MITTATEX EXPORTS P.LTD, MUMBAI V. JT CIT (OSD) 8(2), MUMBAI

ITA 1483/MUM/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8269 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 04-12-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 22-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AKHILENDRA YADAV
• Keywords: Earning of tax free income
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'B' BENCH, MUM BAI . , , BEFORE SHRI D. KARUNAKARA RAO, AM & SHRI AMIT SHUKL A, JM ./ ITA NO. 1483/MUM/2013 ( / ASSESSMENT YEAR: 2009-10) M/S. MITTATEX EXPORTS P. LTD. / VS. JT. CIT (OSD)- 8(2) 4, CROSSGATE, LOKHANDWALA COMPLEX, ANDHERI (W) MUMBAI 400053 MUMBAI ./ PAN AAACM2803J ! / APPELLANT '# ! / RESPONDENT ! $ % / APPELLANT BY: MS. AARATI SATHE '# ! $ % / RESPONDENT BY: SHRI AKHILENDRA YADAV &' $ ( / DATE OF HEARING: 04.12.2014 )*+ $ ( / DATE OF PRONOUNCEMENT: 04.12.2014 / O R D E R PER D. KARUNAKARA RAO, AM THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A)-17, MUMBAI DATED 10.12.2012 FOR AY 2009-10. 2. ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE CIT(A) WHILE PASSING ORDER U/S 250 OF THE I. TAX AC T, 1961 DT. 10/12/2012 ERRED IN UPHOLDING THE ADDITION U/S 14A MADE BY THE AO TO TUNE OF RS.6,07,250/- BEING DISALLOWANCE OF E XPENDITURE U/S 14A READ WITH RULE 8D. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE CIT(A), WHILE PASSING ORDER DT. 10.12.2012 OF THE I . TAX ACT, 1961 ERRED IN UPHOLDING THE ADDITION MADE BY AO TO TUNE OF RS.54,000/- BEING DISALLOWANCE OF EXPENDITURE INCURRED FOR INCR EASE IN AUTHORISED SHARE CAPITAL. 3. AT THE OUTSET THE LEARNED COUNSEL FOR THE ASSESSEE MENTIONED THAT GROUND NO. 2 RELATES TO DISALLOWANCE OF EXPENDITURE ON ROC FEES OF ` 54,000/- WHICH WAS INCURRED FOR INCREASING THE AUTH ORISED SHARE CAPITAL. ITA NO. 1483/MUM/2013 M/S. MITTATEX EXPORTS P. LTD. 2 HE MENTIONED THAT THE ISSUE NOW STANDS COVERED AGAI NST THE ASSESSEE CONSIDERING THE HON'BLE SUPREME COURT JUDGEMENT IN THE CASE OF BROOKE BOND INDIA LTD. VS. CIT 225 ITR 798. 4. ON HEARING BOTH THE PARTIES WE DISMISS GROUND NO. 2 OF THE ASSESSEE. 5. GROUND NO. 1 RELATES TO DISALLOWANCE OF ` 6,07,250/- UNDER SECTION 14A OF THE ACT. IN CONNECTION WITH THIS GROUND THE ASSESSEES COUNSEL BROUGHT OUR ATTENTION TO PARA 4 OF THE ASSESSMENT O RDER AND MENTIONED THAT THE AO DISALLOWED A SUM OF ` 6,07,250/- WITHOUT APPRECIATING THE FACTS OF THE PRESENT CASE. THE ASSESSEE HAS NOT EARNED ANY EXEMP T INCOME IN THIS YEAR AND ALSO NOT INCURRED ANY EXPENDITURE. 6. BRINGING OUR ATTENTION TO THE IMPUGNED ORDER OF THE CIT(A) THE LEARNED COUNSEL MENTIONED THAT THE CIT(A) UPHELD THE ADDITI ON MERELY RELYING ON THE ORDER OF THE AO AND WITHOUT APPRECIATING THE FACT T HAT THE ASSESSEE HAS EARNED NEITHER EXEMPT INCOME NOR INCURRED ANY EXPEN DITURE IN THE YEAR UNDER CONSIDERATION. SHE ALSO MENTIONED THAT THE FA CTS OF CASE WAS NOT PROPERLY APPRECIATED AND SHE REQUESTED FOR REMANDIN G THE ISSUE TO THE FILE OF THE AO FOR FRESH ADJUDICATION. 7. ON THE OTHER HAND, THE LEARNED D.R. DUTIFULLY RELIE D ON THE ORDER OF THE AO AND THE CIT(A). 8. WE HEARD BOTH THE PARTIES ON THIS ISSUE AND FIND TH AT THE REVENUE AUTHORITIES HAVE MECHANICALLY INVOKED THE PROVISION S OF RULE 8D IGNORING THE FACT THAT THERE IS NO EXPENDITURE AND NO EXEMPT INCOME. IT IS THE PRAYER OF THE LEARNED COUNSEL FOR THE ASSESSEE THAT THERE ARE BINDING DECISIONS IN FORCE WHICH ARE SUBSEQUENTLY PRONOUNCED, WHICH REQU IRE THE ATTENTION OF THE LOWER AUTHORITIES. CONSIDERING THE REQUEST OF THE L EARNED COUNSEL FOR THE ASSESSEE WE FIND THAT IN THE INTEREST OF JUSTICE TH E ISSUE SHOULD BE REMANDED TO THE FILE OF THE AO. THE AO SHALL GRANT REASONABL E OPPORTUNITY OF HEARING TO THE ASSESSEE DURING THE REMAND PROCEEDINGS. GROUND NO. 1 OF THE ASSESSEE IS ALLOWED. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ITA NO. 1483/MUM/2013 M/S. MITTATEX EXPORTS P. LTD. 3 ,- &./, $ 0 1$ 23 4 5 6 $ 7 89 ORDER PRONOUNCED IN THE OPEN COURT ON 4 TH DECEMBER, 2014. $ )*+ 0 :&- 04.2.2014 * $ ;' SD/- SD/- (AMIT SHUKLA) (D. KARUNAKARA RAO ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER <' MUMBAI, :& DATED: 4 TH DECEMBER, 2014 COPY TO: 1. ! / THE APPELLANT 2. '# ! / THE RESPONDENT 3. ( )/ THE CIT(A) 17, MUMBAI 4. / THE CIT 8, MUMBAI CITY 5. =>; '&?. , ( ?. , <' THE DR, B BENCH, ITAT, MUMBAI 6. ;/ @' / GUARD FILE. & / BY ORDER #= ' //TRUE COPY// ! ASSISTANT REGISTRAR , <' ITAT, MUMBAI BENCHES, MUMBAI N.P.