CIT vs. HERO CORPORATE SERVICES LTD

IN THE HIGH COURT OF DELHI AT NEW DELHI . ITA 458/2013 . CIT . ..... Appellant . Through Mr. Kamal Sawhney, Sr. Standing Counsel. . versus . HERO CORPORATE SERVICES LTD . ..... Respondent . Through Mr. Satyen Sethi and Mr. Arta Trana Panda, Advocates. . . . CORAM: . HON'BLE MR. JUSTICE SANJIV KHANNA . HON'BLE MR. JUSTICE SANJEEV SACHDEVA . . . O R D E R . 23.10.2013 . . . This appeal by the Revenue under Section 260A of the Income Tax Act, 1961 has to be dismissed for multifarious reasons. The assessee had earned exempt dividend income of Rs.1,96,57,658/-. The respondent- assessee had themselves disallowed Rs.17,26,027/- as expenditure incurred on earning of exempt income under Section 14A of the Act. The Assessing Officer did not record any finding that the said disallowance was low or not reasonable. He applied Rule 8D and computed the disallowance at Rs.91,22,219/-. In other words, he made further disallowance of Rs.73,96,192/-. In the first appeal, the Commissioner (Appeals) noticed factual inaccuracies in the figures taken by the Assessing Officer to compute disallowance under Rule 8D. In the grounds of appeal filed before us, it is not alleged or stated that the factual inaccuracies pointed out by the Commissioner (Appeals) are wrong or incorrect. In view of the factual inaccuracies, the Commissioner (Appeals) worked out the disallowance under Rule 8D at Rs. 35,81,657/-. The decision of the Commissioner (Appeals) was accepted by the respondent-assessee. The Revenue, however, preferred an appeal, which has been dismissed by the tribunal. Thus, in the present case Commissioner (Appeals) has relied and referred to Rule 8D and has recomputed the disallowance on the basis of applicable and correct figures. These figures are not disputed by the Revenue in the present appeal in the grounds. We fail to understand how and why, therefore, this appeal has been filed. The tribunal may have made an observation that Rule 8D is not retrospective but that is inconsequential in the present case, as Commissioner (Appeals) has applied Rule 8D on the correct figures. Disallowance has been made by applying Rule 8D. . The appeal is dismissed. . . . SANJIV KHANNA, J. . . . . . . . SANJEEV SACHDEVA, J. . OCTOBER 23, 2013/VKR . . . $ 5. .