SANJAY GUPTA, MUMBAI V. DCIT CEN CIR 47, MUMBAI

ITA 1027/MUM/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 2684 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-10-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Assessment Year: 2009-2010
• Appeal Filed On: 14-02-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: VISHWAS JADHAV
• Assessee Lawyers: SANJIV M SHAH
• Keywords: Gift; Deemed owner of house property; Business income; Business expenditure; Opportunity of being heard; Principle of natural justice; Deemed to accrue or arise in india; Additional evidence
• Section: 144

Judgement Text

E IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI BEFORE SHRI C.N. PRASAD, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ./ I.T.A. NO.1027 /MUM/2014 ( / ASSESSMENT YEAR : 2009-10) MR. SANJAY GUPTA, BUNGALOW NO. 91-101, MHADA SVP NAGAR, H BUNGALOW, ANDHERI (W), MUMBAI 400 053. / V. THE DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 47, ROOM NO. 658, 6 TH FLOOR, AAYAKAR BHAVAN, M.K. MARG, MUMBAI 400 020. ./ PAN : AABPG 8751F ( / APPELLANT ) .. ( / RESPONDENT ) ASSESSEE BY SHRI SANJIV M SHAH REVENUE BY : SHRI VISHWAS JADHAV / DATE OF HEARING : 02-08-2016 / DATE OF PRONOUNCEMENT : 06/10/2016 / O R D E R PER RAMIT KOCHAR, ACCOUNTANT MEMBER THIS APPEAL, FILED BY THE ASSESSEE, BEING ITA NO. 1027/MUM/2014, IS DIRECTED AGAINST THE APPELLATE ORDER DATED 16 TH DECEMBER, 2013 PASSED BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS)- 38, M UMBAI (HEREINAFTER CALLED THE CIT(A)), FOR THE ASSESSMENT YEAR 2009- 10, THE APPELLATE PROCEEDINGS BEFORE THE LEARNED CIT(A) ARISING FROM THE ASSESSMENT ORDER DATED 9 TH DECEMBER, 2011 PASSED BY THE LEARNED ASSESSING OFF ICER (HEREINAFTER CALLED THE AO) U/S 144 OF THE INCOME TAX ACT,1961 (HEREINAFTER CALLED THE ACT). ITA 1027/MUM/2014 2 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE IN THE MEMO OF APPEAL FILED WITH THE INCOME TAX APPELLATE TRIBUNAL, MUMBA I (HEREINAFTER CALLED THE TRIBUNAL) READ AS UNDER:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFI RMING THAT DISALLOWANCE OF BUSINESS & PROFESSION OF RS.7,46,49 5/-, ELECTRICITY EXPENSES OF RS.L,04,044/-, CAR REPAIRS EXPENSES OF RS.L,72,630/-, REPAIRS & MAINTENANCE OF RS.2,89,550/-, SOCIETY MAI NTENANCE OF RS.L,03,608/- & TRAVELLING EXPENSES OF RS.77,799/-. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE IN LAW, TH E COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFI RMING THAT ASSESSEE HAS 4 PROPERTIES (BUNGLOW AT GOA, PUNE BUNGLOW, BUNG LOW NO.91 MHADA & LONAWALA BUNGLOW OF WHICH BOOK VALUE IS AT RS.2,40,00,000/- TREATED AS DEEMED LET OUT PROPERTY. 3. WITHOUT PREJUDICE THE ABOVE AND ON THE FACTS AND CIR CUMSTANCES OF THE CASE AND IN LAW THE CIT(A) HAS ERRED IN CONFI RMING THE ALV OF PROPERTY BE TAKEN @8.5% OF BOOK VALUE OF 4 PROPERTIES . 4. THE ORDERS OF THE LD CIT(A) AND THE LD AO ARE BAD IN LAW AND ON FACTS. 3. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED BEFORE US THAT HE DOES NOT WANT TO PRESS THE GROUND NO 1 TO THE EX TENT RELEVANT TO CLAIM OF THE ASSESSEE FOR DEDUCTION TOWARDS SOCIETY MAINTENA NCE CHARGES DISALLOWED TO THE TUNE OF RS. 1,03,608/- AND ALSO REPAIRS AND MAI NTENANCE EXPENSES DISALLOWED OF RS. 2,89,550/- , THE DISALLOWANCE WHI CH WAS CONFIRMED/SUSTAINED BY THE LEARNED CIT(A). ACCORDIN GLY, WE DISMISS THE SAID GROUND NO 1 TO THE EXTENT OF CLAIM OF THE ASSESSEE FOR DEDUCTION TOWARDS SOCIETY MAINTENANCE CHARGES TO THE TUNE OF RS. 1,03 ,608/- AND ALSO REPAIRS AND MAINTENANCE CHARGES OF RS. 2,89,550/- AS BEING NOT PRESSED BY THE ASSESSEE. 4. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS AN INDIVIDUAL AND DIRECTOR OF THE FILM. THE ASSESSEES CASE WAS SELE CTED FOR SCRUTINY AND NONE APPEARED DURING THE COURSE OF ASSESSMENT PROCEEDING S U/S 143(2)/142(1) OF ITA 1027/MUM/2014 3 THE ACT AND BEST JUDGMENT ASSESSMENT WAS FRAMED BY THE REVENUE U/S 144 OF THE ACT VIDE ASSESSMENT ORDER DATED 9 TH DECEMBER, 2011. IT WAS OBSERVED BY THE A.O. THAT IN THE IMMEDIATEL Y PRECEDING YEAR, THE ASSESSEE HAS PAID FOR VARIOUS EXPENSES FROM HIS COM PANY NAMELY WHITE WEATHER FILMS PVT. LTD. (WFFL) AND DEBITED THE SAME FROM HIS BOOKS OF ACCOUNTS TERMING THAT IT WAS ESSENTIAL TO PAY THE A CTORS AND TECHNICIANS ETC. . THE A.O. DELIBERATED IN THE PREVIOUS YEAR AS TO HOW SUCH EXPENSES COULD BE ALLOWED WHEN THE ASSESSEES MAIN INCOME IS FROM PRO FESSIONAL RECEIPTS FROM HIS COMPANY WFFL IN WHICH ASSESSEE IS THE DIRECTOR AND ON THIS ACCOUNT THE BUSINESS PROMOTION EXPENSES OF RS. 20,47,811/- WAS DISALLOWED BY THE AO IN THE ABSENCE OF ANY DETAILS. THE AO OBSERVED THAT THE ASSESSEE HAS MAINLY EARNED PROFESSIONAL RECEIPTS FROM HIS COMPANY WFFPL AND THIS YEAR ALSO THE EXPEN SES ON ACCOUNT OF ELECTRICITY EXPENSES TOTALED RS. 2,94,954/- WHICH W ERE CLAIMED BY THE ASSESSEE AS DEDUCTION FROM HIS PROFESSIONAL INCOME OUT OF WHICH 50% WORKS OUT TO RS. 1,47,477/- WHICH WAS DISALLOWED BY THE A O AND ADDED TO THE INCOME OF THE ASSESSEE KEEPING IN VIEW THAT THE PER SONAL USAGE ELEMENT CANNOT BE RULED OUT. SIMILARLY, THE AO OBSERVED THAT THE ASSESSEE HAS MA INLY EARNED PROFESSIONAL RECEIPTS FROM HIS COMPANY WFFPL AND CAR REPAIR CHAR GES TOTALED RS. 3,45,260/- WHICH WAS CLAIMED BY THE ASSESSEE AS DED UCTION FROM HIS PROFESSIONAL INCOME OUT OF WHICH 50% WORKS OUT TO R S. 1,72,630/- WHICH WAS DISALLOWED BY THE AO AND ADDED TO THE INCOME OF THE ASSESSEE KEEPING IN VIEW THAT PERSONAL USAGE ELEMENT CANNOT BE RULED OUT. SIMILARLY, THE AO OBSERVED THAT THE ASSESSEE HAS MA INLY EARNED PROFESSIONAL RECEIPTS FROM HIS COMPANY WFFPL AND TOTAL TRAVELLIN G EXPENSES OF RS. ITA 1027/MUM/2014 4 1,55,599/- WERE CLAIMED AS DEDUCTION FROM PROFESSIO NAL INCOME, 50% OF WHICH WORKS OUT TO RS. 77,799/- WHICH WAS DISALLOWE D BY THE AO AND ADDED TO THE INCOME OF THE ASSESSEE KEEPING IN VIEW THAT THE PERSONAL USAGE ELEMENT CANNOT BE RULED OUT. IT WAS ALSO OBSERVED BY THE AO FROM THE PERUSAL OF THE BALANCE SHEET THAT THE ASSESSEE IS OWNER OF THE FOLLOWING HOUSE PROPERTY:- 1. BUNGLOW AT GOA : RS. 1.40 CRORES 2. BUNGLOW AT WOODSTOCK : RS. 1.42 CRORES 3. BUNGLOW AT PUNE : RS. 0.38 CRORES 4. BUNGLOW AT 91 : RS. 0.50 CRORES 5. BUNGLOW AT LONAWALA : RS. 0.12 CRORES RS. 3.82 CRORES THE A.O. OBSERVED THAT THE ASSESSEE HAS NOT CREDITE D ANY INCOME FROM THE ABOVE BUNGALOWS AND AS PER SECTION 23 OF THE ACT TH E ASSESSEE IS LIABLE TO TAX ON THE DEEMED INCOME FROM THE VACANT PROPERTIES. T HE A.O. ESTIMATED THE FAIR/REASONABLE RENT OUT OF THESE PROPERTIES AT 1% INCOME PER MONTH ON THE COST OF THE PROPERTY , WHICH WORKS OUT TO RS. 45,84 ,000/- FOR THE WHOLE YEAR AGAINST WHICH THE AO ALLOWED THE DEDUCTION U/S 24 OF THE ACT AT THE RATE OF 30% OF THE ANNUAL LETTABLE VALUE AND THE TOTAL INCO ME FROM HOUSE PROPERTY WORKED OUT TO RS. 32,08,800/- AFTER ALLOWING DEDUCT ION U/S 24 OF THE ACT AND THE SAME WAS BROUGHT TO TAX BY THE AO VIDE ASSESSME NT ORDER DATED 09-12- 2011 PASSED U/S 144 OF THE ACT. 5.AGGRIEVED BY THE ASSESSMENT ORDER DATED 09-12-201 1 PASSED BY THE A.O. U/S 144 OF THE ACT, THE ASSESSEE CARRIED THE MATTER IN FIRST APPEAL BEFORE THE LD. CIT(A). ITA 1027/MUM/2014 5 6. BEFORE THE LD. CIT(A) , THE ASSESSEE SUBMITTED A DDITIONAL EVIDENCES AND PRAYED FOR ADMISSION OF THE ADDITIONAL EVIDENCES BE FORE THE LEARNED CIT(A). THE LEARNED CIT(A) FORWARDED THE ADDITIONAL EVIDENC ES TO THE AO FOR REMAND REPORT . THE AO IN REMAND REPORT OBSERVED THAT THE ASSESSEE HAS SUBMITTED THAT THE ASSESSEE BEING A FILM WRITER AND DIRECTOR AND KEEPI NG IN VIEW NATURE OF HIS PROFESSION WITH RESPECT TO CLAIM FOR DEDUCTION OF B USINESS PROMOTION EXPENSES , THE GIFTS ARE GIVEN TO THE PRODUCERS , D ISTRIBUTORS , ACTORS , WRITERS AND CINEMATOGRAPHS TO KEEP THEM IN GOOD HUMOR. THE AO OBSERVED THAT THE ASSESSEE HAS PAID RS.2,96,000/- FOR THE PURCHASE OF ROLEX WATCHES BUT HE COULD NOT ESTABLISH THE NEXUS OF THE SAME WITH HIS BUSINESS ACTIVITIES. IT WAS OBSERVED THAT OTHER MISCELLANEOUS EXPENDITURE OF RS .2,37,000/- WERE ALSO NOT ESTABLISHED AS BUSINESS