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Income Tax Appellate Tribunal, MUMBAI BENCH “K”, MUMBAI
Before: SHRI G.S. PANNU & RAM LAL NEGI
The captioned appeal by the assessee is directed against the order of CIT(A)-17, Mumbai dated 04.03.2015, pertaining to the Assessment Year 2009-10, which in turn has arisen from the order passed by the Assessing Officer, Mumbai under section 143(3) r.w.s. 144C(3) of the Income Tax Act, 1961 (in short ‘the Act’).
In this appeal, two substantive issues raised by the assessee relate to the action of CIT(A) in upholding the disallowance u/s 14A of 2 Zoetis Pharmaceutical Research P. Ltd.
the Act to the extent of Rs.6,36,48,961/- and upholding of interest chargeable u/s 234C of the Act as calculated by the Assessing Officer.
With respect to the issue of disallowance u/s 14A of the Act, assessee has raised as much as 5 Grounds of appeal, but at the time of hearing the following Ground of appeal no. 2 has been adverted to :-
“2. On the facts and in the circumstances of the case and in law, the Commissioner of Income-tax (Appeals) erred in not giving any finding in respect of the following additional ground of appeal raised by the appellant :
“On the facts and in the circumstances of the case and in law, the AO erred in not appreciating the fact that since the appellant has not earned any exempt income during the relevant previous year, no disallowance ought to be made under section 14A of the Act.”
In this context, the learned representative for the assessee pointed out that though assessee had raised the above issue before the CIT(A), as is evident from page 3 of his order wherein the Grounds raised by the assessee have been reproduced, however, the said Ground has not been determined. It was, therefore, submitted that the matter may be set-aside to the file of CIT(A) for adjudication afresh on the above Ground.
The ld. DR appearing for Revenue has not disputed the fact that the aforesaid Ground, though raised by assessee, has not been considered by CIT(A).
3 Zoetis Pharmaceutical Research P. Ltd.
Having considered the rival stands on the aforesaid limited issue, in our view, it would be in the fitness of things that the matter is restored back to file of CIT(A) for deciding the aforesaid additional Ground raised by assessee in accordance with law. A perusal of the order of CIT(A) clearly establishes that though raising of the aforesaid additional Ground of appeal has been noted, but the same has not been taken cognizance of while determining the appeal. In this view of the matter, we restore the matter back to file of CIT(A) who shall allow assessee a reasonable opportunity of being heard and thereafter consider and adjudicate the aforesaid Ground, as per law. Thus, on this aspect, assessee partly succeeds.
7. With respect to levy of interest u/s 234C of the Act, the only plea of assessee is that interest has been calculated with reference to the assessed tax whereas it is liable to be calculated with reference to tax due on the returned income. On this aspect also, learned representative submitted that the matter be restored back to file of Assessing Officer with directions for determining the levy of interest u/s 234C of the Act in accordance with law.
The ld. DR had no objection to the aforesaid prayer of the assessee.
In our view, in deference to the stand of rival counsels we deem it fit and proper to restore the issue relating to calculation of interest chargeable u/s 234C of the Act back to the file of Assessing Officer who
4 Zoetis Pharmaceutical Research P. Ltd. shall consider the plea of assessee and thereafter recompute interest chargeable u/s 234C of the Act, if any, as per law.
In the result, appeal of assessee is partly allowed, as above.
Order pronounced in the open court on 28th October, 2016.