Appeal Details
Counselvise Citation
[2017] 126 COUNSELVISE.COM (IT) 9124 (ITAT-MUMBAI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
1 year(s) 7 month(s) 1 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
03-10-2017
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
Not Allotted
Assessment Year
2009-2010
Appeal Filed On
02-03-2016
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH A, MUMBAI BEFORE SHRI G.S.PANNU, ACCOUNTANT MEMBER AND SHRI RAVISH SOOD, JUDICIAL MEMBER ITA NO. 1063/MUM/2016,(A.Y 2009-10) THE DCIT, CEN.CIR.7(3), ROOM NO.655, 6 TH FLOOR, AAYKAR BHAVAN,M.K.ROAD, MUMBAI 400 020 ...... APPELLAN T VS. SMT. MADHU PRAKASH KAPOOR, PALLONJI MANSION, FLAT NO.G/D 43,CUFFPARADE, MUMBAI 400 005. PAN:AGQPK0792D .... RESPONDENT APPELLANT BY : SHRI R.P.MEENA RESPONDENT BY : SHRI ANUJ KISNA DWALA DATE OF HEARING : 05/07/2017 DATE OF PRONOUNCEMENT : 03/10/2017 ORDER PER G.S.PANNU,A.M: THE CAPTIONED APPEAL FILED BY THE REVENUE IS DIRE CTED AGAINST AN ORDER OF THE CIT(A)-49 MUMBAI DATED 21/12/2015, PER TAINING TO THE ASSESSMENT YEAR 2009-10, WHICH IN TURN HAS ARISEN F ROM ORDER PASSED BY THE ASSESSING OFFICER DATED 14/03/2014 UND ER SECTION 153A R.W.S. 143(3) OF THE INCOME TAX ACT, 1961 (IN SHOR T THE ACT). 2. THE GROUND RAISED BY THE REVENUE IN ITS APPEA L READS AS UNDER:- 2 ITA NO. 1063/MUM/2016,(A.Y 2009-10) 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.23,55,388/ -FOR THE A.Y. 2009-10 RELYING ON THE DECISION OF THE BOMBAY HIGH COURT IN THE CASE OF ALL CARGO GLOBAL LOGISTIC LTD. WITHOUT APPRECIATING THE FACTS THAT THE ABOVE SAID DECISION OF THE HIGH COURT HAS NOT BEEN ACCEPTED BY THE DEPARTMENT AND SLP HAS BEEN FILED IN THE SUPREME COURT AND THE SAME IS PENDING'. 3. AS THE GROUND OF APPEAL REVEALS, THE SOLITARY IS SUE IN THIS APPEAL RELATES TO THE COMPETENCE OF THE ASSESSING OFFICER TO MAKE ADDITION OF RS.23,55,388/- IN AN ASSESSMENT FINALIZED UNDER SE CTION 143(3) R.W.S. 153A OF THE ACT. IN ORDER TO APPRECIATE THE CONTRO VERSY IN THIS APPEAL, THE FOLLOWING FACT-SITUATION IS RELEVANT. THE ASSE SSEE INDIVIDUAL IS A PART OF BHARTI SHIPYARD LTD. GROUP OF CASES, WHEREIN A SEARCH ACTION WAS CARRIED OUT BY THE DEPARTMENT UNDER SECTION 132(1) OF THE ACT ON 24/11/2011. AS A CONSEQUENCE, ASSESSEE WAS ISSUED A NOTICE UNDER SECTION 153A(1) OF THE ACT CALLING FOR A RETURN OF INCOME, WHICH WAS FURNISHED BY THE ASSESSEE ON 19/06/2013, DECLARING A LOSS OF RS.35,40,183/-, WHEREAS IN THE RETURN OF INCOME OR IGINALLY FILED BY THE ASSESSEE UNDER SECTION 139(1) OF THE ACT ON 27/08/2 009 ASSESSEE HAD DECLARED A LOSS OF RS.15,56,964/-. THE DIFFERENCE BETWEEN THE TWO RETURNS AND WHICH IS RELEVANT FOR OUR PURPOSE CAN B E UNDERSTOOD AS FOLLOWS. IN THE RETURN OF INCOME ORIGINALLY FILED UNDER SECTION 139(1) OF THE ACT THE LOSS UNDER THE HEAD HOUSE PROPERTY WA S DECLARED AT 21,47,570/-, WHEREAS IN THE RETURN FILED IN RESPONS E TO NOTICE ISSUED UNDER SECTION 153A(1)(A) OF THE ACT THE LOSS UND ER THE HEAD HOUSE PROPERTY WAS INCREASED TO RS.46,00,639/-. THE DIFF ERENCE WAS ON ACCOUNT OF AN ENHANCED CLAIM OF DEDUCTION ON ACCOUN T OF INTEREST EXPENDITURE AT RS.50,16,947/- AS AGAINST THE CLAIM MADE IN THE ORIGINAL RETURN AT RS.25,63,878/-. IN THE ASSESSMENT FINALI ZED UNDER SECTION 153A R.W.S. 143(3) OF THE