UTPAL KAPADIA, MUMBAI V. ITO 5(1)(1), MUMBAI

ITA 3112/MUM/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 2204 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 6 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-11-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 07-03-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 23-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RANATHIR GUPTA
• Assessee Lawyers: CHETAN I SHAH
• Keywords: Business expenditure; Opportunity of being heard
• Section: 143(3); 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'F' BENCH, MUMBAI BEFORE SHRI JASON P. BOAZ, ACCOUNTANT MEMBER AND SHRI AMARJIT SINGH, JUDICIAL MEMBER ITA NO. 3112/MUM/2013 (ASSESSMENT YEAR: 2009-10) SHRI UTPAL KAPADIA VS. INCOME TAX OFFICER - 5(1)(1) C/O H.C. SHAH & CO., CAS YUSUF BLDG., 4 TH FLOOR V.N. ROAD, FORT MUMBAI 400001 MUMBAI PAN AABPK3340C APPELLANT RESPONDENT APPELLANT BY: SHRI CHETAN I SHAH RESPONDENT BY: SHRI RANATHIR GUPTA DATE OF HEARING: 31.11.2016 DATE OF PRONOUNCEMENT: 09.11.2016 O R D E R PER JASON P. BOAZ, A.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT(A)- 9, MUMBAI DATED 25.02.2013 FOR A.Y. 2009-10. 2. THE FACTS OF THE CASE, BRIEFLY, ARE AS UNDER: - 2.1 THE ASSESSEE, AN INSURANCE CONSULTANT, A DIRECT OR OF ATHENA INSURANCE AND REINSURANCE BROKERS P. LTD. FILED HIS RETURN OF INCOME FOR A.Y. 2009-10 ON 20.01.2010 DECLARING TOTAL INCOME O F ` 9,27,260/- FROM SALARY, BUSINESS, CAPITAL GAINS AND OTHER SOURCES. THE RETURN WAS PROCESSED UNDER SECTION 143(1) OF THE INCOME TAX AC T, 1961 (IN SHORT 'THE ACT') AND THE CASE WAS SUBSEQUENTLY TAKEN UP FOR SC RUTINY. THE ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) OF THE ACT VIDE ORDER DATED 31.10.2011 WHEREIN THE INCOME OF THE ASSESSEE WAS DETERMINED A T ` 24,06,921/- IN VIEW OF THE FOLLOWING ADDITIONS/DISALLOWANCES: - (I) OUT OF EXPENSES CLAIMED ` 9,69,197/ - (II) OUT OF EXPENSES OF CITI BANK CREDIT CARD ` 70,059/ - ITA NO. 3112/MUM/2013 SHRI UTPAL KAPADIA 2 (III) OUT OF EXPENSES OF AMERICAN EXPRESS CREDIT CARD ` 2,48,840/ - (IV) OUT OF EXPENSES CLAIMED FROM INCOME FROM OTHER SOURCES ` 1,05,423/ - (V) UNDER SECTION 14A R.W. RULE 8D ` 86,141/ - 2.2 AGGRIEVED BY THE ORDER OF ASSESSMENT FOR A.Y. 2 009-10, DATED 31.10.2011, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A)-9, MUMBAI WHO DISPOSED OFF THE SAME VIDE IMPUGNED ORDER DATED 25.02.2013 ALLOWING THE ASSESSEE PARTIAL RELIEF OF ` 4,02,540/- AGAINST THE TOTAL EXPENDITURE OF ` 14,79,660/- DISALLOWED BY THE ASSESSING OFFICER (AO ). 