COMMISSIONER OF INCOME TAX, KOLKATA-II vs. M/S. UMIL SHARE & STOCK BROKING SERVICES LTD.

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ITA/66/2014HC CalcuttaWBCHCO002615201401 December 2021Bench: HON'BLE JUSTICE T. S. SIVAGNANAM,HON'BLE JUSTICE HIRANMAY BHATTACHARYYA2 pages
AI SummaryWithdrawn

What did the High Court hold?

The High Court, upon hearing the submissions, noted that the learned standing counsel for the Revenue submitted that the appeal was hit by a CBDT circular due to low tax effect. Recording this submission, the Court disposed of the appeal accordingly. Consequently, the substantial question of law was left open, meaning it was not decided on its merits. The operative direction was to dispose of the appeal based on the low tax effect circular.

What were the facts?

The Revenue, Commissioner of Income Tax, Kolkata-II, filed an appeal under Section 260A of the Income Tax Act, 1961, against an order dated November 29, 2013, passed by the Income Tax Appellate Tribunal (ITAT), Kolkata, 'B' Bench. The appeal pertained to Assessment Year 2008-09 and concerned the assessee, M/s. Umil Share & Stock Broking Services Ltd. The dispute revolved around the computation of disallowance under Section 14A of the Act. The High Court heard arguments from both the Revenue and the assessee.

What were the issues?

The Tribunal had to decide the following substantial question of law: 1. Whether the learned Tribunal and the said Commissioner erred in computing disallowance under Section 14A of the said Act on the basis of net interest paid by the assessee and not on the basis of gross interest, which is contrary to the provisions laid down in Rule 8D(2)(ii) of the said Rules? Contentions: Assessee: The judgment does not record any specific contentions made by the assessee. Revenue: The learned standing counsel for the appellant (Revenue) submitted that the appeal is hit by the circular issued by the CBDT on account of low tax effect.

Which sections of the Income-tax Act were involved?

Section 14A,Section 260A

AI-generated summary — verify with the full judgment below

OD – 2 ORDER SHEET

IN THE HIGH COURT AT CALCUTTA SPECIAL JURISDICTION (INCOME TAX) ORIGINAL SIDE

ITA/66/2014

COMMISSIONER OF INCOME TAX, KOLKATA-II VS. M/S. UMIL SHARE & STOCK BROKING SERVICES LTD.

BEFORE : THE HON’BLE JUSTICE T.S. SIVAGNANAM

A N D THE HON’BLE JUSTICE HIRANMAY BHATTACHARYYA Date: December 1, 2021.

Appearance : Mr. S. N. Dutta, Adv. …for the appellant

Mr. Vineet Tibrewal, Adv. Mr. Siddharth Das, Adv. …for the respondent

The Court : This appeal filed by the Revenue under Section 260A of the Income Tax Act, 1961 (the Act) is directed against the order dated 29th November, 2013 passed by the Income Tax Appellate Tribunal “B” Bench, Kolkata in ITA No. 640/Kol/2012 for the Assessment Year 2008-09. The Revenue has raised the following substantial question of law for consideration: 1. Whether the learned Tribunal and the said Commissioner erred in computing disallowance,

2 under Section 14A of the said Act, on the basis of net interest paid by the assessee and not on the basis of gross interest which is contrary to the provisions laid down in Rule 8D(2)(ii) of the said Rules?

We have heard Mr. S. N. Dutta, learned standing counsel for the appellant/Revenue and Mr. Vineet Tibrewal along with Mr. Siddharth Das learned counsel for the respondent/assessee. Learned standing counsel for the appellant submits that the appeal is hit by the circular issued by the CBDT on account of low tax effect. Recording the said submission, the appeal stands disposed of accordingly. Consequently, substantial question of law is left open.

(T. S. SIVAGNANAM, J.)

(HIRANMAY BHATTACHARYYA, J.)

GH/sp3

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