Principal Commissioner Of Income Tax-1, Chandigarh v. M/S Trident Limited, Ludhiana

ITA-444-2018 -1- IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH ITA-444-2018 (O&M)Date of Decision: 26.3.2019 Principal Commissioner of Income Tax-1, Chandigarh Versus ....Appellant. M/s Trident Limited, Ludhiana ...Respondent. CORAM:- HON'BLE MR. JUSTICE AJAY KUMAR MITTAL.HON'BLE MRS. JUSTICE MANJARI NEHRU KAUL. PRESENT: Mr. Rajesh Katoch, Sr. Standing Counsel for the appellant.*** AJAY KUMAR MITTAL, J. 1.This appeal has been preferred by the revenue under Section260A of the Income Tax Act, 1961 (in short “the Act”) against the orderdated 20.3.20187 (Annexure A-III) passed by the Income Tax AppellateTribunal, Chandigarh Bench 'B', Chandigarh (hereinafter referred to as “theTribunal”) in ITA No. 1433/Chd/2017, for the assessment year 2013-14,claiming the following substantial question of law:- “Whether on the facts and in the circumstances of thecase, the Hon'ble ITAT was justified in law in deletingthe addition made on account of disallowance u/s 14A ofthe Income Tax Act, 1961 read with Rule 8D of theIncome Tax Rules, 1962?” ITA-444-2018 2.Briefly stated, the facts necessary for adjudication of the instantappeal as narrated therein may be noticed. The assessee is engaged in thebusiness of manufacturing and processing of year, terry towel and sulphuricacid, writing and printing paper, recovery of caustic soda and generation ofpower. The assessee filed its return of income on 30.11.2013 for theassessment year 2013-14 declaring the income 'nil' and thereafter filed itsrevised return on 30.4.2014 at 'nil' income. Its case was selected forscrutiny under CASS. The Assessing Officer vide order dated 31.12.2015(Annexure A-I) completed the assessment under Section 143(3) of the Act.The Assessing Officer had noticed that the assessee had made investmentsin various equity funds and shares of different companies and had takenhuge loans and was investing indirectly from the said loan funds. TheAssessing Officer rejected the claim of the assessee under Section 14A readwith Rule 8D of the Income Tax Rules, 1962 (in short “the Rules”)amounting to ` 4,22,14,265/-. Besides this, the other additions were alsomade by the Assessing Officer. Feeling aggrieved, the assessee filed anappeal before the Commissioner of Income Tax (Appeals) [for brevity “theCIT(A)”] challenging the disallowance of ` 4,22,14,265/- under Section14A of the Act read with Rule 8D of the Rules. The CIT(A) vide orderdated 31.7.2017 (Annexure A-II) allowed the appeal and deleted thedisallowance of ` 4,22,14,265/- under Section 14A of the Act read withRule 8D of the Rules. The revenue challenged the order, Annexure A-II,before the Tribunal. The Tribunal vide order dated 20.3.2018 (Annexure A-III) upheld the order of the CIT(A) and dismissed the appeal of the revenue.Hence, the present appeal by the revenue. ITA-444-2018 4.It could not be disputed by the learned counsel for the revenuethat the aforesaid matter is covered by the judgment of this Court in ITA-322-2016 (Principal Commissioner of Income Tax-I, Chandigarh v. M/sVardhman Chemtech Private Limited, Chandigarh) decided on28.8.2018, wherein the appeal filed by the revenue against the deletion ofdisallowance of ` 4,22,14,265/- under Section 14A of the Act read withRule 8D of the Rules, was dismissed. 5.Accordingly, the present appeal is also dismissed in terms of ITA-322-2016. (AJAY KUMAR MITTAL) JUDGE