ACIT (OSD) 8(1), MUMBAI V. KAMAT HOTELS INDIA LTD, MUMBAI

ITA 110/MUM/2013

• Counselvise Citation: 11019914 RSA 2013
• Duration Of Justice: 1 year(s) 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-03-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 03-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: A G VERMA
• Keywords: Bad and doubtful debts

Judgement Text

A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI .. , . . . . BEFORE SHRI P.M. JAGTAP, AM AND DR. S.T.M. PAVALAN, JM ./ I.T.A. NO.110 /MUM/2013 ( / ASSESSMENT YEAR : 2009-2010 D CIT 8 (2), ROOM NO. 209/216A, 2 ND FLOOR, AAYAKAR BHAVAN, M.K. MARG, MUMBAI 20. / VS. M/S K AMAT HOTELS (INDIA) LTD., 70-C, NEHRU ROAD, VILAE PARLE (E), MUMBAI 400 099. ./ PAN :AAACK2912L ( % / APPELLANT ) .. ( &'% / RESPONDENT ) A PPELLANT BY S MT. NEERAJA PRADHAN R E SPONDENT BY : SHRI A.G. VERMA * / DATE OF HEARING : 19-3-2014 * / DATE OF PRONOUNCEMENT : 21-03-2014 [ / O R D E R PER P.M. JAGTAP, A.M . : .. , THIS APPEAL IS PREFERRED BY THE REVENUE AGAINST THE ORDER OF LD. CIT(A) - 17, MUMBAI DATED 15-10-2012 WHEREBY HE ENTERTAINED THE CLAIM OF THE ASSESSEE MADE BEFORE THE A.O. VIDE LETTER DATED 8-1 2-2011 FILED DURING THE COURSE OF ASSESSMENT PROCEEDINGS SEEKING EXCLUSION OF EXCESS PROVISION FOR DOUBTFUL DEBTS OF RS. 14,26,996/- AND EXCESS PROVIS ION FOR DIVIDEND TAX OF RS. 6,11,820/- FROM THE TOTAL INCOME ON THE GROUND THAT THE SAID AMOUNTS INCLUDED IN THE TOTAL INCOME WERE NOT LIABLE TO TAX . 2. THE ASSESSEE IN THE PRESENT CASE IS A COMPANY WH ICH IS ENGAGED IN THE BUSINESS OF RUNNING A HOTEL. THE RETURN OF INCOME F OR THE YEAR UNDER ITA 110/M/13 2 CONSIDERATION WAS FILED BY IT ON 30-9-2009 DECLARIN G LOSS OF RS. 13,83,48,608/-. IN THE ASSESSMENT COMPLETED U/S 143 (3) OF THE INCOME TAX ACT, 1961 VIDE ORDER DATED 21-12-2011, THE TOTAL IN COME OF THE ASSESSEE WAS COMPUTED BY THE A.O. AT A LOSS OF RS. 13,83,18,158/ - AFTER MAKING ADDITION OF RS. 30,450/- ON ACCOUNT OF DISALLOWANCE OF DIFFEREN CE IN AIR. HE, HOWEVER, DID NOT ENTERTAIN THE CLAIM OF THE ASSESSEE MADE VI DE A LETTER DATED 8-12-2011 FOR EXCLUSION OF EXCESS PROVISION FOR DOUBTFUL DEBT S OF RS. 14,26,996/- AND EXCESS PROVISION FOR DIVIDEND TAX OF RS. 6,11,820/- ON THE GROUND THAT THE SAME WERE NOT LIABLE TO TAX. ON APPEAL, THE LD. CI T(A) ENTERTAINED THE SAID CLAIM OF THE ASSESSEE RELYING ON THE DECISION OF HO NBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. PRUTHVI BROKERS & SHAREHOLDERS, [2012] 349 ITR 336 (BOM) AND RESTORED THE MATTER TO THE FILE OF THE A.O. WIT H A DIRECTION TO DECIDE THE SAME ON MERIT AFTER NECESSARY VERIFICATION. AGGRIEV ED BY THE ORDER OF THE LD. CIT(A), THE REVENUE HAS PREFERRED THIS APPEAL BEFOR E THE TRIBUNAL. 4. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED RELEVANT MATERIAL AVAILABLE ON RECORD. AS HELD BY T HE HONBLE BOMBAY HIGH COURT IN THE CASE OF PRUTHVI BROKERS & SHAREHOLDERS (SUPRA) RELIED UPON BY THE LD. CIT(A), THE ASSESSEE IS ENTITLED TO RAISE A NY ADDITIONAL CLAIMS BEFORE THE APPELLATE AUTHORITIES AS PER THE DECISION OF HONBL E SUPREME COURT IN THE CASES OF NATIONAL THERMAL POWER COMPANY LTD. VS. CI T [1998] 229 ITR 383 (SC) AND THE HONBLE SUPREME COURT IN THE CASE OF G OETZE (INDIA) LTD. VS. CIT (284 ITR 323) DID NOT HOLD ANYTHING CONTRARY TO WH AT WAS HELD BY THE PREVIOUS JUDGMENT IN THE CASE OF NATIONAL THERMAL P OWER COMPANY LTD. (SUPRA) TO THE EFFECT THAT EVEN IF A CLAIM NOT MAD E BEFORE THE A.O., IT CAN BE MADE BEFORE THE APPELLATE AUTHORITIES. IT WAS HELD BY THE HONBLE BOMBAY HIGH COURT THAT THE POWER OF THE APPELLATE AUTHORIT Y TO ENTERTAIN SUCH A CLAIM HAS NOT BEEN NEGATED BY THE HONBLE SUPREME COURT I N THE JUDGMENT IN THE CASE OF GOETZE (INDIA) LTD. AND THE HONBLE SUPREME COURT IN FACT HAS MADE IT CLEAR THAT THE ISSUE IN THAT CASE WAS LIMITED TO TH E POWER OF ASSESSING ITA 110/M/13 3 AUTHORITY AND THAT THE JUDGMENT DOES NOT IMPINGE ON THE POWER OF THE APPELLATE AUTHORITY. KEEPING IN VIEW THIS LEGAL POS ITION PROPOUNDED BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF PRUTHVI BR OKERS & SHAREHOLDERS (SUPRA), WE FIND NO INFIRMITY IN THE IMPUGNED ORDER OF THE LD. CIT(A) ENTERTAINING THE NEW CLAIM MADE BY THE ASSESSEE FOR EXCLUSION OF EXCESS PROVISION FOR DOUBTFUL DEBTS AND EXCESS PROVISION F OR DIVIDEND TAX AND RESTORING THE MATTER TO THE FILE OF THE A.O. FOR DE CIDING THE SAME AFRESH AFTER NECESSARY VERIFICATION. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST MARCH, 2014. . * 0 1 21-03-2014 * SD/- -SD/- (DR. S.T.M. PAVALAN) (P.M. JAGTAP ) JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; 1 DATED 21-03-2014 [ .../ RK , SR. PS ' #%& '& / COPY OF THE ORDER FORWARDED TO : 1. % / THE APPELLANT 2. &'% / THE RESPONDENT. 3. 4 () / THE CIT(A)17 MUMBAI. 4. 4 / CIT 8 MUMBAI 5. 7 &9 , 9 , / DR, ITAT, MUMBAI A BENCH 6. ; / GUARD FILE. / BY ORDER, '7 & //TRUE COPY// / ( DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI