INVESTORS CLINIC INFRATECH PRIVATE LIMITED,UTTAR PRADESH vs. DCIT CENTRAL CIRCLE- 15, DELHI

आयकर अपीलीय अिधकरण, िद�ी पीठ�, नई िद�ी INCOME TAX APPELLATE TRIBUNAL, DELHI BENCHES, NEW DELHI BENCH: G BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER ITA 1390/DEL/2026 (िनधा�रण वष�/Assessment Year: 2020-21) INVESTORS CLINIC INFRATECH DCIT PRIVATE LIMITED CENTRAL CIRCLE- 15 DELHI 21ST FLOOR, ASTRALIS TOWER, Vs. SPERTECH SUPERNOVA, SECTOR -94 NOIDA, UTTAR PRADESH – 201 301 अपीलाथ� / Appellant ��थ� / Respondent

Permanent Account Number of Assessee: AACCI 2147 R

अपीलाथ� �ारा/Appellant represented by: Shri Kamal K. Jetley, Adv. ��थ� �ारा/Respondent represented by: Shri Bhogendra Prasad, Sr. DR सुनवाई की तारीख / Date of conclusion of hearing: 20-Aug-2026 घोषणा की तारीख / Date of pronouncement: 20-Aug-2026 आदेश / ORDER PER NAVEEN CHANDRA, ACCOUNTANT MEMBER : This appeal is filed by the assessee against the order of Ld. Commissioner of Income tax (Appeals)-26 dated 12.12.2025 arising from the assessment order dated 23.09.2022 passed under section 143(3) r.w.s 144B of the Income tax Act, 1961 (hereinafter referred to as ‘the Act’) by the Assessment Unit, New Delhi (hereinafter referred to as ‘the AO’) for the Assessment Year 2020-21.

ITA 1390/DEL/2026 INVESTORS CLINIC INFRATECH PRIVATE LIMITED 2. The Assessee has raised the following grounds of appeal: 1. That the order passed by the Ld. CIT(A) is bad in law, contrary to facts on record and liable to be quashed. 2. That the Ld. CIT(A) erred in law and on facts in holding that the additions/adjustments made by CPC while processing the return under section 143(1) were not appealable in appeal against the assessment order passed under section 143(3), without appreciating that the Ld.AO himself adopted the income determined by CPC as the base income in the assessment order, thereby making such adjustments an integral part of the impugned assessment and when such intimation was passed only after issue of scrutiny assessment notice. The Ld. CIT(A) further erred in dismissing the appellant's challenge on technical grounds instead of adjudicating the additions on merits, and in upholding the action of the Assessing Officer in adopting the income determined by CPC in place of the returned income, despite the fact that the adjustments made by CPC were patently incorrect, contrary to law and unsustainable. 3. That the Ld. CIT(A) erred in law and on facts in confirming the disallowance of Rs.20,62,763/- made u/s 14A r.w.r 8D of the Act, without appreciating that it is a settled law that additions u/s 14A cannot be made in absence of any exempt income and when the Ld. AO not only merely on the basis of his presumptions and conjectures has made such additions but also has failed to identify the specific expenditure incurred by the appellant for earning such exempt income and has grossly ignored the fact that the aforesaid investments were made out of the Appellant's own funds and therefore no disallowance was warranted and when financial statements evidencing the NIL exempt income were already on records. 4. That the Ld. CIT(A) erred in law and on the facts in refusing to adjudicate the disallowance of Rs.19,19,846/- towards CSR expenditure, despite the fact that the same was already suo motu disallowed by the Appellant in its return, resulting in impermissible double taxation which is contrary to settled principles of income-tax jurisprudence and when the appeal against an assessment u/s 143(3) necessarily entails examining the correctness of income so assessed, even if such income originates from CPC adjustments u/s 143(1). 5. That the Ld. CIT(A) erred in law in not adjudicating the disallowance of Rs.93,30,000/- u/s 40(a)(i)(ia), despite the fact that the tax deducted at source was deposited before the due date of filing of return, making the disallowance unsustainable in law. 6. That the Ld. CIT(A) erred in law in not adjudicating the disallowance of Rs.87,01,920/- u/s 40(a)(i)(ib), despite the undisputed fact that

ITA 1390/DEL/2026 INVESTORS CLINIC INFRATECH PRIVATE LIMITED

equalisation levy was deposited before the due date of filing of return along with the interest. 7. That the Ld. CIT(A) erred in law in not adjudicating the disallowance of Rs.44,36,515/- u/s 43B, ignoring the fact that the employer's contribution to PF and ESI was paid before the due date of filing of return, and hence fully allowable. 8. Without prejudice to the above grounds of appeal the appellant reserves right to make addition /alteration to the above ground of appeal and also reserves the right to bring on additional grounds of appeal, before and during the course of hearing of this appeal, as consider fit and necessary.” 3. Brief facts of the case are that the assessee M/s. Investors Clinic Infratech Pvt. Ltd. engaged in real estate broking and trading, filed its original return of income on 15.02.2021 declaring total income of Rs.23,41,19,850/-. Thereafter, the case of assessee was selected for scrutiny under Computer Aided Scrutiny Selection (CASS). Statutory notice u/s 143(3) of Act was issued on 29.06.2021. The return of income was processed at CPC vide order u/s 143(1) and intimation dated 24.12.2021 was issued thereby making addition of Rs.2,43,91,290/- and determining income at Rs.25,85,11,140/-, details of which are as under: S. Nature of Addition Amount of Addition No. /Disallowance (Rs.) 1. CSR Expenses 19,19,846/- 2. Equalization levy u/s 40(a)(i)(ib) 87,01,920/- 3. tax deducted at source u/s 40(a)(i)(ia) 93,30,000/- 4. Employer's contribution to the Provident Fund and 44,36,515/- Employees State Insurance u/s 43B 5. Provision for Gratuity u/s 40A(7) 3,000/-

