Vinco Metals Pvt. Ltd., Delhi V. ACIT, New Delhi

ITA 3993/DEL/2013

• Counselvise Citation: 399320114 RSA 2013
• Duration Of Justice: 1 year(s) 10 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 17-06-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 27-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J P CHANDREKAR
• Assessee Lawyers: K P GARG
• Keywords: Opportunity of being heard
• Section: 143(3); 142(1); 14A

Judgement Text

ITA NO. 3993/ DEL/ 2013 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H , NEW DELHI BEFORE SHRI N.K. SAINI, ACCOUNTANT MEMBER AND SHRI H.S. SIDHU, JUDICIAL MEMBER I.T.A. NO. 3993 /DEL/2013 A.Y. : 2009 - 10 M/S VINCO METALS PVT. LTD., A - 78, GROUND FLOOR, JHILMIL IND. AREA, SHAHDARA, DELHI 110 095 (PAN: AAACV4363J) VS. ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - 16, NEW DELHI 55 (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. K.P. GARG, CA DEPARTMENT BY : S H. J.P. CHANDREKAR, SR. DR DATE OF HEARING : 1 7 - 06 - 201 5 DATE OF ORDER : 2 4 - 06 - 201 5 ORDER PER H.S. SIDHU : J M TH IS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE O RDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS ) - XXXII , NEW DELHI DATED 31 . 5 .201 3 P ERTAINING TO ASSESSMENT YEAR 2009 - 10 . 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: - 1. T HE APPELLANT DENIES HIS LIABILITY TO TAX AS DETERMINED AND COMPUTED BY THE AO AND THE MANNER IN WHICH THE DEMAND OF RS. 40,943/ - HAS BEEN SO DETERMINED AND UPHELD BY THE LD. CIT(A) . ITA NO. 3993/ DEL/ 2013 2 2. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN SUSTAINING THE FOLLOWING ADDITIONS WHICH ARE IMPUGNED IN THIS APPEAL: - RS. 1,32,508/ - BEING 5% OF AVERAGE INVESTMENT U/S. 14A APPLYING RULE 8D TO BUSINESS / TRADE INVESTMENTS MADE BY THE COMPANY IN THE COURSE OF ITS BUSINESS AS NBFC, THE INCOME OF WHICH IS DULY ACCOUNTED FO R AND ASSESSED TO TAX. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE COMPANY WAS ENGAGED IN THE BUSINESS OF COPPER TRADING AND HAD SHOWN INCOME UNDER THE HEAD BUSINESS, INCOME FROM HOUSE PROPERTY AND CAPITAL GAIN. THE RETURN OF INCOME IN THIS CA SE WAS FILED ON 17.9.2009 SHOWING TOTAL INCOME OF RS. 7,10,996/ - . SUBSEQUENTLY, THE NOTICES U/S. 142(1) AND 143(2) OF THE ACT ALONGWITH QUESTIONNAIRE WERE ISSUED BY THE AO. THE ASSESSMENT WAS COMPLETED BY THE AO U/S. 143(3) VIDE HIS ORDER DATED 21.10.2 011 AT AN INCOME OF RS. 8,34,500/ - BY MAKING THE FOLLOWING ADDITIONS : - (A) DISALLOWANCE U/S. 14A RS. 1,32,508/ - (B) INCOME FROM HOUSE PROPERTY RS. 16,800/ - (C) INCOME FROM LTCG (LOSS) ( - ) RS. 59,859/ - 4. AGGRIEVED WITH THE AFORESAID ASSE SSMENT ORDER DATED 21. 10. 2011, THE ASSESSEE APPEALED BEFORE THE LD. CIT(A), WHO VIDE IMPUGNED ORDER DATED 31 . 5 .2013 HAS DISMISSED APPEAL OF THE ASSESSEE. 5. AGAINST THE ORDER OF THE LD. CIT(A) DATED 31 . 5 .2013 ASSESSEE NOW APPEALED BEFORE THE TRIBUNAL. ITA NO. 3993/ DEL/ 2013 3 6. LD. COUNSEL OF THE ASSESSEE STATED THAT THE AO HAS WRONGLY DETERMINED THE DEMAND OF RS. 40,943/ - WITHOUT ANY PRESCRIBED MANNER AND SIMILARLY, THE LD. FIRST APPELLATE AUTHORITY HAS NOT ADJUDICATED AND DECIDED THIS GROUND RAISED BY THE ASSESSEE BEFORE HIM . HE FURTHER STATED THAT AO HAS MADE THE ADDITION OF RS.1,32,508/ - BEING 5% AVERAGE INVESTMENT U/S. 14A BY APPLYING THE RULE 8D TO THE BUSINESS MADE BY THE COMPANY IN THE COURSE OF ITS BUSINESS AS NBFC. THE INCOME OF WHICH IS DULY ACCOUNTED FOR AND ASS ESSED TO TAX. HE FURTHER STATED THAT FOR THE ASSESSMENT YEAR 2008 - 09 ASSESSEE HAS GIVEN SIMILAR EXPLANATION IN THE ASSESSMENT YEAR IN DISPUTE, BUT THE REVENUE AUTHORITY HAS NOT MADE ANY ADDITION. HE REQUESTED THAT THE IMPUGNED ORDER MAY BE CANCELLED AND APPEAL FILED BY THE ASSESSEE MAY BE ALLOWED. 6.1 ON THE CONTRARY, LD. DR RELIED UPON THE ORDER OF THE AUTHORITIES BELOW AND STATED THAT THE AO HAS RIGHTLY DETERMINED AND COMPUTED THE TAX LIABILITY AS WELL AS RIGHTLY MADE THE ADDITION IN DISPUTE ON THE B ASIS OF THE MATERIAL AVAILABLE ON RECORD, THEREFORE, THE APPEAL FILED BY THE ASSESSEE MAY BE DISMISSED. 7 . WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE RECORDS ESPECIALLY THE ORDERS OF THE REVENUE AUTHORITIES; CONTENTIONS RAISED BY THE ASSESSEE IN TH E GROUNDS OF APPEAL FILED BY THE ASSESSEE. WE ARE OF THE CONSIDERED VIEW THAT AS ARGUED BY THE LD. COUNSEL OF THE ASSESSEE THAT ASSESSEE HAS DENIED THE LIABILITY TO TAX AND DETERMINED AND COMPUTED BY THE AO AND THE MANNER IN WHICH THE ITA NO. 3993/ DEL/ 2013 4 DEMAND OF RS. 40,943 / - HAS BEEN SO DETERMINED. WE FIND THAT THE LD. CIT(A) HAS NOT ADJUDICATED THIS GROUND RAISED BY THE ASSESSEE AND WE ALSO FIND THAT THE AO HAS NOT COMMENTED IN THE ASSESSMENT ORDER ON THE DETERMINATION OF THE DEMAND OF RS. 40,943/ - , THEREFORE, THE ISSU E INVOLVED IN GROUND NO. 1 REQUIRES DETAILED EXAMINATION AT THE LEVEL OF THE AO. ACCORDINGLY, IN THE INTEREST OF JUSTICE, WE SET ASIDE THE ISSUE IN DISPUTE TO THE FILE OF THE AO TO DECIDE THE SAME AFRESH UNDER THE LAW, AFTER GIVING ADEQUATE OPPORTUNITY OF BEING HEARD. 8 . WITH REGARD TO GROUND NO. 2 REGARDING SUSTAINING THE ADDITION OF RS. 1,32,508/ - BEING 5% OF AVERAGE INVESTMENT U/S. 14A APPLYING THE RULE 8D TO THE BUSINESS/ TRADE INVESTMENT MADE BY THE COMPANY IN THE COURSE OF ITS BUSINESS AS NBFC, THE INCOME OF WHICH IS DULY ACCOUNTED FOR AND ASSESSED TO TAX IS CONCERNED, WE FIND THAT ON THE BASIS OF SIMILAR EXPLANATION , NO ADDITION WAS MADE IN EARLIER YEARS UPTO 2008 - 09, ALL OF WHICH HAVE BEEN SCRUTINY EXAMINATION CASES SINCE AY 2001 - 02. THEREFORE, IN OUR CONSIDERED OPINION, THE ISSUE IN DISPUTE INVOLVED IN GROUND NO. 2 NEEDS TO BE ADJUDICATED AFRESH, UNDER THE LAW. ACCORDINGLY, WE REMIT THE ISSUE IN DISPUTE TO TH E FILE OF THE AO TO CONSIDER THE SAME AFRESH, AFTER GIVING ADEQUATE OPPORTUNITY OF BEING HEARD. ITA NO. 3993/ DEL/ 2013 5 9 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE O PEN C OURT ON 2 4 / 06 /20 1 5 . SD / - S D / - [ N.K. SAINI ] [ H.S. SIDHU ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 2 4 / 6 /201 5 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES ITA NO. 3993/ DEL/ 2013 6