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Income Tax Appellate Tribunal, AHMEDABAD BENCH “B” BENCH, AHMEDABAD
Before: SHRI KUL BHARAT & SHRI AMARJIT SINGH
आयकर अपील�य अ�धकरण, अहमदाबाद �यायपीठ ‘B’, अहमदाबाद । IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH “B” BENCH, AHMEDABAD BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER And SHRI AMARJIT SINGH, ACCOUNTANT MEMBER आयकर अपील सं./I.T.A. Nos.1227 & 1147/Ahd/2017 (�नधा�रण वष� / Assessment Year : 2012-13) DCIT Aditya Medisales Limited बनाम/ Cir- 1(1)(1), Vadodara 402, 4thFloor, R.K. Centre, Vs. 1st Floor, Fatehgunj, Aaykar Bhavan, Vadodara- 390002 Race Course Circle, Vadodara- 390007 Aditya Medisales Limited DCIT 402, 4thFloor, R.K. Cir- 1(1)(1), Vadodara 1st Floor, Centre, Fatehgunj, Aaykar Bhavan, Vadodara- 390002 Race Course Circle, Vadodara- 390007 �थायी लेखा सं./जीआइआर सं./PAN/GIR No. : AAB CA9 317 J .. (अपीलाथ� /Appellant) (��यथ� / Respondent)
अपीलाथ� ओर से / Appellant by : Shri Mudit Nagpal, Sr. DR ��यथ� क� ओर से/Respondent by : Shri Bandish Soparkar, A.R.
सुनवाई क� तार�ख / Date of Hearing :25/04/2019 घोषणा क� तार�ख /Date of Pronouncement :26/04/2019 आदेश / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : These two cross appeals by the Assessee in ITA No. 1227/Ahd/2017 and ITA No. 1147/Ahd/2017. These two cross appeals by the Revenue and assessee are directed against the order of Commissioner of Income Tax(Appeals)-1, Vadodara (‘CIT(A)’ for short) dated 01.02.2017 pertaining to the Assessment Year (AY) 2012-13.
ITA Nos.1227 & 1147/Ahd/2017 Aditya Medisales Ltd. vs. DCIT Asst.Year – 2012-13 - 2 - 2. First we take up the Revenue’s appeal in ITA No. 1227/Ahd/2017. The Revenue has raised following grounds of appeal:- “1. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in allowing the interest of Rs. 6,09,54,788/- by treating it as business expenditure ignoring the fact on record that the transaction between Aditya Medisales Ltd. & M/s. Sun Pharmaceutical Industries ltd. is not a transaction between 2 unrelated parties as the controlling person in both the company is same i.e. Mr. Dilip Shanghvi as per the Audit report u/s. 44AB in form 3CD for A.Y. 2012-13 submitted by the assessee. 2. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in partly allowing the appeal on disallowance u/s. 14A of the Income Tax Act, 1961, without appreciating the fact that the disallowance is rightly made as per provisions of Rule 8D by the AO. 3. The appellant craves leave to add to, amend or alter the above grounds as may be deemed necessary.”
Briefly stated facts are that case of the assessee was for scrutiny assessment and the assessment u/s. 143(3) of the Income Tax Act, 1961, by order dated 13.03.2015.
At the outset, Ld. Counsel for the assessee submitted that both the issues raised in these appeals are squarely covered by the decision of the Tribunal in assessee’s own case pertaining to the assessment order 2009- 10 and 2010-11. Ld. Counsel for the assessee submitted that therefore the ground raised by the Revenue deserves to be dismissed.
Ld. DR did not controvert the fact that issues are covered against Revenue in ITA No. 2548/Ahd/2015 and also by the judgment of the Hon’ble Gujarat High Court in Tax Appeal No. 559 of 2009 in the case of CIT vs. Aditya Medisales Ltd. Therefore, respectfully following the same Ground No. 1 of the Revenue’s appeal is rejected.
ITA Nos.1227 & 1147/Ahd/2017 Aditya Medisales Ltd. vs. DCIT Asst.Year – 2012-13 - 3 - 6. Ground No. 2 it is stated that this also covered by the decision of the Tribunal and ITA No. 2550/Ahd/2015 pertaining to the A.Y. 2011- 12.
