DCIT-8(2), MUMBAI V. HEAT SHRINK TECHNOLOGIES PVT.LTD., MUMBAI

ITA 4565/MUM/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 62247 (ITAT-MUMBAI)
• Duration Of Justice: 10 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-04-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Assessment Year: 2004-2005
• Appeal Filed On: 06-06-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V KRISHNAMOORTHY
• Assessee Lawyers: TARAL DEDHIA
• Keywords: Additional evidence; Bad and doubtful debts

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES H, MUMBAI BEFORE SHRI B. RAMAKOTAIAH (AM) AND SHRI S.S. GODAR A (JM) ITA NO.4565/M/2011 ASSESSMENT YEAR: 2004-05 DCIT-8(2), R.NO. 216-A, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI 400 020. VS. M/S. HEAT SHRINK TECHNOLOGIES PVT. LTD., PLOT NO.112, 13 TH ROAD, MIDC, ANDHERI (EAST), MUMBAI 400 093. PAN: AABCP5129M (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI V. KRISHNAMOORTHY (JCIT ) RESPONDENT BY: SHRI TARAL DEDHIA DATE OF HEARING: 11.4.2012 DATE OF PRO NOUNCEMENT:26.04.2012 O R D E R PER S.S. GODARA, J.M: IN THE INSTANT APPEAL, THE REVENUE HAS CHALLENGED T HE IMPUGNED ORDER OF LD. CIT (A)-17, MUMBAI DATED 10.2.2010 FOR THE ASSESSMENT Y EAR 2004-05. 2. THE INSTANT APPEAL RAISES FOUR GROUNDS. GROUND NOS. 3 & 4 ARE GENERAL IN NATURE. GROUND NOS. 1 & 2 ARE INTER CONNECTED. THEREFORE, THEY ARE BEING DECIDED TOGETHER. 3. FACTS GIVING RAISE TO THE INSTANT GROUNDS BEFORE US ARE THAT THE ASSESSEE FILED ITS RETURN ON 13.09.2004. THE ASSESSING OFFICER DISALL OWED ITS ALLEGED CLAIM REGARDING DOUBTFUL DEBTS AND ADVANCES OF RS. 1,27,43,561/- AS THE ASSE SSEE HAD NOT OFFERED ANY EXPLANATION. 4. IN APPEAL PREFERRED BY THE ASSESSEE AGAINST THE ASSESSMENT ORDER DATED 22.11.2006, THE LEARNED CIT (A) HAS DELETED THE ABOVE SAID DISA LLOWANCE ON THE GROUND THAT THE ASSESSEE IN ITS COMPUTATION OF INCOME HAD CONSIDERE D LOSS AS PER PROFIT & LOSS ACCOUNT. IN 2 ITA NO.4565/M/2011 THE OPINION OF THE LD. CIT (A), SINCE NO SUCH PROVI SION HAD BEEN CLAIMED, THEREFORE, THE DISALLOWANCE IN QUESTION MADE BY THE ASSESSING OFFI CER WAS NOT WARRANTED. HENCE, THE INSTANT APPEAL BY REVENUE. 5. IN SUPPORT OF THE GROUNDS, LD. DR HAS ARGUED BEF ORE US THAT THE LD. CIT (A) HAS COMMITTED A MISTAKE IN SETTING ASIDE THE WELL REASO NED DETAILED ORDER OF THE ASSESSING OFFICER. HENCE, PRAYED FOR ACCEPTANCE OF THE APPEA L. 6. ON THE OTHER HAND, LD. AR HAS SUPPLIED US THE RE CORD OF RETURN COMPRISING DETAILS OF COMPUTATION OF INCOME, PROFIT & LOSS ACCOUNT ETC. D URING HEARING OF THE INSTANT CASE. HE REFERRED TO THE COMPUTATION OF TOTAL INCOME AT PAGE NO.1 AS WELL AS PAGE NO.6 OF THE PAPER BOOK. HE ARGUED THAT THE ASSESSEE HAD NEVER RAISED ANY SUCH CLAIM OF DOUBTFUL DEBTS AND ADVANCES. THEREFORE, THE LD. AR RELIED ON THE ORD ER OF LD. CIT (A). 7. WE HAVE HEARD BOTH THE LEARNED REPRESENTATIVES. WITH THEIR ASSISTANCE, THE RECORD REFERRED TO HAS ALSO BEEN PERUSED. IT IS EVIDENT FR OM THE PAPER BOOK AS WELL AS FROM THE IMPUGNED FINDINGS AND FROM PROFIT & LOSS ACCOUNT / COMPUTATION OF INCOME THAT THE ASSESSEE HAD NOT CLAIMED PROVISION FOR DOUBTFUL DEB TS AND ADVANCES AS A DEDUCTION. RATHER, IT HAD MADE A PROVISION TO THAT EXTENT IN THE APPRO PRIATION ACCOUNT AFTER DETERMINING THE LOSS OF THE YEAR AS RS. 1,00,28,78,289/-. THE COMP UTATION OF INCOME STARTED WITH THE ABOVE AMOUNT. IT IS FURTHER CLEAR THAT THOUGH THE PROVIS ION WAS MADE IN THE BOOKS OF ACCOUNT, NO CLAIM WAS RAISED IN THE COMPUTATION OF INCOME. THE REFORE, THE LD. CIT (A) IS VERY MUCH CORRECT IN HOLDING THAT THE PROVISION APPEARS WELL BELOW THE LINE IN PROFIT & LOSS A/C. THE REVENUE BEFORE US HAS NOT CONTROVERTED THE SAID FIN DING OF THE FACT. WE ALSO FIND NO MERIT IN THE INSTANT GROUND. ACCORDINGLY, GROUND NO.1 STANDS REJECTED. 8. GROUND NO.2:- THE REVENUE HAS RAISED THE GROUND THAT THE LD. CIT (A) HAS ERRED IN ADMITTING OF FRESH EVIDENCE FILED BY THE ASSESSEE D URING THE APPELLATE PROCEEDINGS. 3 ITA NO.4565/M/2011 8.1. WE HAVE HEARD THE LEARNED DR WHO HAS FAILED TO POINT OUT AS TO WHERE THE ADDITIONAL EVIDENCE HAS BEEN ADMITTED BY THE LD. CIT (A). FRO M THE RECORD, IT COMES OUT THAT NEITHER THERE WAS AN APPLICATION OF ADDITIONAL EVIDENCE FIL ED BY THE ASSESSEE NOR ANY ORDER IN THIS REGARD. THEREFORE, THE INSTANT GROUND HAS BEEN RAI SED UNNECESSARILY. RATHER IN OUR OPINION, BOTH THE GROUNDS AMOUNT TO UNNECESSARY LITIGATION A ND BURDEN ON THE EXCHEQUER. BUT REFRAINING OURSELVES, WE DO NOT WANT TO PASS ANY OR DER ENTAILING CIVIL CONSEQUENCES OR COSTS. RESULTANTLY, BOTH THE GROUNDS OF APPEAL FILED BY TH E REVENUE ARE REJECTED. 9. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 26 TH DAY OF APRIL, 2012. SD/- SD/- (B. RAMAKOTAIAH) (S.S. GODARA) ACCOUNTANT MEMBER JUDICIAL ME MBER DATE : 26.4.2012 AT :MUMBAI OKK COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A), MUMBAI CONCERNED 4. THE CIT, MUMBAI CONCERNED 5. THE DR H BENCH, ITAT, MUMBAI // TRUE COPY// BY ORDER ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI.