2013 (12) TMI 1695 - AT - Income Tax

Summary

Issues involved:
The judgment involves the following issues:
1. Whether disallowance u/s 14M of the I.T. Act can be made when dividend income is earned on shares held as stock in trade.
2. Permissibility of tribunal to base its decision on decisions by co-ordinate benches without confronting parties.
3. Applicability of judgments by high courts in relation to the issue under appeal.
4. Consistency of tribunal's view on the matter.
5. Principles of apportionment under section 14A in relation to dividend income from shares held as stock-in-trade.
6. Whether any expenditure can be said to be incurred in relation to dividend income when shares are held as stock-in-trade.

Revenue's Appeal (ITA No. 5163/MuW2011):
The Revenue's appeal did not have a difference of opinion between the members, and thus, no confirmatory order was needed. The appeal was decided as per the order proposed by the Accountant Member and concurred with by the Judicial Member.

Assessee's Appeal (ITA No. 5724/MuW2011):
In the assessee's appeal, no submissions were made by the Revenue, and the assessee was unrepresented during the final posting. The points of difference referred to u/s 255(4) by the Members separately included questions regarding disallowance u/s 14M of the I.T. Act when earning dividend income on shares held as stock in trade, permissibility of relying on decisions by co-ordinate benches, applicability of high court judgments, consistency of tribunal's view, principles of apportionment under section 14A, and whether any expenditure can be said to be incurred in relation to dividend income from shares held as stock-in-trade. The Third Member concurred with the view expressed by the Accountant Member, and the appeal was decided as per the majority view.

In conclusion, the Revenue's appeal was dismissed, and the assessee's appeal was partly allowed. The order was pronounced in the open court on December 06, 2013.