REI Agro Ltd. v. DCIT

West Bengal Electronic Industries Development Corporation Limited, Kolkata vs. D.C.I.T Cir - 1, Kolkata

In the result, the appeal of the assessee in ITA No

Bench: Hon’Ble Shri M.Balaganesh, Am & Hon’Ble Shri S.S.Viswanethra Ravi, Jm] I.T.A No. 1945/Kol/2013 Assessment Year : 2008-09 Dcit, Circle-1, Kolkata -Vs- M/S West Bengal Electronics Industry Development Corp. Ltd. [Pan: Aaacw 2411 Q] (Appellant) (Respondent)

…lded dividend income should be considered for working out the disallowance under second and third limb of Rule 8D(2) of the IT Rules. Reliance in this regard was placed on the co-ordinate bench decision of this tribunal in the case of REI Agro Ltd reported in 144 ITD 141 (Kol Trib). We are in complete agreement with the various alternative arguments advanced by the ld AR and since we have already held that no satisfaction was recorded by the ld AO for resorting to computation mechanism provided in Rule 8D(2) of the Rules, which is a condition precedent, as per the provisions of the Act and Rules and also as per t…

West Bengal Electronic Industries Development Corporation Limited, Kolkata vs. A.C.I.T Cir - 1, Kolkata

In the result, the appeal of the assessee in ITA No

Bench: Hon’Ble Shri M.Balaganesh, Am & Hon’Ble Shri S.S.Viswanethra Ravi, Jm] I.T.A No. 1945/Kol/2013 Assessment Year : 2008-09 Dcit, Circle-1, Kolkata -Vs- M/S West Bengal Electronics Industry Development Corp. Ltd. [Pan: Aaacw 2411 Q] (Appellant) (Respondent)

…lded dividend income should be considered for working out the disallowance under second and third limb of Rule 8D(2) of the IT Rules. Reliance in this regard was placed on the co-ordinate bench decision of this tribunal in the case of REI Agro Ltd reported in 144 ITD 141 (Kol Trib). We are in complete agreement with the various alternative arguments advanced by the ld AR and since we have already held that no satisfaction was recorded by the ld AO for resorting to computation mechanism provided in Rule 8D(2) of the Rules, which is a condition precedent, as per the provisions of the Act and Rules and also as per t…

D.C.I.T Cir - 1, Kolkata vs. M/S West Bengal Electronics Industry Development Corporation Ltd, Kolkata

In the result, the appeal of the assessee in ITA No

Bench: Hon’Ble Shri M.Balaganesh, Am & Hon’Ble Shri S.S.Viswanethra Ravi, Jm] I.T.A No. 1945/Kol/2013 Assessment Year : 2008-09 Dcit, Circle-1, Kolkata -Vs- M/S West Bengal Electronics Industry Development Corp. Ltd. [Pan: Aaacw 2411 Q] (Appellant) (Respondent)

…lded dividend income should be considered for working out the disallowance under second and third limb of Rule 8D(2) of the IT Rules. Reliance in this regard was placed on the co-ordinate bench decision of this tribunal in the case of REI Agro Ltd reported in 144 ITD 141 (Kol Trib). We are in complete agreement with the various alternative arguments advanced by the ld AR and since we have already held that no satisfaction was recorded by the ld AO for resorting to computation mechanism provided in Rule 8D(2) of the Rules, which is a condition precedent, as per the provisions of the Act and Rules and also as per t…

DCIT, Cir-5, Kolkata vs. M/S Essel Mining & Industries Ltd., Kolkata

In the result, the appeals of assessee are partly allowed and that of revenue are dismissed

Bench: Shri A. T. Varkey, Jm & Dr. A. L. Saini, Am]

…nder Rule 8D(2)(iii) of the Rules, we hold that only investments yielding exempt income should be considered for the purpose of working out disallowance thereon, in consonance with the decision rendered by this tribunal in the case of REI Agro Ltd reported in 144 ITD 141. Accordingly we direct the ld AO to recompute the disallowance under the third limb of Rule 8D(2) of the Rules accordingly. While doing so, he should also reduce the disallowance already made by the assessee in the return of income.” 6. From the audited accounts we note that the position of the assessee’s own funds vis- à-vis in its investment in…

Essel Mining & Industries Ltd., Kolkata vs. DCIT, Cir-5, Kolkata

In the result, the appeals of assessee are partly allowed and that of revenue are dismissed

Bench: Shri A. T. Varkey, Jm & Dr. A. L. Saini, Am]

…nder Rule 8D(2)(iii) of the Rules, we hold that only investments yielding exempt income should be considered for the purpose of working out disallowance thereon, in consonance with the decision rendered by this tribunal in the case of REI Agro Ltd reported in 144 ITD 141. Accordingly we direct the ld AO to recompute the disallowance under the third limb of Rule 8D(2) of the Rules accordingly. While doing so, he should also reduce the disallowance already made by the assessee in the return of income.” 6. From the audited accounts we note that the position of the assessee’s own funds vis- à-vis in its investment in…

D.C.I.T Cir - 5, Kolkata vs. M/S Essel Mining & Industries Ltd., Kolkata

In the result, the appeals of assessee are partly allowed and that of revenue are dismissed

Bench: Shri A. T. Varkey, Jm & Dr. A. L. Saini, Am]

…nder Rule 8D(2)(iii) of the Rules, we hold that only investments yielding exempt income should be considered for the purpose of working out disallowance thereon, in consonance with the decision rendered by this tribunal in the case of REI Agro Ltd reported in 144 ITD 141. Accordingly we direct the ld AO to recompute the disallowance under the third limb of Rule 8D(2) of the Rules accordingly. While doing so, he should also reduce the disallowance already made by the assessee in the return of income.” 6. From the audited accounts we note that the position of the assessee’s own funds vis- à-vis in its investment in…

Essel Mining & Industries Limited, Kolkata vs. D.C.I.T Cir - 5, Kolkata

In the result, the appeals of assessee are partly allowed and that of revenue are dismissed

Bench: Shri A. T. Varkey, Jm & Dr. A. L. Saini, Am]

…nder Rule 8D(2)(iii) of the Rules, we hold that only investments yielding exempt income should be considered for the purpose of working out disallowance thereon, in consonance with the decision rendered by this tribunal in the case of REI Agro Ltd reported in 144 ITD 141. Accordingly we direct the ld AO to recompute the disallowance under the third limb of Rule 8D(2) of the Rules accordingly. While doing so, he should also reduce the disallowance already made by the assessee in the return of income.” 6. From the audited accounts we note that the position of the assessee’s own funds vis- à-vis in its investment in…

Narbheram Vishram, Jharkhand vs. DCIT, Central Circle - 4(2), Kolkata

In the result, the appeal filed by the assessee in ITA No

Bench: Shri S. S. Godara, Jm &Dr. A.L.Saini, Am आयकरअपीलसं./Ita No.42 & 43/Kol/2018 ("नधा"रणवष" / Assessment Year: 2013-14 &2014-15) Narbheramvishram Vs. Dcit, Central Circle-4(2), Kolkata Gua, Singhbhum West, Aayakar Bhawan Poorva 110, Jharkhan-833213. Shantipally, Kolkata – 700 107. "थायीलेखासं./जीआइआरसं./Pan/Gir No.: Aabfn 7217 R (Assessee) .. (Respondent) Assessee By :Shri A. K. Tibrewal, Fca& Shri Amit Agarwal, Advocate. Respondent By : Md. Usman, Cit, Sr. Dr सुनवाईक"तार"ख/ Date Of Hearing : 17/05/2018 घोषणाक"तार"ख/Date Of Pronouncement : 27/07/2018 आदेश / O R D E R

…ions and perused the materials available on record, we note that in this ground of appeal the Assessee Firm has challenged the disallowance of Rs.66,08,861 u/s 14A of the Act. We note that coordinate Bench of Kolkata ITAT in the case of REI Agro Ltd. Vs. DCIT 144 ITD 141 (Kol-Trib) has held that it is only the investments which yields dividend during the previous year that has to be considered while adopting the average value of investments for the purpose of Rule 8D(2)(ii) & (iii) of the Rules. The aforesaid view of the Tribunal has since been affirmed as correct by the Hon’ble Calcutta High Court in G.A.No.3581…

Narbheram Vishram, Jharkhand vs. DCIT, Central Circle - 4(2), Kolkata

In the result, the appeal filed by the assessee in ITA No

Bench: Shri S. S. Godara, Jm &Dr. A.L.Saini, Am आयकरअपीलसं./Ita No.42 & 43/Kol/2018 ("नधा"रणवष" / Assessment Year: 2013-14 &2014-15) Narbheramvishram Vs. Dcit, Central Circle-4(2), Kolkata Gua, Singhbhum West, Aayakar Bhawan Poorva 110, Jharkhan-833213. Shantipally, Kolkata – 700 107. "थायीलेखासं./जीआइआरसं./Pan/Gir No.: Aabfn 7217 R (Assessee) .. (Respondent) Assessee By :Shri A. K. Tibrewal, Fca& Shri Amit Agarwal, Advocate. Respondent By : Md. Usman, Cit, Sr. Dr सुनवाईक"तार"ख/ Date Of Hearing : 17/05/2018 घोषणाक"तार"ख/Date Of Pronouncement : 27/07/2018 आदेश / O R D E R

…ions and perused the materials available on record, we note that in this ground of appeal the Assessee Firm has challenged the disallowance of Rs.66,08,861 u/s 14A of the Act. We note that coordinate Bench of Kolkata ITAT in the case of REI Agro Ltd. Vs. DCIT 144 ITD 141 (Kol-Trib) has held that it is only the investments which yields dividend during the previous year that has to be considered while adopting the average value of investments for the purpose of Rule 8D(2)(ii) & (iii) of the Rules. The aforesaid view of the Tribunal has since been affirmed as correct by the Hon’ble Calcutta High Court in G.A.No.3581…

Narnolia & Associates LLP, Kolkata vs. ITO, Ward-35(2), Kolkata

Appeal is partly allowed for statistical purposes

Bench: Sri S.S. Godara& Sri M. Balaganesh] I.T.A. No. 263/Kol/2017 Assessment Year: 2013-14 Narnolia & Associates Llp.............................…..…….……………………………………………………..……Appellant Chhaparia & Associates Chartered Accountants 8, Camac Street Shantiniketan Building 5Th Floor Room No. 2 Kolkata – 700 017 [Pan: Aaifn 4113 F]

…tments does not attract proportionate interest as the presumption in such an instance is of utilization of interest free funds only. Next comes the tribunal’s decision in Deputy Commissioner of Income-tax, Central Circle-XXVII, Kolkata v. REI Agro Ltd. [2013] 144 ITD 141 (Kolkata - Trib.), wherein it has been held that only dividend yielding investments have to be considered for the purpose of computation of administrative expenditure. Our attention is invited to the fact that assessee has interest bearing funds and exempt investments of Rs.21,19,26,043/- and adjusted latter sum of Rs.22,05,18,438/-; respectively…

M/S. Exide Industries Ltd., Kolkata vs. DCIT, Circle - 1, Kolkata

In the result, the appeal of revenue is dismissed and assessee’s appeal is allowed for statistical purposes

Bench: "ी जे. सुधाकर रे"डी, लेखा सद"य एवं/And "ी ऐ. ट". वक", "यायीक सद"य) [Before Shri J. Sudhakar Reddy, Am & Shri A. T. Varkey, Jm]

…ompute the disallowance under rule 8D(ii) have been already disposed of by us, so what is left is his direction in respect of Rule 8D (iii) and for that we note that this Tribunal has consistently followed the dictum of law laid down in REI Agro Ltd. Vs. DCIT 144 ITD 141 in which the Tribunal held that only investment which has given rise to the exempted income should be taken into consideration while computing disallowance u/s. 14A read with Rule 8D (iii) of the Rules. This order has been upheld by the Hon’ble Calcutta High Court vide judgment dated 23.12.2013. The Ld. CIT(A) order is confirmed only in respect t…

DCIT, Circle - 1(1), Kolkata vs. M/S. Exide Industries Ltd., Kolkata

In the result, the appeal of revenue is dismissed and assessee’s appeal is allowed for statistical purposes

Bench: "ी जे. सुधाकर रे"डी, लेखा सद"य एवं/And "ी ऐ. ट". वक", "यायीक सद"य) [Before Shri J. Sudhakar Reddy, Am & Shri A. T. Varkey, Jm]

…ompute the disallowance under rule 8D(ii) have been already disposed of by us, so what is left is his direction in respect of Rule 8D (iii) and for that we note that this Tribunal has consistently followed the dictum of law laid down in REI Agro Ltd. Vs. DCIT 144 ITD 141 in which the Tribunal held that only investment which has given rise to the exempted income should be taken into consideration while computing disallowance u/s. 14A read with Rule 8D (iii) of the Rules. This order has been upheld by the Hon’ble Calcutta High Court vide judgment dated 23.12.2013. The Ld. CIT(A) order is confirmed only in respect t…

DCIT, Cir-6(1), Kolkata vs. M/S. Industrial Investment Bank of India, Kolkata

In the result, the appeals of the revenue are partly allowed for statistical purposes

Bench: Hon’Ble Shri S.S. Godara, Jm & Hon’Ble Shri M.Balaganesh, Am] I.T.A Nos. 1870, 1871 & 894/Kol/2017 Assessment Years : 2010-11, 2011-12 & 2012-13 Dcit, Circle-6(1), Kolkata -Vs- M/S Industrial Investment Bank Of India [Pan: Aabci 0324 D] (Appellant) (Respondent)

