ITO16(3)(4), MUMBAI V. M/S METRO MOTORES AUTO DIVISION, MUMBAI

ITA 3767/MUM/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 55183 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-09-2011
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 29-08-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 11-05-2010
• Court: TRIBUNAL
• Keywords: Business expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE SHRI R.S. SYAL (AM) AND SHRI VIJAY PAL RAO (JM) ITA NOS. 3767/M/2009 ASSESSMENT YEAR:2005-2006 THE INCOME TAX OFFICER-16(3)(4), MATRU MANDIR, TARDEO ROAD, MUMBAI 400 007. THE MOTOR HOUSE, 66, N. SANTARAM PATKAR MARG, MUMBAI 400 007. (APPELLANT) (RESPONDENT) APPELLANT BY: RESPONDENT BY: SHRI P.C. MOURYA SHRI NONE DATE OF HEARING: DATE OF PRONOUNCEMENT: 29-08-2011 07-09-2011 O R D E R PER VIJAY PAL RAO (JM): THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 05-02-2010 OF CIT (A) FOR THE ASSESSMENT YEAR 2005-06. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS IN THIS APPEAL: 1. THE LD. CIT (A) ERRED IN DELETING THE DISALLOWA NCE OF RS. 10 LAKHS THE AMOUNT PAID TO BOMBAY METRO MOTORS LTD. AS NON-COMP ETE FEES, WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE HAS DIVERTED ITS INCOME TO A LOSS MAKING COMPANY TO SO AS TO AVOID T HE PAYMENT OF DUE TAX. 2. THE LD. CIT (A) ERRED IN FOLLOWING THE DECISION OF HONBLE ITAYT IN THE ASSESSEES OWN CASE FOR AY 2000-01 AND 2001-02 WHER E IN IT HAS BEEN HELD THAT THIS EXPENDITURE WAS REVENUE IN NATU RE AND HAS TO BE ALLOWED AS A BUSINESS EXPENDITURE FROM THE INCOME O F THE ASSESSEE. THE DECISION HAS NOT BEEN ACCEPTED BY THE DEPARTMEN T AND THE ISSUE IS SUB-JUDICE. ITA NO. 3767/M/2010 M/S METRO MOTORS AUTO DIVISION 2 3. WE HAVE HEARD THE LEARNED DR AND CONSIDERED THE RELEVANT RECORD. NONE HAS APPEARED ON BEHALF OF THE ASSESSEE/RESPONDENT W HEN THE CASE WAS CALLED FOR HEARING. HOWEVER, SINCE THE ISSUE IS COVERED BY TH E ORDER OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR THE AY 2000-01 & 2001-02; THEREFORE, WE PROPOSE TO HEAR AND DISPOSE OFF THIS APPEAL EXPARTE. 4. AT THE OUTSET, WE NOTE THAT THE ISSUED RAISED BY THE REVENUE HAS BEEN ADJUDICATED BY THE LD. CIT (A) BY FOLLOWING THE ORD ER OF THIS TRIBUNAL AS UNDER: IN APPEAL THE LEARNED COUNSEL OF THE ASSESSEE HAS S TATED THAT THEY HAVE RECEIVED THE ORDER OF THE HONBLE ITAT FOR AY 2000-01 IN THE ASSESSEES OWN CASE DATED 29 TH MAY, 2007 AND THE HONBLE TRINBUNALS ORDER DATED 30-04-2008 FOR AY 2001-02. IN BOTH THESE YEARS THE HONBLE ITAT HAS HELD THAT THIS EXPENDITU RE OF RS. 10,00,000/- WAS REVENUE IN NATURE AND HAS TO BE ALL OWED AS A BUSINESS EXPENDITURE FROM THE INCOME OF THE ASSESSE E. RESPECTFULLY FOLLOWING THE DECISION OF THE JURISDICTIONAL ITAT I N THE EARLIER TWO YEARS WHEREIN THE ADDITION MADE ON ACCOUNT OF THIS EXPENDITURE HAS BEEN DELETED, THIS ADDITION OF RS. 10,00,00/- MADE DURING THE YEAR IS ALSO DELETED. 5. IT APPEARS THAT THE REVENUE HAS FILED THIS APPEA L ONLY TO KEEP THE ISSUE ALIVE. AS NOTHING HAS BEEN BROUGHT BEFORE US TO SH OW THAT THE EARLIER ORDER OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR THE AY 2000-01& 2001-02 ARE EITHER STAYED OR REVERSED BY THE HONBLE HIGH COURT, WE THEREFORE, B Y FOLLOWING THE EARLIER ORDER OF THIS TRIBUNAL DECIDE THIS ISSUE AGAINST THE REVENUE AND IN FAVOUR OF THE ASSESSEE. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. THE ORDER WAS PRONOUNCED IN OPEN COURT ON 7 TH SEPTEMBER, 2011 SD/- SD/- (R.S. SYAL) (VIJAY PAL RAO) ACCOUNTANT MEMBER JUDICIAL MEMBER DATE : 07-09-2011 AT :MUMBAI OKK ITA NO. 3767/M/2010 M/S METRO MOTORS AUTO DIVISION 3 COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A), MUMBAI CONCERNED 4. THE CIT, MUMBAI CITY CONCERNED 5. THE DR B BENCH, ITAT, MUMBAI // TRUE COPY// BY ORDER ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI