PRATIBHA SHIPPING COMPANY LTD, MUMBAI V. ACIT 5(2), MUMBAI

ITA 4706/MUM/2011

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 0207 (ITAT-MUMBAI)
• Duration Of Justice: 6 year(s) 2 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-08-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 27-10-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 10-06-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAJAT MITTAL
• Keywords: Cost of acquisition; Capital receipt
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH C MUMBAI BEFORE SHRI MAHAVIR SINGH (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 4703/MUM/2011 ASSESSMENT YEAR: 2003 - 04 & ITA NO. 4706/MUM/2011 ASSESSMENT YEAR: 2004 - 05 PRATIBHA SHIPPING COMPANY LTD. 1201/02 ARCADIA BLAD, 12 TH FLOOR, NCPA ROAD, NARIMAN POINT MUMBAI - 400021. VS. ITO - 5(2)(4) AAYAKARBHAVAN MUMBAI. PAN NO. AAACP7179E ASSESSEE BY : NONE REVENUE BY : SHRI RAJAT MITTAL, DR DATE OF HEARING : 23/05/2017 DATE OF PRONOUNCEMENT: 18/08/2017 ORDER PER N.K. PRADHAN, A.M . THE CAPTIONED APPEALS FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) - 9, MUMBAI AND ARISE OUT OF ORDER U/S 143(3) OF THE INCOME TAX ACT 1961 (T HE ACT). AS SOME COMMON ISSUES ARE INVOLVED WE ARE PROCEEDING TO DISPOSE THEM OFF BY A CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. ITA NO. 4703 & 4706/MUM/2011 2 2. THE GROUNDS OF APPEAL READ AS UNDER: - ASSESSMENT YEAR 2003 - 04 1. THE LD. CI T(A) ERRED IN CONFIRMING THE ADDITION OF RS.6,02,44,502/ - MADE TO THE TOTAL INCOME OF THE APPELLANT TREATING THE SAME AS INTEREST WAIVED BY THE LENDER. 2. (A) THE LD. CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF PROFESSIONAL FEES OF RS.10,75,000/ - PAID TO M R. SACHIN CHAVAN, A PRACTICING CHARTERED ACCOUNT AND AN INDEPENDENT DIRECTOR OF THE APPELLANT COMPANY. (B) THE LD. CIT(A) ERRED IN HOLDING THAT THE SAID EXPENDITURE WAS TOWARDS A CAPITAL RECEIPT AND HENCE NOT ALLOWABLE. (C) THE LD. CIT(A) ERRED IN HOLD ING THAT THE APPELLANT HAD FAILED TO PROVE THE SERVICES RENDERED IN RESPECT OF WHICH PROFESSIONAL FEES WERE RENDERED. 3. THE LD. CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF RS.1,84,39,235/ - OUT OF FUEL AND OIL EXPENSES TREATING IT AS EXCESSIVE AND NOT GEN UINE. 4. THE LD. CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF RS.1,99,080/ - BEING 10% OF MISCELLANEOUS EXPENSES MADE BY THE ASSESSING OFFICER ON AN AD HOC BASIS. ASSESSMENT YEAR 2004 - 05 1. THE LD. CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF RS.1,46,78,264/ - OUT OF FUEL AND OIL EXPENSES TREATING IT AS EXCESSIVE AND NOT GENUINE. 