ACIT-8(1)(1), MUMBAI vs M/S.NETIZEN ENGINEERING PRIVATE LIMITED, MUMBAI

The Income Tax Appellate Tribunal has dismissed an appeal by the Revenue concerning the assessment year 2013-14. The appeal challenged the deletion of a disallowance made under Section 14A read with Rule 8D. The Tribunal noted that the assessee had not derived any exempt income during the relevant financial year. Citing established case law, the Tribunal affirmed that such disallowances are not applicable when no exempt income is earned, upholding the Commissioner's decision to delete the disallowance.

IN THE INCOME TAX APPELLATE TRIBUNAL (VIRTUAL COURT),
”B” BENCH, MUMBAI

BEFORE SHRI S.S. GODARA, JUDICIAL MEMBER
 &
SHRI M.BALAGANESH, ACCOUNTANT MEMBER

ITA No. 6584/Mum/2018
(Assessment Year :2013-14)

ACIT-8(1)(1)
Room No.624, 6th Floor
Aaykar Bhawan, M.K.Road
Mumbai-400 020 PAN/GIR No.AABCR7570C
(Appellant) .. 

Vs.

Netizen Engineering
Pvt.Ltd.
Flat No.19& 20, 6th Floor,
90, Manek Mahal, Veer
Nariman Road, Churchgate
Mumbai-400 020
 
(Respondent)

Assessee by None
Revenue by Ms. Kavita P. Kaushik, Sr.DR
Date of Hearing 13/10/2020
Date of Pronouncement 14/10/2020

O R D E R

PER S.S.GODARA (J.M):

This Revenue’s appeal for A.Y.2013-14 arises from Mumbai’s order of Commissioner of Income Tax (Appeals)-14, in case No.CIT(A)-14/IT-45/16-17 dated 26/07/2018, in proceedings u/s.143(3) of the Income Tax Act, 1961 [hereinafter referred to as Act].

2. None appeared for the assessee. We have heard the Ms. Kavitha P. Koushik, Learned senior departmental representative appearing at the Revenue’s behest. She vehemently contended that the CIT(A) has erred in law and facts in deleting section 14A r.w.Rule 8D disallowance of Rs.3,21,06,151/- made by theAssessing Officer in assessment order dated 17/03/2016. We notice  at the outset that this assessee has not derived any exempt incomein the relevant previous year. Case law CIT v. Holcim India (P.) Ltd. [2015] 57 txmann.com 28 and Pr.CIT vs IL & FS Energy Development Company Ltd. [2017] 84 taxmann.com 186, Redington (india) Ltd. v. Addl. CIT [2017] 392 ITR 633/77 taxmann.com 257(Mad.), CIT v. Lakhan I Marketing Inc. [2014] 49 taxmann.com 257/226 Taxman 45 (Mag.), CIT v. Winsome Textile Industries Ltd.[2009] 319 ITR 204, CIT v. Shivam Motors (P.) Ltd. [2015] 230 Taxman 63/55 taxmann.com 262 (All.) and Quantum Advisors (P.) Ltd. Vs. DCIT [2016] 73 taxmann.com 233 (Mumbai-Trib.) and CIT v. Chetinad Logistics (P.) Ltd. [2017] 80 taxmann.com 221/248 Taxman 55 (Mad.), CIT vs Chettinad Logistics (P.) Ltd. [2018] 95taxmann.com 250 (SC)] hold that the impugned disallowances provision does not come into play in absence of any exempt incomederived in relevant previous year. There is no change stated at the Revenue’s behest in the preceding legal position. We therefore affirm the CIT(A) action deleting the impugned disallowance for this precise reason.

3. This Revenue’s appeal is dismissed.

Order pronounced in the open court on this 14/10 /2020

Sd/-                                                                              Sd/-
 (M.BALAGANESH)                                                     (S.S.GODARA)
ACCOUNTANT MEMBER                                           JUDICIAL MEMBER

Mumbai; Dated 14/10/2020
Thirumalesh, sr.ps
ITA No.6584/Mum/2018

Copy of the Order forwarded to :
1. The Appellant
2. The Respondent.
3. The CIT(A), Mumbai.
4. CIT
5. DR, ITAT, Mumbai
6. Guard file.

//True Copy// 

BY ORDER,
(Asstt. Registrar)
ITAT, Mumbai