The Principal Commissioner of Income-tax-2 v. Ganesh Housing Corporation Ltd
[Citation -2020-LL-0113-84]
| Citation | 2020-LL-0113-84 |
|---|---|
| Appellant Name | The Principal Commissioner of Income-tax-2 |
| Respondent Name | Ganesh Housing Corporation Ltd. |
| Court | HIGH COURT OF GUJARAT AT AHMEDABAD |
| Relevant Act | Income-tax |
| Date of Order | 13/01/2020 |
| Assessment Year | 2012-13 |
| Judgment | View Judgment |
| Keyword Tags | disallowance of interest expenditure • proportionate interest expenditure • substantial question of law • substantial interest • exempt income • interest free loans |
| Bot Summary: | This Tax Appeal is filed under Section 260A of the Income Act, 1961 at the instance of Revenue and it is directed against the order dated 15.05.2019 passed by the Income Tax Appellate Tribunal, Ahmedabad Bench 'B', Ahmedabad in ITA No.3085/Ahd/2015 for the assessment year 2012 2013. The Revenue has proposed the following questions as the substantial questions of law involved in this appeal: 2(A) Whether the Appellate Tribunal had erred in law and on facts in upholding the order of CIT(A) deleting the disallowance made by the Assessing Officer on account of proportionate interest expenditure of Rs.8,36,975/ without appreciating that the assessee company had Page 1 of 3 Downloaded on : Tue Jan 21 10:09:18 IST 2020 C/TAXAP/817/2019 ORDER incurred substantial interest expenditure while giving interest free loans Whether the Appellate Tribunal had erred in law and on facts in upholding the order of the CIT(A) in deleting the disallowance of Rs.6,96,18,668/ under Section 14A of the Act without appreciating the material brought on record 3. So far as the proposed Question No.2(A) is concerned, the same cannot be termed as a substantial question of law in view of the order passed by this Court of even date in the Tax Appeal No.734 of 2019. So far as the proposed Question No.2(B) is concerned, we take notice of the following findings recorded by the Tribunal: 52.3 With the assistance of the learned representatives of the Revenue and assessee, we observe that the assessee has not declared any exempt income and consequently the provisions of Section 14A is not attracted in view of CIT vs. Corrtech Energy Ltd. 45 taxmann.com 116(Guj) and other several decisions in this regard. Secondly, the CIT(A) has also recorded a finding to the effect that interest free funds available at the disposal of assessee is in excess of amount of investments which give rise to potential interest is not permissible in such circumstances. We do not see any infirmity in the action of CIT(A) in deleting the disallowance of interest expenditure for the purposes of section 14(A) of the Act. We are in agreement with the reasoning Page 2 of 3 Downloaded on : Tue Jan 21 10:09:18 IST 2020 C/TAXAP/817/2019 ORDER assigned by the Tribunal so far as the proposed Question No.2(B) is concerned. |