Ld. DR did not controvert this fact that this issue is also covered by the decision of the Tribunal in earlier year therefore taking a consistent view the ground raised by the Revenue is dismissed.
Ground No. 3 is general in nature. There is need no separate adjudication. Appeal of the Revenue is dismissed.
Now coming to the assessee’s appeal in ITA No. 1147/Ahd/2017. The assessee has raised following grounds of appeal:- “1. The order passed by the learned Commissioner of Income Tax (Appeals) [hereinafter referred to as 'the learned CIT-(A)'] is bad in law and on facts. 2. Re: Disallowance of discount claim Rs.24,41,703/- 2.1 In the facts and circumstances of the case and in law, the learned CIT(A) grossly erred in upholding the action of the Assessing Officer in disallowing the discount given to the doctors on the ground that same was not incurred wholly and exclusively for the purpose of business. 2.2 The learned CIT(A) failed to appreciate that the discount offered was in the regular course of Appellant's business for promoting Appellant's business and that the expenses so incurred by the Appellant were wholly and exclusively for the purposes of its business. 3. Re: Disallowance u/s. 14A read with rule 8D of Rs. 5,96,533/- 3.1 On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in upholding the action of the Assessing Officer of disallowing administrative expenses attributable to earning the dividend income u/s. 14A by invoking Rule 8D without recording satisfaction with regard to correctness of claim of the Appellant and as to how the disallowance carried out by the Appellant amounting to Rs.50,000/- was not adequate.
ITA Nos.1227 & 1147/Ahd/2017 Aditya Medisales Ltd. vs. DCIT Asst.Year – 2012-13 - 4 - 3.2 On the facts and in the circumstances of the case and in law, the learned CIT(A) failed to appreciate that the exempt income earned by the Appellant is incidental to the main intention of acquiring the shares, which are the strategic investments of the Appellant. 3.3 Without prejudice to above, the learned CIT (A) grossly erred in not rectifying the errors in calculating amount of disallowance u/s 14A read with Rule 8D. 3.4 Without prejudice to above, the disallowance u/s. 14A read with Rule 8D ought to be substantially reduced. 4. Re: Levy of interest u/s. 234D: 4.1 On facts and circumstances of case, and in law, the learned CIT(A) grossly erred in not directing the Assessing Officer to correct the errors made in the computation of interest u/s. 234D. 5. The appellant craves leave to add to, alter, amend or delete any ground of appeal.”
Ground No. 1 is general in nature and there is no need to separate adjudication.
Ground No. 2 Ld. Counsel for the assessee submitted that this issue is covered by the decision of the Tribunal of ITA No. 2548/Ahd/2015.
Ld. DR did not controvert this fact that the issue under consideration has already been decided against the Revenue. We find that this issue has been decided in favour of the assessee by the Coordinate Bench in assessee’s own case in ITA No. 2548/Ahd/2015. The Revenue has not got any contrary binding precedent by the Hon’ble Jurisdictional High Court. Therefore, the ground raised by the assessee is allowed.
Ground No. 3 is against invoking provision of Sec. 14A. Ld. Counsel for the assessee submitted that the issue raised in this ground is
ITA Nos.1227 & 1147/Ahd/2017 Aditya Medisales Ltd. vs. DCIT Asst.Year – 2012-13 - 5 - squarely covered by the decision of the Tribunal in assessee’s own case in ITA No. 2550/Ahd/2015.
Ld. DR could not controvert the fact that the issue under consideration has already been decided against the Revenue. The facts are identical there is no change into the facts and circumstances. Therefore, taking consistent view we direct the AO delete this addition. This ground of the assessee’s appeal is allowed.
Ground No. 4 is against levy of interest. This being consequential we hold accordingly.
Ground No. 5 is general in nature. There is need no separate adjudication.
In the result, the appeal filed by the Revenue is dismissed and the appeal filed by the assessee is allowed. Order pronounced in Court on the date mentioned hereinabove at caption page Sd/- Sd/- (AMARJIT SINGH) (KUL BHARAT) ACCOUNTANT MEMBER JUDICIAL MEMBER TRUE COPY Ahmedabad; Dated 26/ 04 /2019 TANMAY आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent. 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त(अपील) / The CIT(A), Vadodara �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 5. 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील�य अ�धकरण, अहमदाबाद / ITAT, Ahmedabad