ASST CIT CIRCLE-9 (3)(2), MUMBAI vs. M/S FUTURE BRANDS LTD., MUMBAI

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ITA 7302/MUM/2019Status: DisposedITAT Mumbai12 May 2021AY 2016-173 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that since the assessee did not earn any exempt income during the year, the disallowance under Section 14A was rightly deleted. The Tribunal relied on its own previous order and a High Court decision.

What were the facts?

The revenue appealed against the deletion of disallowance under Section 14A. The assessee argued that no exempt income was earned, and a similar disallowance in a prior year was deleted and confirmed by the Tribunal.

What were the issues?

Whether disallowance under Section 14A is permissible when no exempt income is earned by the assessee.

Which sections of the Income-tax Act were involved?

Section 14A

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, “F” BENCH, MUMBAI

Before: HON’BLE SHRI MAHAVIR SINGH, VP & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

For Appellant: Ms. Dinkle Hariya – Ld. AR
For Respondent: Ms. Usha Gaikwad – Ld. Sr. DR

1 ITA 7302/M/2019 M/s Future Brands Limited Assessment Year: 2016-17 आयकर अपीलीय अधिकरण “एफ” न्यायपीठ म ुंबई में। IN THE INCOME TAX APPELLATE TRIBUNAL “F” BENCH, MUMBAI माननीय श्री महावीर स िंह, उपाध्यक्ष एवुं माननीय श्री मनोज कुमार अग्रवाल ,लेखा दस्य के मक्ष। BEFORE HON’BLE SHRI MAHAVIR SINGH, VP AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM (Hearing Through Video Conferencing Mode) आयकरअपील िं./ (धििाारण वर्ा / Assessment Year: 2016-17) ACIT-9(3)(2) M/s Future Brands Limited Room No.418, 4th Floor GF, Knowledge House बिाम/ Aaykar Bhavan, M.K. Road Off. Jogeshwari Vikhroli Link Road Vs. Mumbai-400 020 Shyam Nagar, Jogeshwari (E) Mumbai – 400 060 स्थायीलेखा िं./ जीआइआर िं./ PAN/GIR No.AABCF-0462-H (अपीलाथी/Appellant) (प्रत्यथी / Respondent) : Assessee by : Ms. Dinkle Hariya – Ld. AR Revenue by : Ms. Usha Gaikwad – Ld. Sr. DR ुनवाई की तारीख/ : 12/05/2021 Date of Hearing घोषणा की तारीख / : 12/05/2021 Date of Pronouncement आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member)

1.

The registry has noted delay of 5 days in the appeal, the condonation of which has been sought by the department on the strength of condonation petition dated 28/11/2019. After going through the same and considering the period of delay, we condone the delay and admit the appeal.

2 ITA 7302/M/2019 M/s Future Brands Limited Assessment Year: 2016-17 2. In this appeal for Assessment Year (AY) 2016-17, the revenue is aggrieved by deletion of disallowance u/s 14A for Rs.348.94 Lacs by Ld. Commissioner of Income Tax (Appeals)-16, Mumbai {CIT(A)} vide impugned order dated 28/08/2019.

3.

The Ld. AR submitted that the assessee did not earn any exempt income during the year and therefore, the disallowance was rightly deleted by Ld. CIT(A). The attention was drawn to the fact that similar disallowance made by Ld.AO in AY 2012-13 was deleted by learned first appellate authority for the same very reason. The said order has been confirmed by the Tribunal vide order dated 29/01/2018, a copy of which has been placed on record. The Ld. DR submitted that disallowance was to be computed despite the fact that no income was earned by the assessee during the year. After perusal of material on record, our adjudication to the subject matter of appeal would be as given in succeeding paragraphs 4. The material facts are that the assessee being resident corporate assessee was assessed u/s 143(3) on 12/12/2016. Despite assessee’s submissions that no exempt income was earned during the year, the Ld. AO computed disallowance u/s 14A r.w.r. 8D(2) for Rs.348.94 Lacs. The Ld. CIT(A) deleted the same by relying upon appellate order for AY 2014-15. Aggrieved, the revenue is in further appeal before us.

5.

It is undisputed fact that the assessee has not earned any exempt income during the year. We find that similar disallowance made in AY 2012-13 in assessee’s own case was deleted by learned first appellate authority on same factual matrix. The said adjudication has been confirmed by Tribunal vide ITA No.5561/Mum/2016 order dated 3 ITA 7302/M/2019 M/s Future Brands Limited Assessment Year: 2016-17 29/01/2018 by dismissal of revenue’s appeal. Reliance has been placed on the decision of Hon’ble Delhi High Court in Cheminvest Ltd. V/s CIT (378 ITR 33). Facts being pari-materia the same, taking the same view, we dismiss the appeal.

6.

The appeal stands dismissed.

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