SHRENU IMPEX P. LTD, MUMBAI V. ITO 9(3)(1), MUMBAI

ITA 3225/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8620 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-11-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2006-2007
• Appeal Filed On: 06-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T A KHAN
• Assessee Lawyers: K P KAPADIA
• Section: 143(3); 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY , JUDICIAL MEMBER AND SHRI RAMIT KOCHAR , ACCOUNTANT MEMBER ITA NO .3225 /MUM. / 2016 ( ASSESSMENT YEAR : 2006 07 ) SHRENU IMPEX PVT. LTD. SIDDHI BESEMENT & GROUND FLOOR PLOT NO.14 & 15, KHAR WEST MUMBAI 400 052 PAN AAACS6180N . APPELLANT V/S INCOME TAX OFFICER WARD 9(3)(1), MUMBAI . RESPONDENT ASSESSE E BY : SHRI K.P. KAPADIA REVENUE BY : SHRI T.A. KHAN DATE OF HEARING 25.10.2017 DATE OF ORDER 09.11.2017 O R D E R PER SAKTIJIT DEY, J.M. AFORESAID APPEAL BY THE ASSESSEE CHALLENGING THE ORDER DATED 2 5 TH FEBRUARY 201 6 , PASSED BY THE LEARNED COMMISSIONER (APPEALS) 2 1, MUMBAI, FOR THE ASSESSMENT YEAR 20 06 07 . 2 . IN GROUND NO.1, THE ASSESSEE HAS CHALLENGED THE RE OPENING OF ASSESSMENT UNDER SECTION 147 OF THE ACT. 2 SHRENU IMPEX PVT. LTD. 3 . BRIEF FACTS ARE, FOR THE IMPUGNED ASSESSMENT YEAR, ASSESSEE FILED ITS RETURN OF INCOME ON 23 RD NOVEMBER 2006, DECLARING TOTAL INCOME OF ` 8,42,328. THE RETURN OF INCOME FILED BY THE ASSESSEE WAS TAKEN UP FOR SCRUTINY AND THE ASSESSMENT IN CASE OF THE ASSESSEE WAS ORIGINALLY COMPLETED UNDER SECTION 143(3) OF THE ACT ON 12 TH DECEMBER 2008. SUBSEQUENTLY, THE ASSESSING OFFICER HAVING FOUND THAT THE INTEREST PAID TO JYOTI MAJITHIA HAS NO NEXUS WITH THE INTEREST INCOME EARNED BY THE ASSESSEE FROM THE PARTNERSHIP FIRM WAS OF THE VIEW THAT BY CLAIMING DEDUCTION OF INTEREST EXPENDITURE AGAINST INTEREST INCOME , THERE IS ESCAPEMENT OF INCOME , THE ASSESSING OFFICER RE OPENED THE ASSESSMENT UNDER SECTION 14 8 OF THE ACT AND ISSUED NOTICE UNDER SECTION 147 ON 19 TH MARCH 2013. THOUGH, THE ASSESSEE AFTER PARTICIPATING IN THE RE ASSESSMENT PROCEEDINGS OBJECTED TO THE VALIDITY OF RE OPENING, HOWEVER , THE ASSESSING OFFICER REJECTING THE OBJECTION OF THE ASSESSEE PROCEEDED TO COMPLETE THE ASSESSMENT VIDE IMPUGNED ORDER PASSED UNDER SECTION 14 3(3) R/W SECTION 147 OF THE ACT BY MAKING A NUMBER OF ADDITION S INCLUDING ADDITION S ON ACCOUNT OF INTEREST EXPENDITURE AMOUNTING TO ` 2,45,982. T HE ASSESSEE CHALLENGED THE ASSESSMENT ORDER IN AN APPEAL PREFERRED BEFORE THE LEARNED COMMISSIONER (APPEALS), INTER ALIA, ON THE VALIDITY OF RE OPENING UNDER SECTION 147 OF THE ACT. 3 SHRENU IMPEX PVT. LTD. 4 . THE LEARNED COMMISSIONER (APPEALS) WHILE UPHOLDING THE RE OPENING OF ASSE SSMENT UNDER SECTION 147 OF THE ACT, GRANTED PARTIAL RELIEF TO THE ASSESSEE IN RESPECT OF CERTAIN ADDITIONS MADE BY THE ASSESSING OFFICER. 