3. THE ASSESSEE BEING STILL AGGRIEVED BY THE IMPUGNED ORDER OF THE LEARNED CIT(A)-9, MUMBAI DATED 25.02.2013 FOR A.Y. 29009-10 HAS PREFERRED THIS APPEAL RAISING THE FOLLOWING GROUNDS : - THE APPELLANT AVERS THAT THE LEARNED C.I.T. (A), 9 , MUMBAI HAS ERRED IN UPHOLDING THE DISALLOWANCES / ADDITIONS MADE BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER PASSED U/S. 143(3) OF THE I.T. ACT, 1961. THE APPELLANT FURTHER AVERS THAT FOLLOWING DISALLOW ANCES MADE BY THE ASSESSING OFFICER AND UPHELD BY THE LEARNED C.I.T ( A), 9, MUMBAI SHOULD HAVE BEEN ALLOWED IN ITS ENTIRETY AS UNDER:- A) DISALLOWANCE ON ACCOUNT OF EXPENSES CLAIMED RS. 9,6 9,197/- B) DISALLOWANCE ON ACCOUNT OF CITIBANK CREDIT CARD EXPENSES RS. 70,059/- C) DISALLOWANCES ON ACCOUNT OF AMERICAN EXPRESS CARD EXPENSES RS. 2,48,840/- D) DISALLOWANCE UNDER THE HEAD, INCOME FROM OTHER SOURCES ON ACCOUNT OF DEDUCTION U/S. 14A R.W.RULE 8D RS. 1,91,564/- THE APPELLANT PRAYS THE DISALLOWANCES / ADDITIONS M ADE BY THE ASSESSING OFFICER AND THE C.I.T.(A) 9, MUMBAI, UPHO LDING THEM IS UNJUST, UNFAIR, AND SHOULD HAVE BEEN ALLOWED / DELE TED. THE APPELLANT HEREBY RESERVES THE RIGHT TO ADD TO, TO ALTER AND OR TO AMPLIFY THE GROUNDS OF APPEAL. 4. BEFORE US, THE ASSESSEE HAS FURNISHED THE FOLLOWING WRITTEN SUBMISSIONS GROUNDWISE/ITEMWISE IN SUPPORT OF HIS P LEA THAT THE IMPUGNED ORDER BE SET ASIDE, SINCE THE AUTHORITIES BELOW, PARTICULARLY THE LEARNED CIT(A) HAS BEEN EITHER SILENT ON OR TOTALLY DISREGARDED THE PLEAS ITA NO. 3112/MUM/2013 SHRI UTPAL KAPADIA 3 AND SUBMISSIONS MADE OR NOT ASSIGNED ANY COGENT REA SONS FOR THE FINDINGS RENDERED WITHOUT EVEN TOUCHING UPON OR CONSIDERING THE ASSESSEES ARGUMENTS THAT HAD BEEN PUT FORTH. THE GROUNDWISE W RITTEN SUBMISSIONS FILED VIDE THE ASSESSEES LETTER DATED 18.07.2016 A RE EXTRACTED HEREUNDER: - GROUND NO A:- DNLLOWANCE OF EXPENSES CLAIMED AGAINST CONSULTANCY INCOME:- 1. THE LEARNED ASSESSING OFFICER HAD DISALLOWED AN AMOUNT OF RS. 14,79,660/- AGAINST AN EXPENSE OF RS. 10,77,120/- CLAIMED BY YOUR PETITIONER, THEREBY MAK ING AN ADDITIONAL DISALLOWANCE OF RS. 4,02,540/- 2. THE LEARNED COMMISSIONER OF INCOME TAX VIDE HIS APPELLATE ORDER DATED 25.02.2013 HAD DIRECTED THE LEARNED ASSESSING OFFICER TO REDUCE THE EXCESSIVE DISALLOWANCE OF RS. 4,02,540/- 3. YOUR PETITIONER PRAYS THAT THE LEARNED COMMISSIONER HAS ONLY DISALLOWED THE EXCESS DISALLOWANCE AMOUNTING TO RS. 4,02,540/- WHEREAS HE IS COMPLETEL Y SILENT AND HAS NOT TOUCHED UPON THE POINT OF DISALLOWANCE MADE BY THE LEARNED ASSESSING OFFICER OF THE BASIC EXPENSES CLAIMED AMOUNTING TO RS. 9,69,19 7/- AGAINST THE CONSULTANCY INCOME OF RS. 12,00,000/-. 