Case Law Details
Greatship (India) Ltd. Vs DCIT (ITAT Mumbai)
The assessee has further assailed the disallowance worked out by the A.O under Sec. 1 4A r.w Rule 8D, on the ground that there was no recording of an objective satisfaction by the A.O that the suo-motto disallowance offered by the assessee under Sec. 14A was not correct. Succinctly stated, the assessee company which during the year in question was in receipt of exempt dividend income of Rs. 1,05,08,214/- had on a pro-rata basis i.e percentage of exempt income to total income from investments suo-motto worked out the disallowance under Sec.14A at Rs.10,68,219/-. Observing that the aforesaid disallowance was worked out by the assessee de hors the methodology contemplated in Rule 8D of the Income tax Rules, 1962, the A.O reworked out the disallowance under Sec. 1 4A r.w. Rule 8D at Rs. 25,28,937/-. Accordingly, the A.O considering the suo moto disallowance that was already offered by the assessee in its return of income, therein made a further disallowance of Rs.14,60,718/- [Rs.25,28,937/- (-) Rs.10,68,219/-]. We have given a thoughtful consideration to the aforesaid issue pertaining to sustainability of the disallowance worked out by the A.O under Sec. 14A r.w Rule 8D at Rs. 25,28,937/-, which as observed by us hereinabove had been assailed by the assessee on the ground that the A.O while dislodging the suo-motto disallowance that was offered by the assessee under Sec. 1 4A in its return of income for the year in question had principally erred in not recording an objective satisfaction that the disallowance offered by the assessee was not correct. As a similar claim had been raised by the assessee in its appeal for the immediately preceding year i.e A.Y 2012-13 before us thus, in terms of our reasoning and observations therein recorded, we on the same terms restore the issue to the file of the A.O for fresh adjudication.
FULL TEXT OF THE ITAT JUDGEMENT
The captioned appeals filed by the assessee are directed against the respective orders passed by the A.O under Sec.143(3) r.w.s 144C(13) of the Income Tax Act, 1961 (for short „Act‟), dated 06.01.2017 and 28.08.2018 for A.Y 2012-13 & A.Y 2014-15, respectively. As common issues are involved in the captioned appeals, the same, thus, are being taken up and disposed off by way of a consolidated order. We shall first take up the appeal of the assessee for A.Y. 2012-13 wherein the impugned order has been assailed on the following grounds of appeal before us:
“This Appeal is filed against the order u/s. 143(3) r.w.s. 144C(13) of the Income-tax Act, 1961 passed by the Deputy Commissioner of Income Tax, Range 5(1)(1), Mumbai (‘hereinafter referred to as Assessing Officer7) and relates to the Assessment Year 2012-201 3.
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