Bharat Rice & Oil Mills, Hyd, Hyderabad V. ITO, Ward-8(3), Hyd, Hyderabad

ITA 1039/HYD/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 98615 (ITAT-HYDERABAD)
• Duration Of Justice: 2 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2015
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 11-08-2015
• Court: TRIBUNAL
• Department Lawyers: M SITARAM
• Assessee Lawyers: K L RATHI
• Keywords: Depreciation
• Section: 37(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A (SMC), HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER I.T.A. NO. 1039/HYD/2015 ASSESSMENT YEAR: 2008-09 M/S. BHARAT RICE & OIL MILLS, HYDERABAD [PAN: AADFB2444G] VS INCOME TAX OFFICE R, WARD-8(3), HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI K.L. RATHI , AR FOR REVENUE : SHRI M. SITARAM, DR DATE OF HEARING : 09 - 1 0 - 201 5 DATE OF PRONOUNCEMENT : 21 - 1 0 - 2015 O R D E R THIS IS AN ASSESSEES APPEAL AGAINST THE ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS)-2, HYDERABAD D ATED 20-05-2015. ASSESSEE HAS RAISED FIVE GROUNDS, OUT OF WHICH GROUND NO. 4 & 5 DOES NOT REQUIRE ANY ADJUDICATION. 2. WE HAVE HEARD LD. COUNSEL AND LD. DR AND PERUSED THE PAPER BOOK PLACED ON RECORD CONTAINING PAGES 16. G ROUND NOS. 1 & 2 PERTAINS TO THE ISSUE OF DISALLOWANCE OF ELECTR ICITY CHARGES OF RS. 97,882/- PAID RESPECT OF A HOUSE BELONGING TO A PARTNER. ASSESSING OFFICER (AO) DISALLOWED THE AMOUNT AS PER SONAL IN NATURE AND NOT RELATED TO THE BUSINESS OF ASSESSEE. IT WA S THE SUBMISSION OF ASSESSEE THAT THE BUSINESS PREMISES WAS USED FOR THE PURPOSE OF I.T.A. NO. 1039/HYD/2015 M/S. BHARAT RICE & OIL MILLS :- 2 -: BUSINESS AND ALL THE DETAILS WERE PLACED BEFORE THE AO AND CIT(A). LD. CIT(A) DISMISSED THE GROUNDS BY STATING VERY BR IEFLY AS UNDER: 6.1 THE ASSESSMENT ORDER WRITTEN SUBMISSIONS FILED BY THE APPELLANT, FACTS, ISSUES AND CIRCUMSTANCES OF T HE CASE WAS PERUSED. CONSIDERING THE TOTALITY OF FACTS, ISSUES AND CIRCUMSTANCES OF THE CASE AND THE SUBMISSIONS OF TH E APPELLANT, GROUND NO. 3, 4 5 AND 6 ARE DISMISSED. 3. WE ARE UNABLE TO UNDERSTAND ON WHAT BASIS THE LD . CIT(A) DISMISSED AS IT DOES NOT CONTAIN ANY ANALYSIS OF TH E ISSUE MADE OUT BY THE AO OR MADE OUT BY ASSESSEE. BEFORE US, LD. COUNSEL REFERRING TO THE ORDERS SUBMITTED THAT THEIR CONTEN TIONS PERTAIN TO THE USAGE OF PARTNERS HOUSE FOR THE PURPOSE OF BUS INESS AND THE EXPENDITURE WAS CLAIMED IN LIEU OF RENT WHICH COULD BE PAID. IT WAS THE SUBMISSION THAT THEY USED THE PREMISES FOR PARK ING THE BUSINESS VEHICLES AND EXPENDITURE IS ALLOWABLE U/S 37(1) OF THE ACT. 4. I HAVE PERUSED THE CONTENTIONS AND SEEN THE ORDE R OF THE AO. AO AFTER EXTRACTING THE DETAILS OF PAYMENTS, AO DIS ALLOWED THE SAME ON THE REASON THAT THE PAYMENTS ARE NOT RELATE D TO THE BUSINESS OF ASSESSEE. IN THE GROUND ITSELF, ASSESS EE STATES THAT THE RESIDENTIAL PREMISES OF THE PARTNER WAS USED VIRTUA LLY AS A BRANCH OF THE FIRM INCLUDING PROVISION FOR FIRMS VEHICLE PARKING AND WAS USED FOR THE PURPOSES OF BUSINESS. AS SEEN FROM TH E CLAIM OF DEPRECIATION IN THE P&L A/C, THERE SEEMS TO BE ONE CAR AND A MOTORCYCLE IN THE LIST OF ASSETS OF THE FIRM. WHIC H VEHICLES ARE PARKED THERE AND HOW USAGE OF PREMISES CAN BE CONSI DERED FOR THE PURPOSE OF BUSINESS HAS NOT BEEN EXAMINED EITHER BY THE AO OR BY THE CIT(A). SINCE ASSESSEES CONTENTIONS ARE NOT E XAMINED, I AM OF THE VIEW THAT THIS ISSUE REQUIRES EXAMINATION BY TH E AO, IF REQUIRED I.T.A. NO. 1039/HYD/2015 M/S. BHARAT RICE & OIL MILLS :- 3 -: BY VISITING THE PREMISES AND ESTABLISHING WHETHER T HE PREMISES IS USED FOR THE PURPOSE OF BUSINESS OR NOT? IN VIEW O F THIS, THE ISSUE OF DISALLOWANCE OF ELECTRICITY CHARGES IS RESTORED TO THE FILE OF AO FOR FRESH EXAMINATION OF FACTS AND CONTENTIONS OF ASSES SEE. GROUNDS ARE CONSIDERED ALLOWED FOR STATISTICAL PURPOSES. 5. GROUND NO. 3 PERTAINS TO LEVY OF INTEREST U/S. 2 34B WITHOUT GIVING PROPER CREDIT TO TDS. THERE IS NOTHING ON R ECORD TO EXAMINE THIS CONTENTION AND LD. CIT(A) BRIEFLY DISMISSED TH E GROUND STATING THAT IT IS CONSEQUENTIAL. IT IS THE CONTENTION OF ASSESSEE THAT TDS WAS NOT GIVEN CREDIT, AN AMOUNT OF RS. 4,144/- AS S EEN FROM THE GROUNDS BEFORE CIT(A) IN FORM 35. AO IS DIRECTED T O VERIFY THE CLAIM OF ASSESSEE AND ALLOW THE CREDIT TO ASSESSEE AFTER DUE EXAMINATION. CALCULATION OF INTEREST THEREAFTER IS CONSEQUENTIAL . WITH THESE OBSERVATIONS, THE GROUND IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST OCTOBER, 2015 SD/- (B. RAMAKOTAIAH) ACCOUNTANT MEMBER HYDERABAD, DATED 21 ST OCTOBER, 2015 TNMM I.T.A. NO. 1039/HYD/2015 M/S. BHARAT RICE & OIL MILLS :- 4 -: COPY TO : 1. M/.S BHARAT RICE & OIL MILLS, 19-3-1075/1, SHAMSHERGUNJ, HYDERABAD. C/O. K.L. RATHI, ADVOCATE , 3-5-144/5, EDEN GARDEN, HYDERABAD. 2. INCOME TAX OFFICER, WARD-8(3), HYDERABAD. 3. CIT(APPEALS)-2, HYDERABAD. 4. THE PR. CIT - 2 , HYDERABAD . 5. D.R. ITAT, HYDERABAD. 6. GUARD FILE.