THE PR. COMMISSIONER OF INCOME TAX vs. M/S COFFEE DAY ENTERPRISES LTD

PDF · subscribers
ITA/43/2025HC KarnatakaKAHC01011615202518 November 2025Bench: B M SHYAM PRASAD,T.M.NADAF4 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the Revenue's appeal, following a previous decision in the assessee's own case for AY 2013-14 on identical questions. The court found parity of reasoning and held the substantial questions of law in favor of the assessee.

What were the facts?

The Revenue appealed against an ITAT order concerning disallowance under Section 14A read with Rule 8D for AY 2020-21. The dispute involved the applicability of Circular No. 5/2014.

What were the issues?

Whether the Tribunal erred in not considering Circular No. 5/2014 and in deleting the disallowance made under Section 14A r.w. Rule 8D.

Which sections of the Income-tax Act were involved?

Section 14A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BENGALURU

- 1 -

HC-KAR NC: 2025:KHC:47763-DB ITA No. 43 of 2025

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18TH DAY OF NOVEMBER, 2025 PRESENT THE HON'BLE MR. JUSTICE B M SHYAM PRASAD AND THE HON'BLE MR. JUSTICE T.M.NADAF INCOME TAX APPEAL NO. 43 OF 2025

BETWEEN:

1.

THE PR. COMMISSIONER OF INCOME TAX CENTRAL, 3RD FLOOR, C.R. BUILDING, QUEENS ROAD, BENGALURU-560 001.

2.

THE DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-1(3), 3RD FLOOR, C.R BUILDING, QUEENS ROAD, BENGALURU-560 001.

…APPELLANTS (BY SRI. Y V RAVIRAJ.,ADVOCATE A/W SRI. M. DILIP., ADVOCATE)

AND:

M/S COFFEE DAY ENTERPRISES LTD NO.23/2, COFFEE DAY SQUARE,

Digitally signed by REKHA R Location: HIGH COURT OF KARNATAKA

- 2 -

HC-KAR NC: 2025:KHC:47763-DB ITA No. 43 of 2025

VITTAL MALLYA ROAD, BENGALURU-560 001. REP BY ITS MANAGING DIRECTOR

…RESPONDENT (BY MS. TANMAYEE RAJKUMAR.,ADVOCATE)

THIS INCOME TAX APPEAL IS FILED UNDER SEC. 260-A OF INCOME TAX ACT 1961, PRAYING TO ALLOW THE APPEAL AND SET ASIDE THE ORDERS PASSED BY THE INCOME TAX APPELLATE TRIBUNAL, BENGALURU IN ITA NO.785/BANG/2024 DATED 23.07.2024 FOR ASSESSMENT YEAR 2020-2021 ANNEXURE A CONFIRMING THE ORDER OF THE APPELLATE COMMISSIONER AND CONFIRM THE ORDER PASSED BY THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 1(3), BENGALURU.

THIS APPEAL, COMING ON FOR HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE B M SHYAM PRASAD and HON'BLE MR. JUSTICE T.M.NADAF

- 3 -

HC-KAR NC: 2025:KHC:47763-DB ITA No. 43 of 2025

ORAL JUDGMENT (PER: HON'BLE MR. JUSTICE B M SHYAM PRASAD)

The Revenue's appeal is as against the order dated 23.07.2024 in ITA No.785/Bang/2024. These orders relate to the assessment year 2020-21, and the dispute is over the disallowance computed by the Assessing Officer under Rule 8D of the Income Tax Rules applying Section 14A of the Income Tax Act, 1961. This appeal is admitted for consideration of the following substantial questions of law: "1. Whether on the facts and in the circumstances of the case, the Tribunal was correct in not considering the Circular No.5/2014 dated 11.02.2014 on the issue of disallowance under Section 14A r.w. Rule 8D.

2.

Whether on the facts and circumstances of the case, the Tribunal was correct in deleting the addition on disallowance under Section 14 r.w. Rule 8D?

It is undisputed that the Revenue's appeal in ITA No.2/2020 in the Assessee's own case relevant to

- 4 -

HC-KAR NC: 2025:KHC:47763-DB ITA No. 43 of 2025

the assessment year 2013-14, on the same set of questions, is dismissed answering the questions in favour of the Assessee. On perusal of the records, this Court opines that for parity of reasoning this appeal must also be dismissed holding that the substantial questions proposed are answered in favour of the Assessee as is opined in the appeal in ITA No.2/2020.

The appeal is disposed of accordingly.

Sd/- (B M SHYAM PRASAD) JUDGE

Sd/- (T.M.NADAF) JUDGE

SA ct:sr

More judgments on Section 14A

All 15,875 judgments and leading authorities on Section 14A →

Recent GST High Court judgments

Search GST case law →