ASST CIT 15(1)(2), MUMBAI V. BERNHARD SCHULTE SHIPPING (INDIA) P. LTD, MUMBAI

ITA 4252/MUM/2016

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 7286 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-05-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2010-2011
• Appeal Filed On: 20-06-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: N HEMLATHADR
• Keywords: Additional evidence; Corroborative evidences
• Section: 143(3); 142(1)

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES G, MUMBAI , . , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ITA NO.4252/MUM/2016 ASSESSMENT YEAR: 2010-11 ACIT-15(1)(2) ROOM NO.483A, 4 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI-400020 / VS. M/S BERNHARD SCHULTE SHIPPING INDIA PVT. LTD. 401, OLYMPIA HIRANANDANI GARDENS, POWAI, MUMBAI-400076 ( / REVENUE) ( !' /ASSESSEE) P.A. NO.AABCB7797H / REVENUE BY SHRI N. HEMLATHA-DR !' / ASSESSEE BY SHRI PRV RAGHAVAN # $ % '& / DATE OF HEARING : 02/05/2018 % '& / DATE OF PRONOUNCEMENT 02/05/2018 ITA NO.4252/MUM/2016 M/S BERNHARD SCHULTE SHIPPING (INDIA) PVT LTD. 2 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DATED 01/03/2016 OF THE LD. FIRST APPELLATE AUTHORI TY, MUMBAI, IN NOT ALLOWING THE ADDITION MADE AS SERVIC E FEE ON REIMBURSEMENT OF EXPENSES ON ACTUAL COST BASIS D ESPITE THE FACT THAT THE ASSESSEE COULD NOT PRODUCE ANY SUPPORTING EVIDENCE ON SUCH EXPENSE THAT THERE WAS NO INCOME ELEMENT WHILE CLAIMING REIMBURSEMENT OF SUCH EXPENSES AND FURTHER IN VIOLATING THE RULE 46A OF T HE I.T. RULES IN NOT PROVIDING OPPORTUNITY TO THE LD. ASSES SING OFFICER WHILE ADMITTING ADDITIONAL EVIDENCE DURING APPELLATE PROCEEDINGS. 2. DURING HEARING, THE LD. DR, MS. N. HEMLATHA ADVANCED ARGUMENTS, WHICH IS IDENTICAL TO THE GROUN D RAISED, BY ASSERTING THAT THE ASSESSEE DID NOT RECO RD THE EXPENSES IN PROFIT & LOSS ACCOUNT FOR WHICH OUR ATT ENTION WAS INVITED TO THE FINDING RECORDED IN THE ASSESSME NT ORDER AND FURTHER THE ASSESSEE KEPT ON DEBITING EXPENSES INCURRED ON CLIENTS SHIP WITHOUT ADJUSTING ADVANCE RECEIVED FROM CLIENT/SHIP OWNERS. IT WAS ALSO PLEAD ED, WHILE ITA NO.4252/MUM/2016 M/S BERNHARD SCHULTE SHIPPING (INDIA) PVT LTD. 3 ADMITTING THE ADDITIONAL EVIDENCE, THE LD. COMMISSI ONER OF INCOME TAX (APPEAL) DID NOT PROVIDE ANY OPPORTUNITY TO THE LD. ASSESSING OFFICER, THEREFORE, IT IS VIOLATION O F RULE-46A OF THE I.T. RULES. HOWEVER, THE LD. COUNSEL FOR THE ASSESSEE, SHRI PRV RAGHAVAN, DEFENDED THE IMPUGNED ORDER BY CONTENDING THAT THE LD. COMMISSIONER OF INCOME TAX (APPEAL), AFTER CONSIDERING THE FACTUAL MATRIX CAME TO A JUSTIFIABLE CONCLUSION. