PR. COMMISSIONER OF INCOME TAX-VI vs. M/S. STERLING DEVELOPERS INDIA PVT. LTD.,

1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 25TH DAY OF MAY 2021 PRESENT THE HON’BLE MR. JUSTICE ALOK ARADHE AND THE HON’BLE MR.JUSTICE HEMANT CHANDANGOUDAR I.T.A. NO.1043 OF 2017 BETWEEN: 1. PR. COMMISSIONER OF INCOME TAX-VI

CENTRAL REVENUE BUILDINGS

QUEENS ROAD, BANGALORE-560001. 2. ASSISTANT COMMISSIONER OF INCOME TAX

CIRCLE-6(1)(2), 2ND FLOOR

BMTC BUILDING, 80 FEET ROAD

KORAMANGALA, BANGALORE.

... APPELLANTS (BY SRI. E.I. SANMATHI, ADV.) AND: M/S. STERLING DEVELOPERS INDIA PVT. LTD. NO.8, PRESTIGE NUBULA, LEVEL-5 CUBBON ROAD, OPP. INCOME TAX OFFICE BANGALORE-560001 PAN: AACCSO304G.

... RESPONDENT (BY SRI. S. ANNAMALAI, ADV.,)

2 THIS I.T.A. IS FILED UNDER SECTION 260-A OF I.T.ACT, 1961 ARISING OUT OF ORDER DATED 28.07.2017 PASSED IN ITA NO.28/BANG/2016, FOR THE ASSESSMENT YEAR 2011-12, PRAYING TO:

I. DECIDE THE FOREGOING QUESTION OF LAW AND/OR SUCH OTHER QUESTIONS OF LAW AS MAY BE FORMULATED BY THE HON'BLE COURT AS DEEMED FIT.

II. SET ASIDE THE APPELLATE ORDER DATED 28.07.2017 PASSED BY THE INCOME TAX APPELLATE TRIBUNAL 'B' BENCH, BENGALURU, IN APPEAL PROCEEDINGS NO.ITA NO.28/BANG/2016 FOR ASSESSMENT YEAR 2011-12, AS SOUGHT FOR IN THIS APPEAL; AND TO GRANT SUCH OTHER RELIEF AS DEEMED FIT, IN THE INTEREST OF JUSTICE. THIS I.T.A. COMING ON FOR HEARING, THIS DAY, ALOK ARADHE J., DELIVERED THE FOLLOWING: JUDGMENT Mr.E.I.Sanmathi, learned counsel for the revenue. Mr.S.Annamalai, learned counsel for the assessee. This appeal under Section 260-A of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’, for short) has been filed by the revenue against the order dated 28.07.2017 passed by the Income Tax Appellate Tribunal.

3 The subject matter of the appeal pertains to Assessment Year 2011-12. The appeal was admitted by a Bench of this Court vide order dated 25.02.2019 on the following substantial question of law: "Whether, in the facts and in the circumstances of the case, the Tribunal is justified in law in deleting the disallowances made under section 14A read with Rule 8D(2)(ii) and 8D(2)(iii) of the Act without appreciating the contents of Circular No.5/2014 dated 11.02.2014, which emphasized that only expenditure allowable is relatable to earning of income and therefore, the expenses which are relatable to earning of exempt income have to be considered for disallowance, irrespective of the fact whether such income has been earned during the financial year or not?" 2. When the matter was taken up today, learned counsel for the assessee submitted that the aforesaid substantial question of law has already been answered by a Bench of this Court against the revenue vide judgment dated 04.02.2021 passed in ITA No.685/2015. The aforesaid

4 submission could not be disputed by the learned counsel for the revenue. 3. For the reasons assigned in the judgment dated 04.02.2021 passed in ITA No.685/2015, the substantial question of law is answered against the revenue. In the result, the appeal fails and is hereby dismissed. Sd/- JUDGE Sd/- JUDGE RV