ACT, THE ASSESSING OFFI CER HAS ASSESSED THE 3 ITA NO. 1063/MUM/2016,(A.Y 2009-10) INCOME UNDER THE HEAD HOUSE PROPERTY AT A POSITIVE FIGURE OF RS.2,07,818/-,THEREBY RESULTING IN AN ADDITION OF RS.23,55,388/- VIS--VIS THE INCOME DECLARED IN THE ORIGINAL RETURN OF INCOM E. AT THIS STAGE, WE MAY ALSO BRIEFLY TOUCH UPON THE MANNER IN WHICH THE ADDITION OF RS.23,55,388/- HAS BEEN COMPUTED BY THE ASSESSING O FFICER. IN ITS RETURN OF INCOME, ASSESSEE DECLARED INCOME FROM HOU SE PROPERTY AT CRICKET CLUB OF INDIA ON DEEMED TO BE LET OUT BASIS AND RENT WAS ESTIMATED AT RS.6,00,000/-. THE ASSESSEE WAS 50% O WNER OF THE SAID PROPERTY AND AS PER THE ASSESSING OFFICER THE DETER MINATION OF ANNUAL LETTING VALUE (ALV) FOR A DEEMED TO BE LET OUT PROP ERTY WAS TO BE DETERMINED AFTER CONSIDERING THE PROVISIONS OF SECT ION 23 OF THE ACT, NAMELY, THAT THE ALV HAS TO BE BASED ON AN AMOUNT W HICH THE HOUSE IS LIKELY TO FETCH IF IT WAS LET OUT IN THE OPEN MA RKET. BE THAT AS IT MAY, THE ASSESSING OFFICER ESTIMATED THE DEEMED LET OUT VALUE AT RS.43,24,800/- AND DETERMINED THE INCOME FROM HOUS E PROPERTY (BEFORE ALLOWING DEDUCTION OF INTEREST) AT RS.27,71 ,696/- FOR A PERIOD OF 11 MONTHS. AFTER ALLOWING INTEREST CLAIM UNDER SEC TION 24(B) OF THE ACT AT RS.25,63,878/- AS WAS ORIGINALLY CLAIMED IN THE RETURN FILED UNDER SECTION 139(1) OF THE ACT, THE INCOME FROM HOUSE PR OPERTY WAS ASSESSED AT A POSITIVE FIGURE OF RS.2,07,818/-, THEREBY RESU LTING IN AN ADDITION OF RS.23,55,388/-. THE ENHANCED CLAIM OF INTEREST MADE IN THE RETURN FILED IN RESPONSE TO NOTICE U/S 153A OF RS.24,53,069/- WA S DENIED BY THE ASSESSING OFFICER, WHICH HAS ALSO BEEN AFFIRMED BY THE CIT(A) AND IT IS NOT A SUBJECT MATTER OF DISPUTE BEFORE US. THE DIS PUTE BEFORE US IS WITH REGARD TO THE ADDITION OF RS.23,55,388/- MADE TO TH E INCOME DETERMINED UNDER THE HEAD HOUSE PROPERTY, WHICH WE HAVE NARRATED ABOVE. THE SAID ADDITION HAS BEEN DELETED BY THE CI T(A) ON THE GROUND 4 ITA NO. 1063/MUM/2016,(A.Y 2009-10) THAT THERE WAS NO INCRIMINATING MATERIAL TO JUSTIFY SUCH AN ADDITION CONSIDERING THE FACT THAT ORIGINALLY ASSESSMENT FOR THE INSTANT ASSESSMENT YEAR HAD BECOME FINAL AND DID NOT ABATE IN TERMS OF THE SECOND PROVISO TO SECTION 153A(1) OF THE ACT. IN C OMING TO SUCH A DECISION, THE CIT(A) HAS RELIED UPON THE DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF ALL CARGO GLOBAL LOGI STICS LTD. VS. DCIT, 137 ITD 287(SB), WHICH HAS BEEN FURTHER AFFIRMED BY THE HON'BLE BOMBAY HIGH COURT IN A DECISION REPORTED IN 374ITR 645(BOM ). AGAINST SUCH A DECISION OF THE CIT(A), REVENUE IS IN APPEAL BEFORE US IN TERMS OF THE AFORESAID GROUND OF APPEAL. 4. AS THE PERUSAL OF THE AFORESAID GROUNDS OF APPEA L REVEALS, THE ONLY PLEA RAISED BY THE REVENUE IS THAT THE DECISIO N OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF ALL CARGO GLOBAL LOGISTICS LTD. (SUPRA), WHICH HAS BEEN RELIED UPON BY THE CIT(A) HAS NOT BE EN ACCEPTED BY THE DEPARTMENT AS THE SLP FILED IN THE HON'BLE SUPREME COURT IS PENDING. QUITE CLEARLY, PENDENCY OF THE SLP IN THE HON'BLE S UPREME COURT DOES NOT TAKE AWAY THE BINDING NATURE OF THE JUDGMENT OF THE HON'BLE BOMBAY HIGH COURT, WHICH CLEARLY CONTINUES TO HOLD THE FIELD. THEREFORE, ON THIS GROUND ITSELF, WE FIND NO MERIT IN THE PLEA RAISED BY THE REVENUE. 