TaxTMI 
TaxTMI 
2020 (8) TMI 148
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....-11 and is preferred against the order of the Ld. Commissioner of Income Tax (Appeals) {CIT (A)} dated 14.07.2014. The assessee has filed Cross Objection bearing C.O. No.37/Del/2019 against the Department's Appeal. ITA No.4390/Del/2016 is the assessee's appeal for Asst. Year: 2011-12 which has been preferred against the order of the Ld. CIT (A) dated 21.06.2016 whereas ITA No.4816/Del/2017 is the Department's cross appeal for the same year. ITA No.4122/Del/2017 is assessee's appeal for Asst. Year: 2012-13 which against the order of the Ld. CIT (A) dated 01.05.2017 whereas ITA No.4911/Del/2017 is the Department's Cross appeal for the same year. ITA No.4122/Del/2017 is assessee's appeal for Asst. Year: 2013-14 which challenges the order of the Ld. CIT (A) dated 01.05.2017 and ITA No.4912/Del/2017 is the Department's Cross Appeal for Asst. Year 2013-14. ITA No. 4123/Del/2017 is assessee's appeal for Asst. Year: 2014-15 and challenges the findings of the Ld. CIT (A) as contained in order dated 01.05.2017. The Department's cross appeal for Asst. Year: 2014-15 is captioned as ITA No.4913/Del/2017. 2.1 The respective grounds raised by both the parties for the captioned assessment years....
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.... appeal): 1. On the facts and in the circumstances of the case and in law, the Ld. CIT (A) has erred in deleting addition of Rs. 1,06,54,85,768/- made by the AO on account of disallowance of 40% of general license fee, holding that the same as not incurred wholly and exclusively for the purpose of business of the assessee. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT (A) has erred in reducing the disallowance made u/s 14A from Rs. 31,21,639/- to 30,72,696/- thereby granting relief to the extent of Rs. 48,943/- 3. On the facts and in the circumstances of the case and in law, the Ld. CIT (A) has erred in deleting the addition of Rs. 2,59,26,734/- made by AO denying the claim of depreciating in respect or pollution control equipment as there was no evidence submitted to indicate that they were pollution control equipments. 4. The appellant craves leave to, add to, alter, amend or vary from the above grounds of appeal at or before the time of hearing. 2.5 ITA No.4912/Del/2017 for A.Y.2013-14 (Department's appeal): 1. On the facts and in the circumstances of the case and in law, the Ld. CIT (A) has erred in ....
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....962 ['the Rules']. b. That the CIT (A) erred on facts and in law in confirming the aforesaid disallowance without appreciating that no expenditure was actually incurred in earning the exempt dividend income. c. That the CIT (A) erred on facts and in law in not appreciating that no satisfaction as required by law before resorting to Rule 8D of the Rules for purposes of making disallowance under section 14A of the Act was recorded by the AO. d. The respondent craves leave to add, amend, alter or vary from the above grounds at or before the time of hearing. 2.8 ITA No.4121/Del/2017 for A.Y.2012-13 (Assessee's appeal): 1. That the Commissioner of Income Tax (Appeals) ['CIT(A)'] erred on facts and in law in upholding the action of the assessing officer ['AO'] in disallowing expenditure of Rs. 30,72,696 under section 14A of the Income-tax Act, 1961 ['the Act'] read with Rule 8D(2)(iii) of the Income-tax Rules, 1962 ['the Rules']. 1.1 That the CIT (A) erred on facts and in law in confirming the aforesaid disallowance without appreciating that no expenditure was actually incurred in earning the exempt dividend income. 1.2 That the CI....
