The present appeal by the Revenue arises out of order dated 21.01.2011 of the Income Tax Appellate Tribunal, Ahmedabad Bench ‘C’, passed in ITA No. 188 of 2009 for the Assessment Years 2006-2007. 1.1 Following question is raised by the appellant proposing it to be a substantial question of law.
[A] Whether the Appellate Tribunal is right in setting aside the order of CIT(A) and deleting the disallowance made u/s 14A of the I.T. Act?”
[B] Whether the Appellate Tribunal is right in deleting the disallowance of Rs. 2,57,97,996 made u/s 40A (2)(b) of the I.T. Act?”
2. We heard learned advocate for the appellant Ms. Paurami B. Sheth.
2.1 Learned advocate for the appellant fairly submitted at the threshold of hearing that so far as question no. 2 is concerned, the same is covered by the decision of this Court dated 18.1.2002 in Tax Appeal No. 2488 of 2010, which was in assesse's case itself. The said appeal filed by the department was dismissed.
2.3 In view of the above, question no.2 is not required to be gone into as the same having been already decided. It is pertinent to mention that this Bench decided the very question against the Revenue vide its decision dated 17/02/2011 in tax appeal no. 522/2010. Thus, as regards question no.2, the appeal fails.
3. Now, turning to the first question which relates to disallowance under Section 14A of the Income Tax Act 1961 (hereinafter referred to as 'the act' for sake of brevity) which came to be deleted by the Tribunal by setting aside the order of the Commissioner of Income Tax (Appeals).
3.1 The facts in the background are that the assessing officer had disallowed interest expenditure of Rs. 28,83,761/- while considering the return of income of the assessee for the assessment year 2006-2007. The said disallowance was for the reason that the dividend interest earned from investment of shares of Rs. 1.92 crores was exempted under section 10(34) of the Act and as per provisions of section 14A the expenditure incurred for earning tax free income was not an allowable deduction. The CIT(A) deleted addition on the basis of decision in the previous year.
3.2 In the impugned order, as far as the said aspect is concerned the Tribunal has only remanded the issue to the CIT(A) for fresh adjudication requiring the CIT(A) to consider decision of Punjab & Haryana High Court in Hero Cycle Ltd. (2010) 323 ITR 518.
4. We do not find any infirmity in the order of the Tribunal on the aforesaid issue. As the issue is restored to the CIT(A) for considering it afresh after giving opportunity of hearing to both the sides. In light of the foregoing discussion, no interference is called. Neither the question is a question of law, much less a substantial question of law rendering the appeal devoid of merit.
5. Accordingly, the appeal is dismissed.
[V.M.SAHAI, J] [N.V.ANJARIA, J.] cmjoshi