DCIT - 14(3)(1), MUMBAI vs. TATA PETRODYNE LTD, MUMBAI

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ITA 7169/MUM/2017Status: DisposedITAT Mumbai21 August 2019AY 2013-142 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 followed the Special Bench decision in Vireet Investments Pvt. Ltd., holding that only investments yielding exempt income should be considered for calculating average investments for Section 14A disallowance.

What were the facts?

The Revenue appealed the CIT(A)'s order directing the exclusion of investments not yielding exempt income from the disallowance calculation under Section 14A. The assessment year in question is 2013-14.

What were the issues?

Whether investments not yielding exempt income should be included in the calculation of average investments for disallowance under Section 14A.

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, MUMBAI BENCH “E”, MUMBAI

Before: SHRI RAJESH KUMAR & SHRI RAM LAL NEGI

For Appellant: Shri Prakash R. Mane, A.R
For Respondent: Shri Firoz Andhyarujina, D.R
Hearing: 27.06.2019Pronounced: 21.08.2019

Per Rajesh Kumar, Accountant Member:

1.

The present appeal has been preferred by the Revenue against the order dated 31.10.2017 of the Commissioner of Income Tax (Appeals) [hereinafter referred to as the CIT(A)] relevant to assessment year 2013-14.

2.

The Revenue has raised various grounds challenging the order of the Ld. CIT(A) whereby the Ld. CIT(A) has directed the AO to exclude those investments which did not yield any exempt income during the year and calculate the disallowance under section 14A of the Act accordingly. After perusing the facts on record and hearing the rival parties, we observe that the issue is squarely covered in favour of the assessee and against the Revenue by the decision of Special Bench in the case of ACIT vs.

2 M/s. Tata Petrodyne Ltd. Vireet Investments Pvt. Ltd. (2017) 82 taxman.com 415 (Del-Tri.- Special Bench) wherein the Hon’ble Special Bench has held that only those investments are to be considered for the purpose of computing average investments which yielded exempt income during the year. We, therefore, respectfully following the same are inclined to dismiss the appeal of the Revenue.

Order pronounced in the open court on 21.08.2019.

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