SHAILA J PARIKH, MUMBAI V. ASST CIT CIR 12(3), MUMBAI

ITA 3185/MUM/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 2710 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 5 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-10-2016
• Appeal Filed By: Assessee
• Bench Allotted: E
• Next Hearing Date: 04-08-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 25-04-2013
• Court: TRIBUNAL
• Department Lawyers: J SARAVANAN
• Assessee Lawyers: ARTI VISSANJI
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI BEFORE SHRI B.R. BASKARAN (AM) & RAMLAL NEGI (JM) I.T.A. NO. 3185 /MUM/20 13 (ASSESSMENT YEAR 20 09 - 10 ) MRS. SHAILA J. PARIKH ORICON HOUSE 2 ND FLOOR 12 - K, DUBHASH MARG FORT MUMBAI - 400 023. VS. ACIT 12(3) ROOM NO. 660 6 TH FLOOR AAYAKAR BHAVAN M.K. ROAD MUMBAI - 400 020. ( APPELLANT ) ( RESPONDENT ) PAN NO . AGHPP7039B ASSESSEE BY S MT. ARTI VISSANJI DEPARTMENT BY S HRI J. SARAVANAN DATE OF HEARING 6.10 . 201 6 DATE OF PRONOUNCEMENT 6 . 10 . 201 6 O R D E R PER B.R. BASKARAN (AM) : - THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 1.1.2013 PASSED BY LEARNED CIT(A) - 23, MUMBAI AND IT RELATES TO A.Y. 2009 - 10. 2. THE ONLY ISSUE URGED IN THIS APPEAL IS WITH REGARD TO DISALLOWANCE O F ` 12.33 LAKHS MADE BY THE ASSESSING OFFICER UNDER RULE 8D(2)(III) OF THE I.T. RULES. 3. WE HAVE HEARD THE PARTIES AND PERUSED THE RECORD. THE ASSESSEE HAD EARNED FOLLOWING EXEMPTED INCOME DURING THE YEAR UNDER CONSIDERATION: - DIVIDEND ` 83,96,021 INTEREST OF PPF ` 3,10,208 INTEREST OF TAX FREE BONDS ` 9,68,500 SHARE OF PROFIT ` 4,29,677 THE ASSESSEE DID NOT MAKE ANY DISALLOWANCE OF EXPENSES U/S. 14A OF THE ACT AND HENCE ASSESSING OFFICER COMPUTED DISALLOWANCE U/R. 8D(2)(II I ) OF THE RU LES MRS. SHAILA J. PARIKH 2 AT 0.5% OF AVERAGE VALUE OF INVESTMENT WHICH WORK ED OUT TO ` 12,33,044/ - . LEARNED CIT(A) ALSO CONFIRMED THE SAME AND HENCE THE ASSESSEE HAS FILED THIS APPEAL BEFORE US. 4. AT THE TIME OF HEARING, THE ASSESSEE TOOK US TO THE COPIES OF THE INCOME AN D E XPENDITURE ACCOUNT AND ALSO THE STATEMENT OF TOTAL INCOME. LEARNED AR SUBMITTED THAT THOUGH THE ASSESSEE HAS SHOWN EXPENSES OF ` 39 .52 LAKHS IN INCOME AND EXPENDITURE ACCOUNT, THE SAME HAS NOT BEEN CLAIMED AS DEDUCTION WHILE COMPUTING TOTAL INCOME. SHE SUB MITTED THAT THE EXPENSES INCURRED BY THE ASSESSEE INCLUDED PMS CHARGES OF ` 10.56 LAKHS. HENCE THE SAME SHOULD BE DEEMED TO HAVE BEEN DISALLOWED U/S. 14A OF THE ACT. ACCORDINGLY, LEARNED AR SUBMITTED THAT NO FURTHER DISALLOWANCE IS REQUIRED TO BE MADE SIN CE THE ASSESSEE DID NOT CLAIM ANY EXPENDITURE WHILE COMPUTING TOTAL INCOME. 5. ON THE CONTRARY, LEARNED DEPARTMENTAL REPRESENTATIVE PLACED RELIANCE ON THE ORDER PASSED BY LEARNED CIT(A). 6. HAVING HEARD THE RIVAL SUBMISSIONS, WE ARE OF THE VIEW THAT THE RE IS MERIT IN THE CONTENTION S OF THE ASSESSEE. THE ASSESSEE HAS NOT CLAIMED ANY EXPENDITURE WHILE COMPUTING TOTAL INCOME. FURTHER, THE EXPENSES SHOWN IN THE INCOME AND EXPENSES ACCOUNT HAS NOT BEEN CLAIMED AS DEDUCTION WHILE COMPUTING TOTAL INCOME. THE AB OVE SAID EXPENSES INCLUDE PMS CHARGES OF ` 10.56 LAKHS WHICH WAS NOT CLAIMED THE ASSESSEE , MEANING THEREBY THE SAME SHALL CONSTITUTE DISALLOWANCE U/S. 14A OF THE ACT. UNDER THESE SET OF FACTS, WE ARE OF THE VIEW THAT NO DISALLOWANCE U/S. 14A IS CALLED FOR. ACCORDINGLY, WE SET ASIDE THE ORDER PASSED BY LEARNED CIT(A) ON THIS ISSUE AND DIRECT THE ASSESSING OFFICER TO DELETE THIS DISALLOWANCE. MRS. SHAILA J. PARIKH 3 7. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER HAS BE EN PRONOUNCED IN THE COURT ON 6 . 10 .2016 SD/ - SD/ - (RAMLAL NEGI ) (B.R.BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 06 / 10 / 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 COPY// ( DY./ASSTT. REGISTRAR) PS ITAT, MUMBAI