5. SO HOWEVER, ON FACTS ALSO WE MAY BRIEFLY TOUCH U PON THE ISSUE. IN THE INSTANT CASE, THE RETURN OF INCOME WAS ORIGINAL LY FILED BY THE ASSESSEE UNDER SECTION 139(1) OF THE ACT ON 27/08/2 009 AND NO NOTICE UNDER SECTION 143(2) OF THE ACT WAS ISSUED WITHIN T HE PRESCRIBED PERIOD AND, THEREFORE, ON THE DATE OF SEARCH I.E. ON 24/11 /2011, THE ASSESSMENT FOR THE IMPUGNED ASSESSMENT YEAR COULD N OT BE CONSTRUED 5 ITA NO. 1063/MUM/2016,(A.Y 2009-10) TO BE PENDING. CONSEQUENTLY, THE ASSESSMENT FOR TH E YEAR UNDER CONSIDERATION DID NOT ABATE IN TERMS OF THE SECOND PROVISO TO SECTION 153A(1) OF THE ACT. IN SUCH A SITUATION, THE SCOPE AND AMBIT OF AN ASSESSMENT WHICH IS REQUIRED TO BE MADE UNDER SECTI ON 153A(1) OF THE ACT HAS BEEN THE SUBJECT MATTER OF CONSIDERATION B Y THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF ALL CARGO GLOBAL LOGISTICS LTD. (SUPRA). ONE OF THE POINTS ADDRESSED BY THE HONBL E HIGH COURT WAS WHETHER THE SCOPE OF ASSESSMENT UNDER SECTION 153A OF THE ACT ENVISAGES ADDITIONS, WHICH ARE OTHERWISE NOT BASED ON ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF S EARCH. AS PER HON'BLE HIGH COURT, NO ADDITION COULD BE MADE IN RE SPECT OF THE ASSESSMENT THAT HAD BECOME FINAL IN THE EVENT NO IN CRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH. THE HON'BLE HIGH COURT ALSO NOTICED ITS EARLIER JUDGMENT IN THE CASE OF MURALI AGRO-PRODUCTS LTD. (SUPRA) AND ELABORATELY CULLED OUT THE SCOPE AND AM BIT OF THE ASSESSMENT AND REASSESSMENT OF TOTAL INCOME UNDER SECTION 153A (1) OF THE ACT READ WITH THE PROVISO THEREOF. THE HON'BLE BOMBAY HIGH C OURT IN CONTINENTAL WAREHOUSING CORPORATION (SUPRA) HAS RULED THAT AN U NABATED ASSESSMENT UNDER SECTION 153A(1) WOULD NOT ENCOMPASS AN ADDITI ON, IF NO INCRIMINATING MATERIAL IS FOUND DURING THE COURSE O F SEARCH, BECAUSE IN SUCH A CASE, THE ORIGINAL ASSESSMENT HAD BECOME FIN AL. 5.1 THE AFORESAID PROPOSITION HAS BEEN RELIED UPON BY THE CIT(A) TO HOLD THAT THE ADDITION OF RS.23,55,388/- MADE TO TH E INCOME ASSESSABLE UNDER THE HEAD HOUSE PROPERTY IS BAD IN LAW, INASMU CH AS, THERE IS NO INCRIMINATING MATERIAL FOUND IN THE COURSE OF SEARC H TO SUPPORT SUCH AN ADDITION. THE ABSENCE OF REFERENCE TO ANY INCRIMIN ATING MATERIAL BY THE ASSESSING OFFICER IS STARKLY EVIDENT FROM THE RE ADING OF THE ASSESSMENT ORDER ITSELF AND IN ANY CASE, SUCH FINDING OF THE C IT(A) HAS NOT BEEN 6 ITA NO. 1063/MUM/2016,(A.Y 2009-10) ASSAILED BY THE REVENUE BEFORE US ON THE BASIS OF A NY COGENT MATERIAL OR EVIDENCE. THEREFORE, IN OUR CONSIDERED OPINION, THE RATIO OF THE JUDGMENT OF HON'BLE BOMBAY HIGH COURT IN THE CASE O F ALL CARGO GLOBAL LOGISTICS LTD. (SUPRA) IS CLEARLY ATTRACTED AND TH E CIT(A) HAS MADE NO MISTAKE IN DELETING THE ADDITION OF RS.23,55,388/- MADE TO THE INCOME ASSESSABLE UNDER THE HEAD HOUSE PROPERTY. ACCORDIN GLY, WE HEREBY AFFIRM THE ORDER OF THE CIT(A) ON THIS ASPECT. 6. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 03/10/2017. SD/- SD/- (RAVISH SOOD) (G.S. PANNU) JUDICIAL MEMBER ACCOCUNTANT MEMBER MUMBAI, DATED 03/10/2017 VM , SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT , 2. THE RESPONDENT. 3. THE CIT(A)- 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI
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