RAJENDRA P CHITALE, MUMBAI V. JT CIT RG 11(3), MUMBAI

ITA 2672/MUM/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 0114 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Next Hearing Date: 30-05-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 07-05-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R K SAHUDR
• Assessee Lawyers: ARVIND SONDEAR
• Keywords: Unexplained cash credit; Bonafide belief; Earning of tax free income; Wrong claim; Revised return; Bonafide mistake
• Section: 14A; 68

Judgement Text

, INCOME-TAX APPELLATE TRIBUNAL -GBENCH MUMBAI , , , BEFORE S/SHRI RAJENDRA,ACCOUNTANT MEMBER AND RAM LAL NEGI,JUDICIAL MEMBER ./I.T.A./ 2672/MUM/2015, /ASSESSMENT YEAR: 2010-11 RAJENDRA P. CHITALE NIRLON HOUSE, 5TH FLOOR, DR. ANNIE BESANT ROAD,WORLI,MUMBAI-400 030. PAN:AABPC 4812 B VS. JT. CIT, RANGE-11 (3); NOW RANGE-16(3) 4TH FLOOR, ROOM NO.449, AAYAKAR BHAVAN M.K. ROAD, MUMBAI-400 020. ( /APPELLANT ) ( / RESPONDENT ) REVENUE BY: SHRI R.K. SAHU-DR ASSESSEE BY: SHRI ARVIND SONDE-AR / DATE OF HEARING: 30.05.2017 / DATE OF PRONOUNCEMENT: 28.08.2017 ,1961 254(1) ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) / PER RAJENDRA, AM - CHALLENGING THE ORDER,DATED 04/02/2015,OF THE CIT ( A)-7,MUMBAI,THE ASSESSEE HAS FILED THE PRESENT APPEAL.ASSESSEE,AN INDIVIDUAL,IS A CHARTERE D ACCOUNTANT BY PROFESSION.HE FILED HIS RETURN OF INCOME ON 04/09/2010,DECLARING INCOME OF RS.1.08 CRORES.THE ASSESSING OFFICER (AO)COMPLETED THE ASSESSMENT U/S.143(3)OF THE ACT,O N 11/01/2013,DETERMINING HIS INCOME AT RS.1.31 CRORES. 2. FIRST GROUND OF APPEAL IS ABOUT ADDITION OF RS.22.3 1 LAKHS UNDER THE HEAD UNEXPLAINED CASH CREDIT.DURING THE ASSESSMENT PROCEEDINGS, THE AO FO UND THAT THE ASSESSEE HAD CLAIMED CERTAIN EXEMPTIONS IN THE RETURN FILED FOR THE YEAR UNDER A PPEAL,THAT HE HAD SHOWN EXEMPT INCOME FROM MP CHITALE & CO.(MPCC) AT RS.1.20 CRORES,THAT HE WAS A PARTNER IN THE ENTITY, THAT ACTUAL SHARE PROFIT FROM MPCC WAS RS.1.14 CRORES AS PER THE BOOKS OF ACCOUNTS, THAT THE ASSESSEE HAD ALSO SHOWN EXEMPT INCOME FROM MP CHITA LE & ASSOCIATES (MPCA) AT RS. 2.82 CRORES,THAT ASSESSEE WAS A PARTNER OF THAT FIRM ALS O,THAT THE ACTUAL SHARE OF PROFIT FROM MPCA WAS RS.2.15 CRORES, THAT THE EXEMPT INCOME SHOWN BY HIM WAS MORE THAN ACTUAL EXEMPT INCOME HE HAD RECEIVED FROM THE TWO PARTNERSHIP FIR MS.HE DIRECTED THE ASSESSEE TO FILE EXPLANATION IN THAT REGARD.AFTER CONSIDERING THE SU BMISSIONS OF THE ASSESSEE, THE AO HELD THAT THE ASSESSEE HAD SHOWN SHARE OF PROFIT FROM TWO FIR MS AT RS.3.52 CRORES (1.20 CRORES + RS. 2.32 CRORES), THAT AS PER THE BOOKS OF ACCOUNTS TOT AL EXEMPT SHARE PROFIT PAID TO THE ASSESSEE WAS RS. 3.30 CRORES,THAT ADDITIONAL INCOME OF RS. 2 2.31 LAKHS SHOWN IN THE RETURN OF INCOME BY THE ASSESSEE,THAT THE AMOUNT IN QUESTION WAS NOT RECEIVED BY THE ASSESSEE FROM THOSE TWO 2672/M/15(10-11) RAJENDRA P. CHITALE 2 PARTNERSHIP FIRMS, THAT THE DISPUTED AMOUNT COULD N OT BE ALLOWED AS EXEMPT ITEM,THAT THE ASSESSEE HAD NOT FILED A REVISED RETURN OF INCOME W ITHIN THE STIPULATED TIME,THAT IT WAS THE DUTY OF THE ASSESSEE TO FILE CORRECT DETAILS OF INC OME,THAT HE HAD CARRIED OUT THE SAME FIGURES IN THE RETURN OF INCOME FOR THE NEXT ASSESSMENT YEA R,THAT HE FILED A REVISED RETURN OF INCOME FOR THE AY.2011-12 ONLY AFTER THE AO RAISED THE ISS UE DURING THE COURSE OF ASSESSMENT PROCEEDINGS,THAT THE ACCOUNTS OF MPCA WERE FINALISE D ON 28/08/2010,THAT HE HAD SHOWN WRONG FIGURE OF SHARE OF PROFIT FROM THE FIRMS IN H IS RETURN OF INCOME,THAT HE COULD NOT TAKE THE PLEA THAT ACCOUNTS OF THE FIRMS WERE FINALISED LATER THAN THE ACCOUNTS OF THE ASSESSEE,THAT THE CAPITAL OF THE ASSESSEE HAD INCREASED AS A RESU LT OF CLAIM MADE BY HIM, THAT HE WAS NOT ABLE TO GIVE ANY SATISFACTION EXPLANATION ABOUT THE INCOME OF RS. 22.31 LAKHS CREDITED IN THE BOOKS,THAT HE WAS A WELL-QUALIFIED PERSON AND WAS H ELD BY A SPECIALISED TEAM,THAT IT WAS NOT A CASE OF IGNORANCE OR MISTAKE,THAT THE CORRECTIVE AC TION WAS TAKEN BY HIM ONLY AFTER THE MISTAKE WAS POINTED OUT BY THE AO. FINALLY,HE HELD THAT INCOME OF RS. 22.31 LAKHS WAS TO BE TREATED AS UNEXPLAINED INCOME CREDITED IN THE BOOKS OF ACCOUNTS. 2.1. AGGRIEVED BY THE ORDER OF THE AO,THE ASSESSEE PREFE RRED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY(FAA)AND MADE ELABORATE SUBMISSI ONS.AFTER CONSIDERING THE ORDER OF THE AO AND THE SUBMISSION OF THE ASSESSEE,HE HELD THAT THE ASSESSEE WAS ENTITLED TO EXEMPTION U/S.10 (2A) OF THE ACT ONLY IN RESPECT OF HIS ACTUA L SHARE PROFIT FROM MPCC AND MPCA,THAT HE HAD CLAIMED SUCH EXEMPTION AT HIGHER ESTIMATED F IGURE,THAT HE WAS ENTITLED TO EXEMPTION FOR RS.3.30 CRORES ONLY, THAT EXCESS EXEMPTION AMOU NTING TO RS.22.31 LAKHS CLAIMED BY HIM COULD NOT BE GRANTED AND THAT SAME WAS RIGHTLY DISA LLOWED BY THE AO,THAT EXCESS EXEMPTION CLAIM COULD HAVE BEEN CORRECTED BY HIM BY FILING A REVISED RETURN OF INCOME, THAT HE CHOSE NOT TO DO SO EVEN WHEN HE HAD AMPLE TIME TO FILE A REVISED RETURN OF INCOME TILL 31/03/ 2012,THAT BY THE TIME THE ACCOUNTS OF BOTH THE FIRM S NOT ONLY FOR THE YEAR UNDER CONSIDERATION BUT ALSO FOR THE SUCCEEDING YEAR HAD GOT FINALISED, THAT HIS CLAIM FOR HIGHER EXEMPTION BECAME FINAL AS PER THE ORIGINAL RETURN OF INCOME, THAT DU RING THE COURSE OF ASSESSMENT PROCEEDINGS THE AO SPECIFICALLY POINTED OUT THAT THE ASSESSEE H AD MADE A WRONG CLAIM,THAT THE ASSESSEE REQUESTED FOR CORRECTION OF THE RETURN OF INCOME.HE REFERRED TO THE CASE OF GOETEZ INDIA LTD.