4. YOUR PETITIONER AVERS THAT THE AS PER THE APPEAL IN FORM NO. 35, PREFERRED BY THE APPELLANT BEFORE THE LEARN ED COMMISSIONER OF INCOME TAX, AGAINST THE HEAD RELIEF CLAIMED, YOUR PETITIONER HAD MENTIONED:- THE DISALLOWANCE AMOUNTING TO RS 14,79,660/- ARE UNFAIR, UNJUST AND UNLAWFUL AND BE ALLOWED AND THE INCOME RETURNED BE ACCEPTED AS THE ASSESSED INCOME. 5. IN THE SUBMISSIONS BEFORE THE LEARNED COMMISSIONER OF INCOME TAX APPEALS 9, MUMBAI ON 06.02.2012, GROUND NO 1:- IT HAS BEEN MENTIONED, DISALLOWANCE OF RS 9,69,197/ - BEING EXPENSES CLAIMED AGAINST CONSULTANCY INCOME O F RS. 12,00,000/- 6. YOUR PETITIONER PRAYS THAT THE LEARNED COMMISSIONER OF INCOME TAX HAS BEEN SILENT AND NOT TOUCHE UPON THE POINT OF ALLOWING THE EXPENSES OF RS 9,69,197/-. TH E LEARNED CIT IN HIS SPEAKING ORDER, UNDER THE PARA DECISION: - POINT 5.1 (GROUND OF APPEAL A) HAS MENT IONED 'THE PETITIONER VEHEMENTLY ARGUED THAT LAO HAS DISALLOWED EXTRA EXPENSES OF RS. 4,02,540/- WHICH H AS ITA NO. 3112/MUM/2013 SHRI UTPAL KAPADIA 4 NOT EVEN BEEN CLAIMED BY THE APPELLANT IN HIS COMPUTATION OF INCOME' 7. THE LEARNED CIT HAS TOTALLY DISREGARDED THE BASIC P LEA AND THE GROUND OF APPEAL AND THE APPELLANTS SUBMISS ION OF ALLOWING THE BASIC EXPENSES CLAIMED AMOUNTING TO RS 9,69,170/-. THE LEARNED CIT SEEMS TO HAVE TOTALLY M ISSED OUT AND HAS NOT EVEN MENTIONED THIS POINT IN HIS SPEAKING ORDER AND SEEMS TO HAVE OVERLOOKED THE POI NT OF ALLOWING/DISALLOWING THE BASIC EXPENSES CLAIMED OF RS. 9,69,197/-. 8. LEARNED CIT HAS NOT EVEN ASSIGNED ANY REASON FOR NO T TOUCHING UPON THE APPELLANTS PLEA FOR ALLOWING THE SAID EXPENSES CLAIMED AMOUNTING TO RS. 9,69,197/-. THE LEARNED CIT. IN HASTE HAS OVERLOOKED A BASIC GROUND OF APPEAL OF THE APPELLANT. YOUR APPELLANT PRAYS THAT THE SAID APPEAL BE REFERR ED BACK TO THE OFFICE OF THE LEARNED ASSESSING OFFICE R/CIT FOR A FAIR AND JUST DECISION COVERING UP THIS AND A LL OTHER POINTS AND THE GROUNDS OF APPEAL. GROUND NO B AND GROUND NO. C:- DISALLOWANCE OF EXPENSES CLAIMED UNDER CITIBANK/AMERICAN EXPRESS CREDIT CARDS:- 1 . THE LEARNED CIT HAS CONFIRMED THE DISALLOWANCE/ ADDITIONS OF RS. 70,059/- BEING CITIBANK CREDIT CAR D EXPENSES AND HAS CONFIRMED THE DISALLOWANCE/ ADDITIONS OF RS. 2,48,840/- BEING AMERICAN EXPRESS CREDIT CARD EXPENSES. 