GEMSTAR ENTERPRISES, MUMBAI V. ACIT CIR 24(1), MUMBAI

ITA 3781/MUM/2012

• Counselvise Citation: 378119914 RSA 2012
• Duration Of Justice: 1 year(s) 11 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-05-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 13-05-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 29-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABHA KALA CHANDA
• Assessee Lawyers: REEPAL TRALSHAWALA
• Keywords: Revised return
• Section: 263

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNALG BENCH, MUMB AI BEFORE SHRI D.KARUNAKARA RAO, AM AND SHRI VIVEK VAR MA, JM . , ! ! ! ! ' # , $ % % % % & && & ITA NO. 3781/MUM /2012 ASSESSMENT YEAR-2009-10 GEMSTAR ENTERPRISES, GR. FLR. EESHA KRIPA, BRAHMAN SABHA LANE, MALAD(W) MUMBAI-400064 ' ' ' ' / VS. ACIT CIRCLE-24(1), C-13,5 TH FLOOR, PRATYAKSH KAR BHAVAN, BANDRA KURLA COMPLEX BANDRA (E), MUMBAI-400051 ( ./ PAN :AAGFG1145A ( () /ASSESSEE ) .. ( *+() / RESPONDENT ) () , - / ASSESSEE BY : SHRI REEPAL TRALSHAWALA , - / REVENUE BY : SMT.ABHA KALA CHANDA CIT(DR) ' , . / DATE OF HEARING : 13/05/2014 /01 , . / DATE OF PRONOUNCEMENT : 28/05/2014 2 2 2 2 / ORDER PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE ASSESSEE ON 29/05/2012 IS AGAINST THE REVIEW ORDER OF THE CIT-24, MUMBAI DATED 28/03/ 2012 FOR THE ASSESSMENT YEAR 2009-10. 2. BEFORE US, LD. COUNSEL FOR THE ASSESSEE MENTIONE D THAT THE ORDER OF THE REVENUE IS NOT SUSTAINABLE IN LAW. GIV ING REASONS FOR SAID SUBMISSION, LD. COUNSEL MENTIONED THAT THE CIT WRONGLY DESCRIBED THE ORDER OF THE AO IS HAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE ON A COUPLE OF ISSUES. 3. REFERRING TO THE GROUND NO.1, THE COUNSEL MENTI ONED THAT THE SAID GROUND CONTAINS THE FIRST ISSUE AND IT REL ATES TO THE TAXABILITY OF INCOME EARNED FROM LETTING OUT OF TER RACE PREMISES TO MOBILE COMPANIES FOR INSTALLING THEIR ANTENNA. IT IS CLAIMED BY THE ASSESSEE THAT THE SAID INCOME IS TAXABLE UNDER THE HEAD INCOME 2 ITA NO.3781/MUM/2012. GEMSTAR ENTERPRISES OF HOUSE PROPERTY . HOWEVER, THE REVENUE AUTHORITIES TAXED THE SAME UNDER THE HEAD INCOME FROM OTHER SOURCES. F OR THIS PROPOSITION CIT RELIED UPON THE DECISION IN THE CAS E OF ITS SISTERS CONCERN NAMELY VIJAY ENTERPRISES. IGNORING THE FACT , THE CIT(A) GRANTED RELIEF FINALLY IN THE CASE OF VIJAY ENTERPR ISES, THE CIT(A) WRONGLY RELIED IN THIS CASE. TO SUPPORT THE SAME, A SSESSEES COUNSEL BROUGHT OUR ATTENTION TO THE ORDER OF THE C IT(A) DATED 29/04/2009 IN THE CASE OF VIJAY ENTERPRISES, WHICH HAS BECOME FINAL. AS PER THE COUNSEL, AT THE MAXIMUM, SUCH AD DITIONS ARE DEBATABLE NATURE AND SUCH DEBATABLE ISSUE CANNOT BE THE GROUND FOR INVOKING PROVISIONS OF SECTION 263 OF THE ACT. 4. ON HEARING, LD. DR ON THE MATTER, WE FIND THAT T HERE ARE OTHER DECISIONS OF THE TRIBUNAL, FOR THE PROPOSITIO N THAT HOLDING SUCH RENTAL INCOME IS TAXABLE UNDER