DCIT, NEW DELHI vs. M/S. HEMA ENGINEERING INDUSTRIES LTD., NEW DELHI

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ITA 747/DEL/2016Status: DisposedITAT Delhi22 December 2017AY 2008-093 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 if there is no exempt income, no disallowance can be made under Section 14A. This decision was based on binding precedents from various High Courts.

What were the facts?

The Revenue appealed against the deletion of disallowance made under Section 14A read with Rule 8D. The assessee had not received any dividend income during the assessment years under consideration.

What were the issues?

Whether disallowance under Section 14A is permissible when the assessee has not earned 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, DELHI BENCHES: ‘F’, NEW DELHI

Before: SHRI G.D.AGRAWAL & SMT. BEENA A PILLAI

For Appellant: Shri Atiq Ahmad, Sr.D.R
Hearing: 19/12/2017Pronounced: 22/12/2017

ORDER

PER BEENA A PILLAI, JUDICIAL MEMBER

1.

The present appeals by Revenue have been filed against order dated 04/12/15 passed by Ld.CIT(A)-4 and Order dated 29/01/16 passed by CIT(A)-19, New Delhi for assessment year 2008-09 and 2006-07 respectively.

2.

The only issue raised by revenue in these appeals is against deletion of disallowance made by Ld.AO u/s 14A r.w.Rule 8D. It has been submitted before Ld.CIT(A) that no dividend income has been received during the year under consideration by the assesse.

2.1. Ld. DR placed reliance upon the order passed by Ld.AO in support of his arguments. He placed reliance upon the CBDT circular No. 5/2014 dated 11/02/014.

2.2. It has been submitted before Ld. CIT (A) that assessee has not received any dividend income during the year under consideration.

3.

We have perused the relevant material on record in both the appeals before us, and find that this issue stands settled in favour of assessee by the Hon’ble judicial High Court in the case of Cheminvest Ltd versus CIT (2015) reported in 378 ITR 33 wherein it has been held that if there is no exempt income, there can be no question of making any disallowance under section 14 A. Similar view has also been taken by Hon’ble judicial High Court in the case of CIT versus Holcim India Pvt. Ltd vide order dated 05/09/14 in and 299/2014. 3.1. In view of these binding precedents we do not find any infirmity in the addition being deleted as there is no exempt income which has been recorded by Ld.CIT(A) on the facts of the present case. Accordingly this ground raised

by the revenue stands dismissed.

4. In the result appeals filed by revenue stand dismissed. Order pronounced in the open court on 22/12/2017. Sd/- Sd/- (G.D.AGRAWAL) (BEENA A PILLAI) President Judicial Member Dated: 22nd December, 2017. *mv Copy of the Order forwarded to:

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