ITO 8(3)(2), MUMBAI V. SURAKSHA REALTY LTD, MUMBAI

ITA 4550/MUM/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 4555 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-01-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2010-2011
• Appeal Filed On: 02-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIVEK OJHA
• Keywords: Tax effect
• Section: 14A; 2; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E, MUMBAI BEFORE SHRI JASON P. BOAZ (AM) AND SHRI RAM LAL NEG I (JM) ITA NO. 4550 /MUM/2014 ASSESSMENT YEAR: 2010-11 THE INCOME TAX OFFICER- 8(3)(2), 201, AAYAKAR BHAVAN, M.K.MARG, MUMBAI - 400020. VS. M/S. SURAKSHA REALTY LTD. 3, NARAYAN BUILDING, L.N.ROAD, DADAR (E), MUMBAI- 400014. PAN- AALCS7864A (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI. VIVEK OJHA RESPONDENT BY : SHRI. ANUJ KISNADWALA DATE OF HEARING: 07/01/2016 DATE OF PRONOUNCEMENT: 07/01/2016 O R D E R PER JASON P. BOAZ, AM THE AFORESAID APPEAL HAS BEEN FILED BY THE REV ENUE AGAINST IMPUGNED ORDER DATED 11/04/2014 PASSED BY THE CIT( A)-18, MUMBAI IN RESPECT OF THE ORDER OF ASSESSMENT PASSED U/S 14 3(3) FOR THE ASSESSMENT YEAR 2010-11, ON THE FOLLOWING GROUNDS:- I) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE CIT(A) ERRED IN DELETING THE ADDITION OF R S. 22,91,994/- MADE U/S 14A R.W. RULE 8D TO THE BOOK PROFIT U/S 11 5JB HOLDING THAT DISALLOWANCE U/S. 14A CANNOT BE CONSI DERED WHILE COMPUTING BOOK PROFIT U/S. 115JB. 2 ITA NO. 4550 /MUM/2014 ASSESSMENT YEAR: 2010-11 'II). 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN RELYING ON THE DECISIO NS IN THE CASE OF ESSAR TELEHOLDINGS LTD. VS. ADDL.CIT & OTHERS (I TA NOS.3850/MUM/2010) & RELIANCE INDUSTRIAL INFRASTRUC TURE LTD VS. ADDL,CIT & OTHERS (ITA NOS.69&70/MUM/2009) IGNO RING THE SUBSEQUENT DECISION OF THE MUMBAI ITAT IN THE CASE OF RBK SHARE BROKING (PVT.) LTD.(ITA NOS.6678 & 7546 (MUM) OF 2011 DATED 24.07.2013] WHEREIN IT WAS CATEGORICALLY HELD BY THE HON'BLE ITAT THAT FROM THE A.Y.2008-09 ONWARDS, DIS ALLOWANCE U/S.14A IS REQUIRED TO BE COMPUTED AS PER RULE 8D A ND FURTHER THE AMOUNT WHICH HAS BEEN DISALLOWED ALSO NEEDS TO BE ADDED TO THE AMOUNT OF NET PROFIT FOR COMPUTING 'BOOK PRO FIT' U/S.115JB. III) ON THE FACTS AND IN THE CIRCUMSTANCES AND IN LAW, THE LD CIT(A) ALSO ERRED IN NOT APPRECIATING THE DECISION OF MUMBAI ITAT IN THE CASE OF M/S. ESQUIRE PVT. LTD, (ITA NO.5688/MUM/2011 DATED 02.07.2012) WHEREIN THE HON' BLE TRIBUNAL HAS HELD THAT 'IN CASE ANY AMOUNT IS DISAL LOWED U/S.14A, WE MAKE IT CLEAR THAT THE AMOUNT HAS ALSO TO BE DISALLOWED UNDER THE PROVISIONS OF SECTION 115JB. IV) 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. CIT(A) OUGHT TO HAVE CONFIRMED THE ADD ITION AS THE SAME WERE BASED ON DOCUMENTARY EVIDENCES SEIZED DUR ING THE COURSE OF SEARCH IN THE PREMISES OF SHRI MUKESH CHOKSHI WHO HAS ALSO CONFIRMED THAT HE HAD PROVIDED ACCOMMO DATION ENTRIES.' V). 'THE APPELLANT PRAYS THAT THE ORDER OF THE CIT( A) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT OF THE A.O. BE RESTORED.' 3 ITA NO. 4550 /MUM/2014 ASSESSMENT YEAR: 2010-11 VI) 'THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER A NY GROUNDS OR ADD A NEW GROUND WHICH MAY BE NECESSARY'. 2. AT THE OUTSET, IT IS NOTICED THAT, THE DISPUTE D ISSUE IS ONLY FOR RS. 22,21,994/- AND THE TAX EFFECT ON THIS AMOUNT I S BELOW THE SPECIFIED MONETARY LIMIT OF RS. 10 LAKHS. AS PER TH E LATEST CBDT CIRCULAR NO. 21 OF 2015, DATED 10 TH DECEMBER, 2015, NEW GUIDELINES OF MONETARY LIMIT FOR FILING OF APPEALS BY THE DEPARTMENT HAS BEEN ISSUED, WHEREBY THE TAX EFFECT FOR FILING OF APPEAL BEFORE THE ITAT HAS BEEN PRESCRIBED AT RS. 10 LAKHS. IN TH E SAID CIRCULAR, IT HAS BEEN SPECIFICALLY CLARIFIED THAT THE SAID IN STRUCTION WILL APPLY RETROSPECTIVELY TO ALL THE PENDING APPEALS. ACCORDI NGLY, THE APPEAL FILED BY THE REVENUE IS NOT MAINTAINABLE AND IS DIS MISSED IN LIMINE . ORDER PRONOUNCED IN THE OPEN COURT ON 7 TH JANUARY, 2016 SD/ - SD/- ( RAM LAL NEGI ) (JASON P.BOAZ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI; DATED: 07/01/2016 4 ITA NO. 4550 /MUM/2014 ASSESSMENT YEAR: 2010-11 / 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, M PRAMILA