THE HEAD INCOM E FROM HOUSE PROPERTY. AS SUCH, THIS ISSUE IS DEBATABLE AND T HEREFORE, WE FIND THE PROVISIONS OF SECTION 263 CANNOT BE INVOKED ON SUCH ISSUE. ACCORDINGLY, THE DECISION OF THE CIT-24 IN THIS REG ARD IS NOT VALID AND SUSTAINABLE IN LAW. 5. REFERRING GROUND NO.3, THE COUNSEL MENTIONED THA T THE CIT FAILED TO APPRECIATE THAT THE ASSESSEE COMMITTED MI STAKE IN COMPUTATION OF TOTAL INCOME BY ADDING A SUM OF RS.1 5,97,226/- BEING PREVIOUS YEAR ADJUSTMENT. THIS MISTAKE WHICH HAS THE EFFECT OF REDUCING OF THE TOTAL RETURNED OF INCOME BY THE ASSESSEE, WAS EVENTUALLY VERIFIED AND ALLOWED TO THE ASSESSEE. T HUS, THE ASSESSING OFFICER HAS TAKEN AN OPINION ON THIS ISSU E AFTER CONDUCTING REQUISITE VERIFICATIONS AND AFTER DUE AP PLICATION OF MIND. SUCH ADJUSTMENTS BY THE AO ARE LEGALLY VALID AND IN FACT, IT IS THE DUTY OF THE AO TO MAKE A CORRECT ASSESSMENT EVEN IF THE WRONG ENTRIES MADE BY THE ASSESSEE IN THE RETURN OF INCOME. IN THIS REGARD, THE COUNSEL FILED AN ORDER OF THE TRIB UNAL IN THE CASE 3 ITA NO.3781/MUM/2012. GEMSTAR ENTERPRISES OF MAHINDRA HINODAY INDUSTRIES LTD. IN ITA NO.7140/MUM/2011 FOR THE A.Y. 2007-08 AND MENTIONED THE SUCH JUDGMEN T WAS HELD VALID AND IN THE FAVOUR OF THE ASSESSEE UNDER THE C IRCUMSTANCES OF COMPARABLE FACTS. THE JUDGMENT OF HONBLE BOMBAY H IGH COURT IN THE CASE OF CIT VS. PRUTHVI BROKERS AND SHAREHOLDER S PVT. LTD. 252 CTR 151(BOM.) IS RELEVANT. PER CONTRA, REVENUE IS IN THE OPINION THAT THE AO SHOULD NOT MAKE SUCH CORRECTIONS WITHOU T FILING REVISED RETURN OF INCOME BEFORE HIM. 6. ON HEARING, BOTH THE PARTIES, WE FIND THE ISSUE RELATING TO THE POWER OF THE AO TO MAKE SUCH CORRECTIONS IN THE ABS ENCE OF REVISED RETURN OF INCOME IS DEBATABLE IN NATURE. TH E JUDGMENT OF THE TRIBUNAL WHICH WAS DECIDED BASED ON THE JUDGMEN T IN THE CASE OF CIT VS. PRUTHVI BROKERS AND SHAREHOLDERS PVT. LT D. (SUPRA) AND THE JUDGMENT OF HONBLE SUPREME COURT IN THE CASE O F GOETZE (INDIA) LTD. VS. CIT [2006] 157 TAXMAN 1(SC), HELPS THE ASSESSE E. THEREFORE, THE ISSUE RAISED IN GROUND NO.3 IS ALSO DEBATABLE. ACCORDINGLY, GROUND NO.3 IS ALLOWED. 7. GROUND NO.4 IS GENERAL IN NATURE AND DOES NOT NE ED SPECIFIC ADJUDICATION. ACCORDINGLY GROUND NO.1 TO 5 ARE ALL OWED IN FAVOUR OF THE ASSESSEE. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH MAY, 2014. 2 , /01 3 4'5 28 TH MAY, 2014 0 , 9 & SD/- SD/- VIVEK VARMA D.KARUNAKARA RAO (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) MUMBAI , 4' 4' 4' 4' DATED: 28/05 /2014 F{X~{T? P.S. 4 ITA NO.3781/MUM/2012. GEMSTAR ENTERPRISES 2 , *$.:' ;'1. / COPY OF THE ORDER FORWARDED TO : (1) $' #<. / THE ASSESSEE; (2) / THE REVENUE; (3) =() / THE CIT(A); (4) = / THE CIT, MUMBAI CITY CONCERNED; (5) '@9 *$.$' , , / THE DR, ITAT, MUMBAI; (6) 9# A / GUARD FILE. +'. *$. / TRUE COPY 2' / BY ORDER B / C / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI,