HIND MUSAFIR AGENCY LTD, MUMBAI V. DCIT RG 2(3)(2), MUMBAI

ITA 5622/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 9921 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-09-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 16-09-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SUMAN KUMAR LD
• Assessee Lawyers: PARTH ACHWAL LD ARS
• Keywords: Bad and doubtful debts
• Section: 143(3); 14A

Judgement Text

ITA NO 5622/MUM/2016 HIND MUSAFIR AGENCY LIMITED ASSESSMENT YEAR 2012-13 IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI . . , , BEFORE SHRI D.T. GARASIA, JM AND SHRI MANOJ KUMAR AGGARWAL, AM ./I.T.A. NO. 5622/MUM/2016 ( / ASSESSMENT YEAR: 2012-13) HIND MUSAFIR AGENCY LIMITED (CIN : U60100MH1962PLC012455) 39,39 TH FLOOR SUNSHINE TOWER SENAPATI, BAPAT MARG DADAR(W) MUMBAI 400 013 / VS. DEPUTY COMMISSIONER OF INCOME TAX RANGE 2(3)(2) AAYKAR BHAVAN M.K.ROAD MUMBAI -400 020 ! ./ ./PAN/GIR NO. AAACH-1250-Q ( !# /APPELLANT ) : ( $%!# / RESPONDENT ) ASSESSEE BY : KIRIT KAMDAR & PARTH ACHWAL, LD. ARS REVENUE BY : SUMAN KUMAR, LD. DR / DATE OF HEARING : 17/08/2017 / DATE OF PRONOUNCEMENT : 06 /09/2017 ITA NO 5622/MUM/2016 HIND MUSAFIR AGENCY LIMITED ASSESSMENT YEAR 2012-13 2 / O R D E R PER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. THE CAPTIONED APPEAL BY ASSESSEE FOR ASSESSMENT YEAR [AY] 2012-13 ASSAILS THE ORDER OF LD. COMMISSIONER OF IN COME TAX (APPEALS)-6 [CIT(A)], MUMBAI DATED 29/06/2016 QUA CONFIRMATION OF CERTAIN ADDITIONS. 2.1 FACTS LEADING TO THE SAME ARE THAT THE ASSESSEE , BEING RESIDENT CORPORATE ASSESSEE ENGAGED IN THE BUSINESS OF TRAVEL & TOURISM WAS ASSESSED FOR IMPUGNED AY U/S 143(3) ON 27/02/2015 A T RS.98,14,200/- AFTER CERTAIN ADDITIONS / DISALLOWANCES AS AGAINST RETURNED INCOME OF RS.95,60,325/- E-FILED BY THE ASSESSEE ON 28/09/201 2. THE SUBJECT MATTER OF PRESENT APPEAL IS DISALLOWANCE U/S 14A AN D ADDITION AGAINST CERTAIN BAD DEBTS. 2.2 IN THE RETURN OF INCOME, THE ASSESSEE MADE SUO-MOTO DISALLOWANCE U/S 14A FOR RS.6,19,642/-. HOWEVER, IT FILED REVISE D COMPUTATION THEREOF DURING ASSESSMENT PROCEEDINGS AND RE-WORKED THE SAM E AS RS.2,46,286/- BY RESORTING TO NETTING-OFF OF THE INTEREST EXPENSES. HOWEVER, LD. AO NOTED THAT THERE WAS NO PROVISION F OR NETTING-OFF OF INTEREST EXPENSES AND WORKED OUT THE SAID DISALLOWA NCE AS PER RULE 8D WHICH CAME TO RS.6,19,642/- I.E. ORIGINAL SUO-MOTO DISALLOWANCE OFFERED BY THE ASSESSEE HIMSELF IN THE RETURN OF INCOME. TH E AGGREGATE DISALLOWANCE COMPRISED OF INTEREST DISALLOWANCE OF RS.5,14,257/- U/R 8D(2)(II) & EXPENSE DISALLOWANCE OF RS.1,05,385/- U /R 8D(2)(III). ITA NO 5622/MUM/2016 HIND MUSAFIR AGENCY LIMITED ASSESSMENT YEAR 2012-13 3 2.3 THE SECOND ADDITION PERTAINED TO BAD DEBTS OF RS.1,12,575/- CLAIMED BY THE ASSESSEE U/S 36(I)(VII). SINCE NO EV IDENCE COULD BE FURNISHED BY THE ASSESSEE TO SUBSTANTIATE THE FACT THAT THE SAME WERE OFFERED TO TAX IN EARLIER YEARS, THE SAME WERE DISA LLOWED. 3. AGGRIEVED, THE ASSESSEE CONTESTED BOTH THE ADDIT IONS WITH PARTIAL SUCCESS BEFORE LD. CIT(A) VIDE IMPUGNED ORDER DATED 29/06/2016 WHERE LD. CIT(A) WAS CONVINCED WITH THE ASSESSEES CONTEN TION THAT INTEREST FREE FUNDS EXCEEDED THE INVESTMENTS MADE BY THE ASS ESSEE AND THEREFORE, NO DISALLOWANCE QUA INTEREST WAS WARRANTED FOR. FINALLY, LD. CIT(A) RESTRICTED THE SAID DISALLOWANCE TO RS.2,46, 286/-, BEING THE AMOUNT OFFERED BY THE ASSESSEE AS PER REVISED CALCU LATIONS. SIMILARLY LD. CIT(A), AFTER APPRECIATING ASSESSEES EXPLANATI ON / EVIDENCES RESTRICTED THE ADDITION AGAINST BAD DEBTS TO RS.78,620/-. AGGRIEVED, THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 4. THE LD. COUNSEL FOR ASSESSEE [AR] PLEADED FOR FU RTHER RELIEF AGAINST 14A DISALLOWANCE ON THE PREMISES THAT OWNED FUNDS WERE MORE THAN INVESTMENT AND THEREFORE, NO ADDITION QUA INTEREST WAS WARRANTED FOR. NO SERIOUS ARGUMENTS WERE RAISED AGAINST CLAIM OF BAD DEBTS. PER CONTRA, LD. DR CONTENDED THAT THE DISALLOWANCE HAS BEEN RES TRICTED AS PER THE CALCULATIONS PROVIDED BY THE ASSESSEE AND T HEREFORE, DEBARRED FROM TAKING DIFFERENT STANDS. 5. HEARD AND PERUSED RELEVANT MATERIAL ON RECORD. W E SEE NO REASONS TO INTERFERE WITH THE ORDER OF LD. CIT(A) S INCE THE ASSESSEE HIMSELF MADE SUO-MOTO DISALLOWANCE IN THE RETURN OF INCOME WHICH WAS REVISED DURING ASSESSMENT PROCEEDINGS. THE ASSESSEE WAS GRANTED THE REQUISITE RELIEF BY THE LD. CIT(A) AND THE DISALLOW ANCE WAS RESTRICTED AS ITA NO 5622/MUM/2016 HIND MUSAFIR AGENCY LIMITED ASSESSMENT YEAR 2012-13 4 PER THE WORKING PROVIDED BY THE ASSESSEE. THE ASSES SEE IS, THEREFORE, DEBARRED FROM TAKING DIFFERENT STANDS AS PER HIS CO NVENIENCE AND THERE HAS TO BE FINALITY TO LITIGATION. THE ADDITION OF B AD DEBTS CONFIRMED BY LD. CIT(A) WAS AFTER DUE CONSIDERATION OF ASSESSEES EV IDENCES AND SUBMISSIONS AND THE SAME BEING QUITE FAIR, DO NOT R EQUIRE ANY INTERFERENCE ON OUR PART. 6. RESULTANTLY, THE ASSESSEES APPEAL STAND DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 06 TH SEPTEMBER, 2017. SD/- SD/- (D.T. GARASIA) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 06. 09.2017 SR.PS:- THIRUMALESH ! / COPY OF THE ORDER FORWARDED TO : 1. !# / THE APPELLANT 2. $%!# / THE RESPONDENT 3. , ( ) / THE CIT(A) 4. , / CIT CONCERNED 5. $'. , . , / DR, ITAT, MUMBAI 6. / / GUARD FILE / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI