SHREE OM BROKERS P.LTD, MUMBAI V. ITO 4(2)(2), MUMBAI

ITA 2834/MUM/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 83550 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-08-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 12-08-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 10-04-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: VIJAY KUMAR SAMI
• Assessee Lawyers: PALLAVI GUPTA
• Section: 14A

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI BEFORE SHRI N.K.BILLAIYA, AM, AND SHRI SANJAY GARG, JM ./ I.T.A. NO. 2834/MUM/2013 ( / ASSESSMENT YEAR: 2009-10) S HREE OM BROKERS PVT. LTD. 82, MAKER CHAMBERS III, NARIMAN POINT, MUMBAI-400021 / VS. THE INCOME - TAX OFFICER, CIRCLE-4(2)(2), AAYAKAR BHAVAN, MUMBAI-400020 ./ PAN : AADCS9619R ( / APPELLANT) .. ( / RESPONDENT ) / ASSESSEE BY: MS. PALLAVI GUPTA / RESPONDENT BY : SHRI VIJAY KUMAR SAMI / DATE OF HEARING : 12/08/2014 / DATE OF PRONOUNCEMENT : 20/08/2014 !' / O R D E R PER N.K.BILLAIYA, AM: THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST TH E ORDER OF THE LD. CIT(A)-8, MUMBAI, DATED 07/12/2012 PERTAINING T O ASSESSMENT YEAR 2009-10. 2. THE SOLE GRIEVANCES OF THE ASSESSEE IS THAT THE LD. CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE TO THE EXTENT OF ` .1,90,609/- OUT OF ` . 2,15,609/- DISALLOWED BY THE AO UNDER SECTION 14A O F THE ACT READ WITH RULE 8D. 3. THE APPEAL IS BARRED BY 56 DAYS. THE ASSESSEE HA S FILED AN AFFIDAVIT JUSTIFYING THE DELAY IN FILING THE APPEAL WITH A PR AYER FOR CONDONATION OF THE DELAY. 4. WE HAVE CAREFULLY PERUSED THE CONTENTS OF THE AF FIDAVIT. WE FIND THAT THE ASSESSEE WAS PREVENTED BY REASONABLE AND SUFFIC IENT CAUSE FOR NOT FILING THE APPEAL ON TIME, THE DELAY IS CONDONED. ITA NO.2834/MUM/2013 2 5. THE ASSESSEE IS AN INVESTOR IN SHARES AND SECURI TIES. THE RETURN WAS SELECTED FOR SCRUTINY ASSESSMENT PROCEEDING. DURIN G THE COURSE OF SCRUTINY PROCEEDING, THE AO NOTICED THAT THE ASSESS EE HAS EARNED DIVIDEND FROM SHARES AMOUNTING TO ` .3,62,008/- WHICH WAS CLAIMED AS EXEMPT U/S 10(34) OF THE ACT. THE ASSESSEE WAS ASKED TO EXPL AIN WHY EXPENSES ATTRIBUTABLE TO EARN THE DIVIDEND INCOME SHOULD NOT BE DISALLOWED. THE ASSESSEE VIDE ITS LETTER DATED 31/10/2011 HAS FURNI SHED A WORKING OF DISALLOWANCE U/S 14A AT ` .2,15,609/-. THE AO DISALLOWED THE SAME. ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A). IT WAS CLAIMED BEFORE THE CIT(A) THAT THE EXPENDITURE WOULD HAVE BEEN INCURRE D BY THE ASSESSEE EVEN IF THERE WAS NO DIVIDEND INCOME AND THEREFORE THE S AME WERE NOT INCURRED FOR EARNING THE DIVIDEND INCOME. IT WAS ALSO EXPLA INED THAT THE ASSESSEE RECEIVED DIVIDEND ONLY IN RESPECT OF TWO SCRIPS AND THE AMOUNT WAS CREDITED THROUGH THE ELECTRONIC SYSTEM. IT WAS FUR THER EXPLAINED THAT INTEREST INCOME ON REC BONDS HAS BEEN OFFERED AS IN COME THEREFORE THE DISALLOWANCE MADE BY THE AO IS UNCALLED FOR. IN AL TERNATIVE, THE ASSESSEE CLAIMED THAT THE DISALLOWANCE SHOULD BE RESTRICTED TO ` .1,90,609/-. THE CIT(A) ACCEPTED THE ALTERNATIVE PLEA OF THE ASSESSE E AND RESTRICTED THE DISALLOWANCE TO ` .1,90,609/-. 6. AGGRIEVED BY THIS THE ASSESSEE IS BEFORE US. 7. THE COUNSEL FOR THE ASSESSEE RELIED UPON THE DEC ISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. RELIANCE INDUSTRIES LTD. [2011] 339 ITR 632 (BOM). IT IS THE SAY OF THE COUNSEL THAT IN THE LIGHT OF T HE DECISION OF THE HONBLE BOMBAY HIGH COURT NO DISALL OWANCE IS TO BE MADE. PER CONTRA , THE LD. DR STRONGLY SUPPORTED THE FINDINGS OF THE C IT(A). 7. WE HAVE CAREFULLY PERUSED THE ORDER OF THE CIT(A ). WE FIND THAT THE AO HAS MADE THE DISALLOWANCE AS PER THE WORKING GIV EN BY THE ASSESSEE AT THE TIME OF THE ASSESSMENT PROCEEDINGS. WE FURTH ER FIND THAT THE CIT(A) HAS RESTRICTED THE DISALLOWANCE TO ` .1,90,609/- AS PER THE WORKING GIVEN BY THE ASSESSEE BEFORE THE CIT(A). AS BOTH THE AUTHOR ITIES HAVE PROCEEDED ON ITA NO.2834/MUM/2013 3 THE WORKING OF THE DISALLOWANCE GIVEN BY THE ASSESS EE, WE FIND NO MERIT IN THE CASE OF THE ASSESSEE. FINDINGS OF THE CIT(A) AR E ACCORDINGLY CONFIRMED RELIANCE PLACED ON THE DECISION OF THE HONBLE BOMB AY HIGH COURT IS MISPLACED ON THE FACTS MENTIONED HERE IN ABOVE. 8. APPEAL FILED BY THE ASSESSEE IS ACCORDINGLY DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 20/08/2014 !' # $ % &! 20 /08/2014 , ' ( SD/- (SANJAY GARG) SD/- (N.K.BILLAIYA) JUDICIAL MEMBER ACCOUNTANT MEMBER $ ) MUMBAI; &! /DATED : 20 TH AUGUST, 2014. F{X~{TA F{X~{TA F{X~{TA F{X~{TA P.S. P.S. P.S. P.S. !' # $%&' (!'% / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. * ( ) / THE CIT- , MUMBAI. 4. * / CIT(A)- , MUMBAI 5. +,' --./ , ./ , $ ) / DR, ITAT, MUMBAI 6. '01 2 / GUARD FILE. !' ) / BY ORDER, + - //TRUE COPY// * / )+ , (DY./ASSTT. REGISTRAR) , $ ) / ITAT, MUMBAI