AATUR HOLDINGS P. LTD, MUMBAI V. DCIT CEN CIR 31, MUMBAI

ITA 4627/MUM/2011

• Counselvise Citation: 462719914 RSA 2011
• Duration Of Justice: 4 year(s) 2 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-09-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 03-03-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 08-06-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S R KIRTANE
• Keywords: Opportunity of being heard; Principle of natural justice

Judgement Text

, INCOME TAX APPELLATE TRIBUNAL,MUMBAI A BENCH , , BEFORE S/SH. RAJENDRA,ACCOUNTANT MEMBER & PARTHASAR ATHY CHOUDHURY,JUDICIAL MEMBER /. ITA NO. 4627 & 4628 /MUM/201 1 , / ASSESSMENT YEAR - 200 4 - 05 & 05 - 06 M/S. AATUR HOLDINGS PVT. LTD. 32, MADHULI, 3 RD FLOOR DR. ANNIE BEANT ROAD NEHRU CENTRE, WORLI MUMBAI - 400 0 18 . PAN: A A B CA 1472 C VS DCIT - CENTRAL CIRCLE - 31 MUMBAI. ( / APPELLANT ) ( / RESPONDENT ) /ASSESSEE BY : SHRI DHAVAL SHAH / REVE NUE BY : SHRI S.R. KIRTANE / DATE OF HEARING : 0 2 - 09 - 2015 / DATE OF PRONOUNCEMENT : 04 - 0 9 - 2015 , 1961 254 ( 1 ) ORDER U/S.254(1)OF THE INCOME - TAX ACT,1961(ACT) PER RAJENDRA, AM - CHALLENGING THE ORDERS DT .25.4.2011 OF CIT(A) - 40, MUMBAI, THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL FOR THE ABOVE MENTIO NED TWO YEARS - THE ONLY DIFFERENCE IS THE AMOUNT INVOLVED IN GROUND NO. 4 : 1.THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS IN PASSING THE ORDER U/ S. 250 OF THE ACT AND CONFIRMING THE ORDER OF THE ASSESSING OFFICER. 2.TH E LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS IN PASSING THE ORDER WITHOUT COMPLYING WITH THE PRINCIPLES OF NATURAL JUSTICE. 3.THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS IN NOT APPRECI ATING THAT NO INCOME FROM ATTACHED ASSETS CAN BE ASSESSED IN THE HANDS OF THE APPELLANT. 4.THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS IN NOT GRANTING RELIEF OF LIABILITY AMOUNTING TO RS. 60,94,456/ - , TOWARDS INTERES T EXPENDITURE CLAIMED BY THE APPELLANT. 5.THE APPELLANT CRAVES LEAVE OF YOUR HONOUR TO ADD TO, ALTER, AMEND AND/ OR DELETE ALL OR ANY OF THE FOREGOING GROUNDS OF APPEAL. THE ASSESSEE HAS ALSO FILED IDENTICAL ADDITIONAL GROUND FOR BOTH THE YEARS: THE LD. CIT(A) OUGHT TO HAVE APPRECIATED THAT AS PER THE DECISION OF HON'BLE SPECIAL COURT DATED 30.04.2010 IN MP NO.41 OF 1999, THE ASSETS UNDER CONSIDERATION AND THE CONSEQUENTIAL INCOME BELONGS TO SHRI HARSHAD S. MEHTA AND HENCE THE INCOME ASSESSED BY TH E ASSESSING OFFICER OUGHT TO HAVE BEEN TAXED IN THE HANDS OF SHRI H ARSHA D S . MEHTA