Shah Manak Lal Kodar Lal (HUF), JODHPUR V. ACIT, UDAIPUR

ITA 55/JODH/2011

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 3040 (ITAT-JODHPUR)
• Duration Of Justice: 2 year(s) 2 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-05-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 16-05-2013
• Assessment Year: 2005-2006
• Appeal Filed On: 21-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G R KOKANI
• Assessee Lawyers: N O N E
• Section: 154

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL : JODHPUR BENC H : JODHPUR BEFORE SHRI HARI OM MRATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER ITA NO. 52 TO 56/JODH/2011 (ASSESSMENT YEARS 2002-03 TO 2006-07) SHAH MANAK LAL KODAR LAL (HUF) VS ACIT, C/O. G.R. VERMA, ADVOCATE CENTRAL CIRCLE-1 BLOCK NO. B-9, OPP. BHERU BAG, UDAIPUR. NEAR MAHAVEER COMPLEX, SARDARPURA, JODHPUR. PAN NO. AADHS4778Q (APPELLANT) (RESPONDENT) ASSESSEE BY : N O N E. DEPARTMENT BY : SH. G.R. KOKANI- DR. DATE OF HEARING : 16/05/2013. DATE OF PRONOUNCEMENT : 16/05/2013 ORDER PER BENCH . : ALL THESE FIVE APPEALS BY THE ASSESSEE ARE DIRECTE D AGAINST THE COMMON ORDER DATED 13/12/2010 FOR THE A.Y. 2002-03 TO 2005 -06 AND ORDER DATED 14/12/2010 FOR THE A.Y. 2006-07. OF THE CIT(A), CE NTRAL, JAIPUR. 2 2. GROUND RAISED BY THE ASSESSEE IN ITA NO. 84/JODH /2011 FOR THE A.Y. 2002-03 READ AS UNDER :- 1 ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE L D. CIT(A), CENTRAL, JAIPUR HAS GROSSLY ERRED IN CONFIRMING AND REJECTIN G THE APPLICATION FOR ADDITION OF RS. 3,39,826/- AND THE ASSESSEE DEN IES ITS LIABILITIES IN RESPECT OF THE ABOVE ADDITION. 2 THAT THE ASSESSEE OBJECT THE ISSUANCE OF NOTICE U /S 148. 3 THAT THE APPELLANT CRAVES, LEAVE TO ADD, AMEND, A LTER ANY OF THE GROUNDS OF APPEAL ON OR BEFORE ITS FINAL HEARING BE FORE YOUR HONOUR. 3. AT THE TIME OF HEARING NOBODY WAS PRESENT . WE, THEREFORE, PROCEEDED EX- PARTE AND THE CASE IS DECIDED ON MERIT AFTER HEARIN G THE LD. DR. 4. THE FACTS OF THE CASE IN BRIEF ARE THAT THE AO D ISALLOWED INTEREST ON BORROWED FUNDS ON THE GROUND THAT BORROWED FUNDS WE RE UTILIZED FOR THE PURPOSE OF PAYMENT OF TAX. 5. THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A ) WHO CONFIRMED THE DISALLOWANCE VIDE ORDER DATED 22/12/2008 FOR THE A. Y. 2002-03 TO 2005-06. THEREAFTER THE ASSESSEE FILED RECTIFICATION APPLICA TION U/S 154 POINTING OUT THAT OPENING CAPITAL AS ON 31/03/2001 WAS SUFFICIENT TO TAKE CARE OF THE DEPOSIT OF TAXES. ALTERNATIVELY IT WAS STATED THAT THE TAX LIA BILITY AS PER THE BLOCK RETURN WAS RS. 24,00,000/- AND ACCORDINGLY INTEREST PAYMENT RE LATABLE TO THE PERSONAL LOAN TO THAT EXTENT OF RS. 24,00,000/- CAN AT BEST BE TR EATED AS TAKEN FOR PERSONAL 3 PURPOSES AND NOT FOR THE BUSINESS PURPOSES. THE THE N LD. CIT(A) IN ITS ORDER DATED 31/03/2009 PASSED U/S 154 OF