GAJANAN ENTERPRISES,MUMBAI vs. ACIT CIRCLE 17(1), MUMBAI

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ITA 4522/MUM/2018Status: DisposedITAT Mumbai23 August 2019AY 2013-142 pages

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

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT-A's decision, relying on the Supreme Court's ruling in Maxopp Investment Ltd. The Tribunal held that Section 14A applies even if investments are held as stock-in-trade.

What were the facts?

The assessee appealed against the CIT-A's order sustaining a disallowance under Section 14A. The assessee contended that the investments were held as stock-in-trade, thus Section 14A should not apply.

What were the issues?

Whether disallowance under Section 14A is applicable when investments are held as stock-in-trade.

Which sections of the Income-tax Act were involved?

Section 14A

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

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Income Tax Appellate Tribunal, “SMC” Bench, Mumbai

Before: Shri Shamim Yahya (AM)

For Respondent: Shri Chaitanya Anjaria
Hearing: 4.7.2019Pronounced: 23.8.2019

This appeal by the assessee is directed against order of learned CIT-A dated 25.5.2018 and pertains to assessment year 2013-14.

2.

The issue raised is that learned CIT-A erred in sustaining the disallowance under section 14A, ignoring the fact that assessee was holding the investments as the stock in trade.

3.

I have heard the learned departmental representative and perused the records. None appeared on behalf of the assessee despite notice. I note that learned CIT-A has decided the issue against the assessee by placing reliance upon the decision of honourable apex court in the case of Maxopp Investment. The decision of learned CIT-A may be gainfully referred as under :-

“The sole issue is whether when shares are held in from stock-in-trade disallowance under section 14A r.w. rule 8D can be made or not. The appellant made written submission which inter alia includes certain case decisions. This includes PCIT vs. State Bank of Patiala [2017] 391 ITR 218 (P&H). However in Maxopp Investment Ltd vs CIT, New Delhi the Hon. Supreme Court in Civil Appeal 104-109 of 2015 dated

12.02.2018 has held that even if investment is held as stock-in-trade section 14A applies. Hence the issue stand settled judicially”.

4.

Since the above issue has been decided against the assessee by following the latest decision of the honourable apex court, I do not find any substance in the ground raised by the assessee. Accordingly this appeal filed by the assessee stands dismissed. Order has been pronounced in the Court on 23.8.2019.

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