AND NOT IN THE HANDS OF THE APPELLANT. AS STATED EARLIER,THE AMOUNT INVOLVED WITH REGARD TO INTEREST EXPENDITURE IS DIFFERENT F OR THE YEAR UNDER CONSIDERATION - F OR THE AY.20 04 - 05 THE ASSESSEE HAD RAISED THE GROUND FOR RS.60.94 LACS , WHEREAS FOR THE AY.2005 - 06 APPEAL IS FOR 64.43 LACS. AS THE ISSUE RAISED BY THE ASSESSEE IN THE GROUNDS AND ADDITIONAL GROUNDS ARE ALMOS T IDENTICAL FOR BOTH THE YEARS,SO, WE ARE DISPOSING BOTH THE APPEALS BY A SINGLE ORDER . DURING THE COURSE O F HEARING BEFORE US THE AUTHORIS ED REPRESENTATIVE (AR) STATED THAT THE ASSESSEE WAS NOT INTEREST IN PERSUING GROUNDS NO.1 - 3 AND THE ADDITIONAL GROUND FILED FOR BOTH ITA/ 4627 & 28 /M/1 1 , AATUR H 2 THE AY . S ., THE REFORE, SAME STAND DISMISSED AS NOT PRESSED.IT LEAVES US WITH GROUND NO.4 WHICH PERTAINS TO NOT GRANTING RELIEF OF LIABILITY AMOUNTING TO RS.60,94,456/ - AND 64,43,037/ - FOR THE AYS 04 - 05 AND 05 - 06 RESPECTIVELY. 2. DURING THE COURSE OF HEARING BEFORE US, REPRESENTATIVES OF BOTH THE SIDES A GREED THAT THE ISSUE HAS ARISEN IN THE HARSHAD S. MEHTA(HSM) GROUP ON MANY OCCASIONS AND THE TRIBUNAL HAS DECIDED THE IDENTICAL ISSUE IN THE CASES OF THE INDIVIDUAL OF THE GROUP AS WELL AS THE CORPORATE ENTITIES OF THE GROUP. WE FIND THAT THE TRIBUNAL HA S RESTORED BACK THE ISSUE TO THE FILE OF THE AO IN ALL SUCH CASES. WE WOULD LIKE TO REPRODUCE THE RELEVANT PORTION OF THE CASE OF PRATIMA H MEHTA, ONE OF THE MEMBERS OF THE HSM GROUP TO WHICH ONE OF US WAS PARTY (ITA/350/MUM/2013 (AY - 2009 - 10 DT. 11.5.2015) .IN THAT MATTER THE THIRD GROUND OF APPEAL READ AS UNDER : THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) HAS ERRED IN LAW AND IN FACTS IN NOT GRANTING DEDUCTION OF LIABILITY AMOUNTING TO RS.9,3587628/ - TOWARDS INTEREST EXPENDITURE CLAIMED BY THE APPELLA NT. THE TRIBUNAL DECIDED THE CASE AS UNDER : 2. GROUND NO.1 & 2WERE NOT PRESSED. GROUND NO.3 WAS STATED TO BE COVERED BY THE EARLIER DECISION OF THE TRIBUNAL IN GROUP CASE. REFERENCE WAS MADE TO THE DECISION DATED 5/3/2015 PASSED IN ITA NO. 5135& 513 6/MUM/2012 & ITA NOS.2151/MUM/2013 IN THE CASE OF GROWMORE LEASING & INV. LTD. AND REFERENCE WAS MADE TO THE FOLLOWING OBSERVATIONS: 3. GROUND NO. 4 RELATES TO THE DISALLOWANCE OF INTEREST EXPENSE. THE LD. COUNSEL FOR THE ASSESSEE BROUGHT TO OUR NOTICE THAT THE DECISION RELIED UPON BY THE LD. CIT(A) WHILE DISPOSING THIS GROUND HAS BEEN SET ASIDE BY THE TRIBUNAL TO THE FILE OF THE LD. CIT(A). 4. THE LD. DEPARTMENTAL REPRESENTATIVE COULD NOT BRING ANY DISTINGUISHING DECISION IN FAVOUR OF THE REVENUE. 5. WE HAVE CAREFULLY PERUSED THE ORDERS OF THE AUTHORITIES BELOW. WHILE DISPOSING THE GROUND RELATING TO THE DISALLOWANCE OF INTEREST, WE FIND THAT THE LD. CIT(A) HAS FOLLOWED THE FINDINGS GIVEN IN THE CASE OF EMINENT HOLDINGS PVT. LTD. WE FIND THAT THE TRIBUNA L IN THE CASE OF EMINENT HOLDINGS IN ITA NOS. 2139, 2140 AND 2141/MUM/2013 HAVE FOLLOWED THE DECISION OF THE TRIBUNAL GIVEN IN COMMON GROUP CASE OF HITESH S. MEHTA AT PARA 2.3 OF THE ORDER AND RESTORED THE MATTER TO THE FILE OF THE LD. CIT(A) FOR FRESH ADJ UDICATION. RESPECTFULLY FOLLOWING THE FINDINGS OF THE CO ORDINATE BENCH, WE RESTORE THIS ISSUE TO THE FILES OF THE LD. CIT(A) FOR FRESH ADJUDICATION AFTER GIVING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 6. BEFORE CLOSING THIS ISSUE, THE LD. C OUNSEL FOR THE ASSESSEE POINTED OUT THAT THE LD. CIT(A) HAS HELD THAT THE ISSUE OF INTEREST EXPENDITURE IS PENDING BEFORE THE HONBLE SPECIAL COURT. IT IS THE SAY OF THE LD. COUNSEL THAT THE PROCEEDINGS IN WHICH THE SAID ISSUE OF INTEREST WAS ISSUED BY T HE CUSTODIAN HAVE BEEN ALREADY CONCLUDED WHICH FACT HAS ALREADY BEEN RECORDED BY THE LD. CIT(A) IN THE IMPUGNED ORDER. WE, THEREFORE, DIRECT THE LD. CIT(A) TO CONSIDER THIS FACT WHILE DECIDING THE ISSUE AFRESH. THE LD. CIT(A) MAY ALSO DIRECT FOR THE TAXING OF INCOME IN THE HANDS OF THE RECIPIENT (FAMILY MEMBERS) IN ACCORDANCE WITH THE METHOD OF ACCOUNTING FOLLOWED BY THEM AND AS PER THE PROVISIONS OF THE LAW. GROUND NO. 4 IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE. 3. LD. SPECIAL COUNSEL DID NOT CONTR OVERT TO SUCH CONTENTION OF LD. AR THAT THE ISSUE IS COVERED BY THE AFOREMENTIONED DECISION. 4. IN VIEW OF THE SITUATION, AFTER HEARING BOTH THE PARTIES, WE PASS SIMILAR ORDER AND THIS GROUND IS CONSIDERED TO BE ALLOWED FOR STATISTICAL PURPOSES IN THE MA NNER AFORESAID. FOLLOWING THE ABOVE, WE PASS SIMILAR ORDER. GROUND NO.4 IS ALLOWED FOR STATISTICAL PURPOSES FOR BOTH THE YEARS. AS A RESULT,APPEALS FILED BY THE ASSESSEE FOR BOTH THE AY.S. STAND ALLOWED FOR STATISTICAL PURPOSES. ITA/ 4627 & 28 /M/1 1 , AATUR H 3 . . . ORDER PRONOUNCED IN THE OPEN COURT ON 04 TH SEPTEMBER ,2015. 04 TH , 2015 SD/ - SD/ - ( / PARTHASARATHY CHOUDHURY) ( / RAJENDRA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / MUMBAI, /DATE: 04 . 09 . 2015 . . . JV. SR.PS. / COPY OF THE ORDER FORWARDED TO : 1. APPELLANT / 2. RESPONDENT / 3. THE CONCERNED CIT(A)/ , 4. THE CONCERNED CIT / 5. DR A BENCH, ITAT, MUMBAI / , , . . . 6. GUARD FILE/ //TRUE COPY// / BY ORDER, / DY./ASST. REGISTRAR , / ITAT, MUMBAI.