ALCO COMPANY P. LTD, MUUMBAI V. ACIT (OSD)-2(1), MUMBAI

ITA 56/MUM/2009

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 4060 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-10-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 14-05-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 05-01-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D N DEVADASAN
• Assessee Lawyers: CHETAN KARIA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES A, MUMBAI BEFORE SHRI J.SUDHAKAR REDDY (A.M.) AND SHRI V.D. R AO (J.M.) ITA NO.56/MUM/2009 ASSESSMENT YEAR : 2005-2006 ALCO COMPANY P. LTD. RAHIMTOOLA HOUSE, 7, HOMJI STREET, FORT, MUMBAI 400 001. PAN : AAACAA1031G VS. A.C.I.T.(OSD)-2(1), MUMBAI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI CHETAN KARIA RESPONDENT BY : SHRI D.N. DEVADASAN (DR) O R D E R PER J. SUDHAKAR REDDY, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AG AINST THE ORDER OF THE LEARNED CIT (A)-II, MUMBAI DATED 31.10.2008 FOR THE ASSESSMENT YEAR 2005- 2006. 2. THE SOLE ISSUE IN THIS APPEAL IS THE DISALLOWANC E OF EXPENSES U/S.14A. THE FIRST APPELLATE AUTHORITY FOLLOWED THE DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF DAGA CAPITAL MANAGEMENT PVT . LTD. AND OTHERS. AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE ASSESS EE IS IN APPEAL BEFORE US. 5 AFTER HEARING BOTH THE SIDES, WE FIND THE JURISDI CTIONAL HIGH COURT IN THE CASE OF GODREJ BOYCE MFG. CO. LTD. VS. DCIT REP ORTED IN 43 DTR (BOM) 177 HAS HELD THAT THE PROVISIONS OF RULE 8D OF THE I.T. RULES WHICH HAVE BEEN NOTIFIED W.E.F. 24 TH MARCH, 2008 SHALL APPLY W.E.F. ASSESSMENT YEAR 2008-09. IT HAS FURTHER BEEN HELD IN THE SAID ORDE R THAT : (VI)EVEN PRIOR TO ASSESSMENT YEAR 2008-09, WHEN R. 8D WAS NOT APPLICABLE, THE ASSESSING OFFICER HAS TO ENFORC E THE PROVISIONS OF SUB-S.(1) OF S.14A. FOR THAT PURPOS E, THE ASSESSING OFFICER IS DUTY BOUND TO DETERMINE THE EX PENDITURE ITA NO.56/MUM/2009 ASSESSMENT YEAR : 2005-2006 2 WHICH HAS BEEN INCURRED IN RELATION TO INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THE ACT. THE A SSESSING OFFICER MUST ADOPT A REASONABLE BASIS OR METHOD CON SISTENT WITH ALL THE RELEVANT FACTS AND CIRCUMSTANCES AFTER FURNISHING A REASONABLE OPPORTUNITY TO THE ASSESSEE TO PLACE ALL GERMANE MATERIAL ON THE RECORD. 6. WE THEREFORE DEEM IT PROPER TO RESTORE THIS ISSU E TO THE FILE OF THE ASSESSING OFFICER FOR FRESH ADJUDICATION IN THE LIG HT OF THE DECISION OF THE JURISDICTIONAL HIGH COURT CITED ABOVE. THE ASSESSI NG OFFICER SHALL DECIDE THE ISSUE IN ACCORDANCE WITH LAW AFTER GIVING DUE O PPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE HOLD AND DIRECT ACCORDINGLY. THIS GROUND RAISED BY THE ASSESSEE IS ACCORDINGLY ALLOWED FOR STATISTICAL PUR POSES. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 29 TH DAY OF OCTOBER, 2010. SD/- (V.D. RAO) (JUDICIAL MEMBER) SD/- (J.SUDHAKAR REDDY) (ACCOUNTANT MEMBER) MUMBAI, DATED 29 TH OCTOBER, 2010. JANHAVI COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS)- , MUMB AI 4. COMMISSIONER OF INCOME TAX, CITY- , MUMBAI 5. DEPARTMENTAL REPRESENTATIVE, BENCH , MUM BAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI