SABA KHAN, MUMBAI V. ACIT CIR 20(3), MUMBAI

ITA 5476/MUM/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 55858 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Next Hearing Date: 24-11-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 06-07-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: G P TRIVEDI
• Assessee Lawyers: G P MEHTA
• Keywords: Recovery proceedings
• Section: 244A; 154; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI E BENCH BEFORE SHRI N.V.VASUDEVAN, JUDICIAL MEMBER & BEFORE SHRI J.SUDHAKAR REDDY, ACCOUNTANT MEMBER SR.NO. I.T.A.NO. A.Y APPELLANT RESPONDENT 1 5474-M-2010 2003- 04 MISS. SABA KHAN C/O. G.P.MEHTA & CO., C.AS., 807 TULSIANI CHAMBERS, 212, NARIMAN POINT, MUMBAI 400 021. PAN: AAAPR 9202 P THE ASST. COMMISSIONER OF INCOME-TAX, LALBAUG, PAREL CIRCLE 20(3), MUMBAI. 2 5475-M-2010 2003- 04 MISS. SABA KHAN MUMBAI. THE A.C.I.T., CIR. 20(3), MUMBAI 3 5476-M-2010 2004- 05 MISS. SABA KHAN MUMBAI THE A.C.I.T., CIR. 20(3), MUMBAI 4 5477-M-2010 2004- 05 MISS. SABA KHAN MUMBAI THE A.C.I.T., CIR. 20(3), MUMBAI 5 5478-M-2010 2005- 06 MISS. SABA KHAN MUMBAI THE A.C.I.T., CIR. 20(3), MUMBAI 6 5479-M-2010 2005- 06 MISS. SABA KHAN MUMBAI THE A.C.I.T., CIR. 20(3), MUMBAI 7 5480M-2010 2006- 07 MISS. SABA KHAN MUMBAI THE ACIT, CIR. 20(3),MUMBAI 8 5481-M-2010 2006- 07 MISS. SABA KHAN MUMBAI THE ACIT, CIR. 20(3),MUMBAI APPELLANT BY : SHRI G.P.MEHTA. RESPONDENT BY : SHRI G.P.TRIVEDI. DATE OF HEARING: 24-11-2011 DATE OF PRONOUNCEMENT: O R D E R PER BENCH: THESE ARE APPEALS BY THE ASSESSEE AGAINST THE ORDER DATED 20/5/2010 OF CIT(A) 31, MUMBAI RELATING TO ASSESSMENT YEA R 2003-04 TO 2006-07. THESE ARE APPEALS ARISING OUT OF T WO ORDERS PASSED FOR EACH OF THE ASSESSMENT YEARS UNDER SECTION 154 OF THE ACT. THE FIRST ORDER PASSED UNDER SECTION 15 4 OF THE ACT IN ALL ASSESSMENT YEARS IS DATED 11/7/2008 AND THE SECOND 154 ORDER IS DATED 29/8/08. ITA NO.5474 TO 5481/M/10 2 2. THE FACTS GIVING RISE TO THIS APPEALS ARE AS FOLLOWS:- THE ASSESSEE IS AN INDIVIDUAL, DERIVING INCOME FROM HOUSE PROPERTY AND OTHER SOURCES. THE RETURNS OF INCOME WER E FILED BY THE APPELLANT FOR THE ASSESSMENT YEARS UNDER APPEAL AS DETAILED BELOW ASST.YEAR DATE OF FILING OF RETURN OF INCOME 2003-04 05.02.2004 2003-04 24.01.2005 (REVISED) 2004-05 24.01.2005 2005-06 13.09.2006 2006-07 13.09.2006 THE ASSESSEE, ALONGWITH HER MOTHER SMT. SHAMIM BANO RATH I, VIDE A DEED OF CONVEYANCE DATED 30TH JULY, 2002, ACQUIR ED A PROPERTY BEING OFFICE PREMISES NO: 67, GROUND FLOOR, SONAWALLA APOLLO PREMISES CO.OP. SOCIETY LTD., 57, BOMBAY SAMACHAR MARG, FORT, MUMBAI 400 023, IN WHICH ASSESSEES SHARE WAS 20%, FROM A COMPANY M/S. SASHAK NOBLE METALS LTD. OF MUMBAI. THE SAID PROPERTY WAS LET OUT TO M/S. GLOBAL TRUST BANK LTD. (NOW MERGED WITH ORIENTAL BANK OF COMMERCE). PURSUANT TO PURCHASE OF THE PROPERTY, THE ASSESSEE BE CAME ENTITLED TO RECEIVE THE RENT FROM THE SAID BANK. WHILE THE TRANSFER OF PROPERTY AT THE SOCIETYS END WAS IN PROGRE SS, THE TAX RECOVERY OFFICER, RANGE 2(3), MUMBAI, PASSED AN ORDER OF ATTACHMENT OF IMMOVABLE PROPERTY ON 18.11.2003 IN CONNECT ION WITH THE RECOVERY PROCEEDINGS IN THE CASE OF M/S. SASHAK NOBLE METALS LTD. THE