Delhi High Court
Cit vs Jaico Financial Services Pvt Ltd on 28 March, 2012
Author: Sanjiv Khanna
$~2
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Decision : 28th March, 2012.
+ ITA 178/2012
CIT ..... Appellant
Through Mr. Sanjeev Sabharwal, sr. standing
counsel
versus
JAICO FINANCIAL SERVICES PVT LTD .... Respondent
Through Mr. Rajesh Dureja, Adv.
CORAM:
HON'BLE MR. JUSTICE SANJIV KHANNA
HON'BLE MR. JUSTICE R.V. EASWAR
SANJIV KHANNA,J: (ORAL)
Notice.
Mr. Rajesh Dureja, Adv. accepts notice.
This appeal filed by the Revenue under Section 260A of the
Income Tax Act, 1961 (Act, for short) impugns order dated
30.3.2011 passed by the Tribunal giving the following directions :
"4. We have considered the submissions of Ld. D.R.
for the Revenue and have gone through the orders of
authorities below. We find that the Assessing Officer
ITA 178/2012 Page 1 of 3
has made disallowance of `667.51 lacs on the basis of
Rule 8D but as per the judgment of Hon'ble High Court
of Bombay rendered in the case of Godrej & Boyce
Manufacturing Pvt. Ltd., rule 8D is perspective (sic) and
hence will apply w.e.f. Assessment Year 2008-09 and
hence the said rule is not applicable in the present year
being Assessment Year 2006-07. This aspect has been
noted by the CIT(A) and thereafter, he has worked out
disallowance at `62,67,575/- on the basis of proportion
of dividend income and total profit from sale purchase of
shares and F&O segment which has been taken by him at
a figure of `1243.88 lacs as against dividend income of
`91.69 lacs. There is no basis indicated by him for
taking this figure on `1243.88 as total profit from sale
purchase of shares & F&O segment. When the income
declared by the assessee in its return of income is only
`410.77 lacs, then how there can be profit from sale purchase
of shares and F & O segment of `1243.88 lacs. The assessee
has not appeared before us to explain this fact and hence, we
deem it fit and proper to restore the matter back to the file of
the Assessing Officer for a fresh decision in the light of this
judgment of Hon'ble High Court of Bombay rendered in the
case of Godrej & Boyce Manufacturing Pvt. Ltd. (supra).
The Assessing Officer should pass necessary order as per law
as per above discussion after providing adequate opportunity
of being heard to the assessee."
2. The appeal pertains to assessment year 2006-07. We may
notice that Delhi High Court in ITA No. 687/2009 titled Maxopp
Investment Ltd. vs. CIT on 18th November, 2011 decided a similar issue
and has interpreted Section 14A of the Act. Directions and method of
computation of deductions under Section 14A have been explained in the
ITA 178/2012 Page 2 of 3
said decision. It has been held that Rule 8D of the Income Tax Rules,
1962 is applicable from the assessment year 2008-09.
3. In all cases where the Tribunal has remanded this aspect/ question
to the Assessing Officer either before or after the decision in Maxopp
Investment Ltd. (supra) for a fresh consideration, the Assessing Officer is
bound to comply with the direction and ratio expounded in Maxopp
Investment Ltd. (supra). Decision of the jurisdictional High court is
binding on the Assessing Officer and the assessee. Even when the matter
is remanded referring to the decision of the Bombay High Court in
Godrej & Boyce Manufacturing Co. Ltd. v. Dy. CIT, (2010) 328
ITR 81, the Assessing Officer should take into consideration and apply
the ratio of the decision in Maxopp Investment Ltd. (Supra). There is no
repugnancy or incongruity between the two decisions. The appeal is
accordingly disposed of.
SANJIV KHANNA, J.
R.V.EASWAR, J.
MARCH 28, 2012
vld
