8. os itxa 1308-17.doc R.M. AMBERKAR (Private Secretary) IN HIGH COURT OF JUDICATURE AT BOMBAY O.O.C.J. INCOME TAX APPEAL NO. 1308 OF 2017 Pr. Commissioner of Income Tax-1, Mumbai Appellant Versus M/s. Ami Industries (India) Pvt Ltd (Now known as Amit Tech (India) Pvt Ltd Respondent Mr. Suresh Kumar a/w Ms. Sumandevi Yadav & Ms. Priyanka Tiwary for Appellant Mr. Riyaz Padvekar a/w Mr. Tanzil Padvekar for Respondent CORAM : UJJAL BHUYAN & MILIND N. JADHAV, JJ. DATE : JANUARY 29, 2020. P.C.: 1. Heard learned counsel for parties. 2. This appeal under Section 260A of Income Tax Act, 1961 ("the Act" for short) is preferred by revenue against order dated 26.8.2016 passed by Income Tax Appellate Tribunal, Mumbai "A" Bench, Mumbai in Income Tax Appeal No. 353/Mum/2015 for assessment year 2011-12. 1 of 4 8. os itxa 1308-17.doc 3. In this appeal, following four questions have been proposed as substantial questions of law:- "(1) Whether on facts and circumstances of case and in law, Tribunal was justified in directing deletion of sum brought to tax by Assessing Officer as unexplained income under Section 68 of Act in respect of moneys credited in books as share application money of Rs. 7,20,00,000/-? (2) Whether on facts and circumstances of case and in law, Tribunal was justified in holding that assessee proved identity, creditworthiness and genuineness of moneys credited in books as share application money of Rs. 7,20,00,000/- just by submitting PAN, acknowledgment of income tax reruns filed and bank statements? (3) Whether on facts and circumstances of case and in law, Tribunal was justified in deleting addition of Rs. 7,20,00,000/- ignoring facts brought out by Assessing Officer that return of investing company shows no credit worthiness and that investing company merely transferred share application money received from other parties to assessee company? (4) Whether on facts and circumstances of case and in law, Tribunal was justified in holding that disallowance u/S. 14A cannot be more than exempt income earned during year when provisions of Section 14A of Act does not provide for any such limit of disallowance?" 2 of 4 8. os itxa 1308-17.doc 4. Regarding question Nos. (1) to (3) : We have already upheld common order of Tribunal passed in case of assessee itself for assessment year 2010-11 in Income Tax Appeal No. 1231 of 2017. Therefore, question Nos. (1), (2) and (3) would stand covered by said decision. 5. Regarding question No. (4) : This issue is also covered by decision of Delhi High Court in Pr. CIT Vs. Caraf Builders & Constructions (P) Ltd1 wherein Delhi High Court held that upper disallowance cannot exceed exempt income of relevant assessment year. In other words, where assessee had not earned any tax free income, corresponding expenditure could not be worked out for disallowance. Thus, disallowance under Section 14A of Act cannot exceed exempt income of relevant year. 6. SLP filed against aforesaid decision by revenue has been dismissed by Supreme Court in Pr. Commissioner of Income Tax-2 Vs. Caraf Builders & 1 [2019] 101 taxmann.com 167 3 of 4 8. os itxa 1308-17.doc Constructions (P) Ltd2. In that view of matter, question No. (4) also does not arise. 7. Resultantly, appeal is dismissed. [MILIND N. JADHAV, J.] [UJJAL BHUYAN, J.] Digitally signed by Ravindra Ravindra M. Amberkar M. Date: Amberkar 2020.02.03 11:07:35 +0530 2 [2019] 112 taxmann.com 322 (SC) 4 of 4 Pr. Commissioner of Income-tax-1, Mumbai v. Ami Industries (India) Pvt. Ltd. (Now known as Amit Tech (India) Pvt. Ltd.)