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Income Tax Appellate Tribunal, “C” BENCH, KOLKATA
Before: SHRI RAJPAL YADAV, HON’BLE & SHRI RAJESH KUMAR, HON’BLE
PER RAJESH KUMAR, ACCOUNTANT MEMBER :
This is the appeal preferred by the revenue against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the Ld. CIT(A)”], passed u/s 250 of the Income-tax Act, 1961 (hereinafter the ‘Act’), dated 26/10/2022 for the Assessment Year 2013-14. 2. The sole issue which arises for our adjudication relates to the confirmation of disallowance of expense u/s 14A r.w.r. 8D at Rs.29,56,766/- being exempt income earned during the year.
The ld. Counsel for the assessee submitted that the ld. Assessing Officer has wrongly computed the amount of disallowance of expenses of Rs. 29,56,766/- relating to dividend income earned during the year whereas, the assessee has in fact earned only Rs.8,669/- as dividend income. In the written submissions filed before us, the computation of dividend income earned during the year has been placed which is extracted for ready reference:- Assessment Year: 2013-14 Ma Kalyaneshwari Holdings Pvt. Ltd. 2
SI. No. Scrip Name Dividend Opening Closing balance balance 1 HDFC AMC Rs.8,669/- Rs.38,13,779/- Rs.28,39,909/- (Real Estate Portfolio)
This computation has not been controverted by the ld. D/R. The ld. Counsel for the assessee has also filed a paper book containing the audited accounts, RBI Certificate of Registration and relevant extracts of memorandum of association to prove the identity of the assessee company, the investment made and the exempt income so earned during the year.
The ld. D/R, though not leaving his grounds, could not controvert the factual position.
Heard rival contentions. We find that the assessee has earned only Rs.8,669/- as dividend income during the year. Recently, the Hon’ble Delhi High Court PCIT Vs. Era Infrastructure (India) Ltd. (ITA 204/2022) judgment dt. 20/07/2022, has held that the amendment made in Section 14A of the Act by Finance Act, 2022, will be applicable prospectively and also held that disallowance u/s 14A of the Act should not exceed the exempt income earned by the assessee during the year. Therefore, since the assessee has earned exempt income of Rs.8,669/- during the year, the disallowance u/s 14A of the Act, is restricted to the same and the remaining disallowance of Rs.29,48,097/- is hereby deleted.
In the result, appeal of the assessee is allowed. Order pronounced in the Court on 20th March, 2023 at Kolkata. (RAJPAL YADAV) (RAJESH KUMAR) VICE-PRESIDENT ACCOUNTANT MEMBER Kolkata, Dated 20/03/2023 *SC SrPs Assessment Year: 2013-14 Ma Kalyaneshwari Holdings Pvt. Ltd. 3
आदेश क" "ितिलिप अ"ेिषत/Copy of the Order forwarded to : 1. अपीलाथ" / The Appellant
""यथ" / The Respondent 3. संबंिधत आयकर आयु" / Concerned Pr. CIT 4. आयकर आयु" अपील / The CIT(A)- ( ) 5. िवभागीय "ितिनिध ,आयकर अपीलीय अिधकरण, कोलकाता/DR,ITAT, Kolkata, 6. गाड" फाईल /Guard file.
आदेशानुसार/ BY ORDER,