EXPENDITURE BASED ON TH E SUPPORTINGS. IT WAS OBSERVED BY THE AO THAT OTHER VARIOUS EXPENDITURE F OR EXAMPLE KIRTI CARE HOSPITAL RS.74,272/- , HOSPITAL BILLS RS 14,311/- , MEDICINE RS 13,760/- , RAJDHANI THALI PALACE PRIVATE LIMITED RS.49,977/- , OLIVER BAR RS.10395/- , JUBEN WINES ABOUT RS.80,000/- , DEEPAK WINES SHOP R S 81,932/- WERE NOT ESTABLISHED BY THE ASSESSEE THAT THESE ARE BUSINESS EXPENDITURE AND NOT PERSONAL IN NATURE . THE COPY OF REMAND REPORT WAS MADE AVAILABLE TO THE ASSESSEE AND THE ASSESSEE SUBMITTED THAT THE PURCHA SE OF ROLEX WATCHES ARE FOR GIVING GIFTS AND THE EXPENSES FOR RAJDHANI THAL I PALACE PRIVATE LIMITED, OLIVE BAR AND LIQUOR BILLS ARE EXPENDITURE DURING M EETINGS. THE LEARNED CIT(A) REJECTED THE CONTENTIONS OF THE ASSESSEE AND DISALLOWED EXPENSES OF RS.2,96,000/- INCURRED FOR THE PURCHAS E OF ROLEX WATCHES AS THE ASSESSEE FAILED TO ESTABLISH NEXUS BETWEEN THE PEOP LE INVOLVED IN THREE MOVIES AND THE GIFT OF ROLEX WATCHES TO THEM . SIMILARLY T HE LEARNED CIT(A) DISALLOWED A SUM OF RS.1,02,343/- TOWARDS MEDICAL EXPENSES(KIR TI CARE HOSPITAL RS.74,272/- , HOSPITAL BILLS RS 14,311/- , MEDICINE RS 13,760/- ) INCURRED BY ITA 1027/MUM/2014 6 THE ASSESSEE AS THE VERY NATURE OF EXPENSES CANNOT BE FOR PROMOTION OF BUSINESS AND THE EXPENSES BEING PERSONAL IN NATURE , THE DISALLOWANCE WAS CONFIRMED BY LEARNED CIT(A) VIDE HIS APPELLATE ORDE RS DATED 16.12.2013 . THE LEARNED CIT(A) CONFIRMED THE DISALLOWANCE TO THE TU NE OF 50% OF EXPENSES TOWARDS RAJDHANI THALI PALACE PRIVATE LIMITED RS.49 ,977/- , OLIVER BAR RS.10395/- , JUBEN WINES ABOUT RS.80,000/- , DEEPAK WINES SHOP RS 81,932/- BEING ENTERTAINMENT EXPENSES, ON THE GROUN DS AS THE ASSESSEE IS IN ENTERTAINMENT INDUSTRY INCURRING OF SUCH EXPENDITUR E CANNOT BE RULED OUT BUT AT THE SAME TIME PERSONAL USAGE ELEMENT CANNOT BE R ULED OUT, VIDE APPELLATE ORDERS DATED 16.12.2013 . SIMILARLY, A SUM OF RS.2, 37,000/- WAS SHOWN AS MISCELLANEOUS EXPENDITURE WHICH THE ASSESSEE COULD NOT PROVE TO BE BUSINESS EXPENDITURE AND HENCE THE DISALLOWANCE WAS CONFIRME D BY THE LEARNED CIT(A). WHILE THE REST OF THE DISALLOWANCE APART FROM WHAT IS DISCUSSED ABOVE OUT OF THE BUSINESS PROMOTION EXPENSES OF RS.20,47,811/- AS MADE BY THE AO WAS DELETED BY THE LEARNED CIT(A) VIDE APPELLATE ORDER DATED 16.12.2013 PASSED BY LEARNED CIT(A). FOR THE OTHER DISALLOWANCE OF EXPENSES ON ACCOUNT O F ELECTRICITY EXPENSES, CAR REPAIR EXPENSES AND TRAVELLING EXPENSES, THE ASSES SEE FILED WRITTEN SUBMISSIONS AND COPIES OF LEDGER ACCOUNT WHICH WERE FORWARDED BY LEARNED CIT(A) TO THE A.O. FOR HIS REMAND REPORT. THE REMA ND REPORT WAS SUBMITTED BY THE A.O. , WHEREIN THE AO OBSERVED THAT THE ASSE SSEE PROVIDED DETAILS OF ELECTRICITY EXPENSES INCURRED ALONG WITH LEDGER OF ELECTRICITY EXPENSES AND THE BILLS FOR VARIOUS LOCATIONS. IT WAS OBSERVED BY THE A.O. FROM THE DETAILS AND LEDGERS THAT THE ASSESSEE HAS PROVIDED THE BILLS ON LY FOR RS. 1,90,910/- WHEREAS THE ASSESSEE CLAIMED THE ELECTRICITY EXPENS ES OF RS. 2,94,954/- AND APART FROM THIS, THESE BILLS PAYMENTS WERE MADE FOR THE ASSESSEES RESIDENTIAL HOUSE AND NOT FOR ANY OFFICE PREMISES. HENCE, 50% D ISALLOWANCE OF ELECTRICITY EXPENSES AS PROPOSED BY THE A.O. IN THE ASSESSMENT ORDER WAS CONSIDERED AS REASONABLE BY THE AO IN THE REMAND REPORT SUBMITTED TO LEARNED CIT(A). ITA 1027/MUM/2014 7 IT WAS OBSERVED BY THE AO IN REMAND REPORT THAT THE ASSESSEE ALSO PROVIDED THE DETAILS OF CAR REPAIRS ALONG WITH LEDGER. THE A SSESSEE HAS DISTRIBUTED THE TOTAL AMOUNT BETWEEN APARNA MOTORS RS. 3,28,551/-, JEFFSOM BATTERY RS.3200/- AND SHINE SERVICE RS.13509/-. NO OTHER DO CUMENTS OR SUPPORTING BILLS WERE PROVIDED BY THE ASSESSEE EVEN IN REMAND REPORT PROCEEDINGS, FROM WHICH IT IS CLEAR THAT THE ASSESSEE COULD NOT ESTAB LISH THAT THESE ARE EXPENDITURE FOR BUSINESS PURPOSE AND THE AO IN REM AND REPORT PROCEEDINGS PROPOSED TO DISALLOW THE ENTIRE EXPENDITURE IN THE REMAND REPORT SUBMITTED TO LEARNED CIT(A). WITH RESPECT TO THE TRAVELLING EXPE