CIT vs. MULTIMEDIA & ENTERTAINMENT LTD

IN THE HIGH COURT OF DELHI AT NEW DELHI . . . ITA 33/2012 . . . CIT ..... Appellant . Through Mr. N.P. Sahni, Adv. . . . versus . . . MULTIMEDIA and ENTERTAINMENT LTD ..... Respondent . Through . . . CORAM: . HON'BLE MR. JUSTICE SANJIV KHANNA . HON'BLE MR. JUSTICE R.V.EASWAR . . . O R D E R . 27.01.2012 . . . The tax effect in the present case is less than Rs. 10 lacs. This is admitted in the appeal itself. It is stated that the present appeal has been filed as it is covered by the exception carved out in paragraph 8 of the circular. However, which sub-paragraph/clause is applicable, is not indicated. . We have examined the order passed by the tribunal. The Assessing Officer had made disallowance of Rs.7,60, 856/- under Section 14A of the Income Tax Act, 1961 (Act, for short) read with Rule 8D. The assessment year in question 2007-08 and Rule 8D, as held by this Court in the case of Maxopp Investment Ltd. Vs. Commissioner of Income Tax decided on 18th November, 2011, is prospective and not retrospective. The CIT (Appeals) had restricted the aforesaid disallowance to Rs. 1 lac. The Revenue did not challenge the said decision and accepted the deletion made by the first appellate authority. The assessee, however, challenged the order passed by the CIT (Appeals) disallowing Rs.1 lac under Section 14A of the Act. The tribunal by the impugned order has remitted the matter to the Assessing Officer for a fresh decision on the basis of the ratio and directions given by the Bombay High Court in the case of Godrej Boyce Manufacturing Co. Ltd. Vs. DCIT (2010) 328 ITR 81(Bom.). The Assessing Officer at the time of fresh hearing can obviously examine the decision of this Court in the case of Maxopp Investment Ltd. (supra) . On the second aspect i.e., disallowance under Section 73 of the Act, the Assessing Officer had not made any addition. The CIT (Appeals) issued notice under Section 251 of the Act. He had applied the Explanation and held that the entire activity of trading in shares was speculative in nature under Section 73 of the Act. The tribunal has remitted the matter to the Assessing Officer to examine the entire issue afresh. The applicability of the Explanation requires examination and elucidation on the factual aspects. As the factual details were scanty and elusive, the tribunal has passed an order of remit. . In view of the aforesaid position, we do not think that any substantial question of law arises for consideration and the appeal is accordingly dismissed. . . . SANJIV KHANNA, J. . . . . . . . R.V.EASWAR, J. . JANUARY 27, 2012 . NA . . . . . $ 37. .