GARDEN VIEW REALTORS PVT. LTD., MUMBAI V. I.T.O. 3(1)(4), MUMBAI

ITA 2544/MUM/2012

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 2296 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 7 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-12-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Next Hearing Date: 03-12-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 16-04-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ANU K AGGARWAL
• Assessee Lawyers: NARAYAN ATAL
• Keywords: Reopening of assessment; Business income; Opportunity of being heard

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI . . , , BEFORE S/SHRI B.R.BASKARAN, ACCOUNTANT MEMBER AND SHRI SANDEEP GOSAIN, J UDICIAL MEMBER ./ I.T.A. NO. 2544 /MUM/ 201 2 ( / ASSESSMENT YEAR : 2004 - 05 ) M/S GARDEN VIEW REALTORS PVT.LTD., 161 - C MITTAL TOWERS, NARIMAN POINT, MUMBAI - 400021 / VS. INCOME TAX OFFICER 3(1)(4), ROOM NO.666, 6 TH FLOOR , AAYAKAR BHAVAN, M K ROAD, MUMBAI - 400020 ./ PAN : AAACG1917F ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI NARAYAN ATAL / RESPONDENT BY : SMT.ANU K AGGARWAL / DATE OF HEARING : 3 .12. 2015 / DATE OF PRONOUNCEMENT : 3 .12. 2015 O R D E R PER B.R.BASKARAN,AM : THE APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 07.12.2011 PASSED BY LD CIT(A) FOR ASSESSMENT YEAR 2004 - 05 DISMISSING THE APPEAL FILED BY THE ASSESSEE. 2. THE LD COUNSEL SUBMITTED THAT THE ASSESSING OFFICER HAS RE - OPENED THE ASSESSMENT OF THE YEAR UNDER CONSIDERATION IN ORDER TO ASSESS THE LICENSE FEE RECEIVED BY TH E ASSESSEE ON GIVING A PROPERTY ON LICENCE BASIS TO M/S MID DAY PUBLICATIONS PVT LTD. THE ASSESSEE DECLARED THE LICENCE FEE RECEIVED BY IT AS BUSINESS INCOME, WHERE AS THE ASSESSING OFFICER TREATED THE SAME AS INCOME FROM OTHER SOURCES. CONSEQUENTLY, VAR IOUS EXPENSES ITA NO. 2544 / MUM/ 201 2 2 CLAIMED BY THE ASSESSEE HAVE ALSO BEEN DISALLOWED. FURTHER THE ASSESSEE HAD ALSO CLAIMED BUSINESS LOSS ON SALE OF SHARES, BUT THE SAME HAS BEEN NOT ACCEPTED WITHOUT SPECIFYING PROPER REASONS. THE LD COUNSEL SUBMITTED THAT THE ASSESSEES OBJ ECTS INCLUDED LETTING OUT OF PROPERTIES ON COMMERCIAL BASIS AND HENCE, IN VIEW OF THE DECISION RENDERED BY THE HONBLE SUPREME COURT IN THE CASE OF CHENNAI PROPERTIES AND INVESTMENTS LTD VS. CIT (2015)(373 ITR 673), THE DECISION RENDERED BY THE TAX AUTHORI TIES ARE NOT CORRECT. 3. WHEN IT WAS PROPOSED BY THE BENCH THAT THESE MATTERS MAY BE SET ASIDE TO THE FILE OF THE ASSESSING OFFICER FOR EXAMINING ALL THE ISSUES AFRESH IN THE LIGHT OF THE DECISION RENDERED BY HONBLE SUPREME COURT IN THE CASE OF CHEN NAI PROPERTIES AND INVESTMENTS LTD (SUPRA), BOTH THE PARTIES AGREED TO THE SAME. 4. NOW WE SHALL DISPOSE OF THE GROUNDS URGED BY THE ASSESSEE. THE FIRST GROUND OF APPEAL RELATES TO THE VALIDITY OF REOPENING OF ASSESSMENTS. WE NOTICE THAT THE ORIGINAL RETURN OF INCOME FILED BY THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION WAS PROCESSED U/S 143(1) OF THE ACT AND THE ASSESSMENT HAS BEEN REOPENED WITHIN FOUR YEARS FROM THE END OF THE ASSESSMENT YEAR UNDER CONSIDERATION. WE NOTICE THAT THE ASSESSING OFFIC ER HAS RECORDED REASONS FOR REOPENING OF ASSESSMENT AND HENCE WE ARE OF THE VIEW THAT THE LD CIT(A) WAS JUSTIFIED IN HOLDING THAT THE REOPENING WAS JUSTIFIED. 5. WITH REGARD TO GROUND NO.2,3 AND 4, WE HAVE ALREADY NOTED THAT THEY REQUIRE FRESH EXAMINA TION AT THE END OF THE ASSESSING OFFICER. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) ON THESE THREE GROUNDS AND RESTORE THEM TO THE FILE OF THE AO WITH THE DIRECTION TO EXAMINE THEM AFRESH IN THE LIGHT OF THE DECISION RENDERED BY HONBLE APEX COURT IN THE ITA NO. 2544 / MUM/ 201 2 3 CASE OF CHENNAI PROPERTIES & INVESTMENTS LTD (SUPRA) AND TAKE APPROPRIATE DECISION IN ACCORDANCE WITH THE LAW, AFTER AFFORDING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 6. THE FIFTH GROUND RELATES TO THE ASSESSMENT OF INTEREST FROM BA NK DEPOSITS AS INCOME FROM OTHER SOURCES INSTEAD OF INCOME FROM BUSINESS. WE NOTICE THAT THE ASSESSEE HAS EARNED BANK INTEREST FROM DEPOSITS MADE OUT OF SURPLUS FUNDS. AN IDENTICAL ISSUE WAS CONSIDERED BY THE TRIBUNAL IN THE ASSESSEES OWN CASE IN ITA NO S.390, 5616 & 5617/MUM/2005 AND THE SAME WAS DECIDED AGAINST THE ASSESSEE. WE NOTICE THAT THE LD CIT(A) HAS FOLLOWED THE ORDER OF THE TRIBUNAL IN DECIDING THIS ISSUE AGAINST THE ASSESSEE. ACCORDINGLY WE UPHOLD HIS ORDER ON THIS ISSUE. 7. IN THE RESU LT, THE APPEAL FILED BY THE ASSESSEE IS TREATED AS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 3RD DEC 2015 . SD SD ( / SANDEEP GOSAIN ) ( . . / B.R.BASKARAN) /JUDICIAL MEMBER /ACCOUNTANT MEMBER MUMBAI ; DATED .. 3RD DEC,2015 . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - CONCERNED 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI CON CERNED 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) , /ITAT, MUMBAI