PRINCIPAL COMMISSIONER OF INCOME TAX-4, DELHI vs. MAGNUM STEELS LTD

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ITA - 139 / 2023HC Delhi10 March 20232 pages
For Petitioner: ABHISHEK
AI SummaryRemanded

What did the High Court hold?

The High Court noted that the Tribunal had not addressed the deletion of capital gains by the CIT(A). The revenue's counsel agreed with the CIT(A)'s approach regarding undisclosed sales and stated the proposed question of law did not concern capital gains.

What were the facts?

The Assessing Officer made disallowances under Section 14A, additions for undisclosed sales, and short-term capital gains. The CIT(A) sustained the Section 14A disallowance, reduced undisclosed sales additions, and deleted capital gains. The Tribunal further restricted Section 14A disallowance and deleted undisclosed sales additions.

What were the issues?

Whether the Tribunal correctly handled the deletion of short-term capital gains and the additions for undisclosed sales, and if the CIT(A)'s approach was appropriate.

Which sections of the Income-tax Act were involved?

Section 14A,Section 143(2)

AI-generated summary — verify with the full judgment below

$~15 * IN THE HIGH COURT OF DELHI AT NEW DELHI + ITA 139/2023 and CM APPLs.11366-67/2023

PRINCIPAL COMMISSIONER OF INCOME TAX-4, DELHI

..... Appellant Through: Mr Abhishek Maratha, Sr. Standing Counsel.

versus

MAGNUM STEELS LTD

..... Respondent

Through: None.

CORAM:

HON'BLE MR JUSTICE RAJIV SHAKDHER

HON'BLE MS JUSTICE TARA VITASTA GANJU

O R D E R %

10.03.2023 [Physical Hearing/Hybrid Hearing (as per request)] 1. This appeal concerns Assessment Year (AY) 2010-2011. 2. The record shows that the Assessing Officer (AO) made the following disallowances, via an order dated 30.12.2011 issued under Section 143(2) of the Income Tax Act, 1961 [in short, “the Act”]: (i) Disallowance made under Section 14A of the Act- Rs.3,27,697/-; (ii) Addition on account of undisclosed sales- Rs.8,71,32,000/-; (iii) Addition towards short term capital gain- Rs.6,00,000/-. 3. On the other hand, the Commissioner of Income Tax (Appeals) [CIT(A)], via order dated 20.06.2014, while sustaining the disallowance made under Section 14A of the Act, reduced the addition with regard to undisclosed sales to Rs.3,88,50,000/-. Insofar as addition on account of short term capital gain was concerned, the same was deleted.

ITA 139/2023

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4.

The Income Tax Appellate Tribunal [in short, “Tribunal”] restricted the disallowance under Section 14A of the Act to Rs.1,00,000/- and deleted the addition made on account of undisclosed sales. 5. It appears that the Tribunal has not dealt with the deletion of capital gains made by the CIT(A). 6. We may note that the CIT(A) restricted the addition with regard to undisclosed sales to Rs.3,88,50,000/-, on account of the fact that the remaining part related to other AYs [See para 18.3 at pages 131-132 of the CITA’s order]. 7. Mr Abhishek Maratha, senior standing counsel, who appears on behalf of the appellant/revenue, says that insofar as the appellant/revenue is concerned, the approach adopted by the CIT(A) was the correct approach. 7.1 Furthermore, Mr Maratha says that the question of law proposed by the appellant/revenue does not relate to the deletion of short term capital gain. 8. We may note that the record does reveal that the AO did not reject books of accounts of the respondent/assessee. 9. However, the matter needs further examination. 10. We inclined to issue notice to the respondent/assessee via all modes, including e-mail. 11. List the appeal on 18.08.2023. RAJIV SHAKDHER, J

TARA VITASTA GANJU, J

MARCH 10, 2023 / tr

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page 2 of 2 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 27/03/2026 at 14:30:48

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