Sahyadri Corporation, Pune V. ACIT,Cen Cir -2[1] Pune, Pune

ITA 362/PUN/2012

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 2272 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 7 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 06-07-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 22-02-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: DHEERAJ KUMAR JAIN
• Keywords: Search and seizure
• Section: 153A; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUN E . . , , ' , $ % BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO. 362/PN/2012 $' ' / ASSESSMENT YEAR : 2006-07 SAHYADRI CORPORATION, BHOSALE MYSTAQUA, MODEL COLONY, SHIVAJINAGAR, PUNE PAN : AAEFS6617C ....... / APPELLANT / V/S. ACIT, CENTRAL CIRCLE-2(1), PUNE / RESPONDENT ASSESSEE BY : SHRI SHARAD A. VAZE, SHRI RAHUL GODBOLE REVENUE BY : SHRI DHEERAJ KUMAR JAIN / DATE OF HEARING : 12-10-2015 / DATE OF PRONOUNCEMENT : 21-10-2015 / ORDER PER VIKAS AWASTHY, JM : THE APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE OR DER OF COMMISSIONER OF INCOME TAX (APPEALS)-CENTRAL, PUNE DATED 2 5-10-2011 FOR THE ASSESSMENT YEAR 2006-07. 2. THE BRIEF FACTS OF THE CASE ARE : THE ASSESSEE IS A PA RTNERSHIP FIRM. A SEARCH AND SEIZURE OPERATION U/S. 132 OF THE INCO ME TAX ACT, 1961 WAS CARRIED OUT AT THE PREMISES OF THE ASSESSEE O N 24-02-2008. 2 ITA NO. 362/PN/2012, A.Y. 2006-07 SUBSEQUENTLY, A NOTICE U/S. 153A OF THE ACT WAS ISSUED TO THE ASSESSEE. IN RESPONSE TO NOTICE THE ASSESSEE FILED ITS RETURN OF INC OME ON 18-12-2009 DECLARING TOTAL INCOME OF RS.5,000/-. DURING T HE COURSE OF ASSESSMENT, THE ASSESSING OFFICER DISALLOWED THE FOLLOWING EXPENSES: BANK CHARGES RS.26,854/ - BANK INTEREST RS.2,30,009/ - PROCESSING FEES RS.1,50,000/ - REGISTRATION EXPENSES RS.32,000/ - TOTAL RS.4,38,863/ - THE AFORESAID EXPENSES WERE INCURRED BY THE ASSESSEE FO R OBTAINING BANK LOAN. THE ASSESSING OFFICER DISALLOWED THE ENT IRE EXPENSES AS PART OF BANK LOAN WAS DIVERTED FOR THE PER SONAL USE OF ONE OF THE PARTNERS OF THE ASSESSEE FIRM. AGGRIEVED BY THE ASSESSMENT ORDER DATED 31-12-2009, T HE ASSESSEE PREFERRED AN APPEAL BEFORE THE COMMISSIONER OF I NCOME TAX (APPEALS). THE COMMISSIONER OF INCOME TAX (APPEALS) UPHELD TH E FINDINGS OF THE ASSESSING OFFICER AND DISMISSED THE APPEAL OF T HE ASSESSEE. 3. SHRI SHARAD A. VAZE AND SHRI RAHUL GODBOLE APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED, THAT THE AMOUNT DISALLOWED BY THE AUTHORITIES BELOW WAS INCURRED BY THE ASSESSEE FOR OBTAIN ING BANK LOAN FOR THE BUSINESS PURPOSE. ADMITTEDLY, PART OF THE BANK LO AN WAS UTILIZED BY ONE OF THE PARTNERS, FOR NON-BUSINESS PURPOSE . HOWEVER, THE ASSESSEE CHARGED INTEREST FROM THE SAID PARTNER TO THE EXTENT OF LOAN AMOUNT UTILIZED BY HIM. 3 ITA NO. 362/PN/2012, A.Y. 2006-07 4. ON THE OTHER HAND SHRI DHEERAJ KUMAR JAIN REPRESENT ING THE DEPARTMENT VEHEMENTLY SUPPORTED THE FINDINGS OF THE AUT HORITIES BELOW AND SUBMITTED THAT THE AMOUNT HAS BEEN RIGHTLY DISALLOW ED. THE ASSESSEE HAS ADMITTED THAT THE LOAN AMOUNT HAS BEEN U TILIZED FOR NON- BUSINESS PURPOSES. THE LD. DR PRAYED FOR SUSTAINING THE IM PUGNED ORDER AND DISMISSING THE APPEAL OF THE ASSESSEE. 5. BOTH SIDES HEARD, ORDERS OF THE AUTHORITIES BELOW PER USED. IT IS AN ADMITTED FACT THAT THE BANK LOAN OBTAINED BY THE ASS ESSEE HAS BEEN UTILIZED BY ONE OF THE PARTNERS OF THE ASSESSEE FIRM FOR PERSONAL PURPOSES. THE AMOUNT DISALLOWED BY THE AUTHORITIES BELOW RELATES TO THE EXPENDITURE INCURRED FOR OBTAINING THE BANK LOAN. WE ARE OF THE CONSIDERED VIEW THAT IT WOULD BE FAIR AND REASONABLE IF PROP ORTIONATE DISALLOWANCE IS MADE IN RESPECT OF EXPENDITURE INCURRED FOR OBTAINING THE BANK LOAN. THE CASE IS REMITTED BACK TO THE FILE OF ASSESSING OFFICER W ITH A DIRECTION TO MAKE DISALLOWANCE OF THE EXPENDITURE IN THE PR OPORTION OF LOAN AMOUNT UTILIZED BY THE PARTNER OF THE ASSESSEE FIRM. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ACCEPTED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED ON WEDNESDAY, THE 21 ST DAY OF OCTOBER, 2015. SD/- SD/- ( . . / R.K. PANDA) ( ! ' / VIKAS AWASTHY) ' / ACCOUNTANT MEMBER $% ' / JUDICIAL MEMBER / PUNE; & / DATED : 21 ST OCTOBER, 2015 RK 4 ITA NO. 362/PN/2012, A.Y. 2006-07 + ,$.' /' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. ' () / THE CIT(A)-CENTRAL, PUNE 4. ' / THE CIT-CENTRAL, PUNE 5. ! %%, , , , 0 , / DR, ITAT, A BENCH, PUNE. 6. 2 / GUARD FILE. // ! % // TRUE COPY// / BY ORDER, // TRUE COPY // % , / PRIVATE SECRETARY, , , / ITAT, PUNE