2. (A) THE LD. CIT(A) ERRED IN CONFIRMING THE CAPITALIZATION OF FUEL AND OIL EXPENSES OF RS.18,56,400/ - AND INTEREST OF RS.2,37,610/ - AS PART OF COST OF ACQUISITION OF THE SHIP PRATIBHA NARMADA. (B) THE LD. CIT(A) ERRED IN TREATING THE DATE OF ACQUISITION OF THE SHIP PRATIBHA NARMADA AS 22 ND AUGUST 2003 AS AGAINST 17 TH AUGUST 2003. ITA NO. 4703 & 4706/MUM/2011 3 3. (A) THE LD. CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF PROFESSIONAL FEES OF RS.8,50 ,000/ - PAID TO MR. SACHIN CHAVAN, A PRACTICING CHARTERED ACCOUNT AND AN INDEPENDENT DIRECTOR OF THE APPELLANT COMPANY. (B) THE LD. CIT(A) ERRED IN HOLDING THAT THE SAID EXPENDITURE WAS TOWARDS A CAPITAL RECEIPT AND HENCE NOT ALLOWABLE. (C) THE LD. CIT(A) ERRED IN HOLDING THAT THE APPELLANT HAD FAILED TO PROVE THE SERVICES RENDERED IN RESPECT OF WHICH PROFESSIONAL FEES WERE RENDERED. 4. THE LD. CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF RS.1,10,720/ - BEING 10% OF MISCELLANEOUS EXPENSES MADE BY THE ASSESSING OFFICER ON AN AD - HOC BASIS. 3. WE HAVE PERUSED THE RELEVANT RECORD. WE FIND THAT THE CASE WAS FIXED FOR HEARING BEFORE THE TRIBUNAL ON 27.10.2015. NO ONE APPEARED ON BEHALF OF THE APPELLANT ON 27.10.2015. THEN NOTICE WAS SENT BY RPA D FIXING THE CASE FOR HEARING ON 03.02.2016. AGAIN NO ONE APPEARED ON BEHALF OF THE ASSESSEE ON 03.02.2016. THEN NOTICE WAS SENT THROUGH THE DR FIXING THE CASE FOR HEARING ON 10.05.2016. AGAIN NO ONE APPEARED ON BEHALF OF THE ASSESSEE ON 10.05.2016 . THEN A NOTHER NOTICE WAS SENT THROUGH RPAD FIXING THE CASE FOR HEARING ON 08.08.2016. AGAIN NO ONE APPEARED ON BEHALF OF THE ASSESSEE ON 08.08.2016. SO THE CASE WAS AGAIN FIXED FOR HEARING ON 27.10.2016 BY SENDING NOTICE THROUGH RPAD. AGAIN NO ONE APPEARED ON BEH ALF OF THE ASSESSEE ON 27.10.2016. AGAIN THE CASE WAS FIXED FOR HEARING ON 1 5.11.2016 BY SENDING THE NOTICE THROUGH RPAD. BUT NO ONE APPEARED ON BEHALF OF THE ASSESSEE ON 1 5.11.2016. THEN THE CASE WAS AGAIN FIXED FOR HEARING ON 23.05.2017. BUT NO ONE APPEA RED ON BEHALF OF THE ASSESSEE ON 23.05.2017 . ITA NO. 4703 & 4706/MUM/2011 4 4. AT THE THRESHOLD, IT IS RELEVANT TO MENTION THAT NONE APPEARED ON BEHALF OF THE ASSESSEE WHEN THIS APPEAL WAS CALLED FOR. WE FIND THAT PROPER NOTICE OF HEARING HAS ALREADY BEEN GIVEN TO THE ASSESSEE. UNDER THESE CIRCUMSTANCES, IN OUR CONSIDERED OPINION, THE ASSESSEE IS NOT INTERESTED IN PROSECUTING THE APPEAL. AS SUCH WE HOLD THAT THIS APPEAL IS LIABLE TO BE DISMISSED FOR NON - PROSECUTION. IN THIS REGARD, WE PLACE RELIANCE UPON FOLLOWING CASE LAWS: 1 . CIT VS. MULTIPLAN INDIA LTD . 38 ITD 320 (DEL) 2. ESTATE OF LATE TUKOJIRAO HOLKAR VS. CWT 223 ITR 480 (M.P.) 3. NEW DIWAN OIL MILLS VS. CIT (2008) 296 ITR 495 (P& H) 4. CIT VS. B. N. BHATTACHARGEE AND ANOTHER 118 I TR 461(SC) 5. IN THE RESULT, THE APPEALS ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN C OURT ON 18/08/2017 . SD/ - SD/ - (MAHAVIR SI NGH) (N.K. PRADHAN) J UDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED: 18/08/2017 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