USHA GIRISH DESHPANDE, MUMBAI V. DCIT 23(3), MUMBAI

ITA 4268/MUM/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 2681 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-11-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 24-02-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 28-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SALIL B LODHA
• Keywords: Principle of natural justice
• Section: 37(1)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH, MUMBAI BEFORE S/SHRI B.R.BASKARAN, AM AND PAWAN SINGH, JM ./ I.T.A. NO . 4268 / MUM/20 1 3 ( / ASSESSMENT YEA R : 200 7 - 08 ) USHA GIRISH DESHPA NDE, 419 - 20 SWASTIK DISA CORPORATE PARK, L B S ROAD, GHATKOPAR WEST, MUMBAI - 400086 . / VS. DY.COMMISSIONER OF INCOME TAX 23(3), MUMBAI. ( / APPELLANT ) .. ( / RESPONDENT ) ./ ./PAN. : AEKPD7234D / APPELLANT BY SHRI SALIL B LODHA / RESPONDENT BY SHRI PRAMOD NIKALJE / DATE OF HEARING : 4 .11 . 201 5 / DATE OF PRONOUNCEMENT: 4 .11. 201 5 / O R D E R P ER B R BASKARAN, AM: THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 26 - 03 - 2013 PASSED BY LD CIT(A) - 34, MUMBAI AND IT RELATES TO THE ASSESSMENT YEAR 2007 - 08. 2. AT THE TIME OF HEARING, THE LD A.R DID NOT PRESS GROUND NO.2 RELATING TO DISALLOWANCE OF CONSULTING FEE OF RS.15,000/ - . ACCORDINGLY, THE SAME IS DISMISSED AS NOT PRESSED. THE REMAINING GROUND RELATES TO THE DISALLOWANCE OF RS.1,48,345/ - U/S 40(A)(IA) OF THE ACT. ITA NO. 4268 / MUM/20 1 3 2 3. THE LD A.R SUBMITTED THAT THE ASSESSEE IS AN INTERIOR DECORATOR AND UNDERTAKES CONTRACT WORKS ALSO. THE ASSESSEE HAD AVAILED HOUSING LOAN AND PAID INTEREST OF RS.1,48,345/ - . HE SUBMITTED THAT THE SAID INTEREST SHOULD HAVE BEEN CLAIMED AGAINST HOUSE PROPERTY INCOME, BUT THE SAME WAS INADVERTE NTLY CLAIMED UNDER THE BUSINESS HEAD. SINCE THE ASSESSEE DID NOT DEDUCT TAX AT SOURCE U/S 194A OF THE ACT, THE ASSESSING OFFICER DISALLOWED THE SAME BY INVOKING THE PROVISIONS OF SEC. 40(A)(IA) OF THE ACT AND THE LD CIT(A) ALSO CONFIRMED THE SAME. THE CLA IM OF THE ASSESSEE FOR ALLOWING INTEREST EXPENDITURE AGAINST THE PROPERTY INCOME WAS NOT ALLOWED BY THE TAX AUTHORITIES BY FOLLOWING THE DECISION RENDERED BY HONBLE APEX COURT IN THE CASE OF GOETZE INDIA LTD (283 ITR 323). THE LD A.R SUBMITTED THAT THE DECISION RENDERED BY THE HONBLE APEX COURT DOES NOT IMPINGE THE POWER OF THE TRIBUNAL AND ACCORDINGLY PRAYED THAT THE ASSESSING OFFICER MAY BE DIRECTED TO EXAMINE THE CLAIM OF THE ASSESSEE U/S 24 OF THE ACT AGAINST THE HOUSE PROPERTY INCOME. 4. THE LD D.R, ON THE CONTRARY, PLACED STRONG RELIANCE ON THE ORDER OF LD CIT(A). 5. HAVING HEARD RIVAL CONTENTIONS, WE ARE OF THE VIEW THAT THE CLAIM OF THE ASSESSEE FOR DEDUCTION OF INTEREST EXPENDITURE AGAINST THE HOUSE PROPERTY INCOME NEEDS TO BE EXAMINED BY THE ASSESSING OFFICER, IN THE INTEREST OF NATURAL JUSTICE. AS SUBMITTED BY LD A.R, THE DECISION RENDERED BY THE HONBLE SUPREME COURT IN THE CASE OF GOETZE INDIA LTD (SUPRA), AS OBSERVED BY THE HONBLE APEX IN THE SAME JUDGEMENT, DOES NOT IMPINGE THE POWER OF THE TRIBUNAL. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) ON THIS ISSUE AND RESTORE THE SAME TO THE FILE OF THE ASSESSING OFFICER WITH THE DIRECTION TO EXAMINE THE CLAIM OF THE ASSESSEE U/S 24 OF THE ACT. SINCE THE INTEREST EXPENDITURE HAS BEEN ADMITTED AS PERSONAL ITA NO. 4268 / MUM/20 1 3 3 EXPENSES, THE QUESTION OF MAKING TDS U/S 194A OF THE ACT DOES NOT ARISE, BUT THE SAME IS REQUIRED TO BE DISALLOWED U/S 37(1) OF THE ACT. ACCORDINGLY, WE CONFIRM THE DISALLOWANCE MADE BY THE ASSESSING OFFICER/LD CIT(A) BY INVOKING THE PROVISIONS OF SEC. 37(1) AND DIRECT THE ASSESSING OFFICER TO EXAMINE THE CLAIM FOR DEDUCTION OF THE SAME U/S 24 OF THE ACT. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED ACCOR DINGLY ON 4TH NOVEMBER , 2 015. 4TH NOV , 2 015 SD SD ( PAWAN SINGH ) ( B.R. BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI: 4TH NOV , 2 015. . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - CONCERNED 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI CONCERNED 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) , /ITAT, MUMBAI