TSR DARASHAW LTD, MUMBAI V. DCIT 1(3), MUMBAI

ITA 3012/MUM/2013

• Counselvise Citation: 301219914 RSA 2013
• Duration Of Justice: 2 year(s) 3 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-07-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Next Hearing Date: 29-07-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 18-04-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MRS VINITA MENON
• Assessee Lawyers: RYAN SALDANHA
• Section: 14A

Judgement Text

1 , INCOME TAX APPELLATE TRIBUNAL,MUMBAI E BENCH . . , , , BEFORE S/SH. A.D. JAIN,JUDICIAL MEMBER & RAJEND RA,ACCOUNTANT MEMBER /. ITA NO. 3012 /MUM/201 3 , / ASSESSMENT YEAR - 200 9 - 10 M/S. TSR DARASHAW LIMITED 6 - 10 HAJI MOOSA PATRAWALA IDL. ESTATE 20, DR. E. MOSES RD. MAHALAXMI,MUMBAI - 400 011. PAN: AAACB 3282 G VS DCIT - 1(3) MUMBAI - 4 00 077. ( / APPELLANT ) ( / RESPONDENT ) /ASSESSEE BY : SHRI RYAN SALDANHA AR / REVENUE BY : MRS. VINITA MENON - D R / DATE OF HEARING :29 - 07 - 2015 / DATE OF PRONOUNCEMENT :29 - 07 - 2015 , 1961 254 ( 1 ) O RDER U/S.254(1)OF THE INCOME - TAX ACT,1961(ACT) PER RAJENDRA, AM - CHALLENGING THE ORDER OF THE CIT(A) - 2,MUMBAI,D ATED 1 5.03 .201 5 , THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1.THE LD. COMMISSIONER OF INCOME TAX(AP PEALS) ERRED IN CONFIRMING DISALLOWANCE U/S. 14A AT RS.5,12,853/ - WITHOUT APPRECIATING THE FACT THAT NO EXPENDITURE WHATSOEVER HAS BEEN INCURRED FOR EARNING THE EXEMPT DIVIDEND INCOME. 2.THE APPELLANT PRAYS THAT THE ABOVE DISALLOWANCCE CONFIRMED MAY BE DEL ETED. 3.THE APPELLANT CRAVES YOUR HONOURS LEAVE TO ADD, ALTER OR AMEND ANY GROUND OF APPEAL AT THE TIME OF HEARING OR BEFORE. ASSESSEE - COMPANY,E NGAGED IN THE BUSINESS OF REGISTRAR AND SHARE TRANSFER AGENT, FILED ITS RETURN OF INCOME ON 29.09.2009, DECLARIN G AN INCOME OF RS.4 .28 CRORES.THE ASSESSING OFFICER ( AO ) COMPLETED ASSESSMENT U/S.143(3) OF THE ACT , DETERMINING ITS INCOME AT RS. 4.61 CRORES. 2. DU RING THE ASSESSMENT PROCEEDINGS, THE AO FOUND THAT THE ASSESSEE - COMPANY WAS IN RECEIPT OF INCOME OF DIVIDEND INCOME OF RS.28.14 LAKHS,THAT IT HAD CLAIMED EXEMPTION ABOUT THE SAID AMOUNT.HE DIRECTED THE ASSESSEE TO FILE SUBMIT AS TO WHY THE PROVISIONS OF SECTION 14A OF THE ACT SHOULD NOT BE INVOKED AND WHY DISALLOWANCE AS PER RULE 8D OF THE INCOME TAX RULES,1962 SHOULD NOT BE MADE.AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE THE AO DISALLOWED AN AMOUNT OF RS. 5.12 LAKHS 3 .AGGRIEVED BY THE ORDER OF THE AO,THE ASSESSEE PREFERRED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY(FAA).AS PER THE ORDER OF THE FAA HE H AD ISSUED NOTICES TO THE ASSESSEE ON TWO OCCASIONS, BUT NONE APPEARED BEFORE HIM.CONSIDERING THIS HE HELD THAT THE ASSESSEE WAS NOT ITA/ 3012/M/13 ,AY. 09 - 10 2 INTERESTED IN PURSUING THE APPEAL FILED BY IT.CONFIRMING THE ORDER OF THE FAA,HE DISMISSED THE APPEAL FILED BY THE ASSESSEE. 4 .BEFORE US,THE AUTHORISED REPRESENTATIVE(AR)SUBMITTED THAT THE ASSESSEE HAD NOT RECEIVED ANY NOTICE,THAT THE FAA DECIDED THE APPEAL WITHOUT ADJUDICATING THE GROUNDS RAISED BY THE ASSESSEE. DEPARTMENTAL REPRESENTATIVE(DR)LEFT THE ISSUE TO THE DISCRETION O F THE BENCH. 5. AFTER CONSIDERING THE MATERIAL BEFORE US,WE ARE OF THE OPINION THAT THE FAA HAS DECIDED THE ISSUE WITHOUT DISCUSSING THE MERITS OF THE CASE.ISSUING OF HEARING NOTICE/S AND SERVICE OF THE NOTICE/S ARE TWO DIFFERENT THINGS.THE LEGAL REQUIREMEN T OF A VALID ORDER IS NOT MERE ISSUE OF NOTICE - THE ADJUDICATING AUTHORITY HAS TO PROVE THAT THE NOTICE ISSUED BY IT WAS ALSO SERVED UPON THE APPLICANT AND THUS HE WAS AWARE OF THE DATE OF HEARING.IF THE ASSESSEE DOES NOT APPEAR EVEN AFTER SERVICE OF NOTICE THE ADJUDICATING AUTHORITY CANNOT JUST DISMISS THE APPEAL. HE HAS TO PASS A SPEAKING AND REASONED ORDER.IN THE CASE UNDER CONSIDERATION,THE FAA HAS NOT DEALT THE ISSUE BEFORE HIM ON MERITS,SO,IN THE INTEREST OF JUSTICE,WE ARE REMITTING BACK THE ISSUE TO H IS FILE FOR FRESH ADJUDICATION.HE WILL AFFORD A REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE.EFFECTIVE GROUND OF APPEAL IS DECIDED IN FAVOUR OF THE ASSESSEE,IN PART. AS A RESULT APPEAL FILED BY THE ASSESSEE STANDS PARTLY ALL OWED. . ORDER PRONOUNCED IN THE OPEN COURT ON 2 9 TH ,JULY,2015. 29 , 2015 SD/ - SD/ - ( . . /A.D. JAIN) ( / RAJENDRA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / MUMBAI, /DATE:29 .07.20 15 . . . JV.SR.PS. / COPY OF THE ORDER FORWARDED TO : 1. APPELLANT / 2. RESPONDENT / 3. THE CONCERNED CIT(A)/ , 4. THE CONCERNED CIT / 5. DR E BENCH, ITAT, MUMBAI / , , . . . 6. GUARD FILE/ //TRUE COPY// / BY ORDER, / DY./ASST. REGISTRAR , / ITAT, MUMBAI.