ITO (E)-II(1), MUMBAI V. KARAMSHI JETHABHAI SOMAIYA MEDICAL TRUST, MUMBAI

ITA 5451/MUM/2011

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 72001 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-12-2013
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 30-12-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 22-07-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: A H DALAL
• Assessee Lawyers: PRITAM SINGH
• Keywords: Capital expenditure
• Section: 11

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE S/SHRI B.R.MITTAL,(JM) AND N.K.BILLAIYA (AM ) . . , . . , ./I.T.A.NO.5451/MUM/2011 ( / ASSESSMENT YEAR: 2008-09) INCOME TAX OFFICER (E) - II(1), ROOM NO.509, PIRAMAL CHAMBERS, LALBAUG, PAREL, MUMBAI-400012 / VS. KARAMSHI JETHABHAI SOMAIYA MEDICAL TRUST, 4 TH FLOOR, FAZALBHOY BUILDING, 45/47, M G ROAD, FORT, MUMBAI-400023. ./ ./PAN/GIR NO. : AAATK4296Q ( ' / APPELLANT) .. ( ( ' / RESPONDENT) ' / APPELLANT BY : SHRI PRITAM SINGH ( ' * /REVENUE BY SHRI A H DAL AL * - / DATE OF HEARING : 30.12.2013 * - /DATE OF PRONOUNCEMENT : 30.12.2013 / O R D E R PER B.R.MITTAL, JM THE DEPARTMENT HAS FILED THIS APPEAL RELATING TO A SSESSMENT YEAR 2008-09 AGAINST THE ORDER OF LD. CIT(A) DATED 5.4.2011 ON FOLLOWING GROUNDS : 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, AND IN LAW, THE LD. CIT(A), MUMBAI ERRED IN ADMITTING THE NEW EVIDENC E VIZ DETAILS OF SHAREHOLDING PATTERN IN CONTRAVENTION OF RULE 46A OF THE INCOME TAX RULES, 1962. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, AND IN LAW, THE LD. CIT(A), MUMBAI ERRED IN HOLDING THAT THERE IS NO V IOLATION OF PROVISIONS OF SECTION 13(3) R.W.S. 13(1)(C ) OF THE IT ACT IN TH IS CASE AND HENCE THE ASSESSEE IS ENTITLED FOR EXEMPTION U/S 11 OF THE ACT, WITHOUT A PPRECIATING THAT THE ADVANCE OF RS.10,00,000/- WAS MADE TO THE SOMIYA PUBLICATION S PVT. LTD, WHO WAS COVERED BY THE DEFINITION OF EXCLUDED PERSONS AS PROVIDED IN SECTION 13(3) OF THE ACT. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, AND IN LAW, THE LD. CIT(A), MUMBAI ERRED IN HOLDING CONSEQUENTLY THAT SINCE THE ASSESSEE TRUST WAS ENTITLED FOR EXEMPTION U/S 11 OF THE IT ACT THE ASS ESSEE TRUST IS ENTITLED FOR DEDUCTION OF EXPENDITURE OF RS.18,81,64,321/- MADE ON THE OBJECTS OF THE TRUST. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, AND IN LAW, THE LD. CIT(A), MUMBAI ERRED IN HOLDING CONSEQUENTLY THAT SINCE THE ASSESSEE TRUST WAS ENTITLED FOR EXEMPTION U/S 11 OF THE IT ACT THE ASS ESSEE TRUST IS ENTITLED FOR DEDUCTION U/S 11(1)(D) OF THE ACT IN RESPECT OF CO NTRIBUTION OF RS.97,59,600/- TOWARDS CORPUS FUND. I.T.A.NO.5451/MUM/2011 2 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, AND IN LAW, THE LD. CIT(A), MUMBAI ERRED IN HOLDING CONSEQUENTLY THAT SINCE THE ASSESSEE TRUST WAS ENTITLED FOR EXEMPTION U/S 11 OF THE IT ACT THE ASS ESSEE TRUST IS ENTITLED FOR DEDUCTION OF CAPITAL EXPENDITURE OF RS.1,45,90,523 /- INCURRED BY THE ASSESSEE. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, AND IN LAW, THE LD. CIT(A), MUMBAI ERRED IN NOT APPRECIATING THAT TH ERE IS NO PROVISION IN THE ACT TO ALLOW SET OFF OF DEFICIT. 7. THE APPELLANT PRAYS THAT THE ORDER OF COMMISSIO NER OF INCOME TAX (APPEALS)-I, MUMBAI BE SET ASIDE AND THAT OF THE A O BE RESTORED 2. AT THE TIME OF HEARING, LD. DR REFERRED THE PAPE R BOOK FILED BY ASSESSEE AND SUBMITTED THAT THE ASSESSEE ITSELF HAS ADMITTED THA T THE ASSESSEE FILED REQUISITE DOCUMENTS ONLY BEFORE THE LD. CIT(A) AND THE LD. C IT(A) DECIDED THE APPEAL BY REVERSING THE FINDING OF THE AO AFTER ENTERTAINING THE SAID ADDITIONAL DOCUMENTS WITHOUT SEEKING REMAND REPORT FROM THE AO. HE SUBMITTED TH AT THE LD CIT(A) ACCEPTED THE ADDITIONAL DOCUMENTS IN CONTRAVENTION OF RULE 46A OF THE INCOME TAX RULES, 1962 AND THEREFORE, THE ORDER OF LD. CIT(A) IS BAD IN LAW A ND THE SAME SHOULD BE SET ASIDE. 3. ON THE OTHER HAND, THE LD. AR CONCEDED THAT THE ASSESSEE FILED THE ADDITIONAL DOCUMENTS BEFORE THE LD. CIT(A). HE SUBMITTED THAT THE AO DID NOT GIVE SUFFICIENT OPPORTUNITY TO THE ASSESSEE AND THEREFORE, THE LD. CIT(A) AFTER BEING SATISFIED ADMITTED THE ADDITIONAL DOCUMENTS. LD. AR HAS NOT DISPUTED THE CONTENTION OF THE LD. DR THAT THE LD. CIT(A) DID NOT SEEK COMMENTS OF THE AO BEFORE CONSIDERING THE ADDITIONAL DOCUMENTS FILED BY ASSESSEE BEFORE HIM. 4. IN VIEW OF ABOVE, WE CONSIDER MERIT IN THE CONTE NTION OF LD. DR THAT LD. CIT(A) ADMITTED THE ADDITIONAL DOCUMENTS WHILE DECIDING TH E ISSUE BEFORE HIM WITHOUT SEEKING REMAND REPORT FROM THE AO. THEREFORE, WE CONSIDER IT PRUDENT TO SET ASIDE THE ORDER OF LD. CIT(A) AND RESTORE THE ISSUE BEFORE HIM WITH A DIRECTION TO DECIDE THE SAME AFRESH AFTER GIVING OPPORTUNITY TO BOTH THE PARTIES. HEN CE, WE SET ASIDE THE ORDER OF LD. CIT(A) AND RESTORE THE ISSUE TO HIM TO DECIDE THE SAME AFR ESH AFTER GIVING DUE OPPORTUNITY OF HEARING TO BOTH THE PARTIES BY A REASONED ORDER IN ACCORDANCE WITH LAW. 5. IN THE RESULT, THE APPEAL OF THE DEPARTMENT IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH DAY OF DECEMBER 2013 * 1 2 30TH DAY OF DECEMBER, 2013 * SD SD ( . . /N.K.BILLAIYA ) ( . . /B.R.MITTAL) / ACCOUNTANT MEMBER / JUDICIAL MEMBER I.T.A.NO.5451/MUM/2011 3 MUMBAI . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. ' / THE APPELLANT 2. ( ' / THE RESPONDENT. 3. > ( ) / THE CIT(A)- 4. > / CIT 5. ? (A , - A , / DR, ITAT, MUMBAI 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) - A , /ITAT, MUMBAI