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IV. Direct Taxes Case Laws:
1. Cheminvest Limited Vs. CIT, I.T.A. No. 749/2014, Date of Order: 02.09.2015, High Court of Delhi
Whether
disallowance under Section 14A of the Act can be made in a year in
which no exempt income has been earned or received by the Assessee?
Held No.
In light
of the clear exposition of the law in Holcim India (P) Ltd. and in view
of the admitted factual position in this case that the Assessee has
made strategic investment in shares of Max India Ltd.; that no exempted
income was earned by the Assessee in the relevant AY and since the
genuineness of the expenditure incurred by the Assessee is not in doubt,
the question framed is required to be answered in favour of the
Assessee and against the Revenue. In the context of the facts enumerated
hereinbefore the Court answers the question framed by holding that the
expression „does not form part of the total income‟ in Section 14A of
the envisages 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.
(Please click here for judgment)
2. Fast Booking (I) Pvt. Ltd. Vs DCIT, I.T.A. No. 334/2015, Date of Order: 02.09.2015, High Court of Delhi
Whether the ITAT was correct in law in not examining the Assessee's cross objections?
Held No.
The
Appellant Assessee herein filed its cross objection before the ITAT in
the two pending appeals of the Revenue against the order of the CIT(A)
for AYs 2008-09 and 2009-10. While taking up the cross-objections,
although the delay in filing was condoned, the ITAT declined to permit
the Assessee to maintain the cross objections by following the decision
of the Coordinate Bench of the ITAT in ITO v. Neetee Clothing (P)Ltd.
[2010] 129 TTJ 342 (ITAT [Del]), on the ground that since the Assessee
had not urged the plea of being entitled to the benefit under Section 10
A of the Act before the CIT (A), it could not be permitted to urge such
plea for the first time before the ITAT. The basis of this Court
remanding the matters in Valiant Communications Ltd. cases to the ITAT
was precisely to consider whether the benefit under Section 10A could be
granted to those Assessees notwithstanding that they may not be
entitled to the benefit under Section 10B.
It was,
therefore, open to the Appellant Assessee herein to seek support of the
order of the CIT (A) on the ground which was not urged before the CIT
(A) as long as it was not going to be adverse to the case of the
Appellant i.e. the Revenue before the ITAT. The ITAT in considering such
plea was not going to be persuaded to come to a different conclusion as
far as the appeal of the Revenue pertaining to the benefit under
Section 10B of the Act was concerned. Particularly in the light of the
order passed by this Court on 4th January 2013 in the applications filed
by Valiant Communications Ltd., there should have been no difficulty
for the ITAT to have examined the Appellant Assessee‟s cross objections.
(Please click here for judgment)
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