TaxTMI 
TaxTMI 
2022 (6) TMI 85
X X X X Extracts X X X X
X X X X Extracts X X X X
....exceptions. Accordingly, applications stand disposed of. ITA 159/2022 1. The present appeal has been filed under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as 'Act') against the impugned final judgment and order dated 19th February, 2020 passed by the Income Tax Appellate Tribunal (in short "the Tribunal") in I.T.A. No. 74/Kol/2018. Brief Facts: 2. M/s Punjab National Bank (Erstwhile United Bank of India) i.e., Respondent/Assessee (hereinafter referred to as 'Respondent') filed its return of income under Section 139(1) of the Act on 4th October, 2010 for Assessment Year 2010-11. The case was selected for scrutiny under Computer Assisted Scrutiny Selection (CASS) and a notice under Section 143 (2) of the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....4A read with Rule 8D(2)(iii) of Rs. 1,58,00,000/- was confirmed by CIT (Appeals). 7. It is pertinent to mention that the Appellant i.e. Revenue (hereinafter referred to as 'Appellant') did not file any appeal against the order passed by CIT (Appeals) deleting the disallowance made by the JAO under Section 14A of the Act read with Rule 8D(2)(ii). 8. Aggrieved by the order of the learned CIT (Appeals) confirming the above noted disallowances under Section 40(a)(ia) of the Act for non-deposit of TDS and section 14A read with Rule 8D(2)(iii) on account of exempt income, the Respondent preferred an appeal before the Tribunal. 9. The Tribunal vide its impugned order dated 19th February, 2020 allowed the appeal of the Respondent with resp....
X X X X Extracts X X X X
X X X X Extracts X X X X
....iii) the Tribunal held as follows: "...14. When this appeal was called out for hearing, learned counsel for the assessee invited our attention to the order dated 19.11.2018, passed by the Division Bench of Delhi Tribunal in the case of Nice Bombay Transport (P) Ltd,in ITA No.1331/Del/2012for the Assessment Year 2008-09 whereby the issue relating to section 14A read with rule 8D in respect of shares held in stock has been discussed and adjudicated in favour of assessee. Learned counsel for the assessee submitted that the present issue is squarely covered by the aforesaid order of the Tribunal, a copy of which was also placed before the Bench. 16. We see no reasons to take any other view of the matter than the view so taken ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....l is right in holding that the said expense incurred by the Respondent cannot be disallowed. In this regard, findings of the Tribunal are in conformity with the judgment of the Supreme Court in the case of Commissioner of Income Tax v. Calcutta Export Company reported in 2018 404 ITR 654 (SC) and in this regard paragraph 30 of the said judgment is relevant: "...30) Hence, in the light of the forgoing discussion and the binding effect of the judgment given in Allied Motors (supra), we are of the view that the amended provision of section 40(a)(ia) of the Income-tax Act should be interpreted liberally and equitably and applies retrospectively from the date when section 40(a)(ia) was inserted i.e., with effect from the assessment year....
X X X X Extracts X X X X
X X X X Extracts X X X X
....and amounts invested by the Respondent. The Tribunal, therefore, held that the disallowance made by the Assessing officer under Rule 8D(2)(ii) of the Rules was not permissible. The learned Counsel for the Appellant has not disputed the aforesaid facts and on this ground additionally, no challenge can be maintained to the deletion of the disallowance made under this Rule. 16. The learned counsel for the Appellant has contended that the decision of the Tribunal deleting the addition of Rs. 1,58,00,000/- made by the JAO under Section 14A of the Act read with Rule 8D(iii) is incorrect since the said amount was offered for disallowance suo moto by the Respondent. 17. In this regard, the Tribunal has observed that the facts of the Responden....
X X X X Extracts X X X X
X X X X Extracts X X X X
....fits. The situation here is, therefore, different from the case like Maxopp Investment Ltd. where the assessee would continue to hold those shares as it wants to retain control over the investee-company. In that case, whenever dividend is declared by the investee-company that would necessarily be earned by the assessee and the assessee alone. Therefore, even at the time of investing into those shares, the assessee knows that it may generate dividend income as well and as and when such dividend income is generated that would be earned by the assessee. In contrast, where the shares are held as stock-in-trade, this may not be necessarily a situation. The main purpose is to liquidate those shares whenever the share price goes up in order to ear....