Shri Hetal N.Shah, Ahmedabad V. The Income tax Officer,Ward-11(3, Ahmedabad

ITA 1120/AHD/2009

• Counselvise Citation: [2011] 135 COUNSELVISE.COM (IT) 1764 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 11 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 15-03-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 13-04-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R K DHANESTA
• Assessee Lawyers: M K PATEL
• Keywords: Opportunity of being heard
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, A BENCH (BEFORE S/SHRI G.D. AGARWAL, VICE-PRESIDENT AND T.K. SHARMA, JUDICIAL MEMBER) ITA NO.1120/AHD/2009 [ASSTT. YEAR : 2004-2005] HETAL N. SHAH MANEKLAL JOITARAM PATEL ESTATE 76-77, MUNICIPAL IND. ESTATE BAPUNAGAR, AHMEDABAD. PAN : AIYPS 3385 C VS. ITO, WARD-11(3) AHMEDABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI M.K. PATEL REVENUE BY : SHRI R.K. DHANESTA O R D E R PER G.D. AGARWAL, VICE-PRESIDENT: THIS IS ASSESSEES APPEAL AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-XVI, AHMEDABAD DATED 30.1.2009 ARISING OUT OF THE ORDER OF THE ASSESSING OFFICER PASSED UNDER SECTION 143(3) THE INCOME TAX ACT, 1961. 2. THE ONLY GROUND RAISED IN THIS APPEAL BY THE ASS ESSEE IS AGAINST THE DISALLOWANCE OF INTEREST WHICH WAS PARTLY SUSTAINED BY THE CIT(A). 3. AT THE OUTSET, IT WAS SUBMITTED BY THE LEARNED C OUNSEL THAT THE AO DISALLOWED THE INTEREST ON THE GROUND THAT THE ASSE SSEE HAS GIVEN INTEREST FREE ADVANCES TO THE SISTER CONCERNS. IT WAS SUBMI TTED BY THE LEARNED COUNSEL THAT NO ADVANCE WAS GIVEN DURING THE YEAR U NDER CONSIDERATION AND THE ADVANCES, IF ANY, WERE GIVEN IN THE EARLIER YEAR. IN THE EARLIER YEAR, NO INTEREST WAS DISALLOWED. HE ALSO STATED T HAT THE ADVANCES TO THE SISTER CONCERNS WERE NOT GIVEN OUT OF BORROWED MONE Y AND THEREFORE NO DISALLOWANCE OF INTEREST WAS MADE IN THE EARLIER YE AR. HE ALSO POINTED OUT THAT UNDER THE SIMILAR FACTS, THE INTEREST WAS DISA LLOWED IN THE CASE OF ITA NO.1120/AHD/2009 -2- ASSESSEES FATHER, SHRI NARESHCHANDRA POPATLAL SHAH . THE ITAT IN ITA NO.1368/AHD/2007 FOR A.Y.2003-04 AND FOR A.Y.2004-0 5 VIDE ITA NO.2686/AHD/2008 SET ASIDE THE MATTER BACK TO THE F ILE OF THE AO FOR RE- DECIDING THE ISSUE. HE THEREFORE SUBMITTED THAT EI THER DISALLOWANCE OUT OF INTEREST SUSTAINED BY THE CIT(A) SHOULD BE DELETED OR THE MATTER MAY BE SET ASIDE TO THE FILE OF THE AO AS DONE BY THE ITAT IN THE ASSESSEES FATHERS CASE. 4. THE LEARNED DR, ON THE OTHER STATED THAT THE MAT TER MAY BE SET ASIDE TO THE FILE OF THE AO TO RE-ADJUDICATE AS PER THE O BSERVATIONS OF THE ITAT IN THE CASE OF SHRI NARESHCHANDRA POPATLAL SHAH, FA THER OF THE ASSESSEE. 5. AFTER CONSIDERING THE ARGUMENTS OF BOTH THE SIDE S AND FACTS OF THE CSE, WE DEEM IT PROPER TO SET ASIDE THE ORDER OF TH E AUTHORITIES BELOW ON THIS POINT AND RESTORE THE MATTER BACK TO THE FILE OF THE AO. WE ORDER ACCORDINGLY AND DIRECT THE AO TO RE-ADJUDICATE THE ISSUE AFRESH AS PER THE OBSERVATIONS/DIRECTIONS OF THE ITAT IN THE CASE OF SHRI NARESCHANDRA POPATLAL SHAH (SUPRA). NEEDLESS TO MENTION, THE AO WILL ALLOW ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 6. IN RESULT, ASSESSEES APPEAL IS ALLOWED FOR STAT ISTICAL PURPOSE. ORDER PRONOUNCED IN OPEN COURT ON 18 TH MARCH, 2011 SD/- SD/- (T.K. SHARMA) JUDICIAL MEMBER (G.D. AGARWAL) VICE-PRESIDENT PLACE : AHMEDABAD DATE : 18-03-2011