ERSTWHILE OWNER OF THE PROPERTY AND THE DY. C.I.T., CIRCLE 2(3), MUMBAI, VIDE AN ORDER PASSED ULS.281 OF THE INCOME TAX ACT, 1961(THE ACT), ON 2 1.09.2004, DECLARED THE DEED OF CONVEYANCE DATED 30.07.2002, AS VOID. 3. VARIOUS REPRESENTATIONS WERE MADE TO THE ASSESSING/RECOVERY OFFICERS OF M/S. SASHAK NOBLE METALS LTD ., DEMONSTRATING THAT THE PURCHASE OF PROPERTY FROM M/S. S ASHAK NOBLE METALS LTD. WAS A BONAFIDE PURCHASE FOR A CONSIDERAT ION ITA NO.5474 TO 5481/M/10 3 AND THAT THE TRANSACTION WAS NOT HIT BY ANY OF THE PRO VISIONS OF THE I.T. ACT, 1961. 4. IN THE MEANWHILE, BECAUSE OF THE AFORESAID TWO ORDER S, THE SOCIETY DID NOT TRANSFER THE PROPERTY IN THE NAME OF THE ASSESSEE AND BANK CONTINUED TO ADJUST THE RENT PAYABLE AGAINST THE LOAN GRANTED TO M/S. SASHAK NOBLE METALS LTD. (WHICH LOAN WAS ALSO AGREED TO BE TAKEN OVER BY THE ASSESSEE) AND CONTINUE D ISSUING THE TDS CERTIFICATES IN THE NAME OF THE COMPANY. 5. THE ASSESSEE SUBMITTED THE TDS CERTIFICATES ISSUED IN THE NAME OF THE COMPANY, FOR THE ASSESSMENT YEARS UNDER AP PEAL TO THE ASSESSING OFFICER WITH NO-OBJECTION LETTERS OF THE COMP ANY, TO CLAIM THE CREDIT OF TDS, HOWEVER, NO CREDIT OF TDS WAS ALLOWED BY THE ASSESSING OFFICER OF THE ASSESSEE. 6. THE ASSESSEE, ALONGWITH CO-OWNER OF THE PROPERTY EVE NTUALLY FILED A WRIT PETITION BEING W.P. NO: 1969 OF 2007 BEFORE THE HONBLE BOMBAY HIGH COURT SEEKING SETTING ASIDE/CANCELLAT ION OF THE ORDER OF ATTACHMENT OF IMMOVABLE PROPERTY PASSED BY THE TAX RECOVERY OFFICER, 2(3), MUMBAI, AS ALSO ORDER ULS.281 OF THE I.T. ACT, 1961, PASSED BY THE DY.C.I.T. 2(3), MUMBAI. THE HONBLE HIGH COURT PASSED THE ORDER IN WRIT PETITION FILED, ON 05.12.2007 CANCELLING /SETTING ASIDE BOTH THE ABOVE MENTION ED ORDERS. THE BANK WAS ALSO DIRECTED TO ISSUE MODIFIED TDS CERTIFICATES IN THE NAME OF THE ASSESSEE AND CO-OWNER. 7. AFTER THE ORDER PASSED BY THE HONBLE BOMBAY HIGH C OURT, PURSUANT TO AN APPLICATION U/S.154 OF THE ACT, THE ASSESS ING OFFICER ALLOWED THE CREDIT OF TDS IN RESPECT OF ASSESSEES 2 0% SHARE IN THE RENT RECEIVED. THE ASSESSING OFFICER, HOWEVER , DID NOT ALLOW INTEREST ULS.244A OF THE I.T. ACT, 1961, ON THE A MOUNT OF REFUND DETERMINED. THIS ORDER UNDER SECTION 154 OF THE ACT IN ALL ASSESSMENT YEARS IS DATED 11/7/2008. THE ASSESSEE FILED ANOTHER APPLICATION U/S.154 OF THE ACT FOR ALL THE AFORESAID ITA NO.5474 TO 5481/M/10 4 ASSESSMENT YEARS, SPECIFICALLY PRAYING FOR AWARDING INTEREST U/S.244A OF THE ACT, WHICH WAS AGAIN REJECTED BY THE AO . THIS ORDER U/S.154 IS DATED 29/8/08. BOTH THE ORDERS FOR EACH OF THE ASSESSMENT YEARS WERE CHALLENGED BY THE ASSESSEE BEFOR E CIT(A), WHO REJECTED THE PLEA OF THE ASSESSEE. HENCE, THE P RESENT APPEALS BY THE ASSESSEE BEFORE THE TRIBUNAL. 8. AS ALREADY STATED IN THE FIRST ORDER PASSED UNDER S ECTION 154 DATED 11/7/08. THE AO GIVE CREDIT FOR TDS BUT DID NOT A LLOW INTEREST UNDER SECTION 244A OF THE ACT. THE ASSESSEE, T HEREFORE, FILED APPLICATION UNDER SECTION 154 OF THE ACT PRAYING FOR ALLOWING INTEREST UNDER SECTION 244A OF THE ACT. THE AO REJECTED THE SAID APPLICATION AND PASSED THE ORDER DATED 29/8/08 HOLDING THAT THE ASSESSEE WAS NOT ENTITLED TO INTEREST U /S.244 OF THE ACT. THE CIT(A) CONFIRMED THE ORDER OF AO GIVING RISE TO THESE APPEALS BY THE ASSESSEE BEFORE THE TRIBUNAL. 9. AT THE TIME OF HEARING OF THESE APPEALS BOTH THE PART IES AGREED THAT THE FACTS AND CIRCUMSTANCES UNDER WHICH TH ESE APPEALS ARISE ARE IDENTICAL TO THE FACTS IN THE CASE OF OTH ER CO- OWNER OF THE PROPERTY NAMELY SMT SHAMIM BANO RATHI. I N THAT CASE IN ITA NO. TO5468 TO 5472/M/10 BY ORDER DATED 25/11/2011 ON IDENTICAL ISSUE, THIS TRIBUNAL HELD AS FOLLOWS: 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFU LLY. SEC.244A(2) READS AS UNDER: SEC.244A (2): IF THE PROCEEDINGS RESULTING IN THE REFUND ARE DELAYED FOR REASONS ATTRIBUTABLE TO THE ASSESSEE, WHETHER WHOLLY OR IN PART, THE PERIOD OF THE DELAY SO ATTRIBUTABLE TO HIM SHALL BE EXCLUDED FROM THE PERIOD FOR WHICH INTEREST IS PAYABLE, AND WHERE ANY QUESTION ARISES AS TO THE PE RIOD TO BE EXCLUDED, IT SHALL BE DECIDED BY THE CHIEF COMMISSI ONER OR COMMISSIONER WHOSE DECISION THEREON SHALL BE FINAL. A PLAIN READING OF THE ABOVE SECTION MAKES IT CLEAR THAT INTEREST CANNOT BE GRANTED IF THERE IS A DELAY ON THE PART O F THE ASSESSEE, BUT WHETHER SUCH DELAY IS ATTRIBUTABLE TO THE ASSESSEE OR NOT THAT DECISION HAS TO BE TAKEN BY THE CHIEF C OMMISSIONER OR COMMISSIONER. THOUGH THE PROVISION DOES NOT MAKE IT CLEAR WHETHER AO SHALL REFER THE MATTER TO THE CHIEF COMM ISSIONER OR ITA NO.5474 TO 5481/M/10 5 COMMISSIONER ON HIS OWN OR THAT ASSESSEE IS REQUIRE D TO MAKE AN APPLICATION FOR REFERRING THE MATTER TO THE CHIE F COMMISSIONER OR COMMISSIONER, BUT WE AGREE WITH THE PROPOSITION OF THE LD. DR THAT AT BEST THIS IS ONLY AN IRREGULARITY COMMITTED BY THE AO AND, THEREFORE, IN THE INTEREST S OF JUSTICE, WE SET ASIDE THE ORDER OF THE LD. CIT(A) AND REMIT THE MATTER BACK TO THE FILE OF THE AO WITH A DIRECTION TO EITH ER HE HIMSELF SHOULD REFER THE MATTER TO CHIEF COMMISSIONER OR CO MMISSIONER TO ASCERTAIN AS TO WHOM THE DELAY IS ATTRIBUTABLE O R ASK THE ASSESSEE TO MOVE THE CHIEF COMMISSIONER OR COMMISSI ONER AND THE ISSUE REGARDING GRANT OF INTEREST SHOULD BE DEC IDED ONLY AFTER THE DECISION OF THE CHIEF COMMISSIONER OR COM MISSIONER REGARDING TO WHOM THE DELAY IS ATTRIBUTABLE. 10. RESPECTFULLY FOLLOWING THE AFORESAID ORDER, WE SET ASIDE THE ORDERS OF THE CIT(A) AND DIRECT THE AO TO CONSIDER THE IS SUE AFRESH IN THE LIGHT OF THE DIRECTIONS OF THE TRIBUNAL GIVEN ABOVE. FOR STATISTICAL PURPOSES THESE APPEALS ARE TREATED AS ALLOWED. 11. IN THE RESULT, ALL THE APPEALS ARE TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE 30 TH DAY OF NOV.2011 SD/- SD/- (J.SUDHAKAR REDDY) (N.V.VASUDEVAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI: 30 /11/2011. V.M COPY TO- 1) APPELLANT 2) RESPONDENT 3) CITA MUMBAI. 4) CIT CITY MUMBAI 5) DR BENCH MUMBAI TRUE COPY BY ORDER DY /ASST.REGISTRAR,ITAT MUMBAI. ITA NO.5474 TO 5481/M/10 6 SR.NO. PARTICULARS DATE INITIALS 1 DRAFT DICTATED ON 25-11-11 P 2 DRAFT PLACED BEFORE AUTHOR -11-11 P 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 5 APPROVED DRAFT COMES TO SR.PS/PS 6 ORDER KEPT FOR PRONOUNCEMENT 7 FILE SENT TO BENCH CLERK 8 DATE ON WHICH FILE GOES TO THE HEAD CLERK 9 DATE ON WHICH FILE GOES TO THE A.R 10 DATE OF DISPATCH OF ORDER