NSES, NO DETAILS WERE PROVIDED BY THE ASSESSEE BEFORE THE AO IN REMAND RE PORT PROCEEDINGS, HENCE, THIS DISALLOWANCE SHOULD BE SUSTAINED BEING REASONA BLE WAS THE RECOMMENDATION OF THE AO IN THE REMAND REPORT SUBMI TTED BEFORE THE LEARNED CIT(A). THE COPY OF THE REMAND REPORT WAS MADE AVAILABLE TO THE ASSESSEE. THE ASSESSEE DID NOT GIVE ANY SUBMISSION WITH RESPECT T O THE ELECTRICITY EXPENSES. WITH RESPECT TO THE CAR REPAIR CHARGES, THE ASSESSE E SUBMITTED THAT THE BILLS WERE SUBMITTED BEFORE THE LD. CIT(A) WHICH WERE NOT SUBMITTED BEFORE THE A.O. WITH RESPECT TO THE TRAVELLING EXPENSES, NO RECEIPT S WERE SUBMITTED BEFORE THE LEARNED CIT(A). THE LD. CIT(A) CONSIDERED THE SUBMISSIONS OF THE AS SESSEE. WITH RESPECT TO THE ELECTRICITY CHARGES, THE LD. CIT(A) HELD THAT T HE A.O. STATED IN THE REMAND REPORT THAT THE 50% DISALLOWANCE IS REASONABLE. AS PER THE LD. CIT(A) SINCE THE ASSESSEE PRODUCED BILLS FOR ONLY RS. 1,90,910/- AS AGAINST THE CLAIM OF RS.2,94,954/- AND ALSO THE ASSESSEE DID NOT OFFER A NY COMMENTS AGAINST THE REMAND REPORT, THEREFORE, A.O. WAS DIRECTED TO ALLO W THE ELECTRICITY EXPENSES TO THE EXTENT OF THE BILLS PRODUCED OF RS. 1,90,910/- AND THE DISALLOWANCE OF BALANCE CLAIM OF RS.1,04,044/- WAS CONFIRMED BY THE LEARNED CIT(A) AS NO ITA 1027/MUM/2014 8 PROOF WAS SUBMITTED. WITH RESPECT TO THE CAR REPAIR CHARGES, THE ASSESSEE DID NOT PRODUCE ANY EVIDENCE BEFORE THE A.O. DURING ASS ESSMENT PROCEEDINGS, HOWEVER THE BILLS FOR INCURRING SUCH EXPENDITURE WE RE FURNISHED BY THE ASSESSEE DURING THE APPELLATE PROCEEDINGS. KEEPING IN VIEW THAT THE PERSONAL USE CANNOT BE RULED OUT, THE LD. CIT(A) HELD THAT T HE DISALLOWANCE MADE BY THE A.O. OF RS. 1,72,630/- BEING 50% OUT OF THE TOTAL E XPENSES CLAIMED OF RS.3,45,260/- WAS CONSIDERED REASONABLE AND THE SAM E WAS CONFIRMED BY THE LEARNED CIT(A) VIDE APPELLATE ORDERS DATED 16.12.20 13 PASSED BY THE LEARNED CIT(A). WITH RESPECT TO THE TRAVELLING EXPENSES, NO DETAILS WERE PROVIDED BY THE ASSESSEE EVEN DURING APPELLATE PROCEEDINGS, HENCE T HE ADDITION MADE OF RS. 77,799/- BEING 50% OF THE TOTAL CLAIM OF RS. 1,55,5 99/- WAS CONFIRMED BY THE LEARNED CIT(A) VIDE APPELLATE ORDER DATED 16.12.201 3 PASSED BY THE LEARNED CIT(A). WITH RESPECT TO THE OTHER ADDITION ON ACCOUNT OF IN COME FROM HOUSE PROPERTY, THE LD. CIT(A) OBSERVED THAT THE ASSESSEE IS OWNER OF THE FOLLOWING PROPERTIES:- 1. BUNGALOW AT GOA : RS. 1.40 CRORES 2. BUNGALOW AT WOODSTOCK : RS. 1.42 CRORES 3. BUNGALOW AT PUNE : RS. 0.38 CRORES 4. BUNGALOW AT 91 : RS. 0.50 CRORES 5. BUNGALOW AT LONAWALA : RS. 0.12 CRORES RS. 3.82 CRORES BEFORE THE LD. CIT(A) , THE ASSESSEE FILED WRITTEN SUBMISSIONS WHEREIN IT WAS SUBMITTED THAT IN THE PRECEDING ASSESSMENT YEAR, TH E AO HAS BROUGHT TO TAX ACTUAL RENT WITH RESPECT TO PUNE OFFICE, GOA PROPER TY AND MUMBAI OFFICE AND NO NOTIONAL RENT WAS BROUGHT TO TAX . IT WAS SUBMIT TED THAT VILLA WOODSTOCK, ITA 1027/MUM/2014 9 ANDHERI, MUMBAI IS SELF OCCUPIED RESIDENTIAL HOUSE AND ANNUAL VALUE SHALL BE NIL AS PER PROVISIONS OF THE ACT . IT WAS FURTHER S UBMITTED THAT BUNGALOW AT 91, SVP, MHADA WAS USED AS OFFICE BY THE ASSESSEE A ND THE ALV SHALL BE NIL. FOR BUNGALOW AT LONAVALA IT WAS SUBMITTED THAT THE SAME WAS USED FOR STORY- SITTINGS AND IN THE PRECEDING YEAR, THE AO ACCEPTED THE CONTENTION OF THE ASSESSEE. IT WAS ALSO SUBMITTED THAT THE PROPERTIES AT GOA AND PUNE HAD BEEN USED FOR STORY-SITTING AND HENCE ALV SHALL BE NIL. THE ASSESSEE SUBMITTED THAT KEEPING IN VIEW HIS PROFESSION OF STORY WRITING AND FILM DIRECTION WHICH REQUIRES CREATIVE THINKING AND THE ASSESSEE HAS MUL TIPLE TEAMS WORKING FOR DIFFERENT PROJECTS AND HENCE THESE PREMISES ARE USE D FOR CREATIVE WORK IN SERENE ENVIRONMENT AT DIFFERENT LOCATIONS SUCH AS S TORY WRITING AND INSTEAD OF GOING TO HOTELS WHICH ARE VERY EXPENSIVE , OWNED PR EMISES ARE USED AND HENCE IT WAS PRAYED THAT NO ADDITIONS BE MADE ON DE EMED ALV OF THESE PROPERTIES. WITHOUT PREJUDICE , IT WAS SUBMITTED TH AT THE RENTAL OF RESIDENTIAL