M/S PLEASANT VINIMAY PVT. LTD.,KOLKATA vs. ITO, WARD-6(3), KOLKATA
No AI summary yet for this case.
Income Tax Appellate Tribunal, “SMC” BENCH: KOLKATA
Before: Shri Rajesh Kumar&Shri Pradip Kumar Choubey]
आयकर अपील�य अ�धकरण, कोलकाता पीठ “एसमसी’’, कोलकाता IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH: KOLKATA �ी राजेश कुमार, लेखा सट�य एवं �ी �द�प कुमार चौबे, �या�यक सद�यके सम� [Before Shri Rajesh Kumar, Accountant Member &Shri Pradip Kumar Choubey, Judicial Member] I.T.A. No. 304/Kol/2024 Assessment Year: 2017-18 M/s Pleasant Vinimay Pvt. Ltd. Vs. ITO, Ward-6(3), Kolkata
(PAN: AAGCP 1108 H)
( अपीलाथ# ) Respondent / �%यथ# Appellant /
09.07.2024 Date of Hearing / सुनवाई क( �त*थ Date of Pronouncement/ 25.07.2024 आदेश उ-घोषणा क( �त*थ For the Appellant/ Shri Somnath Ghosh, Advocate �नधा34रती क( ओर से For the Respondent/ Shri Nicholash Murud, Addl. CITDR राज�व क( ओर से
ORDER / आदेश Per Rajesh Kumar, AM: This is an appeal preferred by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals)-NFAC, Delhi dated 28.12.2023 for the AY 2017-18.
The only issue raised in the various grounds of appeal is against the confirmation of addition of Rs. 28,93,440/- by the Ld. CIT(A) as made by the AO u/s 14A of the Act.
2 I.T.A. No.304/Kol/2024 Assessment Year: 2017-18 M/s Pleasant Vinimay Pvt. Ltd. 3. Facts in brief are that the assessee filed return of income on 29.06.2017 disclosing the total income at Rs. 48,273/-. The case of the assessee was selected for limited scrutiny stating the reason that the assessee has returned low income in comparison to high loans/ advances/investments in shares as appearing in the balance sheet. Thereafter the statutory notices were duly issued and served upon the assessee which were also replied by the assessee. Thereafter the AO after taking into account the facts stated in the return of income, replies to queries raised in notice issued u/s 142(1) of the Act and other show notices observed that the assessee had investments to the tune of Rs. 28,93,444/- as on 31.03.2017 and the assessee has not furnished the required details qua the income therefrom as called for in the notice u/s 142(1) of the Act. Thereafter the AO after referring to the show cause notice issued to the assessee wherein it was show caused as to why income on the total investment in the ITR should not be computed @1% and added to the income of the assessee as the assessee has failed to comply with the notice u/s 142(1) of the Act. Finally the AO added the sum of Rs. 28,93,440/ to the income of the assessee.
In the appellate proceedings, the Ld. CIT(A) dismissed the appeal of the assessee by observing that the assessee did not file any response to the notice issued by the AO. During the appellate proceedings the assessee did not file any details in support of its claim and contentions and finally sustained the addition of Rs. 28,93,440/- which was calculated by the Ld. CIT(A) @1% of the total income.
After hearing the rival contentions and perusing the material on record, we find that though the assessee has not responded to the various quarries raised in the notice u/s 142(1) of the Act. But we note that the addition has been made by the AO oin the notional basis sans any substantive basis. In our considered opinion even if the addition is to be estimated it has to done one some reasoned basis and not merely on the basis of conjectures, surmises and presumptions. Even if it is presumed to be disallowance in terms of section 14A of the Act but the same is not applicable as the assessee has derived any income by way dividend or otherwise from these investments. In the appellate proceedings the Ld. CIT(A) dismissed the appeal of the
3 I.T.A. No.304/Kol/2024 Assessment Year: 2017-18 M/s Pleasant Vinimay Pvt. Ltd. assessee without taking into account the written submission filed by the assessee by stating that the assessee has not filed any details/finding in respect of grounds of appeal whereas the facts on record suggests to the contrary. We note that the assessee has duly uploaded detailed reply on 08.04.2019 online the acknowledgment whereof is available at page no. 6 of PB. We note that in para 4 of the said reply ( page 7 of PB) it has been stated that there is no exempt income earned by the assessee during the year and in para 5 it is stated that no expenses have incurred for earning of exempt income. In para 6 of the reply, it was stated that Section 14A is not applicable where the assessee has not earned any exempt income during the year. In our opinion the settled legal position is that no disallowance u/s 14A is called for where there is no exempt income earned during the year. We note that the Ld. CIT(A) has failed to consider the submissions made by the assessee and dismissed the appeal in a very casual manner. Having perused the facts on record and taking into account the rival contentions, we are of the view that addition confirmed by the Ld. CIT(A) is not justified and cannot be sustained. In view of the fact that no disallowance is called for where there is no exempt income. The case of the assessee finds support from the decision of Hon’ble Calcutta High Court in the case of PCIT vs. R. M Commercial Pvt .Ltd. [2022] 138 taxmann.com 21 (Calcutta) wherein it has been held that no disallowance u/s 14A is called for as the assessee has not received any exempt income during the year. Accordingly we set aside the order of Ld. CIT(A) and direct the AO to delete the addition.
In the result, the appeal of the assessee is allowed. 6.
Order is pronounced in the open court on 25th July, 2024
Sd/- Sd/-
( Pradip Kumar Choubey /�द�प कुमार चौबे) (Rajesh Kumar/राजेश कुमार) Judicial Member/�या�यक सद�य Accountant Member/लेखा सद�य Dated: 25th July, 2024 SM, Sr. PS
4 I.T.A. No.304/Kol/2024 Assessment Year: 2017-18 M/s Pleasant Vinimay Pvt. Ltd.
Copy of the order forwarded to:
Appellant- M/s Pleasant Vinimay Pvt. Ltd., 6, Lyons Range, Ground Floor, Room No. 1, Kolkata-700001. 2. Respondent – ITO, Ward-6(3), Kolkata 3. Ld. CIT(A)- NFAC, Delhi 4. Ld. Pr. CIT- , Kolkata 5. DR, Kolkata Benches, Kolkata (sent through e-mail)
