Income Tax Appellate Tribunal - Chandigarh
Dcit, C-5, Ludhiana vs M/S Avon Cycles Ltd., Ludhiana on 2 July, 2019
ITA Nos.1253 & 1254-c-2018 & Cos . 2 & 3-c-2019 M/s Avon Cycles Limited, Ludhiana.
2[hereinafter referred to as CIT(A)] relating to the assessment years 2014-15 & 2015-16 respectively. .
2. First, we take up Revenue's appeal in ITA No. 1253/Chd/2018 and the corresponding Cross Objections No. 2/Chd/2019 of the assessee relating to the assessment year 2014-15.
3. The Revenue in its appeal has taken the following grounds of appeal;
1. Whether, on the facts and circumstances of the case, the Ld. CIT(A) was right in deleting the disallowance u/s 36(1)(iii) of the Income Tax Act, 1961 on account of investment in land despite the investment being not for business purpose."
2. Whether, on the facts and circumstances of the case, the Ld. CIT(A) was right in law in restricting the disallowance u/s 14A of the Income Tax Act, 1961 for Rs. 32,34,941/- instead of Rs. 78,07,205/- computed as per provisions of Rule 8D of the Income Tax Rules, 1962?
Whereas, the assessee has taken the following cross objections:-
1. That the learned CIT (A) - 2, Ludhiana, has erred in sustaining a disallowance of Rs. 32,34,941/- u/s 14A / Rule 8D(2)(ii) of the Income Tax Rules.
2. That the learned CIT(A) is in complete defiance of the order of the Tribunal for the A.Y. 2010-11 & 2011-12 wherein the Hon'ble Tribunal had deleted the disallowance u/s 14A on the ground that after netting of interest nothing remained for making any disallowance on account of interest, even otherwise no disallowance was called for under rule 8D(2)(ii) as all the investments were made out of funds.