KIDUJA SECURITIES P.LTD, MUMBAI V. DCIT CIR 3(2), MUMBAI

ITA 3136/MUM/2013

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 5691 (ITAT-MUMBAI)
• Duration Of Justice: 5 year(s) 2 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-07-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 08-03-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 25-04-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: POOJA SWAROOP
• Keywords: Business income; Business expenditure
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH H, MUMBAI BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO. 3136/MUM/2013 : A.Y : 2006 - 07 M/S. KIDUJA SECURITIES PVT. LTD., 127 - B, MITTAL TOWER, MUMBAI 400 021. (APPELLANT) PAN : AAACK1609A VS. DCIT, CIRCLE - 3(2), MUMBAI (RESPONDENT) ASSESSEE BY : SHRI RAJESH P. SHAH REVENUE BY : MS. POOJA SWAROOP DATE OF HEARING : 11/07/2018 DATE OF PRONOUNCEMENT : 11/07/2018 O R D E R PER G.S. PANNU , AM : THE CAPTIONED APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(A) - 4 , MUMBAI DATED 14.02.2013 PERTAINING TO ASSESSMENT YEAR S 2006 - 07 , WHICH IN TURN HA VE ARISEN FROM THE ORDER PASSED BY THE ASSESSING OFFICER, MUMBAI, DATED 28.11.2011 U/S 143(3) R. W.S. 263 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). 2. IN THIS APPEAL ALTHOUGH ASSESSEE HAS RAISED MULTIPLE GROUNDS OF APPEAL IN THE MEMO OF APPEAL, THE ONLY PLEA RAISED IS THAT THE PREMIUM PAID OF RS.2,00,00,056/ - ON KEYMAN INSURANCE POLICY BE CONSIDERED FOR ALLOWANCE UNDER THE HEAD BUSINESS INCOME. 2 ITA NO. 3136/MUM/2013 M/S. KIDUJA SECURITIES PVT. LTD. 3. BRIEFLY PUT, THE RELEVANT FACTS ARE THAT IN THE ASSESSMENT FINALISED BY THE ASSESSING OFFICER CONSEQUENT TO THE ORDER OF THE COMMISSIONER U/S 263 OF THE ACT DATED 17.05.2010 , THE TOTAL INCOME W AS ASSESSED AT RS.2 0 , 22 , 25 ,5 48 / - , WHICH COMPRISED OF INCOME FROM SHORT TERM CAPITAL GAINS. IN THE SAID ASSESSMENT, A SUM OF RS.2,00,00,056/ - REPRESENTING PREMIUM ON KEYMAN INSURANCE POLICY , WHICH WAS CLAIMED AS DEDUCTION WHILE COMPUTING CAPITAL GAINS, WAS DISALLOWED BY THE ASSESSING OFFICER. THE SAID POSITION HAS SINCE BEEN ACCEPTED BY THE ASSESSEE ALSO. HOWEVER, AN ALTERNATE CLAIM WAS RAISED BY THE ASSESSEE THAT THE PREMIUM PAID BE CONSIDERED AS BUSINESS EXPENDITURE AND ALLOWABLE WHILE COMPUTING INCOME UNDER THE HEAD BUSINESS INCOME. BEFORE US ALSO, THIS IS THE SOLITARY PLEA RAISED AND IN SUPPORT, IT IS CANVASSED THAT IN THE EARLIER ASSESSMENT YEARS OF 2004 - 05 AND 2005 - 06 SUCH CLAIM HAS BEEN ALLOWED BY THE ASSESSING OFFICER WHILE COMPUTING THE BUSINES S INCOME. 4. THE LD. DR APPEARING FOR THE REVENUE HAS OPPOSED THE PLEA OF THE ASSESSEE BY POINTING OUT TO THE RELEVANT DISCUSSION IN THE ORDER S OF THE ASSESSING OFFICER AS WELL AS THAT OF THE CIT(A), WHICH IS TO THE EFFECT THAT NO ASSESSMENT HAS BEEN MADE IN THE INSTANT YEAR UNDER THE HEAD BUSINESS INCOME PRIMARILY ON THE GROUND THAT NO BUSINESS WAS CONDUCTED DURING THE YEAR. 5. WE HAVE CAREFU LLY CONSIDERED THE SHORT PLEA RAISED BY THE ASSESSEE BEFORE US. ACCORDING TO THE APPELLANT, THE PREMIUM ON KEYMAN INSURANCE POLICY SHOULD BE CONSIDERED FOR ALLOWANCE AS EXPENDITURE WHILE COMPUTING THE INCOME UNDER THE HEAD BUSINESS INCOME. FACTUALLY SP EAKING, IN THE 3 ITA NO. 3136/MUM/2013 M/S. KIDUJA SECURITIES PVT. LTD. IMPUGNED ASSESSMENT, THE ONLY INCOME THAT IS ASSESSED BY THE ASSESSING OFFICER IS ON ACCOUNT OF SHORT TERM CAPITAL GAINS. NO DOUBT, IN THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION, ASSESSEE HAD DECLARED A BUSINESS LOSS, SO HOWEVER, NO ASSESSMENT HAS BEEN MADE UNDER THE HEAD BUSINESS INCOME ON THE GROUND THAT NO BUSINESS WAS CONDUCTED BY THE ASSESSEE DURING THE YEAR . IN FACT, FOR THE AFORESAID REASON, THE ASSESSING OFFICER DECLINED THE INSTANT PLEA OF THE ASSESSEE. THE CIT(A) HAS ALSO NOTED A SIMILAR FACT - SITUATION. APART FROM THE AFORESAID, WE FIND THAT ASSESSEE HAS ACCEPTED THE STAND OF THE ASSESSING AUTHORITY THAT THERE WAS NO BUSINESS DURING THE YEAR INASMUCH AS NO APPEAL ON THIS ASPECT HA S BEEN FILED BY THE ASSESSEE . THEREFORE, CONSIDERING THE TOTALITY OF FACTS AND CIRCUMSTANCES, THERE IS NO JUSTIFIABLE REASONS TO ADMIT THE ALTERNATE PLEA OF THE ASSESSEE THAT THE IMPUGNED AMOUNT BE CONSIDERED FOR ALLOWANCE WHILE COMPUTING THE INCOME UNDER THE HEAD BUSINESS INCOME. IN THIS VIEW OF THE MATTER, WE HEREBY AFFIRM THE STAND OF THE INCOME - TAX AUTHORITIES ON THIS ASPECT. 6. APART FROM THE AFORESAID, NO OTHER ISSUE HAS BEEN ARGUED BY THE APPELLANT BEFORE US AND ACCORDINGLY, THE APPEAL OF THE AS SESSEE IS DISMISSED. THE ABOVE DECISION WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF BOTH THE PARTIES AT THE CONCLUSION OF THE HEARING ON 11 TH JULY , 2018. SD/ - SD/ - ( PAWAN SINGH ) JUDICIAL MEMBER (G.S. PANNU) ACCOUNTANT MEMBER MUMBAI, DATE : 1 1 T H JULY , 201 8 *SSL* 4 ITA NO. 3136/MUM/2013 M/S. KIDUJA SECURITIES PVT. LTD. COPY TO : 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 4) THE CIT CONCERNED 5) THE D.R, H BENCH, MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T, MUMBAI