PIYUSH GANGJI CHHEDA, MUMBAI V. NATIONAL E-ASSESSMENT CENTRE, DELHI , DELHI

ITA 1234/MUM/2024

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 1656 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-06-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 11-06-2024
• Assessment Year: 2018-2019
• Appeal Filed On: 04-03-2024
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MALATI GHOSH
• Keywords: Business income; Opportunity of being heard; Principle of natural justice; Non compliance; Set aside
• Section: 37; 250

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “C”, MUMBAI BEFORE SHRI ANIKESH BANERJEE, JUDICIAL MEMBER AND SHRI GAGAN GOYAL, ACCOUNTANT MEMBER ITA 1234/Mum/2024 (Assessment year: 2018-19) Piyush Gangji Chheda 1 st Floor, Sunshine Plaza, Naigaum Cross Road, Dadar (E), Mumbai-400 014 PAN :AABPC3159M vs National E-Assessment Centre, Delhi APPELLANT RESPONDENT Assessee by : Ms. Mrugakshi Joshi Respondent by : Ms. Malati Ghosh,CIT - DR Date of hearing : 12/06/2024 Date of pronouncement : 13/ 06/2024 O R D E R PER ANIKESH BANERJEE, J.M: Instant appeal of the assessee is preferred against the order of theLd. National Faceless Appeal Centre, Delhi [for brevity, ‘Ld.CIT(A)’] passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’), for Assessment Year 2018-19, date of order 09.02.2024.The impugned order was emanated from the order of the Ld. National E-Assessment Centre, Delhi (in short, ‘the A.O.’) passed under section 143(3)r.w.s. 143(3A) & 143(3B) of the Act, date of order 04/03/2021. 2 ITA No.1234 /Mum/2024 Piyush Gangji Chheda 2. The assesseehas taken the following grounds of appeal:- “On the facts and circumstances of the case and in law :- GROUND NO. 1 :EX-PARTE ORDER 1. The Ld, CIT(A) erred in passing an Order and without giving the Assessed sufficient opportunity of being heard. 2. The Ld. CIT(A) failed to take into consideration the mindless assessment made by the Assessing Officer, where he, without any logical and legal basis, erred in not allowing any deduction (pertaining to Interest expenditure of Rs. 1 3,1 7,69, 069/-) under any head of income whatsoever, although the nexus between the income earned and expenditure claimed was clearly established during the assessment proceedings. GROUND NO. 2 : DEDUCTION U/S. 57(iii) OF RS. 6,54,03,244/- 1. The Ld. CIT(A) erred in confirming the addition ma.de. by the AO, in respect of the Deduction claimed u/s. 57(iii), of the proportionate Interest expenditure of Rs. 6,54.03,244/- and failed to take into consideration the direct nexus between the Interest income earned and the Interest. Expenditure claimed. 2. Without prejudice, the Ld. AO erred in not allowing the Assessee to claim a deduction u/s. 37, against the Business income earned, since it is clear that either the loans were utilized to give loans to outsiders or the same was utilized for the purpose of its share trading business or to introduce capital in the partnership firm. GROUND NO. 3 : DEDUCTION U/S. 37 OF RS. 6,54,03,244/- 3 ITA No.1234 /Mum/2024 Piyush Gangji Chheda 1. The Ld, CIT(A) erred in confirming the addition made by the AO, in respect of the deduction claimed u/s. 37, of the proportionate Interest expenditure of Rs. 6,63,65,825/- and failed to take into consideration that a part of the Unsecured Loans have been utilized for the sharetrading business and capital introduction in partnership firm (from which Assessee has earned taxable Interest on capital, and thus the Interest expenditure ought to be allowed as a deduction u/s. 37 under the head Business Income'. 2. Without prejudice, the learned AC) erred in making an addition of Rs. 2,35.383/- ; being income already assessed to tax under the head Income from House property and therefore any further addition would amount to double taxation”. 3. Brief facts of the case are that the addition was made in the assessment proceedings amount to Rs. 13,17,69,069/- related to disallowance of interest expenditure. The Ld.AO disallowed the deduction under section 57 of the Act amount to Rs.6,54,03,254/- and under section 37 amount to Rs.6,63,65,825/- which works out to total amount Rs.13,17,69,069/-. The aggrievedassessee filed an appeal before the Ld.CIT(A). The Ld.CIT(A) passed an exparte order without considering the ground of the assessee and upheld the assessment order. Being aggrieved on appeal order, the assessee filed an appeal before us. 4. The Ld.AR for the assessee filed an adjournment petition. Considering the merit of the case, the Ld.AR started argument and withdrew the application. The Ld.AR placed that the assessee is not conversant with the on-line proceedings, so the notice remained non-complied. The Ld.AR prayed to set aside the matter before the Ld.CIT(A) for decision afresh. 5. The Ld. DR had not raised any objection against the submission of the Ld.AR. 4 ITA No.1234 /Mum/2024 Piyush Gangji Chheda 6. We heard the rival submission and considered the documents available in the record. The assessee placed that the reasonable opportunity was denied to the assessee during the appeal hearing. The Ld.AR for the assessee explained the reasons for non compliance in the appeal proceedings. We find that for the sake of natural justice, the assessee should get another opportunity for submitting his evidence before Ld.CIT(A). All the issues are restored to the file of the ld. CIT(A) for adjudicating the case on merits. We are not expressing any views on the merits of the case so as to limit the appellate procedure before the Ld. CIT(A). Needless to say, theassessee should get a reasonable opportunity of hearing. The assessee should be diligent in appeal proceeding for expeditious disposal of appeal. 7. In the result, ITA No.1234/Mum/2024 is allowed for statistical purposes. Order pronounced in the open court on 13 th day of June, 2024. Sd/- sd/- (GAGAN GOYAL) (ANIKESH BANERJEE) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai,दिन ांक/Dated: 13/06/2024 Pavanan Copy of the Order forwarded to: 1. अपील र्थी/The Appellant , 2. प्रदिव िी/ The Respondent. 3. आयकरआयुक्त CIT 4. दवभ गीयप्रदिदनदि, आय.अपी.अदि., मुबांई/DR, ITAT, Mumbai 5. ग र्डफ इल/Guard file. BY ORDER, //True Copy// (Asstt. Registrar), ITAT, Mumbai 5 ITA No.1234 /Mum/2024 Piyush Gangji Chheda