G.Tech Stone Ltd., CHENNAI V. ACIT, CHENNAI

ITA 519/CHNY/2013

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 68618 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-08-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 14-08-2013
• Assessment Year: 2009-2010
• Appeal Filed On: 27-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHAJI P JACOBADDL
• Assessee Lawyers: S SRIDHAR

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER I.T.A. NO. 519/MDS/2013 (ASSESSMENT YEAR : 2009-10) M/S G TECH STONE LTD., 7, LVR CENTRE, SESHADRI RD., ALWARPET, CHENNAI - 600 018. PAN : AAACG 1179 K (APPELLANT) V. THE ASSISTANT COMMISSIONER OF INCOME TAX, COMPANY CIRCLE II(2), CHENNAI - 600 034. (RESPONDENT) APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE RESPONDENT BY : SHRI SHAJI P. JACOB, ADD L.CIT DATE OF HEARING : 14.08.2013 DATE OF PRONOUNCEMENT : 14.08.2013 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : IN THIS APPEAL FILED BY THE ASSESSEE, IT ASSAILS AN EX PARTE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) I, CO IMBATORE. AS PER THE ASSESSEE, THE CIT(APPEALS) SUSTAINED A DISA LLOWANCE OF ` 50,77,903/- BEING INTEREST CHARGED TOWARDS THE FORW ARD CONTRACT LOSS/ HEDGING LOSS, DISALLOWANCE OF ` 27,77,275/- BEING BANK CHARGES RELATABLE TO INCREASE IN CASH CREDIT LIMIT, DISALLO WANCE OF ` 83,73,894/- I.T.A. NO. 519/MDS/13 2 BEING INTEREST RELATABLE TO BORROWED FUNDS DIVERTED , DISALLOWANCE OF ` 3,122/- AS EXPENSES RELATABLE TO TAX FREE DIVIDEND AND DISALLOWANCE OF ` 17,74,186/- ON LORRY FREIGHT AND RENT PAID, FOR WA NT OF DEDUCTION OF TAX AT SOURCE. 2. WE FIND FROM THE ORDER OF THE CIT(APPEALS) THAT NOBODY ENTERED APPEARANCE ON BEHALF OF ASSESSEE, DESPITE FOUR OPPO RTUNITIES GIVEN TO IT. IT IS NOTED BY THE CIT(APPEALS) THAT THE AUTHO RIZED REPRESENTATIVE OF THE ASSESSEE HAD AGREED BEFORE THE ASSESSING OFF ICER FOR DISALLOWANCE OF ` 50,77,903/- BEING INTEREST CHARGEABLE TOWARDS FORWARD CONTRACT LOSS/ HEDGING LOSS. THE CIT(APPEA LS) ALSO NOTED THAT THE INCREASE IN CASH CREDIT LIMIT WERE FOR THE EDIBLE OIL BUSINESS OF THE ASSESSEE AND NOT FOR ITS HEDGING BUSINESS, WHIL E CONFIRMING THE DISALLOWANCE OF BANK CHARGES OF ` 27,77,275/-. CIT(APPEALS) ALSO HELD THAT DISALLOWANCE OF INTEREST ` 78,34,554/- WAS JUSTIFIED SINCE THERE WERE SUBSTANTIAL DIVERSION OF INTEREST BEARIN G FUNDS. SIMILARLY, DISALLOWANCE MADE UNDER SECTION 40(A)(IA) WAS ALSO CONFIRMED FOR NOT SUBSTANTIATED THE CLAIM PROPERLY. 3. ARGUMENT OF THE LEARNED A.R. BEFORE US IS THAT P ROPER OPPORTUNITY WAS NOT GRANTED TO IT FOR REPRESENTING ITS CASE BEFORE CIT(APPEALS). I.T.A. NO. 519/MDS/13 3 4. LEARNED D.R. DID NOT RAISE ANY SERIOUS OBJECTION , FOR THE MATTER BEING REMITTED BACK TO CIT(APPEALS) FOR CONSIDERATI ON AFRESH. 5. IN THE INTEREST OF JUSTICE, WE SET ASIDE THE ORD ER OF CIT(APPEALS) AND REMIT ALL THE ISSUES BACK TO HIS FILE FOR CONSI DERATION AFRESH. ASSESSEE SHALL CO-OPERATE AND APPEAR BEFORE CIT(APP EALS) AND SUBMIT ITS PLEADINGS AND EVIDENCE. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN THE COURT ON WEDNESDAY, THE 14 TH OF AUGUST, 2013, AT CHENNAI. SD/- SD/- (V.DURGA RAO) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 14 TH AUGUST, 2013. KRI. COPY TO: (1) APPELLANT (2) RESPONDENT (3) CIT(A)-I, COIMBATORE (4) CIT (JUDICIAL), CHENNAI (5) D.R. (6) GUARD FILE