M/S. S.R. BATLIBOI & COS. LLP,KOLKATA vs. DCIT, CIRCLE - 22, KOLKATA, KOLKATA

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ITA 370/KOL/2018Status: DisposedITAT Kolkata28 December 2018AY 2010-113 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the CIT(A) had not properly adjudicated the assessee's specific argument regarding the correct computation of disallowance. Therefore, the issue was restored to the CIT(A) for proper adjudication.

What were the facts?

The assessee challenged an administrative expenditure disallowance made under Section 14A read with Rule 8D(2)(iii). The assessee argued that the disallowance was not computed correctly as per the average value of investments.

What were the issues?

Whether the administrative expenditure disallowance under Section 14A was computed correctly based on the average value of investments. Whether the CIT(A) properly adjudicated this specific argument raised by the assessee.

Which sections of the Income-tax Act were involved?

Section 14A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “D” BENCH : KOLKATA

Before: Hon’ble Shri J. Sudhakar Reddy, AM & Shri S.S. Godara, JM]

Hearing: 18.12.2018Pronounced: 28.12.2018

ORDER Per S.S. Godara, JM

1.

This assessee’s appeal for assessment year 2010-11 arises against the CIT(A)-6, Kolkata’s order dated 30.01.2018 passed in case no. CIT(A), Kolkata-6/10075/2016- 17, involving proceeding u/s 263 / 143(3) of the Income Tax Act, 1961 (in short the ‘Act’).

Heard both the parties. Case file perused.

M/s S.R.Batliboi & Cos. LLP A.Yr.2010-11 2. The assessee’s sole substantive ground pleads in the instant appeal challenges correctness of both the lower authorities’ action invoking section 14A read with Rule 8D(2)(iii) administrative expenditure disallowance amounting to Rs. 6,71,675/- made in the course of assessment dated 31.03.2016 and affirmed in lower appellate proceedings. Learned authorized representative’s sole plea before us is that neither the Assessing Officer nor the CIT(A) has correctly applied the impugned disallowance computation provision. He submits that the administrative disallowance in question has to be computed as per average value of investment as on the opening and closing date of the relevant previous year. He thereafter takes us to the CIT(A)’s findings nowhere adjudicating this clinching aspect despite the fact that the tax payer had specifically raised this argument in lower appellate proceedings. Our attention is invited to paras 5 to 5.2 of page 32 of the CIT(A)’s order simply brushing aside the said specific argument non-speaking discussion. The Revenue fails to dispute this clinching factual position emanating from the record during the course of hearing. We therefore deem it appropriate to restore the instant sole issue back to the CIT(A) for appropriate adjudication as per law.

3.

This assessee’s appeal is allowed for statistical purposes.

Order pronounced in the Court on 28.12.2018

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