The Order Dated 13.04.2016 Made In Ita v. Https://Hcservices.ecourts.gov.in/Hcservices

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 02.02.2021 The Honourable Mr.Justice T.S.SIVAGNANAMandThe Honourable Ms.Justice R.N.MANJULA M/s.Sundaram Clayton Ltd,No.29, Haddows Road,Chennai - 600006. ...AppellantVs The Additional Commissioner ofIncome Tax,Company Range-VI,Chennai - 34. ...Respondent APPEAL under Section 260A of the Income Tax Act, 1961 againstthe order dated 13.04.2016 made in ITA.No.1163/Mds/2013 on thefile of the Income Tax Appellate Tribunal, 'B' Bench, Chennaifor the assessment year 2009-10, appeal filed against the orderdated 28/03/2013 made in ITA Nos.39 & 394/2011-12 on the file ofthe Commissioner of Income Tax (Appeals)-V, Chennai-34 for theAssessment Year 2009-10 against the order dated 30/12/2013 madein PAN No. on the file of the Assistant Commissionerof Income Tax Company Circle-VI(4), Chennai for the AssessmentYear 2009-10 against the Order dated 28/12/2011 made in PANNo.AAACS4920J on the file of the Additional Commissioner ofIncome Tax Company Circle VI, Chennai-34 for the Assessment Year2009-10. For Appellant:Mr.R.Vijayaraghavan assisted byMr.Vikram Vijayaraghavanfor M/s.Subbaraya Aiyar PadmanabhanFor Respondent:Mr.J.NarayanasamySenior Standing Counsel JUDGMENT (Delivered by T.S.Sivagnanam,J) This appeal, filed by the assessee under Section 260A of theIncome Tax Act, 1961 ('the Act' for brevity) is directed against https://hcservices.ecourts.gov.in/hcservices/ the order dated 13.04.2016 made in ITA.No.1163/Mds/2013 on thefile of the Income Tax Appellate Tribunal, 'B' Bench, Chennai('the Tribunal' for brevity) for the assessment year 2009-10. 2. The appeal was admitted on 06.06.2018 on the followingsubstantial question of law:"Whether the Tribunal was right in lawinconfirmingthedisallowanceofexpenditure under Section 14A of the IncomeTax Act, 1961 read with Rule 8D of theIncome Tax Rules, 1962 without appreciatingthat the investments were made in earlieryears out of sufficient profits and no partof borrowings were used for makinginvestments?" 3. We have heard Mr.R.Vijayaraghavan, assisted by Mr.VikramVijayaraghavan, appearing for M/s.Subbaraya Aiyar Padmanabhan,learned counsel for the appellant and Mr.J.Narayanasamy, learnedSenior Standing Counsel appearing for the respondent-Revenue 4. After elaborately considering the factual position andthe substantial question, which is being framed forconsideration, we have no hesitation to hold that the questionneeds to be answered in favour of the assessee in the light ofthe decision of the Hon'ble Division Bench in the case ofM/s.Marg Limited vs. CIT, Chennai in T.C.A.Nos.41 to 43 and 220of 2017 dated 30.09.2020 and the other decisions rendered bythis Court following the said decision, one such decision beingin the case of The Commissioner of Income Tax, Chennai vs.M/s.Shriram Ownership Trust in T.C.A.No.242 of 2018, wherein inparagraph 39, this issue was considered and decided in favour ofthe assessee, which portion of the judgment is extractedhereunder: "39. The first substantial question oflaw raised by the revenue in this appeal iswhether the Tribunal was right in holdingthat the investment which yielded no exemptincome was to be excluded while computingdeduction under Section 14A when the Act aswell as the Rules do not provide for any suchexception. An identical question was raisedby the revenue in the assessee's own case inT.C.A.No.241 of 2018 for the assessment year2013-14. When the said tax case appeal washeard, we noted that the substantial questionof law has to be answered in favour of theassessee in the light of the decision of theHon'ble Division Bench in the case ofM/s.MargLimitedvs.CIT,Chennai "39. The first substantial question oflaw raised by the revenue in this appeal iswhether the Tribunal was right in holdingthat the investment which yielded no exemptincome was to be excluded while computingdeduction under Section 14A when the Act aswell as the Rules do not provide for any suchexception. An identical question was raisedby the revenue in the assessee's own case inT.C.A.No.241 of 2018 for the assessment year2013-14. When the said tax case appeal washeard, we noted that the substantial questionof law has to be answered in favour of theassessee in the light of the decision of theHon'ble Division Bench in the case ofM/s.MargLimitedvs.CIT,Chennai [T.C.A.Nos.41 to 43 and 220 of 2017 dated30.09.2020]. However, the appeal filed by therevenue was dismissed on 08.07.2020 owing tolow tax effect. The revenue cannot disputethe fact that the above substantial questionof law was decided in favour of the assessee.In the case of M/s.Marg Limited, in which thedecision of the High Court of Karnataka inPragathi Krishna Gramin Bank vs. VireetInvestment (P) Ltd. [(2017) 82 Taxman.com 415(Delhi-Trib.)(SBI)] also decided the saidissue in favour of the assessee. Thus,following the above referred decision,substantial question of law No.1 is answeredin favour of the assessee and against therevenue." 5. In the absence of any distinguishing factors in the caseon hand, we are obliged to follow the decision of M/s.MargLimited, which has been consistently followed in several otherdecisions as well. 6. In the result, the Tax Case Appeal is allowed and thesubstantial question of law framed for consideration is answeredin favour of the appellant-assessee. No costs. Sd/- Assistant Registrar(CS VI) //True Copy// hvkTo Sub Assistant Registrar 1.The Income Tax Appellate Tribunal, 'B' Bench, Chennai. 'B' Bench, Chennai. 2.The Additional Commissioner of Income Tax, Company Range-VI, Chennai – 34. 3.The Commissioner of Income Tax (Appeal)-V, Chenani-34. +1cc to M/s.Subbaraya Aiyar, Advocate Sr.6006 TCA.No.257 of 2018 srg 25/02/20212