THE IT ACT, 1961 (HEREINAFTER REFERRED TO THE ACT IN SHORT) ACCEPTED THE ALTERNATIVE CLAIM WHICH WAS TREATED AS MISTAKE APPARENT FROM THE RECORD AND AO WAS DIRECTED TO COM PUTE THE INTEREST ON THE RESPECTIVE AMOUNT TAKEN ON PROPORTIONATE BASIS FOR CONFIRMATION OF DISALLOWANCE AND BALANCE RELIEF. THE ASSESSEE WAS NOT SATISFIED AND AGAIN MOVED AN APPLICATION U/S 154 OF THE ACT ON THE ISSU E OF DISALLOWANCE OF INTEREST. THE LD. CIT(A) REJECTED THE APPLICATION OF THE ASS ESSEE BY OBSERVING THAT IN APPLICATION NOTHING WAS THERE BUT REITERATION OF TH E CLAIM ALREADY MADE IN APPEAL PROCEEDINGS AND IN APPLICATION U/S 154 WHICH HAD A LREADY BEEN CONSIDERED BY THE THEN LD. CIT(A) AND WAS REJECTED ON MERIT. ACCO RDING TO THE LD. CIT(A) RECONSIDERATION OF THE CLAIM WAS NOT PERMISSIBLE WH ICH WILL AMOUNT TO REVIEW OF THE ORDER WHICH WAS NOT LEGALLY PERMISSIBLE. NOW THE ASSESSEE IS IN APPEAL. 6. THE LD. DR STRONGLY SUPPORTED THE ORDER OF THE L D. CIT(A). WE HAVE CONSIDERED THE SUBMISSIONS OF THE LD. D.R. AND THE MATERIAL AVAILABLE ON RECORD. IN THE PRESENT CASE IT APPEARS THAT THE APPLICATION MOVED BY THE ASSESSEE U/S 154 OF THE ACT WAS REJECTED BY THE LD. CIT(A) ONLY FOR THIS REASON THAT THE THEN LD. CIT(A) HAD ALREADY DECIDED THIS ISSUE VIDE ORDER DA TED 31/03/2009 BUT NOTHING IS MENTIONED IN THE IMPUGNED ORDER WHAT WERE THE CO NTENTS OF THE NEW APPLICATION MOVED BY THE ASSESSEE AFTER THE REJECTI ON OF EARLIER APPLICATION U/S 154 OF THE ACT. SO IT IS NOT CLEAR WHAT MISTAKE WAS POINTED OUT BY THE ASSESSEE IN THE FRESH APPLICATION TO THE LD. CIT(A). IT IS ALSO NOT CLEAR AS TO WHETHER THE MISTAKE POINTED OUT BY THE ASSESSEE WAS APPARENT FR OM RECORD OR THE OLD MISTAKE ALREADY CONSIDERED BY THE THEN LD. CIT(A) WAS REITE RATED. THEREFORE, IN THE 4 ABSENCE OF THE CLEAR FACTS ON RECORD WE DEEM IT APP ROPRIATE TO REMAND THIS ISSUE BACK TO THE FILE OF LD. CIT(A) FOR FRESH ADJUDICATI ON IN ACCORDANCE WITH LAW AFTER PROVIDING DUE AND REASONABLE OPPORTUNITY OF BEING H EARD TO THE ASSESSEE. 7. SINCE THE ISSUE INVOLVED IS COMMON FOR THE A.Y. 2002-03 TO 2005-06 AND THE MAIN ISSUE AGITATED FOR THE A.Y. 2006-07 IS CO- RELATED WITH THE COMMON ISSUE INVOLVED FOR THE A.Y. 2002-03 TO 2005-06, THE REFORE, THE CASES RELATING TO ALL THE A.YS. UNDER CONSIDERATION I.E. 2002-03 TO 2 006-07 ARE RESTORED BACK TO THE FILE OF THE LD. CIT(A) FOR FRESH ADJUDICATION I N ACCORDANCE WITH LAW AFTER PROVIDING DUE AND REASONABLE OPPORTUNITY OF BEING H EARD TO THE ASSESSEE. 8. IN THE RESULT, APPEALS ARE ALLOWED FOR STATISTIC AL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 16.05.2013 SD/- SD/- [HARI OM MARATHA] [N.K. SAINI] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED :16.05.2013 RKK COPY TO :- 1- APPELLANT. 2- RESPONDENT. 3- CONCERNED CIT. 4- CONCERNED CIT(A) 5- D.R. ASSISTANT REGISTRAR 5