Godrej Investment P.Ltd, Mumbai vs Assessee
- CitationITA No. 6085/Mum/2012
Ratio decidendi
The rule this decision rests on
The Tribunal's reasoning rests on the following: the question whether an assessment under section 115JB is affected where no expenditure relatable to exempt dividend income has actually been incurred is not decided on the merits but is remitted, because both sides accepted that it required reconsideration by the CIT(A) in light of the decisions relied upon by the assessee's representative, which treat sections 14A and 115JB as operating on separate axes, each being a self-contained code. The matter under section 14A read with Rule 8D, where the assessee had suo motu offered a disallowance and the CIT(A) had deleted the Assessing Officer's further disallowance, is likewise restored to the CIT(A) for fresh adjudication, on the basis that it is linked to the section 115JB question and must be decided consistently with the directions given in the department's appeal.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
1 Godrej Investments Private Limited ITA No. 6085/Mum/2012 ITA No. 5879/Mum/2012
आयकर अपीलीय अिधकरण "जी" यायपीठ मुब ं ई म। IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH "G", MUMBAI ी एन. के . िबलै या, लेखा सद य एवं ी िववेक वमा, याियक सद य के सम । BEFORE SHRI N K BILLAIYA, ACCOUNTANT MEMBER AND SHRI VIVEK VARMA, JUDICIAL MEMBERITA ITA No. : 6085/Mum/2012 (Assessment year: 2009-10) Godrej Investments Private Limited, Vs Income Tax Officer, Plant 11, Pirojshanagar, Range 10(2)(3), Vikhroli (East), Room No. 430, Aayakar Bhavan, Mumbai -400 0079 Mumbai अपीलाथ (Appellant) यथ (Respondent) ITA No. : 5879/Mum/2012 (Assessment year: 2009-10) Asst Commissioner of Income Tax- Vs Godrej Investments Private Limited, 10(2), Plant 11, Pirojshanagar, Room No. 432, 4th Floor, Vikhroli (East), Aayakar Bhavan, M K Road, Mumbai -400 079 Mumbai -400 020 थयी लेखा सं.:PAN: AAACG 1301 H अपीलाथ (Appellant) यथ (Respondent) अपीलाथ क औरसे : ी फाली ऐच िबलमो रया Appellant-assessee by Shri Falee H Bilimoria यथ क औरसे : ी पवन कु मार बीरला Respondent-revenue by Shri Pavan Kumar Beerla
सुनवाई क तार ख /Date of Hearing : 05-03-2015 घोषणा क तार ख /Date of Pronouncement : 17 -04-2015
आदेश ORDER ी िववेक वमा, या स: PER VIVEK VARMA, JM:
Cross appeals have been filed by the assessee and the department against the order of CIT(A) 21, Mumbai, dated 01.06.2012. Since both the appeals are arising from the same order, we are disposing off both these appeals through common and consolidated order for the sake of convenience and brevity.
2. ITA No. 6085/Mum/2012, the following grounds have been taken by the department:
2 Godrej Investments Private Limited ITA No. 6085/Mum/2012 ITA No. 5879/Mum/2012 "This Appeal is against the order dated June 1, 2012, of the Commissioner of Income tax (Appeals) -21, Mumbai, and relates to the Assessment year 2009-10.
1) The learned Commissioner of Income Tax erred in confirming the action of the Assessing Officer in relying on the provisions of Rule 8D read with section 14A for computing the amount liable for being added back to the book profits to be determined under Section 115JB of the Act, despite the fact that no expenditure which is relatable to the earning of exempt dividend income has actually been incurred by the Appellant.
2) The learned Commissioner of Income Tax erred in disregarding the legal position that section 115JB of the Act is a separate code by itself and that the provisions of the Act cannot be applied for computing the book profits under section 115JB of the Act.
The Appellant craves leave to add to, alter or amend the above Grounds of Appeal as and when advised".
3. ITA No. 5879/Mum/2012, the following grounds have been taken by the assessee:
"1.(a) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance u/s 14A, r.w. Rule 8D, made by the AO.
(b) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in holding that the disallowance suo-moto offered by the assessee was reasonable as it was based on scientific working.
2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in not appreciating the fact that the assessee has not provided the working as to how the suo-moto disallowances u/s 14A were computed.
3. The appellant prays for appropriate relief bases on the said ground of appeal and the facts and circumstances of the case.
3. The appellant craves leave to add, amend, vary, omit or substitute any of the aforesaid grounds of appeal at any time before or at the time of hearing of appeal".
ITA No. 6085/Mum/2012 : Department appeal 4. The issue raised in the present appeal is whether in case no expenditure pertaining to earning of dividend would affect the working of section 115JB.
5. Both the sides admitted that the issue needs to be reconsidered by the CIT(A) in the light of case laws submitted by the AR, i.e. ITO vs RBK Share Broking Pvt Ltd reported in 60 SOT 61 & Dabur India Ltd vs ACIT, reported in 145 ITD 175 by the Mumbai Benches as both the provisions, i.e. section 14A and 115JB work on their own axis, being separate code.
3 Godrej Investments Private Limited ITA No. 6085/Mum/2012 ITA No. 5879/Mum/2012
6. We, therefore, restore cases back to the file of the CIT(A) for fresh adjudication.
7. In ITA No. 5879/Mum/2012, since the issue is related to section 14A and application of 115JB, the issue would be adjudicated a fresh as per our directions in ITA No. 6085/Mum/2012.
8. As a result, both the appeals are allowed for statistical purposes.
Order pronounced in the open court on 17th April, 2015.
Sd/- Sd/- (एन. के . िबलै या) (िववेक वमा) लेखा सद य याईक सद य (N K BILLAIYA) (VIVEK VARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, Date: 17th April, 2015
त/Copy to:-
1) अपीलाथ /The Appellant. 2) यथ /The Respondent. 3) The CIT(A) -21, Mumbai.
4) The CIT-10, Mumbai/CIT -10, Mumbai.
5) िवभागीय ितिनिध "जी", आयकर अपीलीय अिधकरण, मुंबई/ The D.R. "G" Bench, Mumbai.
6) गाड फाईल Copy to Guard File.
आदे शानस ु ार/By Order
/ / True Copy / / उप/सहायक पंजीकार आयकर अपील य अ धकरण, मब ंु ई Dy./Asstt. Registrar I.T.A.T., Mumbai
*च हान व.िन.स *Chavan, Sr.PS
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