HOLTEC CONSULTING PVT. LTD.,NEW DELHI vs. DCIT, CIRCLE- 11(1), NEW DELHI

PDF · subscribers
ITA 7050/DEL/2017Status: DisposedITAT Delhi23 February 2021AY 2013-143 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the facts for the current assessment year were identical to previous years where the issue was restored to the Assessing Officer. Therefore, the Tribunal restored the issue to the Assessing Officer for fresh consideration.

What were the facts?

The assessee, engaged in consultancy, had additions made to its income for disallowance of director payments and under Section 14A. The CIT(A) granted relief on director payments but confirmed the Section 14A disallowance.

What were the issues?

Whether the disallowance under Section 14A read with Rule 8D was sustainable, considering the nature of investments and the AO's satisfaction.

Which sections of the Income-tax Act were involved?

Section 14A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘C’ NEW DLEHI

Before: SHRI R.K. PANDA & SHRI K. NARASIMHA CHARY

For Respondent: Ms. Sunita Singh, CIT/DR
Hearing: 23.02.2021

PER K. NARASIMHA CHARY, J.M. Challenging the order dated 28.09.2017 passed by the learned Commissioner of Income Tax (Appeals)-18, New Delhi (“the Ld. CIT(A”), for the assessment year 2013-14, Holtec Consulting Pvt. Ltd.(“the assessee”), preferred this appeal.

2.

Brief facts are that the assessee is engaged in the business of Technical and Management Consultancy. For the assessment year 2013- 14, they filed their return of income on 29.11.2013 declaring an income of Rs.29,96,84,870/-. Assessment u/s. 143(3) of the Income-tax Act (“the Act” for short) was, however, complete by order dated 26.02.2016 determining income at Rs.33,09,42,326/- by making additions of Rs.2,22,74,011/- on account of disallowance of payments made to director and a sum of Rs.89,83,445/- u/s. 14 of the Act read with Rule 8D of the Income-tax Rules.

3.

When the assessee preferred appeal, by way of impugned order, learned CIT(A) granted relief to the assessee in respect of disallowance of Rs.2,22,74,011/-, but confirmed the addition made u/s. 14A read with Rule 8D. The assessee is, therefore, aggrieved by such an order and preferred this appeal stating that such a disallowance by invoking section 14A read with Rule 8D is not sustainable.

4.

Learned AR submitted that the authorities below failed to analyse the nature of investment as to whether the investment is yielding taxable income, exempt income or no income and that the satisfaction regarding the incorrect amount disallowed by the assessee was not recorded by the Assessing Officer. He, however, submitted that facts & circumstances and questions of law involved this year are identical to the ones involved for the assessment years 2009-10, 2010-11 and 2011-12, in which years, a coordinate Bench of this Tribunal in for assessment year 2009-10, 1057/Del/2014 for A.Y. 2010-11 and 2148/Del/2015 for A.Y. 2011-12, restored the issue back to the file of Assessing Officer to consider the issue afresh in the light of observations made in ITA No. 4563/Del/2012 for assessment year 2009-10. Learned AR prayed that this issue for this year may also be restored back to the file of Assessing Officer to consider the same in consonance with the view to be taken for assessment year 2009-10.

5.

In view of the admitted position that the facts and circumstances involved for this year are identical to ones involved in assessment years 2009-10, 2010-11 and 2011-12, in which the issue was restored to the file of Assessing Officer to take a fresh view in the light of directions given in for assessment year 2009-10, we are of the considered opinion that the request of the assessee can be accepted. We accordingly, while setting aside the impugned findings of the authorities below, restore the issue to the file of Assessing Officer to decide the same in the light of the view to be taken for earlier assessment years.

6.

In the result, appeal of the assessee is allowed for statistical purposes.

1.

Order was announced on conclusion of Virtual Hearing in the presence of both the parties on this the 23rd day of February, 2021.

More judgments on Section 14A

All 15,875 judgments and leading authorities on Section 14A →

Recent GST High Court judgments

Search GST case law →