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSEE COMPANY IS ENGAGED IN THE BUS INESS OF VESSEL MANAGEMENT AND MARINE CONSULTANCY, DECLAR ED TOTAL INCOME OF RS.1,68,84,140/- ON 08/10/2010. NOT ICES U/S 143(2) AND 142(1) ALONG WITH QUESTIONNAIRE CALL ING FOR VARIOUS DETAILS WERE SERVED UPON THE ASSESSEE TO WH ICH THE ASSESSEE ATTENDED THE PROCEEDINGS AND MADE SUBMISSI ONS. THE LD. ASSESSING OFFICER ASKED THE ASSESSEE TO FUR NISH THE TRIAL BALANCE OF THE COMPANY WHEREIN OPENING BALANC E TOT DEBIT, TOT CREDIT AND CLOSING BALANCES ARE PROVIDED . ON PERUSAL OF THE TRIAL BALANCE, THE LD. ASSESSING OFF ICER OBSERVED THAT THE EXPENSES MENTIONED AT PAGE-2 ONWA RDS ITA NO.4252/MUM/2016 M/S BERNHARD SCHULTE SHIPPING (INDIA) PVT LTD. 4 WERE NOT ACCOUNTED FOR IN THE PROFIT & LOSS ACCOUNT AND RECORDED AS CURRENT ASSET, LOANS AND ADVANCES IN TH E BALANCE SHEET. IT WAS FURTHER OBSERVED THAT THE ASS ESSEE KEPT ON DEBITING EXPENSES INCURRED ON CLIENTS SHIP WITHOUT ADJUSTING ADVANCES RECEIVED FROM SHIP OWNERS. AS PE R THE REVENUE, THE ASSESSEE, IN SPITE OF PROVIDING OPPORT UNITIES DID NOT PROVIDE ANY EVIDENCE THAT THE EXPENSES ARE REIMBURSED ON ACTUAL COST TO COST BASIS. CONSIDERIN G THE FACTS, THE LD. ASSESSING OFFICER FRAMED ASSESSMENT U/S 143(3) OF THE ACT AS DETAILED IN THE ASSESSMENT ORD ER. THE ASSESSMENT WAS CARRIED IN APPEAL BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEAL), WHERE THE ASSE SSEE FURNISHED ADDITIONAL EVIDENCES AND RELIEF WAS GRANT ED TO THE ASSESSEE WITHOUT PROVIDING OPPORTUNITY TO THE ASSES SING OFFICER NOR ANY REMAND REPORT WAS SOUGHT FROM HIM. THUS, WITHOUT GOING INTO MUCH DELIBERATION, WE NOTE THAT IT IS CLEAR CUT CASE OF VIOLATION OF RULE-46A OF THE RULE S. EVEN OTHERWISE, MANDATE OF ARTICLE 265 OF CONSTITUTION O F INDIA ONLY DUE TAX HAS TO BE LEVIED/COLLECTED, THEREFORE, WE REMAND TO THIS APPEAL TO THE FILE OF LD. ASSESSING OFFICER TO EXAMINE THE CLAIM OF THE ASSESSEE AFRESH, IN ACCORD ANCE ITA NO.4252/MUM/2016 M/S BERNHARD SCHULTE SHIPPING (INDIA) PVT LTD. 5 WITH LAW. THE ASSESSEE IS DIRECTED TO FURNISH THE N ECESSARY DETAILS BEFORE THE LD. ASSESSING OFFICER TO SUBSTAN TIATE ITS CLAIM. THE ASSESSEE BE GIVEN OPPORTUNITY, THUS, THE APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSE. FINALLY, THE APPEAL OF THE REVENUE IS ALLOWED FOR S TATISTICAL PURPOSE. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 02/05/2018. SD/- (G. MANJUNATHA) SD/- (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER # $ MUMBAI; + DATED : 02/05/2018 F{X~{T? P.S/. . . , %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. ,-./ / THE APPELLANT 2. 01./ / THE RESPONDENT. 3. 2 2 # 3' , ( ,- ) / THE CIT, MUMBAI. 4. 2 2 # 3' / CIT(A)- , MUMBAI 5. 56 0' , 2 ,-& , , # $ / DR, ITAT, MUMBAI 6. 7 8$ / GUARD FILE. / BY ORDER, 15-' 0' //TRUE COPY// / (DY./ASSTT. REGISTRAR) , # $ / ITAT, MUMBAI