SUREMI TRADING P. LTD, MUMBAI V. ITO 5(3)(4), MUMBAI

ITA 533/MUM/2010

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 4646 (ITAT-MUMBAI)
• Duration Of Justice: 8 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2010
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: I
• Assessment Year: 2006-2007
• Appeal Filed On: 21-01-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: N K BAROTIA
• Assessee Lawyers: NISHA GOPLANI

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH I MUMBAI BEFORE SHRI A.L. GEHLOT (AM) AND SMT ASHA VIJAYARAGHAVAN (JM) ITA NO.533/MUM/2010 (ASSESSMENT YEAR-2006-07) M/S. SUREMI TRADING PVT. LTD., D-1, SINDHU HOUSE, NANABHAI LANE, MUMBAI-400 001 PAN-AAACS5620B THE ITO 5(3)(4), AAYAKAR BHAVAN, MUMBAI-400 020 (APPELLANT) VS. (RESPONDENT) APPELLANT BY: MS. NISHA GOPLANI RESPONDENT BY: SHRI N.K. BAROTIA O R D E R PER SMT. ASHA VIJAYARAGHAVAN (JM) THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF THE LD.CIT(A)-9, MUMBAI DATED 19.11.2009 FOR THE A.Y.20 06-07. 2. THE FIRST ISSUE IS REGARDING DISALLOWANCE U/S. 1 4A. 3. WE FIND THAT THE DECISION OF SPECIAL BENCH IN THE C ASE OF DAGA CAPITAL MANAGEMENT PVT. LTD HAS BEEN SET ASIDE BY THE JURIS DICTIONAL HIGH COURT IN THE CASE OF GODREJ & BOYCE MFG CO LTD V DCIT (2010 TIOL-564-HC-MUM-IT). IN THE CIRCUMSTANCES, WE SET ASIDE THE ORDER OF AO AND CIT(A) ON THIS ISSUE AND REMIT THE MATTER BACK TO THE FILES OF AO TO DEC IDE THE ISSUE AFRESH IN LINE WITH THE RATIO OF THE DECISION OF THE JURISDICTIONA L HIGH COURT. 4. THE SECOND ISSUE RAISED BY THE ASSESSEE READS AS FOLLOWS: ITA NO. 533/M/10 2 THE LEARNED CIT(A) ERRED IN NOT SPECIFICALLY DIREC TING THE LEARNED ASSESSING OFFICER TO CONSIDER THE BUSINESS LOSS OF RS.1,53,34,633/- RETURNED BY THE ASSESSEE AS AGAINS T .61,418/- CONSIDERED BY THE LEARNED ASSESSING OFFIC ER. THE LEARNED CIT(A) OUGHT TO HAVE DIRECTED THE LEARN ED ASSESSING OFFICER TO DISALLOW THE EXPENSES U/S.14A FROM THE B USINESS LOSS OF RS.1,53,34,633/-, AS RETURNED BY THE ASSESSEE. 5. WE FIND THAT THE LD. LD. CIT(A) AT PARA 4.1 & 4. 2 HELD AS FOLLOWS: IN THE STATEMENT OF FACTS IT WAS SUBMITTED THAT IT HAD SHOWN LOSS FROM BUSINESS AT 1,53,34,633/-. HOWEVER, IN THE ASSESSMENT ORDER, WHILE COMPUTING THE BUSINESS INCO ME, THE ASSESSING OFFICER HAS TAKEN BUSINESS LOSS AT 61,418/-. THE ASSESSEE SUBMITS THAT, THE ASSESSING OFFICER OUGHT TO HAVE DISALLOWED THE EXPENSES U/S.14A FROM THE BUSINESS L OSS OF RS.1,53,34,633/-, AS RETURNED BY THE ASSESSEE. I HAVE CONSIDERED THE CONTENTION OF THE ASSESSEE. THE ASSESSING OFFICER APPEARS TO HAVE COMMITTED MISTAKE WHICH IS APPARENT FROM RECORD. THE ASSESSING OFFICER IS DIR ECTED TO RECTIFY, IF THERE IS ANY, SUCH MISTAKE AS POINTED OUT BY THE ASSESSEE. THIS GROUND OF APPEAL IS PARTLY ALLOWED. 6. WE FIND NO INFIRMITY IN THE ORDER OF THE LD. CIT (A) AND THE LD. CIT(A) HAS DIRECTED THE AO TO PASS A PROPER ORDER. WE SEE NO GRIEVANCE FOR THE ASSESSEE TO COME UP ON APPEAL BEF ORE US. THEREFORE WE DISMISS THIS GROUND. 7. THE THIRD GROUND RAISED BY THE ASSESSEE READS AS FOLLOWS: THE LEARNED CIT(A) ERRED IN NOT SPECIFICALLY DIRECT ING HE LEARNED ASSESSING OFFICER TO CARRY FORWARD EARLIER YEARS B USINESS LOSSES AND SHORT TERM CAPITAL LOSS FOR SET OFF IN THE SUBS EQUENT ASSESSMENT YEARS. 8. THE LD. CIT(A) HELD AT PARA 6,6.1 & 6.2 HELD AS FOLLOWS: GROUND NO.6 AND GROUND NO.7 OF THE APPEAL ARE AS U NDER: ITA NO. 533/M/10 3 1. THE LEARNED ASSESSING OFFICER ERRED IN NOT SPECIFICALLY CARRYING FORWARD EARLIER YEARS BUSINE SS LOSSES AND SHORT TERM CAPITAL LOSS FOR SET OFF IN S UBSEQUENT ASSESSMENT YEARS. 2. THE LEARNED ASSESSING OFFICER ERRED IN NOT SPECIFICALLY ALLOWING CURRENT YEARS LOSSES TO BE C ARRIED FORWARD FOR SET OFF IN SUBSEQUENT ASSESSMENT YEARS. THE ASSESSEE SUBMITTED THAT IT HAS SUFFICIENT CARRI ED FORWARD LOSES TO BE SET OFF AGAINST THE CURRENT YEARS INCOM E. THE ASSESSING OFFICER IS DIRECTED TO LOOK INTO THE CLAIM OF THE ASSESSEE AND ALLOW ADJUSTMENT OF CARRY FORWARD BUSI NESS LOSSES AS PER LAW. THESE GROUNDS ARE PARTLY ALLOWED. 9. HERE AGAIN WE FIND THERE CAN BE NO GRIEVANCE FOR THE ASSESSEE TO FILE THE APPEAL BEFORE US HENCE WE DISMISS THIS GRO UND. 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE FOR GROUND NO. 1 IS ALLOWED FOR STATISTICAL PURPOSES AND GROUND NO. 2 & 3 IS DISMISSED. ORDER PRONOUNCED ON THIS 30 TH DAY OF SEPTEMBER, 2010. SD/- SD/- (A.L. GEHLOT) ASHA VIJAYARAGHAVAN (ACCOUNTANT MEMBER) (JUD ICIAL MEMBER) MUMBAI, DATED 30 TH SEPTEMBER, 2010. RJ COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT-CONCERNED 4. THE CIT(A)-CENTRAL - I CONCERNED 5. THE DR I BENCH TRUE COPY BY ORDER ASST. REGISTRAR, I.T.A.T, MUMBAI