BHUPATI INVESTMENTS & FINANCE P.LTD, MUMBAI V. ITO 5(1)(2), MUMBAI

ITA 454/MUM/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9821 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-07-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 29-01-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SUMAR KUMAR
• Assessee Lawyers: P B PAREKH
• Keywords: Earning of tax free income
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH B MUMBAI BEFORE SHRI MAHAVIR SINGH (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 454/MUM/2016 ASSESSMENT YEAR: 2011 - 12 BHUPATI INVESTMENTS & FINANCE PVT. LTD. B - 34/35, 3 RD FLOOR PARAGON CONDOMINIUM P.B. MARG WORLI MUMBAI - 400018 VS. ITO - 5(1)(2) AAYAKAR BHAVAN, ROOM NO. 570 , M.K. ROAD MUMBAI - 400020 PAN NO. AAACB0441P (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI P.B. PAREKH, A R REVENUE BY: SHRI SUMAR KUMAR, DR DATE OF HEARING : 03 /07/2017 DATE OF PRONOUNCEMENT : 26/07/2017 ORDER PER N.K. PRADHAN, A.M . THIS IS AN APPEAL FILED BY THE ASSESSEE . THE REL EVANT ASSESSMENT YEAR IS 2011 - 12 . THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISS IONER OF INCOME TAX (APPEALS) - 10 , MUMBAI AND ARISES OUT OF THE ASSESSMENT COMPLETED U/S 143(3) OF THE INCOME TAX ACT 1961, (THE ACT). 2. THE GROUNDS OF APPEAL FILED BY THE ASSESSEE READ AS UNDER: - 1) THE LEARNED CIT (APPEALS) ERRED IN CONFIRMING TH E DISALLOWANCE OF RS.21,63,156/ - MADE BY THE ASSESSING OFFICER U/S.14A OF THE INCOME - TAX ACT ITA NO. 454/MUM/2016 2 1961 AS EXPENDITURE ATTRIBUTABLE TO THE EARNING OF EXEMPT INCOME AS AGAINST RS.5,25,585/ - CONSIDERED FOR DISALLOWANCE BY YOUR APPELLANTS. YOUR APPELLANTS SUBMIT TH AT FURTHER DISALLOWANCE OF RS.16,37.571/ - (I.E. RS.21,63,156 - RS.5,25,585) U/S.14A IS NOT CALLED FOR AND THE DISALLOWANCE OUGHT TO HAVE BEEN RESTRICTED TO RS.5,25,585/ - AS MADE BY YOUR APPELLANTS IN THE COMPUTATION OF INCOME. WITHOUT PREJUDICE TO THE ABOV E, YOUR APPELLANTS SUBMIT THAT THE DISALLOWANCE U/S.14A CONFIRMED BY THE LD. CIT(A) IS EXCESSIVE AND OUGHT TO BE REDUCED SUBSTANTIALLY. 2) THE LEARNED CIT (APPEALS) ERRED IN CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFICER OF RS.21,63,156/ - BEING AMOUNT DISALLOWED BY HIM U/S.14A AS AGAINST RS.5,25,585/ - ADDED BY YOUR APPELLANTS WHILE COMPUTING THE BOOK PROFIT U/S. 115JB. YOUR APPELLANT SUBMITS THAT HE ADDITION MADE BY ASSESSING OFFICER IS NOT OF ANY SPECIFIC AMOUNT, BUT OF AD HOC AMOUNT WORKED OUT UNDER R ULE 8D, AT 0.5% OF AVERAGE INVESTMENTS. YOUR APPELLANT SUBMITS THAT SUCH AN AD HOC ADDITION MADE WHILE COMPUTING THE INCOME UNDER REGULAR COMPUTATION PROVISIONS CANNOT BE ADDED UNDER RULE 8D R.W.S. 14A. YOUR APPELLANTS, THEREFORE, SUBMIT THAT LEARNED ASSES SING OFFICER BE DIRECTED TO RESTRICT THE ADDITION TO RS.5.25,585/ - WHILE COMPUTING THE BOOK PROFIT U/S 1 15JB. WITHOUT PREJUDICE TO THE ABOVE, YOUR APPELLANTS SUBMIT THAT THE DISALLOWANCE IS EXCESSIVE AND OUGHT TO BE REDUCED SUBSTANTIALLY. 3. BEFORE US, T HE LD. COUNSEL OF THE ASSESSEE SUBMITS THAT HE HAS BEEN INSTRUCTED BY THE ASSESSEE TO WITHDRAW THE APPEAL. THE LD. DR DID NOT OBJECT TO SUCH A PLEA OF THE ASSESSEE. ITA NO. 454/MUM/2016 3 4. IN VIEW OF THE ABOVE, THE APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT O N 26/07/2017. SD/ - SD/ - (MAHAVIR SINGH) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED: 26/07/2017 RAHUL SHARMA, SR. P.S. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) - 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE . BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI