MILIND HARISHCHANDRA BHATE, NAVI MUMBAI V. ITO WD 1 PALGHAR, MUMBAI

ITA 2497/MUM/2011

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 9149 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-12-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 05-12-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 30-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation; Business expenditure; Salary income
• Section: 44AD

Judgement Text

. , IN THE INCOME TAX APPELLATE TRIBUNAL SMC , BENCH MUMBAI , BEFORE SHRI R. K. GUPTA , JM ITA NO. 2497 / MUM/ 20 1 1 ( ASSESSMEN T YEAR : 200 4 - 20 0 5 ) M ILIND HARISHCHANDRA BHATE, 703 - 704, 7 TH FLOOR, COMMODITY EXCHANGE BLDG., SECTOR - 19, NAVI MUMBAI - 400705 VS. ITO WD 1 PALGHAR, MUMBAI PAN/GIR NO. : ABSPB 1480 J ( APPELLANT ) .. ( RESPO NDENT ) /ASSESSEE BY : NONE /REVENUE BY : MR. MOHIT JAIN DATE OF HEARING : 5 TH DEC . , 2012 DATE OF PRONOUNCEMENT : 7 TH DEC. ,2012 O R D E R THI S IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 29 - 10 - 2010 OF LEANED CIT(A) - I I , THANE RELA TING TO THE ASSESSMENT YEAR 200 4 - 0 5 . 2 . THE ONLY ISSUE IN THE APPEAL OF THE ASSESSEE IS AGAINST CONFIRMING THE DISALLOWANCE OF RS. 89, 785/ - AGAINST SALARY INCO ME OF RS. 2,40, 000/ - AND THE INCOME DECLARED UNDER SECTION 44 AD OF THE ACT AT RS. 65 ,023/ - @ 8% . ITA NO. 2497 /20 1 1 2 3 . THE ASSESSEE IS A CONTRACTOR, WHO DECLARED PROFIT @ 8% UNDER SECTION 44AD AT RS. 65,023/ - . APART FROM THE ABOVE INCOME, THE ASSESSEE HAS ALSO SHOWN SALARY IN COME OF RS .2,40,000/ - FROM OTHER PARTNERSHIP CONCERN, NAMELY, M/S SAIDUTT ENTERPRISES . SOME SHARE ENGAGED FROM OTHER CONCERN IS ALSO SHOWN BY THE ASSESSEE. THE ASSESSEE CLAIMED DEDUCTION OF VARIOUS EXPENSES ON ACCOUNT OF VEHICLE RUNNING AND DEPRECIATION AT RS. 89,785/ - . 4 . THE ASSESSING OFFICER NOTED THAT SINCE THE INCOME HAS BEEN DECLARED UNDER SECTION 44AD, THEREFORE, NO OTHER EXPENSES ARE ALLOWABLE. AGAINST SALARY INCOME ALSO IT WAS HELD THAT NO EXPENSES ARE ALLOWABLE IN THE CASE OF PARTNERSHIP INDIVIDU AL AGAINST SALARY INCOME. ACCORDINGLY, HE DISALLOWED THE EXPENSES ON ACCOUNT OF VEHICLE AND DEPRECIATION. 5 . THE LEARNED CIT(A) CONFIRMED THE ACTION OF THE ASSESSING OFFICER. 6 . LEARNED DR HAS PLACED RELIANCE ON THE ORDER OF THE ASSESSING OFFICER AS WELL AS THE LEARNED CIT(A) . 7 . AFTER CONSIDERING THE ORDER OF THE ASSESSING OFFICER AND THE CIT(A) , AND THE GROUNDS OF APPEAL, I FOUND THAT THE ASSESSEE DESERVES TO SUCCEED ON THE GROUND RAISED BY IT. VARIOUS BENCHES OF THE TRIBUNAL IN THE CASE OF A.H. BALDOT A, 10 SOT 757 AND IN THE CASE OF SUDHIR DATTARAM PATIL VS. DCIT, 2 SOT 678(MUM) , HAVE HELD THAT BUSINESS EXPENDITURE CAN BE ALLOWED AGAINST SALARY RECEIVED FROM THE PARTNERSHIP CONCERN. SALARY IS EARNED BY THE PARTNER ON ACCOUNT OF ITA NO. 2497 /20 1 1 3 BUSINESS ACTIVITY DONE FOR THE PARTNERSHIP FIRM. THE VE HICLE OWNED BY THE ASSESSEE IS I N INDIVIDUAL NAME WHICH WAS USED BY THE PARTNER FOR BUSINESS PURPOSES, THEREFORE, THE ASSESSEE IS ENTITLED FOR DEDUCTION UNDER SECTION 37(1). ACCORDINGLY , I ALLOW THE EXPENSES OF RS. 89, 785/ - CLAIMED BY THE ASSESSEE. 8 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 7 TH DAY OF DEC . 2012. 2012 SD/ - ( ) ( R.K.GUPTA ) / JUDICIAL MEMBER MUMBAI ; DATED : 07 / 1 2 / 2012 . /PKM , PS COPY OF THE ORDER FORWARDE D TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE CIT(A) - X, MUMBAI. 4. / CIT 5. / DR, ITAT, MUMBAI 6. GUARD FILE. / /TRUE COPY// / BY ORDER, ( DY./ASSTT. REGISTRAR) / ITAT, MUMBAI