Delhi High Court
The Pr. Commissioner Of Income Tax ... vs Oil Industry Development Board on 21 November, 2022
Neutral Citation Number: 2022/DHC/005040
$~3
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ITA 1025/2019
THE PR. COMMISSIONER OF INCOME TAX -18 ..... Appellant
Through: Mr.Ruchir Bhatia, Sr.Standing
Counsle for the Revenue.
versus
OIL INDUSTRY DEVELOPMENT BOARD ..... Respondent
Through: None
% Date of Decision: 21st November, 2022
CORAM:
HON'BLE MR. JUSTICE MANMOHAN
HON'BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA
JUDGMENT
MANMOHAN, J (Oral):
1. Present Income Tax Appeal has been filed challenging the Order
dated 12th June, 2019 passed by the Income Tax Appellate Tribunal
('ITAT') in ITA No. 4417/Del./2016 for Assessment Year 2012-13.
2. Learned counsel for the appellant states that the ITAT has erred in
deleting the addition of Rs.4.65 crores made by the assessing officer under
Section 14A of the Income Tax Act, 1961 ('the Act'). He states that the
ITAT has erred in holding that no disallowance can be made under Section
14A of the Act read with Rule 8D of the Income Tax Rule, 1962 in the
case wherein no exempt income has been earned during the year under
consideration.
Signature Not Verified
Digitally Signed By:JASWANT
SINGH RAWAT
Signing Date:22.11.2022
19:24:36
Neutral Citation Number: 2022/DHC/005040
3. A perusal of the paper book reveals that the authorities below have
given concurrent finding of fact that the assessee did not earn any dividend
income during the year under consideration. The relevant extract of the
ITAT order is reproduced hereinbelow:-
"7. It is pertinent to mention here that the decision of the Tribunal was upheld
by the Hon'ble Delhi High Court and the SLP filed by the Revenue was
dismissed by Hon'ble Supreme Court. We find the Ld. CIT(A) deleted the
disallowance made by the Assessing Officer u/s 14A r/w. Rule 8D on the
ground that the assessee has not earned any dividend income during the year.
The Ld. DR also could not controvert the above factual findings given by the
CIT(A), therefore, following the decision of Hon'ble Delhi High Court in the
case of Cheminvest Limited (supra), we hold that no disallowance u/s. 14A
r/w. Rule 8D is called for when the assessee has not received any dividend
income during the year. The order of the CIT(A) is accordingly upheld and
ground raised by the revenue is dismissed."
(emphasis supplied)
4. This Court is of the view that the present case is covered by the
Division Bench judgment in Cheminvest Ltd. vs. CIT, [2015] 61
Taxmann.com 118 (Delhi), wherein it has been held that the expression
'does not form part of the total income' in Section 14A of the Act means
that there should be an actual receipt of income which is not includible in
the total income, during the relevant previous year for the purpose of
disallowing any expenditure incurred in relation to the said income. In
other words, Section 14A will not apply if no exempt income is received or
receivable during the relevant previous year.
5. Furthermore, this Court in Pr. Commissioner of Income Tax
(Central)-2 Vs. M/s Era Infrastructure (India) Ltd., [2022] 141
taxmann.com 289 (Del) has dealt with the issue of amendment made by
the Finance Act, 2022 to Section 14A of the Act. The relevant portion of
the said judgment is reproduced hereinbelow:
Signature Not Verified
Digitally Signed By:JASWANT
SINGH RAWAT
Signing Date:22.11.2022
19:24:36
Neutral Citation Number: 2022/DHC/005040
"8. Consequently, this Court is of the view that the amendment of Section 14A,
which is "for removal of doubts" cannot be presumed to be retrospective even
where such language is used, if it alters or changes the law as it earlier
stood."
6. Accordingly, this Court is of the view that no substantial question of
law arises for consideration in the present appeal. Accordingly, the same is
dismissed.
MANMOHAN, J
MANMEET PRITAM SINGH ARORA, J
NOVEMBER 21, 2022
KA
Signature Not Verified
Digitally Signed By:JASWANT
SINGH RAWAT
Signing Date:22.11.2022
19:24:36
