DCIT 1(3)(2), MUMBAI vs. TATA ADVANCED SYSTEMS LTD., MUMBAI

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ITA 3606/MUM/2018Status: DisposedITAT Mumbai14 June 2019AY 2014-153 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 in the absence of any exempt income, disallowance under Section 14A of the Act is not permissible. Therefore, the grievance of the Revenue was found to be without merit.

What were the facts?

The Revenue appealed against the CIT(A)'s order concerning the disallowance of expenditure relatable to exempt income. The assessee argued that Section 14A was not applicable as no exempt income was declared.

What were the issues?

The key issue was whether disallowance under Section 14A is permissible when the assessee has not declared any exempt income.

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, MUMBAI “E” BENCH, MUMBAI

Before: SHRI PRADIP KUMAR KEDIA & SHRI SANDEEP GOSAIN

For Respondent: Ms. Arati Vissanji, A.R

आदेश/O R D E R

PER PRADIP KUMAR KEDIA - AM:

1.

The captioned appeal has been filed at the instance of the Revenue against the order of the Commissioner of Income Tax (Appeals)-3, Mumbai, (‘CIT(A)’ in short), dated 19.01.2018 [DCIT vs. M/s. Tata Advanced Systems Ltd.] A.Y. 2014-15 - 2 - arising in the assessment order dated 28.12.2016 passed by the Assessing Officer (AO) under s. 143(3) of the Income Tax Act, 1961 (the Act) concerning AY 2014-15.

2.

The solitary issue arising in the instant appeal of the Revenue relates to disallowance of expenditure relatable to exempt income in terms of Section 14A of the Act.

3.

When the matter was called for hearing, the learned AR for the assessee in Revenue’s appeal submitted at the outset that the assessee has not declared any exempt income by way of dividend income etc. and therefore Section 14A of the Act has no application in the facts of the case. It was further pointed out that the issue is squarely covered by several judicial precedents including the decision of the Hon’ble Supreme Court in the case of Pr.CIT vs. Oil Industry Development Board [2019] 103 taxmann.com 326 (SC).

4.

In the light of the decision of the Hon’ble Supreme Court in Oil Industry Development Board (supra), it is well settled that in the absence of any exempt income, disallowance under s.14A of the Act of any amount is not permissible in law. Section 14A of [DCIT vs. M/s. Tata Advanced Systems Ltd.] A.Y. 2014-15 - 3 - the Act is a non-starter in the instant case. Thus, we find no merit in the grievance of the Revenue.

5.

In the result, the appeal filed by the Revenue is dismissed.

This Order pronounced in Open Court on 14/06/2019

Sd/- Sd/- (SANDEEP GOSAIN) (PRADIP KUMAR KEDIA) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai: Dated 14/06/2019 True Copy S. K. SINHA आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. राज�व / Revenue 2. आवेदक / Assessee 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त- अपील / CIT (A) 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, मुंबई / DR, ITAT, Mumbai 6. गाड� फाइल / Guard file.

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