PROPERTIES ARE AROUND 3-4% ANNUALLY AND THE ADDITIO NS MADE @12% PER ANNUM ON ACCOUNT OF ALV IS VERY HIGH. IT WAS ALSO S UBMITTED THAT NO ENQUIRIES WERE MADE BY THE AO BEFORE MAKING ADDITIO NS. THE SUBMISSIONS WERE FORWARDED TO THE A.O. FOR HIS REMAND REPORT AN D THE REMAND REPORT WAS SUBMITTED BY THE A.O. WHEREIN THE AO SUBMITTED THAT IN THE PRECEDING YEAR THE ASSESSEE RECEIVED RENT FROM PUNE OFFICE, GOA PR OPERTY AND MUMBAI OFFICE AMOUNTING TO RS 7 LACS , WHILE IN THIS YEAR , NO RE NT WAS RECEIVED AND THE CLAIM OF THE ASSESSEE IS NOT GENUINE. THE REMAND REPORT WAS MADE AVAILABLE TO THE ASSESSE E FOR HIS COMMENTS WHEREBY THE ASSESSEE SUBMITTED HIS COMMENTS THAT WO ODSTOCK BUNGALOW WAS USED FOR RESIDENTIAL HOUSE, WHILE IT WAS ALSO SUBMI TTED THAT WITH RESPECT TO THE PUNE, GOA AND BOMBAY OFFICES, EARLIER THE ASSES SEE HAS ARRANGEMENT WITH WFFL FOR PAYMENT OF RENT BUT WITH EFFECT FROM 01-04 -2008 , THE ARRANGEMENT WAS CHANGED AND NOW WFFL SHALL NOT PAY ANY RENT FOR THE USE OF THE SAID PREMISES OWNED BY THE ASSESSEE FOR STORY SITTING ET C. AND THE REMUNERATION FOR ITA 1027/MUM/2014 10 THE PROJECTS FROM WFFL SHALL INCLUDE THE VALUE OF U SE OF THE PREMISES FOR STORY SITTING ETC AND THE SAID WFFL SHALL PAY FOR CREATIV E WORK ONLY , WHICH IS A COMMERCIAL ARRANGEMENT BETWEEN THE ASSESSEE AND WFF L.WITH RESPECT TO BUNGALOW NO. 91 IT WAS SUBMITTED THAT IN THE ASSESS MENT YEAR 2008-09, THERE WAS A SURVEY CONDUCTED AGAINST THE ASSESSEE IN THE SAME PREMISES AND HENCE THERE IS NO QUESTION THAT THE SAID PROPERTY WAS NOT USED FOR THE PURPOSE OF OFFICE OF THE ASSESSEE. THE LD. CIT(A) AFTER CONSIDERING THE MATERIAL ON RE CORD DIRECTED THE A.O. TO VERIFY AND HOLD ONE OF THE FIVE PROPERTIES OWNED BY THE ASSESSEE AS SELF OCCUPIED PROPERTY OF WHICH ANNUAL VALUE SHALL BE TA KEN TO BE NIL AS PER THE PROVISIONS OF THE ACT, AND WHILE FOR THE REST OF FO UR PROPERTIES OWNED BY THE ASSESSEE THE DIRECTIONS WERE ISSUED TO ADOPT 8.5% OF THE TOTAL VALUE OF THE PROPERTIES AS THE ANNUAL VALUE AND TO ALLOW THE DED UCTION U/S 23 AND 24 OF THE ACT, VIDE APPELLATE ORDER DATED 16.12.2013 PASS ED BY LEARNED CIT(A). 7. AGGRIEVED BY THE APPELLATE ORDER DATED 16.12.201 3 PASSED BY THE LD. CIT(A), THE ASSESSEE FILED SECOND APPEAL BEFORE THE TRIBUNA L. 8. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT NO AD-HOC DISALLOWANCE CAN BE MADE WITH RESPECT TO THE EXPENSES. IT WAS SU BMITTED THAT ADHOC DISALLOWANCE HAS BEEN MADE WHICH IS NOT PERMISSIBLE . WITH RESPECT TO THE INCOME FROM HOUSE PROPERTY,IT WAS SUBMITTED THAT TH E REVENUE AUTHORITIES HAVE TREATED DEEMED INCOME FROM THESE PROPERTIES A S ALV ALTHOUGH ONE PROPERTY WOODSTOCK VILLA , ANDHERI, MUMBAI WAS SELF OCCUPIED PROPERTY USED FOR RESIDENTIAL PURPOSES , WHILE OTHER PROPERTIES W ERE USED FOR OFFICIAL PURPOSES SUCH AS OFFICE OR FOR CREATIVE WORK SUCH A S STORY WRITING ETC.. IT WAS SUBMITTED THAT NO RENT WAS REALIZED FROM THESE PROP ERTIES DURING THE YEAR AS AGAINST IN PRECEDING YEAR DUE TO THE FACT THAT THE ARRANGEMENT WITH WWFL WAS CHANGED W.E.F. 01-04-2008 AND NOW THE CREATIVE WORK FEE PAID BY WFFL ITA 1027/MUM/2014 11 SHALL INCLUDE RENTAL FOR THESE PROPERTIES WHICH IS EMBEDDED IN THE PROFESSIONAL FEE. THERE WERE FIVE PROPERTIES HELD B Y THE ASSESSEE IN MUMBAI, GOA,LONAVALA AND PUNE. THE LD. COUNSEL SUBMITTED TH AT THE ASSESSEE IS A FILM DIRECTOR AND FOR DOING CREATIVE WORK, THESE FOUR PR OPERTIES HAVE BEEN USED BY THE ASSESSEE FOR STORY WRITING AND RELATED CREATIVE WORK. THE LD. COUNSEL SUBMITTED THAT THE BUNGALOW AT ANDHERI,MUMBAI IS US ED AS SELF OCCUPIED RESIDENCE OF THE ASSESSEE, HENCE, THE ANNUAL VALUE OF THIS PROPERTY SHOULD BE TREATED AS NIL. WITH RESPECT TO THE OTHER FOUR PRO PERTIES, THE ANNUAL VALUE SHOULD BE TAKEN AT NIL AS THE SAME WERE USED FOR BU SINESS PURPOSES BY THE ASSESSEE. THE ANNUAL VALUE SHOULD BE TREATED AS PE R THE SCHEME OF SECTION 22 & 23 OF THE ACT. THE LD. COUNSEL SUBMITTED THAT FOR EVERY FILM, THERE IS AN ELEMENT OF CONTINUED DEEP THINKING AND WORKING ON C ONCEPTS, VISUALIZATIONS, STORY, SCRIPTING AND DIALOGUES ETC. FOR A NUMBER OF DAYS CONTINUOUSLY WHICH CANNOT BE DONE IN EITHER HOME OR ONE'S NORMAL OFFIC E BECAUSE OF DISTURBANCES AT HOME/OFFICE. HENCE, THE CREATIVE PERSONS AND THE IR RESPECTIVE TEAMS GO OUT OF MUMBAI, STAY AT QUIET HOTELS AND DO THE BASIC CR EATIVE WORK IN SERENE ENVIRONMENT UNDISTURBED. THE SAME IS THE TREND IN H OLLYWOOD I.E. THEY GO OUT OF NORMAL PLACES OF THEIR STAY AND OFFICES TO DO CR EATIVE WORK. THE ASSESSEE WORKS ON 8-10 SCRIPTS AT A TIME AND HENCE HOTELS PR OVE VERY EXPENSIVE AND PLUS THERE IS NO PRIVACY. ACCORDINGLY FOR HIS OWN C REATIVE THINKING, THE ASSESSEE GOES TO GOA AND WORKS IN SOLITUDE. HOWEVER WHENEVER THERE ARE TEAM OF WRITERS THEN IN THAT CASE EITHER THE TEAM OR HE ALONG WITH THE TEAMS GOES TO THESE LOCATIONS. THE LD. COUNSEL SUBMITTED THAT THE A.O. ERRED IN ADDING THE ANNUAL VALUE BASED UPON THE COST OF THE PROPERTY @1 2% WHICH WAS THEN CONFIRMED /SUSTAINED TO THE TUNE OF 8.5% OF THE VAL UE OF PROPERTY AS REASONABLE EXPECTED MARKET RENT BY LEARNED CIT(A). THE LD. COUNSEL SUBMITTED THAT THE A.O. HAS ACCEPTED THE ACTUAL REN T RECEIVED IN THE EARLIER YEARS AND IN THIS YEAR THE ADDITIONS HAVE BEEN MADE ALTHOUGH THERE IS NO RECEIPT OF RENT DURING THE INSTANT YEAR UNDER APPEA L. ALL THE PROPERTIES ARE SELF OCCUPIED EITHER FOR RESIDENTIAL PURPOSES OR FO R BUSINESS PURPOSES AND ITA 1027/MUM/2014 12 HENCE ALV SHALL BE NIL FOR ALL THE PROPERTIES WAS T HE SUBMISSIONS OF LEARNED COUNSEL FOR THE ASSESSEE BEFORE THE TRIBUNAL. HE S UBMITTED THAT THE AUTHORITIES BELOW HAVE NOT EXAMINED THE CLAIM OF T HE ASSESSEE IN PROPER PERSPECTIVE. WITHOUT HAVING VERIFIED THAT THE PROP ERTY WAS USED FOR THE PURPOSE OF BUSINESS OR NOT, THE A.O. PROCEEDED TO M ADE THE ADDITIONS. THE ASSESSEE RELIED ON THE DECISION OF THE TRIBUNAL IN THE CASE OF MR. VISHWANATH ACHARAYA V. ACIT, WHICH WAS AUTHORED BY ONE OF US N AMELY ACCOUNTANT MEMBER, IN ITA NO. 7976/MUM/2011 FOR THE ASSESSMENT YEAR 2007-08 VIDE ORDERS DATED 16 TH DECEMBER, 2015 AND SUBMITTED THAT THE ASSESSEES C ASE IS SIMILAR TO THE CASE OF MR. VISHWANATH ACHARAYA (SU PRA) AND THE SAME DIRECTIONS MAY BE GIVEN IN THIS CASE ALSO. THE ASS ESSEE ALSO RELIED ON THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE O F CIT V. TIP TOP TYPOGRAPHY (2014) 48 TAXMANN.COM 191 (BOM). THE LD. COUNSEL SUBMITTED THAT THE MATTER MAY BE SET ASIDE TO THE FILE OF THE A.O. AND THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT V. TIP TOP TYPOGRAPHY (2014) 48 TAXMANN.COM 191(BOM.) SHOULD BE FOLLOWED. 9. THE LD. D.R., ON THE OTHER HAND, RELIED ON THE O RDER OF THE LD. CIT(A). 10. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND AL SO PERUSED THE MATERIAL AVAILABLE ON RECORD INCLUDING THE CASE LAWS RELIED UPON. WE HAVE OBSERVED THAT THE ASSESSEE IS A FILM DIRECTOR WHO IS ALSO UN DERTAKING STORY WRITING WORK AND IS IN RECEIPT OF PROFESSIONAL FEES. WE HAVE OBSERVED THAT THE ASSESSEE HAS INCURRED CER TAIN EXPENSES , THE DEDUCTION OF WHICH FROM THE BUSINESS INCOME EARNED BY THE ASSESSEE HAVE NOT BEEN ALLOWED BY THE AUTHORITIES BELOW. WITH RE SPECT TO DISALLOWANCE OF BUSINESS PROMOTION EXPENSES, DETAILED FINDINGS HAVE BEEN GIVEN BY THE AUTHORITIES BELOW FOR NOT ACCEPTING THE CLAIM OF TH E ASSESSEE WITH RESPECT TO ITA 1027/MUM/2014 13 CERTAIN COMPONENTS OF THE BUSINESS PROMOTION EXPENS ES. WE FIND THAT LEARNED CIT(A) HAS GIVEN DETAILED REASONING FOR UPHOLDING / SUSTAINING THE DISALLOWANCE OF GIFTING OF ROLEX WATCHES OF RS.2,96 ,000/- WHEREIN NO DETAILS WERE SUBMITTED BY THE ASSESSSEE ABOUT THE PERSONS T O WHOM THE SAME WERE GIFTED AND ITS NEXUS WITH BUSINESS OF THE ASSESSEE TO HAVE BEEN INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSES OF BUSINESS COULD NOT BE ESTABLISHED BY THE ASSESSEE, SIMILARLY FOR MISC EXPENDITURE OF RS.2,37,000/- NO DETAILS WERE SUBMITTED BY THE ASSESSEE AND ITS NEXUS BEING WHOLLY AND EXCLUSIVELY FOR THE PURPOSES OF BUSINESS COULD NOT BE ESTABLISHED B Y THE ASSESSEE. WE CONCUR