…ction 14A of the Act are applicable even for investments held as stock in trade. Hence this issue is now settled and provisions of section 14A of the Act are to be applied in the instant case. We find that this tribunal in the case of REI Agro Ltd reported in 144 ITD 141 (Kol Trib) had held that only those investments which had yielded dividend income need to be considered while working out the disallowance under third limb of Rule 8D(2) of the Rules. Hence we direct the ld AO to rework the disallowance accordingly for Asst Years 2010-11 and 2011-12 under normal provisions of the Act. 10 A.Yrs. 2010-11, 2011-12…

DCIT, Cir-6(1), Kolkata vs. M/S. Industrial Investment Bank of India, Kolkata

In the result, the appeals of the revenue are partly allowed for statistical purposes

Bench: Hon’Ble Shri S.S. Godara, Jm & Hon’Ble Shri M.Balaganesh, Am] I.T.A Nos. 1870, 1871 & 894/Kol/2017 Assessment Years : 2010-11, 2011-12 & 2012-13 Dcit, Circle-6(1), Kolkata -Vs- M/S Industrial Investment Bank Of India [Pan: Aabci 0324 D] (Appellant) (Respondent)

…ction 14A of the Act are applicable even for investments held as stock in trade. Hence this issue is now settled and provisions of section 14A of the Act are to be applied in the instant case. We find that this tribunal in the case of REI Agro Ltd reported in 144 ITD 141 (Kol Trib) had held that only those investments which had yielded dividend income need to be considered while working out the disallowance under third limb of Rule 8D(2) of the Rules. Hence we direct the ld AO to rework the disallowance accordingly for Asst Years 2010-11 and 2011-12 under normal provisions of the Act. 10 A.Yrs. 2010-11, 2011-12…

DCIT, Cir-6(1), Kolkata vs. M/S. Industrial Investment Bank of India, Kolkata

In the result, the appeals of the revenue are partly allowed for statistical purposes

Bench: Hon’Ble Shri S.S. Godara, Jm & Hon’Ble Shri M.Balaganesh, Am] I.T.A Nos. 1870, 1871 & 894/Kol/2017 Assessment Years : 2010-11, 2011-12 & 2012-13 Dcit, Circle-6(1), Kolkata -Vs- M/S Industrial Investment Bank Of India [Pan: Aabci 0324 D] (Appellant) (Respondent)

…ction 14A of the Act are applicable even for investments held as stock in trade. Hence this issue is now settled and provisions of section 14A of the Act are to be applied in the instant case. We find that this tribunal in the case of REI Agro Ltd reported in 144 ITD 141 (Kol Trib) had held that only those investments which had yielded dividend income need to be considered while working out the disallowance under third limb of Rule 8D(2) of the Rules. Hence we direct the ld AO to rework the disallowance accordingly for Asst Years 2010-11 and 2011-12 under normal provisions of the Act. 10 A.Yrs. 2010-11, 2011-12…

DCIT, Cir-10(1), Kolkata vs. M/S. Bhoruka Investment (P) Ltd., Kolkata

Bench: Hon’Ble Shri S.S.Godara, Jm & Shri M.Balaganesh, Am ]

…pra). We notice that the CIT(A) has directed the Assessing Officer to compute the impugned disallowance only qua assesee’s investments yielding exempt income in the impugned assessment year. This tribunal’s coordinate bench in the case of REI Agro Ltd vs DCIT 144 ITD 141 (Kol)as upheld by hon’ble jurisdictional high court in ITAT No.220 of 2013 decided on 09.4.2014, holds that only such exempt income yielding investments are taken into consideration for the purpose of administrative expenditure. We thus find no fault with the CIT(A) ‘s direction issued to the Assessing Officer in this regard. The Revenue fails in…

Orient Paper & Industries Limited, Kolkata vs. DCIT, Circle-6(1), Kolkata

Appeal is partly allowed in the above terms

Bench: Hon’Ble Shri S.S.Godara, Jm & Shri M.Balaganesh, Am ] Assessment Year : 2011-12

…gned proportionate expenditure disallowance of Rs.1,05,77,957/-. 4. Coming to administrative expenditure disallowance of Rs.24,68,828/- @ ½ % of average value of investments, both parties are ad item that this tribunal coordinate bench in REI Agro Ltd vs DCIT 144 ITD 141 (Kol) has held that only dividend yielding investments are to be considered for the purpose of computation of the disallowance in question. There is no dispute that neither the Assessing Officer nor the CIT(A) has proceeded on the said assumption. We therefore restore the instant latter issue back to the Assessing Officer for consequential comput…

