The Commissioner Of Income Tax-I, Chandigarh v. M/S Punjab State Warehousing Corporation

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH. I.T.A. No.567 of 2008Date of decision: 21.11.2008 The Commissioner of Income Tax-I, Chandigarh. Vs. M/s Punjab State Warehousing Corporation. -----Appellant. -----Respondent CORAM:- HON'BLE MR JUSTICE ADARSH KUMAR GOELHON'BLE MR JUSTICE L.N. MITTAL Present:-Ms. Urvashi Dhugga,Standing Counsel for the revenue. ----- ORDER: The revenue has preferred this appeal under Section 260Aof the Income Tax Act, 1961 (for short, “the Act”) against the order ofIncome Tax Appellate Tribunal, Chandigarh, Bench ‘B’ passed in I.T.A.No.734/Chandi/2007 dated 26.2.2008 for the assessment year 2002-03, proposing to raise following substantial question of law:- “Whether in the fact and circumstances of the case theHon’ble Tribunal was right in questioning the applicability ofsection 14A of the Income Tax Act, 1961. Further whetherthe Hon’ble Tribunal is right in upholding the decision of Ld.CIT(A) by directing the AO to calculate the income fromprocurement/ other activities on the basis ofturnover/receipts when as per the amended provisions of14A of the Income Tax Act, 1961, the AO was supposed todetermine the amount of expenditure incurred in relation tosuch income which does not form a part of the total income in accordance with the method to be laid down by theCBDT.” The assessee claimed deduction of expenses which weredisallowed under Section 14-A of the Act to the extent attributable toexempted income. The CIT (Appeal) accepted the claim of theassessee holding that the expenses should be apportioned in the ratioof gross turnover. The Tribunal allowed the appeal of the revenue andremanded the matter to the Assessing Officer for fresh adjudication inaccordance with law. The Tribunal followed its earlier order dated24.12.2007 in respect of previous years, taking a view that Section 14Aof the Act could not be invoked for assessment years prior to 2001. Since the matter has been remanded back to the AssessingOfficer, at this stage, we are unable to hold that any substantialquestion of law arises from the order of the Tribunal. The appeal is dismissed. ( ADARSH KUMAR GOEL )JUDGE November 21, 2008ashwani ( L. N. MITTAL ) JUDGE