WITH THE FINDING OF LEARNED CIT(A) AS WE DONOT FIND ANY INFIRMITY IN THE ORDERS OF LEARNED CIT(A) WHICH WE UPHOLD AS NO NEW EVIDENC E/MATERIAL HAS BEEN BROUGHT ON RECORD BY THE ASSESSEE BEFORE US TO SUBS TANTIATE AND JUSTIFY THE CLAIM OF THE SAID EXPENSES AS BUSINESS EXPENSES BY THE ASSESSEE, AND WE CONFIRM THE DISALLOWANCE OF EXPENSES TO THE TUNE OF RS.2,96,000/- TOWARDS PURCHASE OF ROLEX WATCHES AND ALSO FOR MISC EXPENDI TURE OF RS.2,37,000/- WHICH STOOD DISALLOWED BY US ALSO KEEPING IN VIEW F ACTS AND CIRCUMSTANCES OF THE CASE. WE ORDER ACCORDINGLY. WITH RESPECT TO MEDICAL EXPENSES OF RS.1,02,343/-, THE ASSESSEE DID NOT SUBMIT ANY DETAILS WITH RESPECT OF INCURRING OF THE SAID MEDICAL EXPENSES WHOLLY AND EXCLUSIVELY FOR THE PURPOSES OF BUSINESS AND THE DISALLOWANCE STOOD CONFIRMED BY US ALSO AS WE DONOT FIND ANY INF IRMITY IN THE ORDERS OF LEARNED CIT(A) AND NO NEW EVIDENCE/MATERIAL HAS BEE N BROUGHT ON RECORD BY THE ASSESSEE BEFORE US TO SUBSTANTIATE AND JUSTIFY THE CLAIM OF THE SAID EXPENSES AS BUSINESS EXPENSES BY THE ASSESSEE . WITH RESPECT TO THE ENTERTAINMENT EXPENSES OF RS.22 2304/-, WE HAVE OBSERVED THAT THE AUTHORITIES BELOW HAVE DISALLOWED 50% OF T HE SAID EXPENSES ON THE GROUNDS THAT PERSONAL USAGE ELEMENT CANNOT BE RULED OUT , KEEPING IN VIEW THAT THE SAME WAS AN AD-HOC DISALLOWANCE WE GIVE RE LIEF TO THE ASSESSEE BY ITA 1027/MUM/2014 14 UPHOLDING / CONFIRMING DISALLOWANCE TO THE TUNE OF 25% OF THE TOTAL EXPENDITURE TOWARDS ENTERTAINMENT EXPENSES OF RS.22 2304/- WHICH IN OUR CONSIDERED VIEW IS REASONABLE DISALLOWANCE KEEPING IN VIEW FACTS AND CIRCUMSTANCES OF THE CASE AND BALANCE 25% OF THE EN TERTAINMENT EXPENDITURE OF RS.222304 STOOD DISALLOWED AS IN OUR CONSIDERED VIEW DISALLOWANCE OF 50% OF THE ENTERTAINMENT EXPENSES IS EXCESSIVE. WE ORDE R ACCORDINGLY. WITH RESPECT TO THE ELECTRICITY EXPENSES, THE ASSES SEE HAS PRODUCED BILLS FOR ONLY RS. 1,90,910/- AS AGAINST THE CLAIM OF RS.2,94 ,954/- AND THE LD. CIT(A) ALLOWED THE ELECTRICITY EXPENSES TO THE TUNE OF RS. 1,90,910/- AND CONFIRMED THE DISALLOWANCE OF THE BALANCE AMOUNT OF RS.1,04,0 44/- . WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT(A) WHICH WE AFFIRM AND UPHOLD. WE ORDER ACCORDINGLY. WITH RESPECT TO THE CAR REPAIR CHARGES, WE HAVE OBS ERVED THAT THE ASSESSEE DID NOT PRODUCE ANY EVIDENCE BEFORE THE A.O. DURING ASS ESSMENT PROCEEDINGS, HOWEVER THE BILLS FOR INCURRING SUCH EXPENDITURE WE RE FURNISHED BY THE ASSESSEE DURING APPELLATE PROCEEDINGS BEFORE LEARNE D CIT(A). KEEPING IN VIEW THAT THE PERSONAL USAGE CANNOT BE RULED OUT, THE LD . CIT(A) UPHELD DISALLOWANCE OF 50% OF THE CAR REPAIR CHARGES WHERE BY RS. 1,72,630/- STOOD DISALLOWED . WE HAVE OBSERVED THAT THE ASSESSEE IS AN INDIVIDUAL AND ENGAGED IN BUSINESS AS FILM DIRECTOR AND ALSO STORY WRITING . THE ASSESSEE HAS NOT PRODUCED ANY LOG BOOK OF THE CAR IN RELATION WITH T HE BUSINESS ACTIVITIES TO SUBSTANTIATE USAGE OF CAR FOR BUSINESS PURPOSES . PERSONAL USAGE ELEMENT OF THE CAR IN-FACT CANNOT BE RULED OUT. HOWEVER, KEEP ING IN VIEW THE OVERALL FACTS AND CIRCUMSTANCES OF THE CASE, THE DISALLOWANCE IS REDUCED TO 25% OF THE TOTAL EXPENSES TOWARDS CAR REPAIRS INCURRED BY THE ASSESS EE VIS--VIS DISALLOWANCE TO THE TUNE OF 50% OF CAR REPAIR CHARGES UPHELD BY THE LEARNED CIT(A), WHICH IN OUR CONSIDERED VIEW IS A REASONABLE DISALLOWANCE KEEPING IN VIEW FACTS AND CIRCUMSTANCES OF THE CASE.WE ORDER ACCORDINGLY. ITA 1027/MUM/2014 15 WITH RESPECT TO THE TRAVELLING EXPENSES, NO DETAILS WERE PROVIDED BY THE ASSESSEE BEFORE THE AUTHORITIES BELOW AND THE ADDIT ION MADE OF RS. 77,799/- BEING 50% OF THE TOTAL CLAIM OF RS. 1,55,599/- BY T HE A.O. WAS CONFIRMED BY THE LD. CIT(A). IN OUR CONSIDERED VIEW, KEEPING IN VIEW FACTS AND CIRCUMSTANCES OF THE CASE , WE DONOT FIND ANY INFIR MITY IN THE ORDERS OF THE LEARNED CIT(A) WHICH IS QUITE JUSTIFIED AND REASO NABLE WHICH WE UPHOLD/SUSTAIN .WE ORDER ACCORDINGLY. WITH RESPECT TO THE ADDITION ON ACCOUNT OF INCOME F ROM HOUSE PROPERTY, WE HAVE OBSERVED THAT THE ASSESSEE OWNS FIVE PROPERTIE S SPREAD OVER MUMBAI, PUNE & GOA. THERE WAS NO RECEIPT OF RENT VIS--VIS PRECEDING ASSESSMENT YEAR WHEREIN THERE WAS ARRANGEMENT WITH WFFL WHICH STOOD CHANGED W.E.F. 01-04- 2008 AND IT IS THE CONTENTION OF THE ASSESSEE THAT NOW RENTAL INCOME IS EMBEDDED IN THE PROFESSIONAL RECEIPT OF WHICH NO EV IDENCE TO SUBSTANTIATE THE CONTENTION IS BROUGHT ON RECORD BY THE ASSESSEE EXC EPT MAKING AN BALD STATEMENT NOR ANY EVIDENCE TO SUBSTANTIATE BUSINESS USAGE OF FOUR PREMISES AS CONTENDED BY THE ASSESSEE HAS BEEN BROUGHT ON RE CORD . THE ASSESSEE CLAIMED THAT ONE PROPERTY AT WOODSTOCK VILLA, ANDHE RI, MUMBAI WAS A SELF OCCUPIED RESIDENTIAL PROPERTY WHILE THE REST OF FOU R PROPERTIES WERE USED FOR BUSINESS PURPOSES . WE FIND THAT THE AO HAS BROUGHT TO TAX INCOME FROM HOUSE PROPERTY @ 12% OF THE COST OF THE PROPERTY OF ALL THE FIVE PROPERTIES , WHICH WAS SUSTAINED BY THE LEARNED CIT(A) TO THE T UNE OF 8.5% OF THE VALUE OF THE PROPERTY WITH RESPECT TO FOUR PROPERTIES AND TH E LEARNED CIT(A) ALLOWED RELIEF FOR ONE PROPERTY WHICH IS BEING USED BY THE ASSESSEE AS SELF OCCUPIED RESIDENTIAL PROPERTY FOR WHICH RELEVANT DIRECTIONS WERE GIVEN TO THE AO TO IDENTIFY AND DEEM ALV AS NIL FOR THE SAID RESIDENTI AL PROPERTY . THE AO DID NOT MADE ANY ENQUIRY TO IDENTIFY AND ESTIMATE PREVA ILING MARKET RENTAL OF THE PROPERTIES IN THE RELEVANT PERIOD AND THE ASSESSEE ON HIS PART HAS ALSO NOT BROUGHT ON RECORD ANY MATERIAL TO PROVE THE BUSINES S USAGE OF FOUR PROPERTIES ITA 1027/MUM/2014 16 CONTENDED TO BE USED FOR BUSINESS PURPOSES EXCEPT M AKING BALD STATEMENT. IN OUR CONSIDERED VIEW, THE ADDITIONS CANNOT BE MADE B ASED UPON THE NOTIONAL RENT BASED ON THE VALUE OF THE PROPERTIES HOWEVER A LV OF THE PROPERTIES IS TO BE BROUGHT TO TAX AS PER THE SCHEME OF THE ACT . TH E A.O. HAS NOT CONDUCTED ANY ENQUIRY WITH RESPECT TO THESE PROPERTIES TO COM PUTE INCOME FROM HOUSE PROPERTIES BEING ALV IN ACCORDANCE WITH SECTION 22 & 23 OF THE ACT AND THE PRINCIPLES LAID DOWN BY HONBLE BOMBAY HIGH COURT I N THE CASE OF TIP TOP TYPOGRAPHY(SUPRA) . THE ASSESSEE ON HIS PART HAS A LSO NOT BROUGHT ON RECORD ANY COGENT MATERIAL / EVIDENCES TO SUBSTANTIATE ITS SUBMISSIONS ABOUT USAGE OF THE PROPERTIES FOR BUSINESS PURPOSES EXCEPT FOR MAKING A STATEMENT IN THIS REGARD. THE FACTS IN THIS CASE ARE SIMILAR TO THE F ACTS IN THE CASE OF VISHWANATH ACHARAYA V. ACIT IN ITA NO 7976/MUM/2011 VIDE ORDERS DATED 16-12-2015 WHICH WAS AUTHORED BY ONE OF US(ACCOUNTA NT MEMBER). KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE CASE , W E ARE INCLINED TO SET ASIDE AND RESTORE THE MATTER BACK TO THE FILE OF THE A.O. WITH A DIRECTION TO DECIDE THE ISSUE DE NOVO IN ACCORDANCE WITH THE PROVISIONS OF SECTION 22 AND 23 OF THE ACT AND THE PRINCIPLES LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF TIP TOP TYPOGRAPHY (SUPRA). NEEDLESS TO SAY THAT THE A.O. SHALL AFFORD PROPER AND SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN ACCORDANCE WITH THE PRINCIPLES OF NATURAL JUSTICE I N ACCORDANCE WITH LAW. THE ASSESSEE WILL BE ALLOWED TO SUBMIT RELEVANT EVIDENC ES AND EXPLANATIONS IN HIS DEFENSE WHICH WILL BE ADMITTED BY THE AO BEFORE ADJ UDICATING THE ISSUE. THE ASSESSEE IS DIRECTED TO CO-OPERATE WITH THE REVENUE IN SET ASIDE PROCEEDINGS. WE ORDER ACCORDINGLY. 11. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IN ITA NO. 1027/MUM/2014 FOR THE ASSESSMENT YEAR 2009-10 IS PARTLY ALLOWED A S INDICATED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 6 TH OCTOBER, 2016. ITA 1027/MUM/2014 17 # $% &' 06-10-2016 ( ) SD/- SD/- (C.N. PRASAD) (RAMIT KOCHAR) JUDICIAL MEMBER ACCOUNTANT MEMBER $ MUMBAI ; & DATED 06-10-2016 [ .9../ R.K. R.K. R.K. R.K. , EX. SR. PS !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. : ( ) / THE CIT(A)- CONCERNED, MUMBAI 4. : / CIT- CONCERNED, MUMBAI 5. =>( 99?@ , ?@ , $ / DR, ITAT, MUMBAI E BENCH 6. (BC D / GUARD FILE. / BY ORDER, = 9 //TRUE COPY// / ( DY./ASSTT. REGISTRAR) , $ / ITAT, MUMBAI