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Income Tax Appellate Tribunal, KOLKATA BENCH “D”, KOLKATA
ORDER
PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER
This appeal filed by the Revenue against the order dated 01.11.2017 passed by CIT(A)-4, Kolkata u/s 143(3) of the Income Tax Act, 1961 (in short “Act”) for AY 2012-13.
The only issue is to be decided as to whether the CIT(A) justified in deleting the disallowance made on account of section 14A of the Act.
Heard both parties and perused the material available on record. The contention of the Ld.AR is that no exempt income was earned by the assessee during the year under consideration and the CIT(A) in the first appellate proceedings by placing reliance in the decision of Cheminvest Ltd. Vs CIT 378 ITR 33 deleted the addition. The Ld.AR argued when there is no exempt income earned, no disallowance is maintainable. Ld. DR did not controvert the same. On perusal of the impugned order at para 4.2, it is noted that the CIT(A) examined the record and found satisfied that no exempt income was earned by the assessee. For ready-reference, the relevant portion of which is reproduced herein below:-
4.2. “I have perused the assessment order and the submission of the Ld.A/R. I have also gone through the case laws relied upon by the department and the assessee. It is undeniable that the instant case no dividend/exempt income has been earned by the assessee. Hon’ble Delhi High Court in the case of Cheminvest Ltd. V. CIT 378 ITR 33 has held that no disallowance u/s 14A can be made where the assessee has not earned any exempt income. The same view has been held by Gujarat High Court in the case of Corrtech Energy Pvt.Ltd. Appeal No.239 of 2014 dated 24.03.2014. Further on identical set of facts it is sseen that in the case of Divakar Solar System Ltd. Vs DCIT in Hon’ble Calcutta ITAT has allowed the appeal in faovur of the assessee. Respectfully following the above judgement and the judgement of Hon’ble Calcutta ITAT in the case of Divakar Solar System Ltd. (supra). Gorund Nos.2(a), (b), (c) and Gorund Nos. 3(a), (b) & (c) are allowed in favour of the assessee.”
In view of the above, we find no infirmity in the order of CIT(A). Thus, Ground Nos. 1 & 2 raised by the Revenue are dismissed.
In the result, the appeal of the Revenue is dismissed.
Order pronounced in the open court on 25.01.2019.