IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, KOLKATA BEFORE SHRI RAJESH KUMAR, AM AND SHRIPRADIP KUMAR CHOUBEY, JM ITA No.2730/KOL/2025 (Assessment Year:2023-20241)

Shyam Steel Manufacturing Ltd Shyam Tower, Premises No.03-

319, DH-6/11, Action Area-1D, DCIT, Central Circle-2(1), Street No.319, New Town, Vs. Kolkata Kolkata, West Bengal, Kolkata-700156 (Appellant) (Respondent)

PAN No. AAHCS4673H AND ITA No. 3288/KOL/2025 (Assessment Year: 2023-20241)

Shyam Steel Manufacturing Ltd Shyam Tower, Premises No.03-

DCIT, Central Circle-2(1), 319, DH-6/11, Action Area-1D, Kolkata Vs. Street No.319, New Town, Kolkata, West Bengal, Kolkata-700156 (Appellant) (Respondent)

PAN No. AAHCS4673H Assessee by : Shri S.K. Tulsiyan, Ms.Puja Somani, ARs Revenue by : Shri Sanat Kumar Raha, CITDR Date of hearing: 22.04.2026 Date of pronouncement: 00.00.2026 O R D E R Per Rajesh Kumar, AM:

These two cross appeals preferred by the assessee and revenue against the separate orders of the Commissioner of Income Tax Appeal, Kolkata-26(hereinafter referred to as the “Ld. CIT(A)”]

dated 24.09.2025 for the AY 2023-2024.

2. At the outset, we note that the appeal of the revenue is barred by limitation by 31 days. At the time of hearing the ld. DR explained the reasons for the delay in filing the appeal. The Ld. AR did not raise any objection in condoning the delay. After hearing the rival contentions and perusing the materials available on record, we find that the delay is for bonafide and genuine reasons and hence, we condone the delay and adjudicate the appeal of the revenue along with the appeal of the assessee.

ITA No.2730/KOL/2025 (Assessee’s Appeal) ITANo.3288/Kol/2025 (Revenue’s Appeal):

3. The ground no. 1 assessee’s appeal is general ground and does not require any adjudication.

4. Ground No.2 of assessee’s appeal is relating to partial confirmation of the addition to the tune of Rs.7,02,462/- as against total addition made by the AO u/s.14A of the Act at Rs.9,87,837/-.

5. The facts in brief are that during the course of assessment proceedings the AO, on examination of books of accounts of the assessee, found that the assessee company has made certain investments which has potential to generate exempt income. He further noted that during the relevant previous year, the assessee has earned interest income of Rs.26,70,379/- from Tax free Bond and exemption has been claimed as per the provisions of the Act. The AO called upon the assessee to state whether the amount disallowed suo-motto has been calculated as per Rule 8D of Income Tax rules, 1962. In response to the same, the assessee filed a written explanation and made the submission stating that an amount of Rs.49,560/- has been voluntarily disallowed u/s 14A of the Act which is in accordance with Rule 8D r.w.s. 14A of the Act. It was also submitted that no specific/ direct expenses have been incurred to generate the exempt income and in respect of indirect expense, the assessee company has determined Rs.49,560/- as the proportionate salary and other costs and disallowed the same. It was submitted that the exempt income was received from only 1 scrip viz IRFC Ltd. The opening balance of this tax free bond was Rs. 1053.69 lakhs. The said bond was sold during the year. Shri Ravi Sharma, employee of the company was looking after the investment decision. Only one sale transaction was entered into during the year. The assessee computed the disallowance u/s 14A of the Act taking into consideration 15 days salary and 15 days Business Support Services of Shri Ravi Sharma. However, the learned AO was not satisfied with the submissions of the assessee and applied Rule 8D(2)(ii) of the Act and worked out an additional disallowance at Rs.9,87,837/- u/s 14A of the Act r.w.r 8D(2)(ii).

6. In appeal, the ld. CIT(A) restricted the addition to Rs.7,02,462/-

and sustained the remaining addition.

7. After hearing the rival contentions of the parties and perusing the material available on record, we find that the assessee has sold