(284 ITR 323) AND HELD THAT WITHOUT FILING A RE VISED RETURN OF INCOME THE ASSESSEE COULD NOT CORRECT THE ORIGINAL RETURN OF INCOME,THAT THE AO HAD NO OTHER CHOICE THAN TO DISALLOW THE EXCESS CLAIM OF EXEMPTION U/S.10 (2) OF THE ACT CLAIMED BY THE ASSESSEE IN THE ORIGINAL RETURN OF INCOME,THAT THE AO WAS RIGHT IN TAXING THE AGGREGAT E EXCESS CLAIM OF EXEMPTION AT RS.22, 31,929/-MADE BY THE ASSESSEE IN HIS RETURN OF INCOM E, THAT THE ASSESSEE HAD NOT BROUGHT TO HIS 2672/M/15(10-11) RAJENDRA P. CHITALE 3 NOTICE ANY DECISION WHICH CONTROVERTED THE STAND TA KEN BY THE AO. HE FURTHER OBSERVED THAT CBDT CIRCULAR NO.14,DATED 11/04/1955 WOULD NOT APPL Y TO THE FACTS OF THE CASE OF THE ASSESSEE,THAT THE ACCOUNTS OF MPCC AND MPCA WERE FI NALISED SIMULTANE -OUSLY ALONG WITH THE ASSESSEES OWN ACCOUNTS,THAT IT COULD NOT BE PL EADED THAT THE CORRECT FIGURE FROM THE ACCOUNTS OF THE FIRM TO HIS INDIVIDUAL ACCOUNTS COU LD NOT BE TRANSFERRED AT ALL, THAT EVEN IF THERE WAS A MISTAKE THERE WAS AMPLE TIME AVAILABLE TO THE ASSESSEE TO CORRECT THE SAME BY FILING REVISED RETURN OF INCOME, THAT THE LAST DATE OF FILING OF REVISED RETURN OF INCOME FOR THE YEAR UNDER APPEAL WAS 31/03/2012,THAT ACCOUNTS OF T HE ASSESSEE AS WELL AS THE PARTNERSHIP FIRMS WERE COMPLETE EVEN FOR THE SUCCEEDING ASSESSM ENT YEAR.FINALLY,HE UPHELD THE ADDITION MADE BY THE AO AND STATED THAT THE AO HAD RIGHTLY I NVOKE THE PROVISIONS OF SECTION 68 OF THE ACT. 2.2. DURING THE COURSE OF HEARING THIS FOR US,THE AUTHOR ISED REPRESENTATIVE(AR)ARGUED THAT THE ASSESSEE HAD DEBITED THE DISPUTED AMOUNT ON 24/9/20 11 BY FILING REVISED RETURN OF INCOME,THAT THE PROVISIONAL INCOME WAS UPLOADED ON 4/9/2010, TH AT THE ACCOUNTS OF THE INDIVIDUAL WERE FINALISED ON 13/10/2010, THAT THE ACCOUNT OF ONE OF THE FIRMS WERE FINALISED ON 28/8/2010,THAT THE ASSESSEE HAD TAKEN THE AMOUNT IN QUESTION FROM THE PROVISIONAL FIGURES,THAT THE ASSESSEE REVISED HIS RETURN AS SOON AS THE MISTAKE WAS POINT ED OUT BY THE AO,,THAT THE DISPUTED AMOUNT WAS PART OF EXEMPT INCOME,THAT IT WAS NOT INCOME AT ALL. HE REFERRED TO PAGE NO.26, 69,85-87 OF THE PB AND STATED THAT IT WAS A GENUINE MISTAKE. HE FURTHER STATED THAT RESPONSIBLE PERSON LOOKING AFTER ACCOUNT SECTION OF BOTH THE FIRMS HAD FILED AN AFFIDAVIT IN THAT REGARD.THE DEPARTMENTAL REPRESENTATIVE (DR) CONTENDED THAT ASS ESSEE REVISED THE RETURN FOR THE AY 2010-11 NOT FOR THE YEAR UNDER APPEAL, THAT THE ASS ESSEE HAD TIME MORE THAN 18 MONTHS TO REVISE THE RETURN, THAT HE FILED THE REVISED ONLY A FTER THE AO CONFRONTED HIM ABOUT THE INCORRECTNESS OF THE INCOME RETURNED, THAT IT WAS A CASE OF CAPITAL BUILD UP THAT THE AO HAD RIGHTLY INVOKED THE PROVISION OF SECTION 68 OF THE ACT. 2.3. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL BEFORE US.WE FIND THAT THE ASSESSEE HAD FILED THE ORIGINAL RETURN WHEREIN HE H AD TAKEN THE PRE-AUDITED FIGURES OF SHARES OF PROFITS FROM BOTH THE ENTITIES,THAT THE AO BROUGHT THE CORRECT FIGURE OF INCOME TO THE NOTICE OF THE ASSESSEE,THAT IN THE RETURN OF INCOME FILED FOR AY.2011-12 HE MADE NECESSARY CORRECTIONS AND RECTIFIED THE MISTAKES THAT OCCURRED IN THE RET URN FILED BY HIM FOR THE YEAR UNDER APPEAL.IT IS A FACT THAT THE INCOME IN QUESTION IS PART OF EX EMPT INCOME I.E.TAXABLE INCOME.BROADLY IT CAN BE HELD THAT DISPUTED INCOME WAS INCOME FOR THE YEAR UNDER CONSIDERATION.THE PERSON 2672/M/15(10-11) RAJENDRA P. CHITALE 4 MANAGING THE ACCOUNTS OF THE ENTITIES,FROM WHERE TH E ASSESSEE RECEIVED THE SALARY,HAS FILED AN AFFIDAVIT DESCRIBING THE CIRCUMSTANCES IN WHICH CER TAIN UNVERIFIED DETAILS ABOUT THE SALARY WAS SUPPLIED TO THE ASSESSEE.NO DOUBT IT WAS DUTY OF TH E ASSESSEE,AS A PROFESSIONAL,TO VERIFY THE CORRECTNESS OF THE STATEMENT OF INCOME FILED WITH T HE RETURN OF INCOME.BUT,THE ARGUMENTS OF THE ASSESSEE-THAT HE WAS UNDER A BONAFIDE BELIEF AB OUT THE CORRECTNESS OF THE SALARY STATEMENT ISSUED BY THE FIRMS-CANNOT BE BRUSHED ASIDE LIGHTLY .AT THE MOST IT WAS AN INADVERTENT TECHNICAL BREACH.EVEN IF THE CORRECT FIGURE HAD BEE N SHOWN IN THE ORIGINAL RETURN,IT WOULD HAVE FORMED PART OF EXEMPT INCOME. THE NET RESULT W OULD TO THAT NO TAX WOULD BE PAYABLE BY THE ASSESSEE.WE ARE AWARE THAT THE ASSESSEE SHOULD NOT TAKE THE FILING OF RETURNS OF INCOME IN A CASUAL MANNER.BUT,IN OUR OPINION, IT ONE OF THE R ARE CASES WHERE UNINTENTIONAL MISTAKE HAS OCCURRED.CONSIDERING THE PECULIAR FACTS AND CIRCUM STANCES OF THE CASE INCLUDING THE AFFIDAVIT OF THE RESPONSIBLE PERSON ISSUING CERTIFICATES OF S ALARY AND FILING OF REVISED RETURN,WE ARE OF THE OPINION THAT THE PROVISIONS OF SECTION 68 ARE N OT APPLICABLE TO THE DISPUTED AMOUNT- ESPECIALLY WHEN IT WAS PART OF EXEMPT INCOME.FIRST GROUND OF APPEAL IS DECIDED IN FAVOUR OF THE ASSESSEE. 3. SECOND GROUND OF APPEAL IS ABOUT DISALLOWANCE OF RS .4,727/-MADE U/S. 14A READ WITH RULE 8D OF THE INCOME TAX RULES,1962 (RULES).DURING THE ASSESSMENT PROCEEDINGS, THE AO FOUND THAT THE ASSESSEE HAD CLAIMED EXEMPT INCOME OF RS.3 .79 CRORES IN HIS RETURN,THAT THE EXEMPT INCOME INCLUDED PPF INTEREST,DIVIDEND ON SHARES,DIV IDEND ON MUTUAL FUNDS,DIVIDEND ON CASH MANAGEMENT FUNDS,INTEREST ON BONDS AND SHARE ON PRO FIT FROM PARTNERSHIP FIRMS. HE DIRECTED THE ASSESSEE TO EXPLAIN AS