DCIT, Circle-6, Kolkata vs. M/S. Umil Share & Stock Broking Services Ltd., Kolkata

In the result, the appeal of the revenue is dismissed

Bench: Shri P.M. Jagtap, Am & Shri S.S. Viswanethra Ravi, Jm] I.T.A. No. 2089/Kol/2014 Assessment Year: 2009-10 Dcit Circle 6 Kolkata....................................…………………………..............................Appellant Aayakar Bhawan, 6Th Floor, Room No. 6/17, P-7, Chowringhee Square, Kolkata – 700 069. M/S. Umil Share & Stock Broking Services Ltd...…………………........................Respondent 24, R.N. Mukherjee Road, Kolkata – 700 001. [Pan : Aaacu 3331 K] Appearances By: Shri P.K. Srihari, Cit Appearing On Behalf Of The Revenue. Shri A.K. Tibrewal, Fca Appearing On Behalf Of The Assessee. Date Of Concluding The Hearing : May 09, 2018 Date Of Pronouncing The Order : June 22, 2018 Order Per P.M. Jagtap, Am This Appeal Is Preferred By The Revenue Against The Order Of Ld. Cit(A) – Vi, Kolkata Dated 28.08.2014. 2. In Ground No 1, The Revenue Has Challenged The Action Of The Ld. Cit(A) In Restricting The Disallowance Of Rs. 1,27,34,577/- Made By The Ao Under Section 14A Of The Act Read With Rule 8D To Rs. 36,39,744/-.

…T vide order dated 29.11.2013 in ITA No. 640/Koll2012 for A.Y.2008-09. Hence, no disallowance has to be made under clause (ii) of Rule 8D(2). Coming now to clause (iii), it has been held by jurisdictional bench of tribunal in the case of REI Agro Ltd vs. DCIT 144 ITD 141 that for purpose of clause (iii) of Rule 8D (2), only the investment which had actually given rise to exempt income is to be taken into account. Though the ratio of the said decision is contrary to that of the decision of special bench of ITAT Delhi in the case of Cheminvest Ltd. 121 ITD 318 (Delhi)(SB)), as well as the Board's Circular no. 5/201…

DCIT, Cir-6, Kolkata vs. M/S Cesc Ltd., Kolkata

In the result, the appeal of revenue is dismissed and appeal of assessee is partly allowed for statistical purposes

Bench: "ी ऐ. ट". वक", "यायीक सद"य एवं/And "ी एम .बालागणेश, लेखा सद"य) [Before Shri A. T. Varkey, Jm & Shri M. Balaganesh, Am] I.T.A. No. 1304/Kol/2014 Assessment Year: 2010-11

…(iii) of the Rules, we note that assessee had earned exempt income to the tune of Rs.3,08,00,805/-. We note that the Ld. CIT(A) rightly directed disallowance @ .5% on the dividend earning scrip as held by Coordinate bench in the case of REI Agro Ltd. Vs. DCIT 144 ITD 141. We confirm the Ld. CIT(A)’s order on computation of disallowance under Rule 8D(iii) of the Rules and order accordingly. Therefore, this ground of appeal of revenue is dismissed and assessee’s ground 2 of appeal is partly allowed. CESC Ltd. , AY- 2010-11 4. Ground no. 3 of assessee’s appeal is against the order of Ld. CIT(A) in holding that the d…

Cesc Limited, Kolkata vs. The DCIT RG-6, Kolkata

In the result, the appeal of revenue is dismissed and appeal of assessee is partly allowed for statistical purposes

Bench: "ी ऐ. ट". वक", "यायीक सद"य एवं/And "ी एम .बालागणेश, लेखा सद"य) [Before Shri A. T. Varkey, Jm & Shri M. Balaganesh, Am] I.T.A. No. 1304/Kol/2014 Assessment Year: 2010-11

…(iii) of the Rules, we note that assessee had earned exempt income to the tune of Rs.3,08,00,805/-. We note that the Ld. CIT(A) rightly directed disallowance @ .5% on the dividend earning scrip as held by Coordinate bench in the case of REI Agro Ltd. Vs. DCIT 144 ITD 141. We confirm the Ld. CIT(A)’s order on computation of disallowance under Rule 8D(iii) of the Rules and order accordingly. Therefore, this ground of appeal of revenue is dismissed and assessee’s ground 2 of appeal is partly allowed. CESC Ltd. , AY- 2010-11 4. Ground no. 3 of assessee’s appeal is against the order of Ld. CIT(A) in holding that the d…