Principal Commissioner of Income-tax, Central–2 v. Patel Engineering Ltd
[Citation -2019-LL-0715-66]

Citation 2019-LL-0715-66
Appellant Name Principal Commissioner of Income-tax, Central–2
Respondent Name Patel Engineering Ltd.
Court HIGH COURT OF BOMBAY
Relevant Act Income-tax
Date of Order 15/07/2019
Judgment View Judgment
Keyword Tags joint venture • credit of tds • hire charges • exempt income
Bot Summary: The Income Tax Appeal is admitted for consideration of the following substantial questions of law : Whether on the facts and in the circumstances of the case and in law, the Hon'ble Tribunal was justified in holding the assessee a developer and not a contractor and allowing the deduction u/s. 80IA(4) of the I.T.Act, 1961 Whether on the facts and in the circumstances of the case and in law, the Hon'ble Tribunal was justified in holding that the credit of TDS of Rs.1,29,31,900/- be allowed to the assessee in contravention of Sec. 199(2) of the I.T.Act, 1961, since the advances pertaining thereto are not credited in the P L A/c. We notice that the Revenue has raised an additional issue of disallowance under Section 14A of the Income Tax Act, 1961 in relation to certain funds stated to have been invested with a joint venture. In the impugned Judgment while confirming the view of the CIT came to the conclusion that the amount in question was receivable by the Assessee on account of hire charges on machinery from the joint venture or on account of the assessee's share in the joint venture firm. Correctly came to the conclusion that when the expenditure was not made for earning income which was exempt, disallowance under Section 14A of the Act, would not apply. This additional question is therefore, not entertained.


IN HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO. 442 OF 2017 Principal Commissioner of Income Tax, Central 2 Appellant versus Patel Engineering Ltd. Respondent Mr. Ashok Kotangle, for Appellant. Mr. Madhur Agarwal with mr. Upendra Lokegaonkar I/by Mint and Confreres, fo Respondent. CORAM: AKIL KURESHI & S.J. KATHAWALLA, JJ. DATE : 15th JULY, 2019 P.C.: 1. Income Tax Appeal is admitted for consideration of following substantial questions of law : (i) Whether on facts and in circumstances of case and in law, Hon'ble Tribunal was justified in holding assessee developer and not contractor and allowing deduction u/s. 80IA(4) of I.T.Act, 1961 ? (ii) Whether on facts and in circumstances of case and in law, Hon'ble Tribunal was justified in holding that credit of TDS of Rs.1,29,31,900/- be allowed to assessee in contravention of Sec. 199(2) of I.T.Act, 1961, since advances pertaining thereto are not credited in P & L A/c. of assessee in F.Y. under consideration ? SSP 1/2 33 ITXA 442 OF 2017.doc 2. We notice that Revenue has raised additional issue of disallowance under Section 14A of Income Tax Act, 1961 in relation to certain funds stated to have been invested with joint venture. Tribunal however, in impugned Judgment while confirming view of CIT (Appeals) came to conclusion that amount in question was receivable by Assessee on account of hire charges on machinery from joint venture or on account of assessee's share in joint venture firm. Tribunal therefore, correctly came to conclusion that when expenditure was not made for earning income which was exempt, disallowance under Section 14A of Act, would not apply. This additional question is therefore, not entertained. ( S.J.KATHAWALLA, J. ) ( AKIL KURESHI, J. ) SSP 2/2 Principal Commissioner of Income-tax, Central2 v. Patel Engineering Ltd
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