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TMI Blog2022 (9) TMI 1038X X X X Extracts X X X X X X X X Extracts X X X X ..... section 14A of the Act will take effect from 1st April, 2022 and will apply in relation to the assessment year 2022-23 and subsequent assessment years. Accordingly, the argument of the ld. DR is rejected. Moreover, we find no infirmity in the order passed by the ld. CIT(A) on this issue. Accordingly, the ground raised by the Revenue is dismissed. - I.T.A. Nos.28 And 29/Chny/2021 - - - Dated:- 21-9-2022 - Shri V. Durga Rao, Judicial Member And Shri Manoj Kumar Aggarwal, Accountant Member For the Appellant : Shri G. Johanson, Addl. CIT For the Respondent : Mrs. Sandhyaarti, T., FCA ORDER PER V. DURGA RAO, JUDICIAL MEMBER: Both the appeals filed by the Revenue are directed against different orders of the ld. Comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 153(B(1)(b) of the Act on 31.03.2016. Accordingly, the ld. CIT directed the Assessing Officer to redo the assessment under section 263 of the Act. After considering the submissions of the assessee, the Assessing Officer has completed the assessment under section 143(3) r.w.s. 263 r.w.s. 153A r.w.s. 153(B)(1)(b) of the Act dated 30.11.2018 by disallowing ₹.1,81,83,141/- under section 14A of the Act. 4.1 Similarly, in the assessment year 2016-17, the assessee has earned exempt income of ₹.2,03,674/- of which ₹.58,674/- dividend income from investment in Indian Bank, in which the company holds 13,970 shares and the same was invested by the company in the FY 2006-07 out of retained earnings. A dividend amount of ₹ 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the form of paper book. In the assessment year 2014-15, the assessee has earned exempt income of ₹.1,34,112/- for the investments made in the financial year 2006-07 and no interest expenses were incurred for earning exempt income and no expenditure has been debited to profit and loss account having either direct or indirect nexus with the exempt income. However, as per Rule 8D(2)(ii), the Assessing Officer worked out the disallowance at 0.5% of the average investments on shares funds at ₹.1,81,83,141/- and disallowed under section 14A of the Act. 7.1 Similarly, in the assessment year 2016-17, the Assessing Officer made disallowance under section 14A of the Act of ₹.12,09,15,421/- against the dividend income of ͅ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erein it was held that amount of disallowance u/s. 14A could be restricted to the exempt income only and dismissed the SLP filed by the department. The AR also relied on various judicial pronouncements viz., Principal CIT vs. Caraf Builders , Constructions (P) Ltd [2019] 112 taxmann.com 322(SC); Delhi High Court decision in the case of Joint Investment P Ltd vs. CIT; Punjab and Haryana High Court in case of M/s. Empire Package Pvt. Ltd ; ACIT vs. Punjab State Co-op Marketing Federation Ltd and Delhi Tribunal decision in the case of Sahara India Financial Corpn. and Global Capital Ltd: Bangalore Bench Tribunal in the case of M/s. John Distilleries Ltd vs. DCIT. The AR also brought to the notice of the undersigned the decision of the juris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 taxmann.com 415 (Delhi - Trib.)(SB), the Delhi Special Bench of the Tribunal has ruled that the computation under clause (f) of Explanation I to S 115JB of the Act is to be made without resorting to computation as contemplated under S 14A read with rule 8D.The facts of the case of the appellant are squarely covered by the decision of the Special Bench. Further, the jurisdictional Tribunal in order dated 26.06.2019 in the case of ACIT Corporate Circle 6(1), Vs. M/s Samalpatti Power Company Pvt (I.T.A.Nos.1592 1593/Chny/2018) relied on the above decision of the Special Bench ruled in favour of the taxpayer by directing the AO to exclude the disallowance under S 14A r.w. rule 8D while computing MAT under S 11JB of the Act. In view of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ia Trust Association CSI Cinod Secretariat, Madras (1992) 3 SCC 1, the present appeal is dismissed being covered by the judgment passed by the learned predecessor Division Bench in PCIT vs. IL FS Energy Development Company Ltd (supra) and Cheminvest Limited vs. Commissioner of Income Tax-VI, (2015) 378 ITR 33. 10. Accordingly, the appeal and application are dismissed. However, it is clarified that the order passed in the present appeal shall abide by the final decision of the Supreme Court in the SLP filed in the case of PCIT vs. IL FS Energy Development Company Ltd (supra). 8.3 As of now, it has been clear that the amendment made by the Finance Act, 2022 to section 14A of the Act will take effect from 1st April, 2022 and will ..... X X X X Extracts X X X X X X X X Extracts X X X X
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