Sec. 14A of Income Tax Act, 1961—Business Disallowance— The captioned cross-appeals for Assessment Years (AY) 2011-12 and 2012-13 contest common order of Ld. Commissioner of Income Tax (Appeals)-It is admitted position that adjudication in any one year shall apply to other years also. Assessee contended that  CIT(A) has erred in confirming addition of the sum of under Rule 8D(2)(iii) read with Section 14A overlooking that Assessee is covered by Tonnage Tax Scheme where Shipping Business Income is computed on the basis of deemed income under Chapter XIIG and no expense has been claimed nor allowed while computing TONNAGE TAX INCOME as BUSINESS INCOME of shipping business. Hence question of disallowance of EXPENDITURE u/s.14A under Chapter IV does not arise.Facts are pari-materia the same in the AY 2012-13. The assessment was similarly framed u/s 143(3) on 23/03/2015 wherein the assessee was saddled with disallowance u/s 14A. The Ld. CIT(A) deleted interest disallowance but confirmed expense disallowance. The revised return filed by the assessee was ignored on the same reasoning.  Held that the facts and circumstances being identical, the adjudication as for AY 2011-12 shall mutatis mutandis apply to this year also. Accordingly, the revenue’s appeal stands dismissed.
The assessee’s appeal stands partly allowed for both the years whereas the revenue’s appeals stand dismissed--- TOLANI SHIPPING CO. LTD. vs. Deputy CIT. [2020] 23 ITCD Online 41 (MUM)