2 . DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS, TH E LEARNED ASSESSING OFFICER HAD REQUESTED TO FURNISH INFORMATION IN RESPECT OF THE EXPENSES INCURRED THROUGH THE FOLLOWING CREDIT CARDS IN THE NAME OF YOUR PETITIONER THE DETAILS OF THE SAME ARE:- A) RS. 12,44,198/- SPENT THRU AMERICAN EXPRESS CREDIT CARD IN THE NAME OF YOUR PETITIONER. B) RS. 7,47,884/- SPENT THRU CITI BANK CREDIT CARD IN TIIE NAME OF THE YOUR PETITIONER. 3 . YOUR PETITIONER PRAYS THAT IT HAD REPEATEDLY AND THROUGH WRITTEN COMMUNICATIONS BROUGHT TO THE KNOWLEDGE OF THE LEARNED ASSESSING OFFICER THAT:- A) THE ABOVE MENTIONED EXPENSES HAD NOT BEEN INCURRED FOR AND ON BEHALF OF YOUR PETITIONER. B) THE SAID EXPENSES HAVE NOT BEEN CLAIMED AS EXPENSES BY YOUR PETITIONER AGAINST HIS INCOME. ITA NO. 3112/MUM/2013 SHRI UTPAL KAPADIA 5 C) THE SAID EXPENSES HAVE BEEN CLAIMED BY THE COMPA NY WHEREIN YOUR PETITIONER HAS BEEN A DIRECTOR. D) THE SAID EXPENSES HAVE BEEN PAID FROM THE BANK ACCOUNT OF THE SAID COMPANIES WHEREIN YOUR PETITIONER IS A DIRECTOR. E) THE COMPLETE DETAILS OF THE BANK ACCOUNTS OF THE SAID COMPANIES MARKING OUT THE PAYMENTS MADE BY THE COMPANY IN RESPECT OF THE ABOVE CREDIT CARD PAYMENTS HAD ALSO BEEN SUBMITTED TO THE LEARNED ASSESSING OFFICER DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS. F) YOUR PETITIONER STATES THAT THE DISALLOWANCE OF RS. 70,059/- BEING AMOUNT SPENT THROUGH CITI BANK CREDI T CARD AND AN AMOUNT OF RS. 2,48,840/- BEING AMOUNT SPENT THROUGH AMERICAN EXPRESS CARD BEING DISALLOWED BY THE LEARNED ASSESSING OFFICER AND UPHELD BY THE LEARNED COMMISSIONER OF INCOME TAX WAS GROSSLY UNFAIR, UNJUST AND UNLAWFUL AND IN CONTRARY TO ACCOUNTING PRINCIPLES AND PRACTICES. G) THE AMOUNT SPENT THROUGH THE CITI BANK AND AMERICAN EXPRESS CREDIT CARDS BY YOUR PETITIONER WAS A FACILITY OR CONVENIENCE PROVIDED BY YOUR PETITIONER TO THE COMPANY WHEREIN HE IS A DIRECTOR, SINCE THE COMPANY CONCERNED DOES NOT POSSESS A CREDIT CARD IN ITS NAME. THE AMOUNTS DEBITED THROUGH THE SAID CREDIT CARDS ARE EXPENSES INCURRED FOR AND ON BEHALF OF THE SAID COMPANY, AND ARE NOT EXPENSES INCURRED BY YOUR PETITIONER AND CLAIMED AS SUCH IN THE COMPUTATION OF INCOME FOR THE YEAR ENDED 31.3.2009. 4. THE ABOVE FACTS WERE ELABORATED IN THE PETITIONERS LETTERS ADDRESSED TO THE LEARNED ASSESSING OFFICER, AND COPIES OF ALL THE SAID LETTERS WERE SUBMITTED T O THE LEARNED CIT. DURING THE COURSE OF THE HEARING V IDE THE AUTHORISED REPRESENTATIVE'S LETTER DATED 09.05. 2012, ALONG WITH THE DETAILED SUBMISSIONS AND PAPER BOOK. THE SAID FACTS HAVE BEEN ACCEPTED BY THE LEARNED CI T BY QUOTING THE ENCLOSURES AND SUBMISSIONS ON THE FACE OF THE ORDER UNDER PARA 4 UNDER THE HEADING APPELLANTS CONTENTIONS AND SUBMISSIONS. 