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....CIT (A) erred on facts and in law in not appreciating that no satisfaction as required by law was recorded by the AO before resorting to Rule 8D of the Rules for purposes of making disallowance under section 14A of the Act. 1.3 That without prejudice, the CIT (A) erred on facts and in law in not appreciating that disallowance, if any, under section 14A of the Act, had to be restricted to Rs. 17,02,026/- as per computation provided by the appellant. The appellant craves leave to add, alter, amend or vary the above grounds of appeal at or before the time of hearing. 2.11 ITA No.4390/Del/2016 for A.Y.2011-12 (Assessee's appeal) : 1. That the Commissioner of Income Tax (Appeals) ['CIT(A)'] erred on facts and in law in upholding the action of the assessing officer ['AO'] in disallowing expenditure of Rs. 17,58,758/- under section 14A of the Income-tax Act, 1961 ['the Act'] read with Rule 8D (2)(iii) of the Income-tax Rules, 1962 ['the Rules']. 1.1 That the CIT (A) erred on facts and in law in confirming the aforesaid disallowance without appreciating that no expenditure was actually incurred in earning the exempt dividend income. 1.2 That ....
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....re as under: (i) Assessment Year: 2010-11 (a) Returned income - Rs. 7,79,66,41,380/- (b) Disallowance of license fee - Rs. 73,40,98,815/- (c) Disallowance u/s 14A - Rs. 16,95,310/- (d) Disallowance of depreciation - Rs. 20,28,005/- (e) Total additions - Rs. 73,78,22,130/- (f) Assessed income - Rs. 8,53,44,63,510/- (ii) Assessment Year: 2011-12 (a) Returned income - Rs. 10,10,12,81,200/- (b) Disallowance of license fee - Rs. 90,77,99,068/- (c) Disallowance u/s 14A - Rs. 18,33,783/- (d) Disallowance of depreciation - Rs. 52,55,604/- (e) Total additions - Rs. 91,48,88,455/- (f) Assessed income - Rs. 11,01,61,69,655/- (iii) Assessment Year: 2012-13 (a) Returned income - Rs. 12,53,68,36,330/- (b) Disallowance of license fee - Rs. 1,06,54,85,768/- (c) Disallowance u/s 14A - Rs. 31,21,639/- (d) Disallowance of depreciation - Rs. 2,59,26,734/- (e) Total additions - Rs. 1,09,45,34,141/- (f) Assessed income - Rs. 13,63,13,70,471/- (iv) Assessment Year:2013-14 (a) Returned income - Rs. 12,....
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.... the Ld. CIT (A) allowed the claim of the assessee and the Department is in appeal before us whereas in Asst. Year: 2011-12, the Ld. CIT (A) upheld the action of the Assessing Officer in restricting the depreciation on UPS to 15% and the assessee in appeal against the said finding of the Ld. CIT (A). 3.6 Disallowance u/s 14A of the Act read with Rule-8D is subject to challenge by both the parties during the years under appeal. The details of dividend earned by the assessee, suo moto disallowance offered by the assessee company, disallowance made u/s 14A by the Assessing Officer, disallowance deleted by Ld. CIT (A) and disallowance sustained by the Ld. CIT (A) are depicted in the following chart: ASST. YEARS DIVIDEND INCOME (in Rs.) DISALLOWANCE OFFERED BY THE COMPANY, ON SUO MOTO BASIS (in Rs.) DISALLOWANCE UNDER 14A MADE BY THE ASSESSING OFFICER [A+B] (in Rs.) Disallowance of 14A under Rule 8D(2)(iii), deleted by CIT(A) [A] Disallowance of 14A under Rule 8D(2) (iii), sustained by CIT(A) [B] (in Rs.) 2010-11 3,27,60,532 11,52,656 16,95,310 2,43,995 14,51,315 2011-12 5,15,55,446 10,02,954 18,33,783 75,025 17,58,785 2012-13 ....
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....CIT-DR, however submitted that so far as the finding of the Tribunal with respect to non recording of satisfaction by the Assessing Officer prior to making the disallowance u/s 14A of the Act was concerned, each Asst. Year would have to be examined separately as there is no res-judicata in Income Tax proceedings. The Ld. CIT-DR also fairly accepted that depreciation on UPS was allowable @ 60% even as per the amended rates provided in the depreciation schedule. 6.0 We have gone through the records and have also perused the orders of the lower authorities and have also perused the order of the ITAT in assessee's own case for Asst. Year: 2009-10. So far as the issue of disallowance u/s 14A read with Rule-8D is concerned, which is also related to the Department's challenge to a part deletion of the disallowance by the Ld. First Appellate Authority by holding that no disallowance could have been made in respect of interest expenses as the assessee had accumulated surplus, we find that this issue stands covered in favour of the assesee by the order of the Tribunal in Asst. Year: 2009-10. The relevant observations of the Tribunal are contained in paragraphs 7.1, 7.1.1. The same are ....
