The Pr. Commissioner Of Income Tax -5 v. Jindal Stainless Ld. ( Formerly Known As Jsl Limited)

$~50 * IN THE HIGH COURT OF DELHI AT NEW DELHI + ITA 441/2019 THE PR. COMMISSIONER OF INCOME TAX -5..... Appellant Through : Sh. Puneet Rai, Jr. Standing Counsel. versus JINDAL STAINLESS LTD. (FORMERLY KNOWN AS JSL LIMITED) ..... Respondent Through : Sh. Neeraj Jain and Sh. Aniket. D. Agrawal, Advocates.

CORAM:

HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE PRATEEK JALAN

O R D E R

% 30.04.2019 The Revenue is aggrieved by the Income Tax Appellate Tribunal's (ITAT) order which set aside the disallowance made by the Assessing Officer (AO) under Section 14-A of the Income Tax Act, 1961 [hereafter "the Act"]. For a tax exempt income of `2.37 lakhs for the relevant Assessment Year (AY), the assessee had voluntarily disallowed `1 lakh.

Without expressing any opinion why the disallowance was not reasonable, the Assessing Officer proceeded to apply the principles underlined in Rule 8D of the Income Tax Rules, 1962 allowing disallowance of `4,48,08,080/-. The ITAT has applied the principle that without a proper rejection of the explanation regarding why the disallowance is unacceptable, Rule 8D cannot be invoked. This interpretation has been endorsed by the Supreme Court in Godrej and Boyce Manufacturing Co. Ltd. v. DCIT 2017 394 ITR 449. No question of law arises. The appeal is accordingly dismissed.

S. RAVINDRA BHAT, J PRATEEK JALAN, J APRIL 30, 2019/ajk