High Court of Delhi recently confirmed the order passed by Income Tax Appellate Tribunal in favor of the assessee the Airport Authority of India.
In the present case, the Airport Authority of India filed its return for the relevant assessment year and the same was revised thereafter.
During the assessment proceedings the Assessing Officer (AO) noticed that assessee had shown dividend income to the tune of Rs. 142.5 crores which was exempt from taxation. Regarding this finding the AO added a sum of Rs. 4,90,88,000 to the income of the assessee under Section 14A of the Income Tax Act 1961 as the expenditure involved exempt income.
On appeal both lower authorities such as CIT(A) and ITAT found that the exempt income of Rs.`142.5 crores had not been obtained and that it was only a proposed dividend and also passed order in favor of the assesee.
Aggrieved by the order of the lower authorities revenue was on appeal before the Court.
After analyzing the facts and materials deeply the High Court Justice S.Ravindra Bhat and Justice A.K.Chawla also upheld the order passed by the lower authorities. The Court also observed that the aforesaid amount was only a proposed dividend and application of Section 14A of the 1961 Act could not have arisen in this case.
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