2022 (8) TMI 430

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....peal against the Assessment Order, dated 30.12.2019, passed under section 153A read with Section 143(3) of the Act. 2. The Revenue has raised the following grounds of appeal read as under: " 1. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) is justified in restricting the addition of Rs. 3,02,08,627/- u/s 14A r.w. Rule 8D(2) of the Rules to Rs. 7,43,185/-. 2. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) is justified in directing the Assessing Officer to delete the disallowance made under section 14A r.w. Rule 8D to the Book profit relying on decision of Hon'ble ITAT in the assessee's own case for the A.Y. 2013-14 & 2014-15 wherein the Hon'ble Tribunal follow....

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....aking into account the Explanation inserted by the Finance Act 2022. Referring to the clarification provided under the sub-heading "The clarification in respect of disallowance under Section 14A in absence of any exempt income during an assessment year" contained in the Memorandum to the Finance Bill, 2022, the Learned Departmental Representative submitted that Memorandum clearly provides that the insertion of Explanation to Section 14A of the Act shall have effect from 01.04.2022 and would have effect retrospectively, whereas insertion of non-obstante clause in sub-section 1 of Section 14A will take effect from 01.04.2022 and shall apply in relation to the Assessment Year 2022-23, and subsequent assessment years. In support of the aforesai....

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....9 Bombay. Further, relying upon paragraph 7 of the clarification in respect of disallowance under Section 14A of the Act contained in Memorandum to Finance Bill 2022, Ld. Authorised Representative for the Assessee submitted that it has been specifically provided that the amendment shall apply in relation to Assessment Years 2022-23 and subsequent assessment years. He further submitted that the aforesaid amendments to Section 14A were applicable only in a case where no exempt income was earned by the Assessee during the relevant previous year and did not apply in cases where exempt income was earned by the Assessee. He submitted that the judgments on which reliance has been placed by the Learned Departmental Representative were distinguishab....

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....e amended provisions of Section 14A of the Act. 7. We note that the Mumbai Bench of the Tribunal has, in the case of Assistant Commissioner of Income Tax- Circle 3(1)(1) Vs Bajaj Capital Ventures (P.) Ltd.: [2022] 140 taxmann.com 1 (Mumbai - Trib.)[29-06-2022] and also in the case of Assistant Commissioner Of Income Tax Vs. K Raheja Corporate Services Private Limited [ITA No. 2521 to 2527], held that the amendments to Section 14A introduced by the Finance Act 2022 shall apply from Assessment Year 2022-23 and onwards. Further, Hon'ble Delhi High Court in the case of Principal Commissioner of Income-Tax (Central) -2 Vs. M/s Era Infrastructure India Ltd: [ITA No. 204 of 2022, decided on 20.07.2022] has rejected the contention of the Revenue t....