TO WHY PROVISIONS OF SEC TION 14A OF THE ACT READ WITH RULE 8D OF THE RULES SHOULD NOT BE APPLIED.AFTER CONSIDERING T HE SUBMISSION OF THE ASSESSEE,THE AO HELD THAT TO MANAGE THE PORTFOLIOS,RESULTING IN ACCRUAL OF EXEMPT INCOME,CERTAIN EXPENSES MUST HAVE BEEN INCURRED BY THE ASSESSEE,THAT IT WAS A FI T CASE FOR APPLYING THE PROVISIONS OF RULE 8D OF THE RULES R.W.S.14A.THE AO WORKED OUT THE DIS ALLOWANCE AT RS.7,31,979/-.HE FURTHER OBSERVED THAT THE ASSESSEE HAD DISALLOWED EXPENDITU RE OF RS.4,727/-,HENCE THE DISALLOWANCE HAD TO BE RESTRICTED TO RS.4,727/-. 3.1. BEFORE THE FAA,THE ASSESSEE MADE ELABORATE SUBMISSI ONS.HE REFERRED TO THE PROVISIONS OF SUB-SECTIONS 2 AND 3 OF SECTION 14A AND RELIED UPON THE JUDGMENT OF HONORABLE BOMBAY HIGH COURT IN THE CASE OF GODREJ AND BOYCE MANUFACTURING COMPANY LTD.(328 ITR 81).THE FAA HELD THAT THE ASSESSEE HAD CLAIMED THAT IT HAD NOT INCURRED ANY EXPENSE FOR EARNING EXEMPT INCOME, THAT THE ARGUMENT COULD NOT BE ACCEPTED,THA T THE ASSESSEE HAD NOT DEMONSTRATED THAT 2672/M/15(10-11) RAJENDRA P. CHITALE 5 ABSOLUTELY NO EXPENSES WERE INCURRED FOR MAKING THE INVESTMENTS/EARNING EXEMPT INCOME, THAT EVEN INDIRECT EXPENSES COULD HAVE APPROXIMATE COST TO THE EXEMPT INCOME MUST HAVE BEEN INCURRED,THAT SAME HAD TO BE DISALLOWED,THAT T HE AO HAD DISALLOWED THE ACTUAL EXPENDI - TURE ONLY.HE UPHELD THE ORDER OF THE AO. 3.2. BEFORE US,THE AR STATED THAT OUT OF RS.4,727/-,RS.2 500/- WERE PAID ON ACCOUNT OF PROFESSIONAL TAX AND SAME WAS STATUTORY IN NATURE, THAT IT HAD TO BE INCURRED IRRESPECTIVE OF THE FACT THAT WHETHER THE ASSESSEE HAD EARNED TAXABLE INCOME OR EXEMPT INCOME, THAT THE ASSESSEE HAD INCURRED EXPENDITURE OF RS.2,267/- TOWARDS TAX AUDIT/ACCOUNTING FEE, THAT THE PAYMENT WAS MADE FOR EARNING TAXABLE INCOME, THAT DISALLOWA NCE WAS MADE BY THE REVENUE AUTHORITIES ON THE ALLEGED BASIS THAT SAME WAS INCURRED FOR EAR NING EXEMPT INCOME SHOULD BE DELETED. 3.3. BEFORE US,THE AR ARGUED THAT THERE WAS NO JUSTIFIC ATION FOR MAKING ANY DISALLOWANCE,THAT THE EXPENSES WERE NOT INCURRED FOR EARNING EXEMPT I NCOME.THE DR SUPPORTED THE ORDER OF THE FAA. 3.4. WE HAVE HEARD THE RIVAL SUBMISSIONS.WE FIND THAT TH E ASSESSEE NOT CLAIMED ANY EXPENDITURE THAT HAD ANY DIRECT OR INDIRECT RELATIO N WITH EXEMPT INCOME.THE PURPOSE BEHIND THE INTRODUCTION OF SECTION 14A R.W.RULE 8D OF THE RULES WAS TO DISCOURAGE THE TENDENCY OF ASSESSES WHO WOULD CLAIM EXPENSES AGAINST EXEMPT IN COME.THUS,THEY WERE AVAILING DOUBLE BENEFIT.NOW,THE SETTLED POSITION OF LAW IS THAT EXP ENSES INCURRED FOR EARNING TAX FREE INCOME WOULD NOT BE ALLOWED.BUT, IN AN INCURS EXPENDITURE FOR EARNING TAXABLE INCOME NO DISALLOWANCE CAN BE MADE FOR SUCH A CLAIM.IN THE CA SE BEFORE US,THE ASSESSEE HAD INCURRED EXPENSES UNDER THE HEAD PAYMENT OF PROFESSIONAL TAX ES AND PAYMENT F AUDIT FEES.IN OUR OPINION,BOTH THE ITEMS ARE NOT RELATED WITH EARNING OF EXEMPT INCOME.THEREFORE,REVERSING THE ORDER OF THE FAA,WE DECIDE SECOND GROUND OF APPEAL IN FAVOUR OF THE ASSESSEE. 4. NEXT GROUND DEALS WITH DISALLOWANCE OF RS.81,227/- UNDER THE HEAD LOSS FROM FUTURE CONTRACTS.AS PER THE ASSESSEE,THE AO DID NOT CONSID ER HIS REQUEST,MADE,VIDE LETTER DATED 11/ 10/201,TO ALLOW LOSS OF RS.81,227/-SUFFERED IN THE MONTH OF MAY,2009 UNDER THE HEAD FUTURE CONTRACT.HE FURTHER MENTIONED THAT LOSS INCURRED ON ACCOUNT OF FUTURE SHARE TRADE ACTIVITY SHOULD BE ALLOWED AGAINST THE INCOME FOR THE YEAR U NDER CONSIDERATION, THAT AO SHOULD HAVE ALLOWED THE SAID CLAIM UNDER THE HEAD BUSINESS LOSS ,THAT THE LOSSES HAD OCCURRED ON RECOGNISED NATIONAL STOCK EXCHANGE IN ACCORDANCE WI TH THE EXPLANATION UNDER PROVISO (D) TO SECTION 43 (5) OF THE ACT,THAT THE LOSS WAS NOT SPE CULATIVE LOSS. 2672/M/15(10-11) RAJENDRA P. CHITALE 6 4.1. BEFORE US,THE AR RELIED UPON THE CASE OF PRITHVI BR OKERS (336ITR349) AND STATED THAT AS AN APPELLATE AUTHORITY,THE FAA SHOULD HAVE ADMITTED THE CLAIM MADE BY THE ASSESSEE WHICH WAS NOT PART OF THE STATEMENT OF INCOME.THE DR LEFT THE ISSUE TO THE DISCRETION OF THE BENCH. 4.2. WE FIND THAT THE FAA HAD NOT CONSIDERED THE CLAIM O F THE ASSESSEE AS IT WAS MADE BEFORE HIM FOR THE FIRST TIME,THAT IN THE CASE OF PRITHVI BROKERS (SUPRA)THE HONBLE JURISDICTIONAL HIGH COURT HAS HELD THAT THE APPELLATE AUTHORITIES ARE NOT BARRED FROM ENTERTAINING NEW CLAIMS MADE BY THE AO. THEREFORE,IN THE INTEREST OF JUSTIC E,WE ARE RESTORING THE ISSUE TO THE FILE OF THE FAA FOR FRESH ADJUDICATION. 5 .LAST GROUND OF APPEAL IS ABOUT NOT DEALING WITH TH E ASSESSEES CLAIM OF TAX-FREE INTEREST INCOME RECEIVED FROM IIFC BONDS,AMOUNTING TO RS.43, 932/-.AS PER THE AR THE FAA HAS NOT DEALT WITH THE ISSUE WHILE DECIDING THE APPEAL FILE D BY THE ASSESSEE.THEREFORE,WE DIRECT THE FAA TO ADJUDICATE THE ISSUE AFTER AFFORDING A REASO NABLE OPPORTUNITY OF HEARING TO THE ASSESSEE.FOURTH GROUND IS PARTLY ALLOWED. AS A RESULT, APPEAL FILED BY THE ASSESSEE STANDS PA RTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH AUGUST, 2017. 28 , 2017 SD/- SD/- ( / RAM LAL NEGI ) ( / RAJENDRA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; /DATED : .08 .2017. JV.SR.PS. / COPY OF THE ORDER FORWARDED TO : 1. APPELLANT / 2. RESPONDENT / 3. THE CONCERNED CIT(A)/ , 4. THE CONCERNED CIT / 5. DR G BENCH, ITAT, MUMBAI / , , . . . 6. GUARD FILE/ //TRUE COPY// / BY ORDER, / DY./ASST. REGISTRAR , /ITAT, MUMBAI.