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Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI
1 Aryadoot Transpor P.Ltd. Assessment Year-2010-11 आयकर अपीलीय अिधकरण “एक-सद" मामला” "ायपीठ मुंबई म"। IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI शमीम याहया, लेखा सद" Shamim Yahya, Accountant Member आयकरअपील सं./ (िनधा"रण वष" / Assessment Year:2010-11) Aryadoot Transport Pvt.Ltd. Dy. Commissioner of Income Tax बनाम/ Unit No.801, Godrej Coliseum Central Circle-6(4) C-Wing, Off Somaiya Hospital Rd.,Sion Mumbai. Vs. Mumbai-400 022. "थायीलेखासं./जीआइआरसं./PAN/GIR No.AAACA 4793 K (अपीलाथ"/Appellant) : (""थ" / Respondent) अपीलाथ"कीओरसे/ Appellant by : Shri Harsh Shah-Ld. AR ""थ"कीओरसे/Respondent by : Shri Chaitanya Anjaria-Ld. DR सुनवाईकीतारीख/ : 20/02/2020 Date of Hearing घोषणाकीतारीख / : 16/06/2020 Date of Pronouncement आदेश / O R D E R Shamim Yahya (Accountant Member):-
1. 1. This appeal by the assessee is directed against order of learned CIT appeal dated 23/7/2018 and pertains to assessment year 2010 – 11.
2. The issue raised is that learned CIT appeals erred in sustaining the disallowance of rupees 3, 85, 313 under section 14 A despite the assessee not receiving any exempt income during the year.
2 Aryadoot Transpor P.Ltd. Assessment Year-2010-11
Brief facts of the case are that the above said disallowance by the assessing officer was sustained by the learned CIT appeals despite the Bombay High Court decision in the case of Delite in appeal No. 110 of 2009 dated 26/2/2009 being cited before him wherein the honourable jurisdictional High Court had agreed with the view expressed by the honourable Delhi High Court that disallowance under section 14A cannot exceed the exempt income earned. For doing so the learned CIT appeals erroneously mentions that he is relying upon the recent decision of honourable court in the case of Maxopp investment Ltd. While doing so the learned CIT appeals referred to that portion where the honourable supreme court deals with the issue of dominate purpose of the investment and hold that strategic investments cannot be a reason to not make disallowance under section 14 A.
I find that learned CIT appeals has totally erred in the above interpretation. The honourable Supreme Court did not hold that disallowance has to be made under section 14 A even when no exempt income is earned.
In the facts and circumstances of the case the disallowance under section 14 A is not warranted as it is not disputed that assessee has not earned any exempt income during the year.
3 Aryadoot Transpor P.Ltd. Assessment Year-2010-11 6. Accordingly I set aside the orders of authorities below and direct that the disallowance should be deleted.