9911796707
TMI Blog2022 (7) TMI 898X X X X Extracts X X X X X X X X Extracts X X X X ..... /-. Subsequently, the assessee filed revised return of income on 30.11.2014 declaring total loss of Rs.1,43,53,566/-. The return was processed u/s 143(1) of the I.T. Act. Subsequently, the case was selected for scrutiny and the statutory notices were issued to the assessee. During the course of assessment proceedings, the Assessing Officer noted from the balance sheet that the assessee company has investments to the tune of Rs.228,71,96,925/- as on 31.3.2014. He, therefore, asked the assessee to explain as to why the provisions of section 14A should not be applied. Rejecting the various explanations given by the assessee and applying the provisions of section 14A r.w.Rule 8D, the Assessing Officer disallowed the amount of Rs.1,66,03,554/- b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not apply where no exempt income iss received or receivable during the relevant assessment year" Respectfully following the Hon'ble ITAT decision in the above mentioned case, the addition made by the Assessing Officer deleted since there is no dividend income during this assessment year". 4. Aggrieved with such order of the learned CIT (A), the Revenue is in appeal before the Tribunal by raising the following grounds of appeal: 1. The CIT (A) erred in deleting the disallowance u/s 14A of Rs.1,66,03,554/- 2. The CIT(A) erred in ignoring CBDT's Circular No.5 of 2014 dated 11.02.2014, 3. The CIT(A) erred in ignoring the supreme Court decision in the case of CIT Vs Walfort share of stock Brokers P Ltd[326 ITR 11, wherein it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing Officer in the instant case made addition of Rs.1,66,03,554/- by invoking the provisions of section 14A r.w. Rule 8D. We find the learned CIT (A) deleted the addition the reasons of which are already reproduced in the preceding paragraphs. We find the Finance Act 2022 has drastically amended the provisions of section 14A and a Coordinate Bench of the Tribunal has held the amendment to be retrospective in nature i.e. w.e.f. 1.4.1962. We, therefore, in the interest of justice deem it fit and proper to restore the issue to the file of the Assessing Officer with a direction to decide the issue afresh in the light of the amendments to the provisions of section 14A by the Finance Act, 2022 and decide the issue as per fact and law after giving ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant. The appellant submitted that, the Assessing Officer has taken the reserves as positive by working out year end but it should be as per the date of advances, the reserves are negative. Further, this amount was taken as loan and the same was repaid within the year. Therefore, reliance is placed upon the CBDT Circular No. 19/2017, dated 12th June, 2017 which was stated as under: Section 2(22)clause (e) of the IT Act, 1961(the Act) provides that "dividend" includes any payment by a company, not being a company in which the public are substantially interested, of any sum by way of advance or loan to a shareholder, being a person who is the beneficial Owner of shares (not being shares entitled to a fixed rate of dividend whether with or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s mentioned that the deemed dividend will be applicable in the instant case. However, despite saying so, the learned CIT (A) has directed the Assessing Officer to delete the deemed dividend u/s 2(22)(e) of the Act. Although the submission of the learned Counsel for the assessee is that it is a typographical error, however, we find neither the assessee nor the Assessing Officer moved any rectification application u/s 154 of the I.T. Act before the learned CIT (A) for rectification of the typographic error. Considering the totality of the facts and in the interest of justice, we deem it fit and proper to restore the issue to the file of the Assessing Officer with a direction to decide the issue afresh in the light of the CBDT Circular No.19/0 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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