ITA 1390/DEL/2026 INVESTORS CLINIC INFRATECH PRIVATE LIMITED 4. Subsequently, the scrutiny assessment u/s 143(3) r.w.s 144B of Act was completed on 23.09.2022 after making disallowance of Rs. 20,62,763/- u/s 14A of Act r.w. Rule 8D. 5. Aggrieved by the order of ld. AO u/s 143(3) and intimation under section 143(1), assessee was in appeal before the ld. CIT(A), challenging the disallowance under section 14A and the adoption of CPC adjustments. The ld. CIT(A) dismissed the assessee’s appeal against order u/s 143(3) on addition u/s 14A and further held that additions made u/s 143(1) were outside the scope of appeal against the assessment order under section 143(3) of the Act. Being aggrieved by the order of the ld. CIT(A), assessee is now in appeal before us. 6. Before us, ld. Counsel for the assessee, with respect to ground 2, 4 to 7 regarding adjustment made u/s 143(1), stated that the same was not pressed, hence dismissed as not pressed. With respect to ground 2 regarding disallowance u/s 14A, the ld AR submitted as under: Addition of Rs. 20,62,763/- u/s 14A of the Income Tax Act, 1961 made by Ld. AO 1. During the preceding previous Assessment Years prior to AY 2020-21 the assessee has made investments in the shares of various companies to the tune of Rs. 20,19,80,552/-. 2. During the Assessment Year 2020-21, the assessee has made an investment as capital of Rs.44,82,541/- in partnership firm and in shares of a subsidiary company 3. The aforesaid investments were made by the assessee out of the own fund. 4. The assessee has not earned any exempt income during the year under consideration from these investment in shares/capital in partnership firm.

ITA 1390/DEL/2026 INVESTORS CLINIC INFRATECH PRIVATE LIMITED 5. Also, the assessee has not incurred any expenditure whether directly or indirectly either on maintenance or collection of such exempt income or investments. 6. The investments made were one time activity undertaken by the assessee in earlier years and the assessee did not incurred any expenditure towards making or maintaining these investments or for collection of any income from these investments. 7. The Ld. AO failed to specifically point out as to which expenditure the assessee incurred for earning the income from these investments or for maintaining these investments. 8. However, Ld. AO without considering the fact of the case, explanation and justifications offered, disallowed Rs.20,62,763/- u/s 14A of the Income Tax Act, 1961 to the income of the assessee. 7. Per contra, the ld DR relied on the orders of AO and CIT(A). 8. We have heard the rival submissions and have perused the materials on record. We find that the assessee has made investments in the shares of various companies to the tune of Rs. 20,19,80,552 in the preceding previous Assessment Years prior to AY 2020-21. The assessee had further made investment as capital of Rs.44,82,541/- in partnership firm and in shares of a subsidiary company, in the year under consideration. The AO has not controverted the fact that the aforesaid investments were made out of assessee’s own fund. We further note that the AO has nowhere established that the assessee has earned any exempt income during the year under consideration from these investments in shares/capital in partnership firm. In such factual matrix, we are of the considered view that no disallowance can be made u/s 14A where no exempt income has been earned. We are fortified by the decision of the hon’ble Delhi High Court in the case of PCIT V Delhi International Airport [2022] 144 taxmann.com 80 (Delhi) 5

ITA 1390/DEL/2026 INVESTORS CLINIC INFRATECH PRIVATE LIMITED wherein it was held that no disallowance under Section 14A can be made if the assessee has not earned or received any exempt income during the relevant financial/previous year. It also held that the amendment made to Section 14A by the Finance Act, 2022 is prospective in nature and applies from Assessment Year 2022-23 onwards. It was similarly held in PCIT V Era Infrastructure (India) Ltd.[2022] 448 ITR 674 (Del.). Following the judicial precedents as above, we hold that disallowance made u/s 14A is not justified and the same is deleted. Ground 2 is allowed. 9. In the result, appeal filed by the Assessee in ITA No.1390/Del/2026 is partly allowed. Order pronounced in the open court on 20-Aug-2026.

Sd/- Sd/- SATBEER SINGH GODARA NAVEEN CHANDRA JUDICIAL MEMBER ACCOUNTANT MEMBER Delhi Dated: 07-Oct-2026 Priti Yadav, Sr. PS*

SHASHI Digitally signed by SHASHI KANT KANT PANDEY Date: 2026.10.09 PANDEY 15:41:48 +05'30'

ITA 1390/DEL/2026 INVESTORS CLINIC INFRATECH PRIVATE LIMITED

Copy to: INVESTORS CLINIC INFRATECH PRIVATE LIMITED, 21 FIRST FLOOR ASTRALIS TOWER SPERTECH 1 SUPERNOVA SECTOR -94 NOIDA, NOIDA-201301, UTTAR PRADESH DCIT CENTRAL CIRCLE- 15, 2 DELHI, NEW DELHI-, DELHI 3 THE PCIT / CIT, 4 THE D.R., ITAT, DELHI BENCH 5 GUARD FILE TRUE COPY

ASSISTANT REGISTRAR I.T.A.T., DELHI