GOLDEN TEMPLE PHARMA LLP, MUMBAI V. ITO - 21(1)(4), MUMBAI

ITA 1866/MUM/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 1677 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-12-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 01-04-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KAILASH GAIKWAD
• Keywords: TDS; Set aside

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC-III BENC H, MUMBAI BEFORE SHRI SHAMIM YAHYA, AM ITA NO. 1866/MUM/2019 (ASSESSMENT YEAR: 2014-15) M/S. GOLDEN TEMPLE PHARMA LLP 107/108, ANAND ESTATE, N. M. JOSHI MARG, CHINCHPOKLI, MUMBAI-400 011 VS. ITO-21(1)(4) ROOM NO. 108, 5 TH FLOOR, PIRAMAL CHAMBERS, LALBAUG, PAREL, MUMBAI-400 012 PAN/GIR NO. AALFG 8399 P ( APPELLANT ) : ( RESPONDENT ) APPELLANT BY : NONE RESPONDENT BY : SHRI KAILASH GAIKWAD DATE OF HEARING : 13.10.2020 DATE OF PRONOUNCEMENT : 11.12.2020 O R D E R PER SHAMIM YAHYA, A. M.: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-48, MUMBAI (L D.CIT(A) FOR SHORT) DATED 13.02.2019 AND PERTAINS TO THE ASSESSMENT YEAR (A.Y .) 2014-15. 2. THE ISSUE RAISED IS THAT LD. CIT(A) ERRED IN SUS TAINING THE ADDITION OF RS.15,60,720/- AS INTEREST INCOME. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSING O FFICER (A.O. FOR SHORT) IN THIS CASE MADE ADDITION OF RS.15,60,720/- HOLDING THAT THE SA ME WAS INTEREST ACCRUED AND THE ASSESSEE HAS NOT ACCOUNTED FOR THE SAME, DESPITE T HE ASSESSEE FOLLOWING MERCANTILE SYSTEM OF ACCOUNTING. 4. BEFORE THE LD.CIT(A), THE ASSESSEE SUBMITTED THA T THE ASSESSEE IS FOLLOWING CASH SYSTEM AND THE SSESSEE ALSO PRODUCED A CERTIFICATE FROM THE PARTY, IN WHICH IT WAS DULY STATED THAT THE SAID INTEREST HAS NOT BEEN PAID DUR ING THE ASSESSMENT YEAR. HOWEVER, THE LD. CIT(A) WAS NOT CONVINCED. HE ACCEPTED THE A.O.S OB SERVATION THAT SINCE THE ASSESSEE 2 ITA NO. 1866/MUM/2019 (A.Y. 14-15) M/S. GOLDEN TEMPLE PHARMA LLP VS. ITO HAD BEEN FOLLOWING MERCANTILE SYSTEM OF ACCOUNTING EARLIER, FOR THIS YEAR HE CANNOT CHANGE THE SAME TO CASH SYSTEM. THOUGH, IN THIS REG ARD, THE A.O. HAS DULY NOTED THAT IN ASSESSEES BOOKS OF ACCOUNT, FOR THE PRESENT ASSESS MENT YEAR IT WAS DULY MENTIONED THAT THE ASSESSEE IS FOLLOWING CASH SYSTEM OF ACCOUNTING . 5. AGAINST THE ABOVE ORDER, THE ASSESSEE IS IN APPE AL BEFORE THE ITAT. 6. I HAVE HEARD THE LD. DEPARTMENTAL REPRESENTATIVE (LD. DR FOR SHORT) AND PERUSED THE RECORDS. I NOTE THAT ASSESSEE HAS NOT RECEIVED THE INTEREST DURING THE YEAR. THIS ASPECT HAS BEEN DULY CERTIFIED BY THE CREDITOR. IN THIS VI EW OF THE MATTER, WHEN THE ASSESSEE HAS NOT RECEIVED THE INTEREST, THE ASSESSEE CANNOT BE F ORCED TO ACCOUNT FOR THE SAME WHEN THE ASSESSEES BOOKS OF ACCOUNTS ARE BEING MAINTAINED O N CASH SYSTEM. HENCE, I SET ASIDE THE ORDERS OF AUTHORITIES BELOW AND DELETE THE ADDITION . HOWEVER, I NOTE THAT WHEN THE INCOME IS NOT BEING ACCOUNTED FOR, THE ASSESSEE ALSO CANNO T CLAIM THE TDS IN THIS REGARD. HENCE, THE A.O. SHALL EXAMINE THIS ASPECT AND GIVE EFFECT TO THE OBSERVATION. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS PARTY ALLOWED. ORDER PRONOUNCED UNDER RULE 34(4) OF THE INCOME TAX (APPELLATE TRIBUNAL) RULES, 1962, BY PLACING THE DETAILS ON THE NOTICE BOARD ON 11.12.20 20 SD/- (SHAMIM YAHYA) ACCOUNTANT MEMBER MUMBAI; DATED : ROSHANI , SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT - CONCERNED 5. DR, ITAT, MUMBAI 6. GUARD FILE BY ORDER, (DY./ASSTT. REGISTRAR) ITAT, MUMBAI