5. DESPITE THE FACT THAT THE SAID GROUND OF APPEAL WAS EXPLAINED IN DETAIL TO THE LEARNED CIT AND THE FACT S WERE BACKED BY WRITTEN SUBMISSIONS, THE LEARNED CIT HAS COMPLETELY MISCONSTRUED THE FACTS AND CIRCUMSTANCES OF THE MATTER AND HAS MISUNDERSTOOD THE FACTS OF THE CASE AND HAS DISALLOWED AN EXPENSE IN ITA NO. 3112/MUM/2013 SHRI UTPAL KAPADIA 6 THE HANDS OF THE APPELLANT WHICH HAS NOT BEEN BORNE BY HIM, NOR HAS IT BEEN CLAIMED BY HIM, BUT IS AN E XPENSES OF THE COMPANY IN WHICH THE APPELLANT IS A DIRECTOR AND THE EXPENSE PERTAINS TO THE SAID COMPANY, HAS BEEN CLAIMED AS AN EXPENSE BY THE SAID COMPANY, HAS BEEN PAID BY THE SAID COMPANY. 6. YOUR PETITIONER AVERS THAT SINCE THE ABOVE MENTI ONED EXPENSES HAD NEITHER BEEN EXPENDED NOR CLAIMED BY HIM, GAINST HIS INCOME IN THE COMPUTATION OF INCOME , THE DISALLOWANCE BY THE LEARNED ASSESSING OFFICER OF TH E SAID AMOUNTS SPENT BY THE COMPANY WHERE IN YOUR PETITIONER IS A DIRECTOR AND THE UPHOLDING OF THE S AID DISALLOWANCE BY THE LEARNED COMMISSIONER OF INCOME TAX (A) 9, MUMBAI IS GROSSLY UNFAIR, UNJUST AND UNL AWFUL AND IN CONTRARY TO ACCOUNTING PRINCIPLES AND PRACTI CES AND BEREFT OF ANY LOGIC. 7. THE LEARNED CIT SEEMS TO HAVE PASSED THE ORDER I N MUCH HASTE AND HAS OVERLOOKED CRUCIAL POINTS AND BASIC FACTS AND CIRCUMSTANCES OF THE CASE AND HAS PASSED THE ORDER WHICH HAS CAUSED UNDUE HARDSHIP FINANCIAL AND OTHERWISE TO THE APPELLANT. YOUR APPELLANT PRAYS THAT THE SAID APPEAL ON THIS P OINT TOO BE REFERRED BACK TO THE OFFICE OF THE LEARNED ASSESSING OFFICER/CIT FOR A FAIR AND JUST DECISION COVERING UP THIS POINT ALONG WITH ALL THE POINTS A ND THE GROUNDS OF APPEAL. GROUND NO. D: - DISALLOWANCE OF EXPENSES OF RS. 1,9 1,564/-: THE SAID EXPENSES COMPRISES OF TWO PARTS 1) DISALLOWANCE OF RS. RS. 1,05,423/- BEING EXPENSES C LAIMED AGAINST OTHER INCOME AND 2) DISALLOWANCE OF RS. 86,141/- BEING EXPENSES DISALLO WED U/S. 14A R.W. RULE 8D OF THE I.T.ACT 1961 . 1. THE LEARNED CIT HAS UPHELD THE DISALLOWANCE WORK ED U/S. 14A RW RULE 8D OF THE INCOME TAX ACT BY THE LEARNED ASSESSING OFFICER AND HAS DISMISSED THE GROUND OF APPEAL D OF THE APPELLANT. 2. YOUR PETITIONER PRAYS THAT GROUND D OF THE STATEMEN T OF FACTS CLEARLY MENTIONED 'DISALLOWANCE OF RS. 1,91,564/- AGAINST INCOME FROM OTHER SOURCES AND AS PER DEDUCTION U/S. 14A RW RULE 8D. 3. THE LEARNED CIT HAS ERRONEOUSLY ASSUMED THAT THE SA ID GROUND OF APPEAL PERTAINS ENTIRELY IN RESPECT OF DISALLOWANCE U/S. 14A RW RULE 8D. 4. THE SAID GROUND OF APPEAL IS TWO FOLD, DISALLOWANCE OF ITA NO. 3112/MUM/2013 SHRI UTPAL KAPADIA 7 EXPENSE AGAINST INCOME FROM OTHER SOURCES (RS 10542 3/- AND B) DISALLOWANCE OF RS. 86,141/- BEING EXPENSES DISALLOWED U/S. 14A R.W. RULE 8D OF THE I.T.ACT 196 1. 