Income Tax Appellate Tribunal - Chennai
M/S. L&T Infrastructure Development ... vs Ito, Chennai on 5 January, 2018
आयकर अपील य अ धकरण, 'डी' यायपीठ, चे नई
IN THE INCOME TAX APPELLATE TRIBUNAL ,
'D' BENCH, CHENNAI
ी ए. मोहन अलंकामणी,लेखा सद य एवं ी ध#ु व$
ु आर एल रे %डी, या'यक सद य केसम(
Before Shri A. Mohan Alankamony, Accountant Member And
Shri Duvvuru R.L. Reddy, Judicial Member
Miscellaneous Petition Nos.292 to 296/Mds/2016
in I.T.A.Nos.2330 to 2334/ Mds/2015
( नधा रण वष / Assessm ent Years:2002-03, 2006-07, 2009-10 to 2011-12)
M/s. L&T Infrastructure Vs The Income Tax Officer,
Development Projects Ltd., Company W ard II(1),
P.B. No.79, Mount Poonamallee Chennai-34.
Road, Manapakkam,
Chennai - 600 089.
PAN: AAACL7617D
(Petitioner) ( यथ /Respondent)
Applicant by : Shri Saroj Kumar Parida, Advocate
यथ क ओरसे/Respondent by : Shri N. Madhavan, JCIT
सन
ु वाईक तार ख/Da t e of h e ar in g : 05.01.2018
घोषणाक तार ख /D at e of Pr on o unc em en t : 05.01.2018
आदे श / O R D E R
PER A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER:
These Miscellaneous Petitions are filed by the assessee praying for rectification of mistake apparent on record by recalling the order of the Tribunal passed in I.T.A. Nos.2330 to 2334/Mds/2015 dated 11.08.2016 for the assessment years 2002-03, 2006-07, 2009-10, 2010-11 and 2011-12.
2 MP Nos.292 to 296/Mds/2016
2. For the assessment years 2002-03 and 2006-07, the assessee has raised two identical grounds in its miscellaneous petitions and they are briefly stated herein below for disposal:-
(i) The Bench of the Tribunal had not considered the decision of the Tribunal in the case ACIT vs. Mr. M. Baskaran in ITA No.1717/Mds/2013 wherein it was held that when the assessee had not earned any exempt income, disallowance cannot be made U/s.14A of the Act.
(ii) The Bench of the Tribunal had not considered the decision of the Tribunal in the appellant's own case in ITA No.2226/Mds/2013 for the assessment year 2007-08 wherein it was held that the Ld.AO shall calculate disallowance U/s.14A of the Act, the interest expenses directly incurred for earning exempt income on the investments other than the investment made in SPVs plus 2% of the dividend income earned on the investments other than the investment made in SPVs after verifying the total investments made by the assessee.
3. For the assessment years 2009-10, 2010-11 & 2011-12 the assessee has raised one lengthy ground in its miscellaneous petitions and it is briefly stated herein below for adjudication:- 3 MP Nos.292 to 296/Mds/2016
(i) The Bench of the Tribunal had not considered the decision of the Tribunal in the appellant's own case in ITA No.2226/Mds/2013 for the assessment year 2007-08 wherein it was held that the Ld.AO shall calculate disallowance U/s.14A of the Act, the interest expenses directly incurred for earning exempt income on the investments other than the investment made in SPVs plus 2% of the dividend income earned on the investments other than the investment made in SPVs after verifying the total investments made by the assessee.
4. At the outset the Ld.AR submitted that with respect to assessment years 2002-03 & 2006-07, Rule 8D of the Rules is not applicable because it came into effect only from 24.03.2008. He further submitted that the Hon'ble Jurisdictional High Court in the case S. Simpson & Co. Ltd., vs. DCIT in Tax case (Appeal) No.2621 of 2006 for the assessment year 2001-02 vide its decision dated 15.10.2012 had held that when the assessee had not furnished the details of expenditure incidental to the earning of dividend income, estimation of 2% of the gross total dividend income would suffice for disallowance U/s.14A of the Act. It was therefore submitted that the Bench of the Tribunal had failed to take note of the above said 4 MP Nos.292 to 296/Mds/2016 decision while remitting back the matter to the file of Ld.AO with certain directions. The Ld.AR therefore pleaded that the order of the Tribunal for the assessment years 2002-03 & 2006-07 may be recalled and thereafter decide the matter in accordance with the decision rendered in the case S.Simpson & Co. Ltd., supra. The Ld.DR could not controvert to the submission of the Ld.AR.
5. After hearing both sides, we find merit in the submission of the Ld.AR. As pointed out by the Ld.AR for the assessment years 2002-03 & 2006-07, Rule 8D of the Rules is not applicable because it has come into effect from 24.03.2008. Further this Bench of the Tribunal had failed to take note of the decision rendered by the Hon'ble Jurisdictional Madras High Court in the case S.Simpson & Co. Ltd., supra which is a mistake apparent on record that requires to be rectified. Therefore we hereby recall the order of the Tribunal for the assessment years 2002-03 & 2006-07 and further direct the Ld.AO to make disallowance U/s.14A of the Act by estimating the disallowance @2% of the gross total dividend income earned by the assessee during the relevant assessment years as held by the decision of Hon'ble Jurisdictional Madras High Court in the case S.Simpson & Co. Ltd., supra.
5 MP Nos.292 to 296/Mds/2016
6. With respect to the other assessment years we do not find any mistake that is apparent in the order of the Tribunal because we had remitted all the other appeals of the assessment years 2009-10, 2010- 11 & 2011-12 to the file of Ld.AO only with the direction to verify whether the investments are made by the assessee out of its interest free funds in its sister concerns for strategic reasons and if found so, to delete the addition and if found otherwise to pass appropriate orders as per merit and law, which is in accordance with the earlier decisions of the Tribunal cited in the order.
7. In the result the miscellaneous petitions filed by the assessee in MP Nos. 292 & 293 of 2016 are allowed as indicated herein above and MP Nos. 294, 295 & 296 of 2016 are dismissed.
Order pronounced in the open court on 5th January, 2018 at Chennai.
Sd/- Sd/-
(ध#ु व$
ु आर एल रे %डी) ए. मोहन अलंकामणी)
(ए ामणी
(A. Mohan Alankamony)
लेखा सद य/Accountant
(Duvvuru R.L Reddy)
या'यक सद य/Judicial Member सद य Member
चे नई/Chennai,
दनांक/Dated 5th January, 2018
RSR.
आ दे श क त$ल&प अ)े&षत/Copy to:
1. Applicant 2. Respondent 3. आ यकर आ यु*त (अपील)/CIT(A)
4. आ यकर आ यु*त/CIT 5. &वभागीय त न.ध/DR 6. गाड फाईल/GF.