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....shows that the Assessing Officer has made identical observations in all the years under appeal and in all the years the factum of recording of satisfaction is completely absent. We also note that the assessee had made suo moto disallowances in the years under appeal as under: 2010-11 Rs. 11,52,656/- 2011-12 Rs. 10,02,954/- 2012-13 Rs. 9,64,928/- 2013-14 Rs. 20,13,989/- 2014-15 Rs. 17,02,026/- 6.0.2 The above suo moto disallowances were not commented upon by the Assessing Officer but were completely disregarded and no satisfaction for not accepting the suo moto disallowances was recorded by the AO. The Ld. AR has also submitted that the disallowances may be restricted to the suo moto disallowance offered by the assessee company. Therefore, we sustain the disallowance u/s 14A, as offered by the assessee company for the various years under appeal as under: 2010-11 Rs. 11,52,656/- 2011-12 Rs. 10,02,954/- 2012-13 Rs. 9,64,928/- 2013-14 Rs. 20,13,989/- 2014-15 Rs. 17,02,026/- 6.0.3 Accordingly, the ground raised by the assessee stands partly allowed and grounds raised by the Department are dis....
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....ty Passing Order Appeal No. Date of order 1997-98 ITAT ITA NO.4545/Del/2000 10.01.2005 1998-99 ITAT ITA NO.2239/Del/2002 10.01.2005 1999-00 ITAT ITA NO.2755/Del/2003 30.04.2007 2000-01 ITAT ITA NO.2714/Del/2004 15.06.2007 2001-02 ITAT ITA NO.1979/Del/2006 27.03.2009 2002-03 ITAT ITA NO.1980/Del/2006 27.03.2009 2003-04 ITAT ITA NO.1612/Del/2007 24.07.2009 2004-05 ITAT ITA NO.3096/Del/2007 24.07.2009 2005-06 ITAT ITA NO.319/Del/2010 22.03.2010 2006-07 ITAT ITA NO.4477/Del/2010 18.11.2011 2007-08 ITAT ITA NO.4669/Del/2012 03.01.2014 2008-09 ITAT ITA NO.4670/Del/2012 03.01.2014 1997-98 to 2000-01 and 2005-06 Delhi High Court ITA No.662/2005, ITA No.1202/2005, ITA No.96/2008, ITA No.294/2008, ITA No.288/2011, 11.05.2011 2006-07 Delhi High Court ITA No.644/2012 21.11.2012 2007-08 Delhi High Court ITA No.502/2014 10.09.2014 2008-09 Delhi High Court ITA No.532/2014 10.09.2014 7.4.2 The Ld. CIT-DR also could not controvert this fact. Therefore, in view of the binding judicial pr....
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....ear 2010-11 we dismiss the ground raised by the Department and in Asst. Year: 2011-12 we allow the ground raised by the assesee with respect to depreciation on UPS and direct that the assessee should be given benefit of depreciation on UPS @ 60%. 6.4 The only issue now remaining in the bunch of appeals is depreciation on pollution control equipment and energy saving devices. The Assessing Officer has denied depreciation on pollution control equipment and energy saving devices on the ground that the assessee could not establish that the pollution control equipment and energy saving devices were put to use by the assessee. The following disallowances were made by the Assessing Officer in respect of depreciation on such equipment and devices in the years under appeal as under: Asst. Years. Disallowance of license fee Disallowance of depreciation on pollution control equipment (in Rs.) 2010-11 73,40,98,815 17,27,059 2011-12 90,77,99,068 17,27,059 2012-13 1,06,54,85,768 2,59,26,734 2013-14 1,17,83,98,395 4,50,01,287 2014-15 1,25,91,03,440 41,66,502 6.4.1 However, the Ld. CIT (A) has deleted these disallowances in all the years ....