5. THE LEARNED CIT HAS HARPED ON THE REASONS AND LOGIC OF UPHOLDING THE DISALLOWANCE BEING EXPENSES DISALLOWE D U/S. 14A R.W. RULE 8D OF THE I.T.ACT 1961. AND HAS BEEN COMPLETELY SILENT ON THE ALLOWABILITY OR OTHERWISE OF EXPENSES CLAIMED AGAINST THE INCOME UNDER THE HEAD INCOME FROM OTHER SOURCES. 6. LEARNED CIT HAS OVERLOOKED A PART OF THE GROUND OF APPEAL (EXPENSE CLAIMED UNDER THE HEAD INCOME FROM OTHER SOURCES) AND HAS ASSIGNED REASONS AND CITED CASE LAWS FOR SUPPORTING THE DISALLOWANCE BY THE LEARNED ASSESSING OFFICER IN RESPECT OF CLAIM OF DISALLOWANCE BEING EXPENSES DISALLOWED U/S. 14A R.W . RULE 8D OF THE I.T.ACT 1961. 7. THE LEARNED CIT IN HIS HASTE HAS OVER LOOKED A CRUC IAL AND AN IMPORTANT ASPECT OF THE GROUNDS OF APPEAL AN D HAS BEEN SILENT ON THIS ASPECT TOO IN HIS SPEAKING ORDER. YOUR APPELLANT PRAYS THAT THE SAID APPEAL ON THIS P OINT TOO BE REFERRED BACK TO THE OFFICE OF THE LEARNED ASSESSING OFFICER/CIT FOR A FAIR AND JUST DECISION COVERING UP THIS ALONG WITH ALL THE POINTS AND THE GROUNDS OF APPEAL. 5. THE LEARNED D.R., THOUGH HE SUPPORTED THE IMPUGNED ORDER OF THE LEARNED CIT(A), SUBMITTED THAT ON THE BASIS OF THE ASSESSEES PLEA, THE IMPUGNED ORDER BE SET ASIDE BACK TO THE FILE OF THE LEARNED CIT(A) FOR DE- NOVO CONSIDERATION OF ALL ISSUES RAISED IN THE APPE AL BEFORE THE LEARNED CIT(A) AFTER AFFORDING THE AO ALSO ADEQUATE OPPORTU NITY OF BEING HEARD IN SUPPORT OF THE ORDER OF ASSESSMENT AND TO REBUT THE ASSESSEES CONTENTIONS. 6.1 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED AND CAREFULLY CONSIDERED THE MATERIAL ON RECORD; INCLUDING THE OR DERS OF THE AUTHORITIES BELOW AND THE WRITTEN SUBMISSIONS OF THE ASSESSEE ( SUPRA). ON AN APPRECIATION OF THE IMPUGNED ORDER AND SUBMISSIONS MADE, WE ARE INCLINED TO AGREE WITH THE BASIC CONTENTIONS OF THE ASSESSEE THAT THE LEARNED CIT(A) HAS EITHER DISREGARDED OR NOT ADDRES SED THE ASSESSEES CONTENTIONS AND NO COGENT REASONS HAVE BEEN ASSIGNE D FOR COMING TO THE FINDING HE DID. WE ARE ALSO NOT ABLE TO UNDERSTAND AS TO EXACTLY AGAINST ITA NO. 3112/MUM/2013 SHRI UTPAL KAPADIA 8 WHICH ITEMS OF EXPENDITURE HAS THE ASSESSEE BEEN GI VEN RELIEF OF ` 4,02,450/-. WHILE THE SAID RELIEF/DELETION IS NOT T HE SUBJECT MATTER OF APPEAL AND IS ACCEPTED BY REVENUE, IN THE FITNESS