S.KUMAR ENTERPRISES (SYNFABS) LTD, MUMBAI V. ITO 4(3)(4), MUMBAI

ITA 1370/MUM/2012

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0965 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 1 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-04-2015
• Appeal Filed By: Assessee
• Bench Allotted: E
• Next Hearing Date: 06-03-2014
• Assessment Year: 1999-2000
• Appeal Filed On: 29-02-2012
• Court: TRIBUNAL
• Department Lawyers: NEIL PHILIP
• Assessee Lawyers: D P SHROFF
• Section: 14A

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL E , BENCH MUMBAI . . , , BEFORE SHRI R.C.SHARMA , A M & SHRI SANJAY GARG , J M ./ ITA NO . 1369&1370 / MUM/20 1 2 ( / ASSESSMENT YEAR : 1998 - 99 & 1999 - 2000 ) S.KUMAR ENTERPRISES (SYNFABS) LTD., NIRANJAN, GROUND FLOOR, 99, MARINE DRIVE, MUMBAI - 400002 VS. ITO 4 ( 3 )( 4 ), MUMBAI ./ ./ PAN/GIR NO. : A A BCS 4905 Q ( / APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : SHRI D.P.SHROFF /REVENUE BY : SHRI NEIL PHILIP / DATE OF HEARING : 25 /03/2015 / DATE OF PRONOUNCEMENT 08/04 /2015 / O R D E R PER R.C.SHARMA (A.M) : TH ESE ARE THE APPEAL S FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A), FOR THE A.Y. 1998 - 99 & 1999 - 2000, IN THE MATTER OF ORDER PASSED U/S.143(3) R.W.S1 4 7 OF THE I.T.ACT. 2. THE ASSESSEE IS AGGRIEVED FOR DISALLOWANCE OF INTEREST IN RESPECT OF ADVANCE S GIVEN BY IT. 3. LD. AR PLACED ON RECORD ORDER OF THE ITAT MUMBAI BENCH IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2000 - 2001, WHEREIN THE ISSUE REGARDING DISALLOWANCE OF INTEREST WAS DECIDED IN FAVOUR OF T HE ASSESSEE. RELEVANT PARA 14 OF THE ORDER DATED 30 - 9 - 2008, READS AS UNDER : - ITA NO S . 1369&1370 / 1 2 2 14. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF THE PARTIES AND PERUSED THE RECORD. WE FIND THAT THE LEARNED CIT(A) EXAMINED THE SUBMISSIONS OF THE ASSESSEE AS WELL AS THE FACT S ON RECORD AND THE CASE LAWS RELIED UPON BY THE ASSESSEE THOROUGHLY BEFORE COMING TO A CONCLUSION THAT THE APPELLANT HAD PAID INTEREST OF RS.1.35 CRORES ON THE LOAN OF RS.7.50 CRORES, BEING 18% P.A. TO M/S S.KUMAR SUFABS LTD., WHICH WAS TAKEN BY THE ASSES SEE COMPANY DURING THE A.Y.1994 - 95 FOR THE PURPOSE OF BUSINESS. DURING THE AY 94 - 95, THE ASSESSEE COMPANY DID NOT INVEST ANY AMOUNT IN THE SHARES. HENCE, THE ASSESSING OFFICER WAS NOT JUSTIFIED IN INVOKING THE PROVISIONS OF SECTION 14A OF THE ACT. THEREFOR E, IN THE TOTALITY OF THE FACTS AND CIRCUMSTANCES CASE, WE FIND THAT THERE IS NO INFIRMITY IN THE ACTION OF THE CIT(A) IN DIRECTING THE ASSESSING OFFICER TO DELETE THE ADDITION MADE OF RS.1,35,70,931/ - U/S.14A R.W.S.36(1)(III) OF THE ACT. WE, THEREFORE, UP HOLD THE ORDER OF THE CIT(A) ON THIS ISSUE AND DISMISS THE GROUND RAISED BY THE REVENUE. 4. LD. AR ALSO PLACE D ON RECORD THE DETAILS OF LOANS AND ADVANCES GIVEN AS ON 31 - 3 - 1998 AND 31 - 3 - 1999 ALONG WITH DETAILS OF INTEREST PAID DURING THE YEARS, AND CONT ENDED THAT NO DISALLOWANCE IS WARRANTED U/S.14A R.W. SECTION 36(1)(III) IN TERMS OF DECISION BY ITAT IN ASSESSEES OWN CASE. 5. WE HAVE CONSIDERED RIVAL CONTENTIONS AND FOUND FROM THE RECORD THAT DISALLOWANCE OF INTEREST IN BOTH THE YEARS UNDER CONSIDERATI ON WAS MADE ON ACCOUNT OF ADVANCES GIVEN TO ASSOCIATE CONCERNS. THE ISSUE WITH REGARD TO DISALLOWANCE OF SUCH INTEREST HAS BEEN CONSIDERED BY THE TRIBUNAL IN ASSESSEES OWN CASE IN THE IMMEDIATE SUCCEEDING ASSESS MENT YEAR 2000 - 2001 VIDE ORDER DATED 23 - 9 - 20 08 AND WAS DECIDED IN FAVOUR OF THE ASSESSEE. AS THE FACTS AND CIRCUMSTANCES DURING THE YEAR S UNDER CONSIDERATION WAS ALLEGED TO BE SAME, IN THE INTEREST OF JUSTICE, WE RESTORE THE MATTER BACK TO THE FILE OF AO FOR DECIDING AFRESH KEEPING IN VIEW THE OBSERVATI ON MADE BY CIT(A) VIS - - VIS TRIBUNAL IN THE ASSESSMENT YEAR 2000 - 01 WHILE DECIDING THE ISSUE OF DISALLOWANCE OF ITA NO S . 1369&1370 / 1 2 3 INTEREST U/S.14A READ WITH SEC TION 36(1)(III) OF THE I.T. ACT, IN FAVOUR OF ASSESSEE. WE DIRECT ACCORDINGLY. 6 . IN THE RESULT, BOTH APPEALS O F THE ASSESSEE ARE ALLOWED IN PART FOR STATISTICAL PURPOSES . O RDER PRONOUNCED IN THE OPEN COURT ON THIS 08/04 / 201 5 . SD/ - SD/ - ( ) ( SANJAY GARG ) ( . . ) ( R.C.SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 08/04 /201 5 . . /PKM , . / PS / COPY OF THE ORDER FORWARDED TO : / BY O RDER, / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRUE COPY//