KANTILAL NANJI KARANI, MUMBAI V. ITO 14(1)(4), MUMBAI

ITA 2880/MUM/2011

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3328 (ITAT-MUMBAI)
• Duration Of Justice: 5 year(s) 4 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-09-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 09-02-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 12-04-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: A B KOLI
• Section: 14A; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI B.R. BASKARAN (AM) & SHRI SANJAY GARG (JM) I.T.A. NO. 2880 /MUM/ 20 1 1 (ASSESSMENT YEAR 200 7 - 0 8 ) SHRI KANTILAL NANJI KARANI C/O. M/S. MITESH MEHTA & ASSOCIATES 432, LAMINGTON ROAD OPERA HOU SE 2 ND FLOOR, ABOVE DENA BANK MUMBAI - 400 006. VS. ITO 14(1)(4) MUMBAI. ( APPELLANT ) ( RESPONDENT ) PAN NO . AACPK4348R ASSESSEE BY NONE DEPARTMENT BY SHRI A.B. KOLI DATE OF HEARING 25 .8 . 201 6 DATE OF PRONOUNCEMENT 2.9 . 201 6 O R D E R PER B.R. BASKARAN (AM) : - THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 3.3.2011 PASSED BY LEARNED CIT(A) - 25, MUMBAI AND IT RELATES TO A.Y. 2007 - 08. 2. AT THE TIME OF HEARING ONE OF THE EMPLOYEE S OF A CHARTERED ACCOUNTANT FIRM AP PEARED AND SOUGHT ADJOURNMENT. HOWEVER, WE NOTICED THAT THE ASSESSEE HAS NOT GIVEN ANY POW ER OF ATTORNEY IN FAVOUR OF IT AND HENCE WE DECLINE D TO ACCEPT THE PETITION MOVED BY THE FIRM. 3. WE NOTICED THAT THE ASSESSEE IS CONTESTING THE ADDITION OF ` 7, 27,527/ - MADE U/S. 14A OF THE ACT. 4. WE HEARD LEARNED DEPARTMENTAL REPRESENTATIVE AND PERUSED THE RECORD. WE NOTICED FROM THE ASSESSMENT ORDER THAT THE ASSESSING OFFICER HAS FOLLOWED METHODOLOGY GIVEN U/R. 8D OF THE I.T. RULES FOR COMPUTIN G THE DISALLOWA NCE U/S. 14A OF THE ACT. HON'BLE MUMBAI HIGH COURT IN THE CASE OF GODREJ & BOYCE KANTILAL NANJI KARANI 2 MANUFACTURING CO. LTD. 328 ITR 81 HAS EXPRESSED THE VIEW THE PROVISIONS OF RULE 8D WI LL APPLY FROM A.Y. 2008 - 09 ONLY. HON'BLE HIGH COURT HAS ALSO HELD THAT DISALLOWANCE U/S. 1 4A SHOULD BE COMPUTED FOR THE YEARS EARLIER TO A.Y. 2008 - 09 ON A REASONABLE BASIS. SINCE THE YEAR INVOLVED IN THIS APPEAL IS A.Y. 2007 - 08, DISALLOWANCE U/S. 14A HAS TO BE COMPUTED ON A REASONABLE BASIS BY CONSIDERING THE FACTS AVAILABLE ON RECORD. SINCE TH E ASSESSING OFFICER HAD COMPUTED DISALLOWANCE AS PER RULE 8D AND SINCE THE SAME HAS BEEN CONFIRMED BY LEARNED CIT(A), WE ARE OF THE VIEW THAT THIS ISSUE REQUIRES FRESH EXAMINATION AT THE END OF THE ASSESSING OFFICER. ACCORDINGLY, WE SET ASIDE THE ORDER PAS SED BY LEARNED CIT(A) ON THIS ISSUE AND RESTORE THE SAME TO THE FILE OF THE ASSESSING OFFICER WITH THE DIRECTION TO COMPUTE THE DISALLOWANCE U/S. 14A ON REASONABLE BASIS BY DULY CONSIDERING THE FACTS, INFORMATION AND EXPLANATION THAT MAY BE FURNISHED BY TH E ASSESSEE. 5. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER HAS BE EN PRONOUNCED IN THE COURT ON 2.9 .2016 SD/ - SD/ - (SANJAY GARG ) (B.R.BASKARAN ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 2 / 9 / 20 1 6 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE C OPY// ( DY./ASSTT. REGISTRAR) ITAT, MUMBAI PS KANTILAL NANJI KARANI 3 S.NO DESCRIPTION DATE INTLS 1 PREPARED BY BRB /DICTATION PAD ENCLOSED 2 6 .8. 2016 2 DRAFT DICTATED ON 26 .8 . 2016 SR.P.S. 3 DRAFT PLACED BEFORE AUTHOR 2 6 . 8 . 2016 SR.P.S 4 DRAFT PROPO SED & PLACED BEFORE THE SECOND MEMBER JM /AM 5 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 6 APPROVED DRAFT COMES TO THE SR.P.S./PS SR.P.S. 7. KEPT FOR PRONOUNCEMENT ON 2 . 8 . 201 6 SR. P.S. 8. FILE SENT TO THE BENCH CLERK .8. 201 6 SR.P.S. 9 DATE ON WHICH FILE GOES TO THE HEAD CLERK 10 DATE OF DISPATCH OF ORDER