DCIT, C-1, LUDHIANA vs. VARDHMAN ACRYLICS LTD., LUDHIANA

आदेश/ORDER Per Sanjay Garg, Judicial Member :

The present cross appeals preferred by the assessee and Revenue are against the order dated 22.8.2017 of Commissioner of Income Tax (Appeals)-I, Ludhiana [hereinafter referred to as ‘CIT(A)’]

ITA No.182-C-2018 & 1512-C-17 2 M/s Vardhman Acrylics Limited Ludhiana

assessee in ITA No. 1512/Chd/2017.

disallowance of expenditure u/s 14A of the Income-tax Act,

1961 (in short 'the Act') read with rule 8D(2(iii)of the

I.T.Rules.

disallowance has applied the amended Rule effective from

2.6.2016. The Ld. Counsel for the assessee has submitted

that the assessment year under consideration is assessment

year 2014-15 and that the amended rule is to be applied

prospectively. He, therefore, has submitted that the matter

needs to be restored to the file of the CIT(A) to apply the

relevant rules, as were enforceable for the assessment year

under consideration. The Ld. Counsel for the assessee in

this respect has relied upon the decision of Hon'ble

Supreme Court in ‘CIT Vs. Essar Teleholdings Ltd., [2018]

90 taxmann.com 2 (SC)

Supreme Court in ‘CIT Vs. Essar Teleholdings Ltd., (supra)

that amended rule 8D of the I.T. Rules is applicable

prospectively. In view of this, the matter is restored to the

file of the CIT(A) to decide the issue afresh in accordance

with law in the light of relevant rules as may be applicable

in the assessment year under consideration.

ITA No.182-C-2018 & 1512-C-17 3 M/s Vardhman Acrylics Limited Ludhiana

182/Chd/2018. The appeal is time barred for 100 days. A

separate application for condonation of delay has been

filed, wherein, it has been pleaded that order giving effect

to the CIT(A) could not be passed due to non-availability of

certain records. That the delay in filing the present appeal

was not intentional.

Considering the reasons given in the application, the

delay in filing the present appeal is hereby condoned.

effect involved in the present case is less than Rs. 20 lacs

and that the CBDT Circular No. 3/2018 is applicable to this

appeal, hence, this appeal of the Revenue is liable to be dismissed.

dated 11.07.2018 has revised the monetary limit upto Rs.20

lacs for filing appeals by the Department before the Tribunal

and further vide para 13 of the said Circular it has been

clarified that said circular is applicable retrospectively to the

pending appeals also. The Hon’ble Punjab & Haryana High

Court in the case of “Principal CIT of Income Tax Vs. Surinder

Kumar Singhal” ITA No 406-2016 (O&M) vide order dated

30.1.2017 while further relying upon the decision of the

Hon'ble Supreme Court in the case of “CIT Vs. Dhanalekshmi

Bank Ltd.” (2015) 373 ITR 526 (SC), has dismissed the appeal

of the Revenue without going into the merits due to low tax

ITA No.182-C-2018 & 1512-C-17 4 M/s Vardhman Acrylics Limited Ludhiana

effect leaving the question of law open. In view of the CBDT Circular No. 03/2018 (supra) and in the light of the above referred to decision of the Hon'ble Jurisdictional Punjab & Haryana High Court (supra), the present appeal of the Revenue is dismissed due to low tax effect.

In the result, appeal of the assessee is treated as allowed, whereas, the appeal of the Revenue is dismissed.

Order dictated and pronounced in the Open Court immediately on completion of hearing.

Sd/- Sd/- (अ�नपूणा� गु�ता / ANNAPURNA GUPTA) (संजय गग� / SANJAY GARG) �या�यक सद�य/ Judicial Member लेखा सद�य/ Accountant Member Dated : 21 .02.2019 “आर.के.”

आदेश क� ��त�ल�प अ�े�षत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent 3. आयकर आयु�त/ CIT 4. आयकर आयु�त (अपील)/ The CIT(A) 5. �वभागीय ��त�न�ध, आयकर अपील�य आ�धकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड� फाईल/ Guard File

आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar