M/S JAYANT TRADELINK PVT. LTD.,KOLKATA vs. ITO, WARD-7(4), KOLKATA

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ITA 21/KOL/2024Status: DisposedITAT Kolkata08 May 2024AY 2013-14Bench: DR. MANISH BORAD, HON’BLE (Accountant Member), SHRI PRADIP KUMAR CHOUBEY, HON’BLE (Judicial Member)3 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal deleted the disallowance, holding that Section 14A disallowance should not exceed the exempt income earned. The amendment by Finance Act, 2022, was held to be prospective.

What were the facts?

The assessee's sole grievance was the disallowance of Rs. 27,59,132/- made by the Assessing Officer under Section 14A. The assessee contended that no exempt income was earned during the year.

What were the issues?

Whether disallowance under Section 14A is permissible when no exempt income is earned, and the applicability of the Finance Act, 2022 amendment.

Which sections of the Income-tax Act were involved?

Section 14A,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, KOLKATA

Before: DR. MANISH BORAD, HON’BLE & SHRI PRADIP KUMAR CHOUBEY, HON’BLE

For Appellant: Shri Siddharth Jhajharia, FCA
Hearing: 29/04/2024Pronounced: 08/05/2024

PER DR. MANISH BORAD, ACCOUNTANT MEMBER :

The present appeal is directed at the instance of the assessee against the order of the National Faceless Appeal Centre (hereinafter the “ld. CIT(A)”) dt. 19/12/2023, passed u/s 250 of the Income Tax Act, 1961 (“the Act”) for the Assessment Year 2013-14. 2. Though the assessee has raised several grounds of appeal, but its sole grievance is in respect of the disallowance confirmed by the ld. CIT(A) amounting to Rs.27,59,132/- made by the ld. Assessing Officer u/s 14A of the Act.

3.

At the outset, the ld. Counsel for the assessee has submitted that no exempt income was earned during the year and, therefore, in view Assessment Year: 2014-15 Mamta Choraria

of the settled judicial precedents, disallowance u/s 14A of the Act, is uncalled for. The ld. D/R failed to revert the contentions made by the assessee.

4.

We, therefore, considering the admitted fact that, the assessee has not earned any exempt income during the year, and in view of the judgment of the Hon'ble Delhi High Court in the case of PCIT Vs. Era Infrastructure (India) Ltd. (ITA 204/2022) judgment dt. 20/07/2022, wherein it has been held that the amendment made in Section 14A of the Act by Finance Act, 2022, will be applicable prospectively and also that disallowance u/s 14A of the Act should not exceed the exempt income earned by the assessee during the year, delete the alleged disallowance of Rs. 27,59,132/- and allow the effective grounds raised by the assessee.

5.

In the result, appeal of the assessee is allowed. Order pronounced in the Court on 8th May, 2024 at Kolkata. (PRADIP KUMAR CHOUBEY) ACCOUNTANT MEMBER Kolkata, Dated 08/05/2024 *SC SrPs Assessment Year: 2014-15 Mamta Choraria

आदेश क" "ितिलिप अ"ेिषत/Copy of the Order forwarded to : 1. अपीलाथ" / The Assessee

2.

""यथ" / The Respondent 3. संबंिधत आयकर आयु" / Concerned Pr. CIT 4. आयकर आयु" अपील ( ) / The CIT(A)- 5. िवभागीय "ितिनिध ,आयकर अपीलीय अिधकरण, कोलकाता/DR,ITAT, Kolkata, 6. गाड" फाई/ Guard file.

आदेशानुसार/ BY ORDER,

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