O F THINS, THE LEARNED CIT(A) OUGHT TO HAVE SPECIFIED AGAINST WHICH ITEMS OF EXPENDITURE SUCH RELIEF WAS ALLOWED. FURTHER, AS SUBMITTED IT IS SEE N THAT THERE IS NO MENTION OR CONSIDERATION OF THE ASSESSEES SUBMISSIONS/CONT ENTIONS ON THE DISALLOWANCE OF ENTIRE BUSINESS EXPENSES CLAIMED AM OUNTING TO ` 9,69,197/-. SIMILARLY, ON THE ISSUE OF CREDIT CARD EXPENSES, NO EXAMINATION/VERIFICATION OR COGENT REASONS APPEAR T O HAVE BEEN GIVEN BY THE LEARNED CIT(A) ON THE ASSESSEES CONTENTION THA T SAID EXPENSES WERE NEVER CLAIMED BY THE ASSESSEE, BUT WERE RATHER CLAI MED BY THE COMPANY, M/S. ATHENA INSURANCE AND REINSURANCE BROKERS P. LT D. IN WHICH THE ASSESSEE WAS A DIRECTOR. FURTHER, EVEN IN RESPECT O F GROUND D, THE LEARNED CIT(A) APPEARS TO HAVE OVERLOOKED THE FACT THAT THI S GROUND PERTAINED TO BOTH THE ISSUE OF DISALLOWANCE OF EXPENSES OF ` 1,05,423/- AGAINST INCOME FROM OTHER SOURCES WHICH HE TOTALLY DID NOT ADDRESS AND RATHER ADDRESSED ONLY THE DISALLOWANCE UNDER SECTION 14A R.W. RULE 8 D. EVEN IN THE ISSUE OF DISALLOWANCE UNDER SECTION 14A R.W. RULE 8D, THE LE ARNED CIT(A) HAS NOT ADDRESSED AS TO WHETHER THE AO FOLLOWED THE PROCEDU RE MANDATED IN SECTION 14A OF THE ACT BEFORE INVOKING THE PROVISIO NS OF RULE 8D OF THE I.T. RULES TO MAKE THE SAID DISALLOWANCE. 6.2 IN VIEW OF THE FEW INSTANCES POINTED OUT BY US IN OUR OBSERVATIONS ABOVE (SUPRA) ON THE IMPUGNED ORDER OF THE LEARNED CIT(A), WE ARE INCLINED TO AGREE WITH BOTH THE PARTIES THAT THE FINDINGS IN THE IMPUGNED ORDER, BEING NON-SPEAKING, ARE TO BE SET ASIDE AND WE DO S O ACCORDINGLY. WE RESTORE ALL THE ISSUES RAISED IN THE GROUND A TO D BEFORE US AND BEFORE THE LEARNED CIT(A) BACK TO THE FILE OF THE LEARNED CIT( A) FOR DE-NOVO CONSIDERATION AND ADJUDICATION THEREON BY WAY OF A COGENT AND SPEAKING ORDER AFTER AFFORDING THE ASSESSEE ADEQUATE OPPORTU NITY OF BEING HEARD AND TO FILE DETAILS/ SUBMISSIONS REQUIRED IN THIS REGAR D. THE AO WILL ALSO BE AFFORDED DUE OPPORTUNITY OF BEING HEARD IN THE MATT ER, BEFORE THE LEARNED CIT(A) ADJUDICATES ON THE ISSUES AFRESH. IT IS ACCO RDINGLY ORDERED. ITA NO. 3112/MUM/2013 SHRI UTPAL KAPADIA 9 7. IN THE RESULT, THE ASSESSEES APPEAL FOR A.Y. 2009- 10 IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 9 TH NOVEMBER, 2016. SD/ - SD/ - (AMARJIT SINGH) (JASON P. BOAZ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 9 TH NOVEMBER, 2016 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) -9, MUMBAI 4. THE CIT - 7, MUMBAI 5. THE DR, F BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.