5 . LEARNED AUTHORISED REPRESENTATIVE SUBMITTED, THE LEARNED COMMISSIONER (APPEALS) WITHOUT PROPERLY CONSIDERING THE SUB MISSIONS OF THE ASSESSEE HAS UPH E LD THE VALIDITY OF RE OPENING OF ASSESSMENT MADE UNDER SECTION 147 OF THE ACT. LEARNED AUTHORISED REPRESENTATIVE SUBMITTED, UNDER IDENTICAL FACTS AND CIRCUMSTANCES, THE ISSUE RELATING TO RE OPENING OF ASSESSMENT ARISING IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2009 10, HAS BEEN RESTORED BACK TO THE FILE OF THE LEARNED COMMISSIONER (APPEALS) BY THE TRIBUNAL. THEREFORE, HE SUBMITTED, SIMILAR DIRECTION MAY BE ISSUED IN THE IMPUGNED ASSESSMENT YEAR ALSO. 6 . LEARNED DEPARTMENTAL REPRESENTATIVE HAS NO OBJECTION IF THE ISSUES ARE RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER FOR FRESH ADJUDICATION. 7 . WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS EVIDENT ON RECORD ON THE REASONING THAT THE DE DUCTION CLAIMED ON ACCOUNT OF INTEREST EXPENDITURE HA S NO NEXUS WITH THE INTEREST INCOME EARNED BY THE ASSESSEE, THE ASSESSING OFFICER 4 SHRENU IMPEX PVT. LTD. HAS RE OPENED THE ASSESSMENT S FOR ASSESSMENT YEAR 2006 07 AND 2009 10. WHILE DECIDING ASSESSEES APPEAL FOR ASSESSMENT YE AR 2009 10, VIDE ITA NO.3226/MUM./2016, DATED 23 RD AUGUST 2017. THE TRIBUNAL HAS RESTORED THE MATTER BACK TO THE LEARNED COMMISSIONER (APPEALS) WITH THE FOLLOWING DIRECTIONS: I HAVE HEARD THE RIVAL CONTENTIONS AND GONE THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. I FIND THAT THE CIT(A) HAS NOT ADJUDICATED THE ISSUE OF REOPENING ON THE ISSUE OF REASONS RECORDED AND HENCE, I SET ASIDE THE ORDER OF CIT(A) IN ENTIRETY AND REMAND THE MATTER BACK TO THE FILE OF THE CIT(A) FOR FRESH AD JUDICATION ON THE ISSUE OF REOPENING. IN CASE REOPENING IS AFFIRMED, THE CIT(A) WILL ALSO ADJUDICATE THE ISSUE ON MERITS AFRESH ALSO . 8 . NOTABLY, THE ORDER OF THE LEARNED COMMISSIONER (APPEALS) ON THE ISSUE OF RE OPENING IN THE IMPUGNED ASSESSMENT YEAR IS IDENTICAL TO THE ORDER PASSED BY HIM IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2009 10. THAT BEING THE CASE, IN CONSONANCE WITH THE ORDER PASSED BY THE TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2009 10 , AS REFERRED TO ABOVE, WE RESTORE THE MATTE R BACK TO THE FILE OF THE LEARNED COMMISSIONER (APPEALS) WITH SIMILAR DIRECTION. 9 . IN THE RESULT, ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 09.11.2017 SD/ - RAMIT KOCHAR ACCOUNTANT MEMBER SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMBAI, DATED: 09.11.2017 5 SHRENU IMPEX PVT. LTD. COPY OF THE ORDER FORWARDED TO : ( 1 ) THE ASSESSEE; ( 2 ) THE REVENUE; ( 3 ) THE CIT(A); ( 4 ) THE CIT, MUMBAI CITY CONCERNED; ( 5 ) THE DR, ITAT, MUMBAI; ( 6 ) GUARD FILE . TRUE COPY BY ORDER PRADEEP J. CHOWDHURY SR. PRIVATE SECRETARY (DY./ASSTT. REGISTRAR) ITAT, MUMBAI .