT - 4 Hyderabad 5 The DR, ITAT Hyderabad 6 Guard File By Order Page 3 of 3