YASH RAJ FILMS P.LTD, MUMBAI V. ASST CIT RG 11(1), MUMBAI

ITA 5630/MUM/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8725 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2009-2010
• Appeal Filed On: 14-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: TUFAD AHMAD KHAN
• Keywords: Earning of tax free income

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH G, MUMBAI BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA NO.5630/M/2015 ASSESSMENT YEAR: 2009-10 M/S. YASH RAJ FILMS PVT. LTD., 5 SHAH INDUSTRIAL ESTATE, VEERA DESAI ROAD, ANDHERI (WEST), MUMBAI 400 053 PAN: AAACY1176E VS. THE ASST. COMM. OF INCOME TAX, RANGE 11(1), MUMBAI (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI RAJESH P. SHAH, A.R. REVENUE BY : SHRI TUFAD AHMAD KHAN, D.R. DATE OF HEARING : 20.09.2017 DATE OF PRONOUNCEMENT : 31.10.2017 O R D E R PER D.T. GARASIA , JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSES SEE AGAINST THE ORDER DATED 28.09.2015 OF THE COMMISSIONER OF I NCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS THE CIT(A)] R ELEVANT TO ASSESSMENT YEAR 2009-10. 2. THE SHORT FACTS OF THE CASE ARE THAT DURING THE YEAR THE ASSESSEE HAS EARNED INCOME OF RS.75,30,868/- FROM MUTUAL FUN D WHICH IS EXEMPT UNDER SECTION 10(34) OF THE INCOME TAX ACT. ASSESSEE WAS ASKED TO EXPLAIN AS TO WHY THE CORRESPONDING EXPEND ITURE SHOULD NOT BE DISALLOWED. THE ASSESSEE REPLIED BUT THE ASSESS ING OFFICER (HEREINAFTER REFERRED TO AS THE AO) DID NOT ACCEPT IT. THE AO HELD ITA NO.5630/M/2015 M/S. YASH RAJ FILMS PVT. LTD. 2 THAT ASSESSEE HAS MADE INVESTMENTS OF RS.28,04,01,7 07/- IN THIS YEAR. THEREFORE, HE DISALLOWED EXPENDITURE BEING INTEREST EXPENDITURE AND 0.5% OF AVERAGE INVESTMENT. 3. MATTER CARRIED TO THE LD. CIT(A) AND THE LD. CIT (A) HAS PARTLY ALLOWED THE APPEAL. 4. DURING THE COURSE OF HEARING, THE LD. A.R. SUBMI TTED THAT THE AO SHOULD HAVE DISALLOWED THE EXPENDITURE IN RELATI ON TO EXEMPT INCOME AND NOT THE TOTAL INCOME. ONLY THOSE INVEST MENTS ARE CONSIDERED FOR COMPUTATION OF AVERAGE VALUE INVESTM ENT WHICH YIELDS THE INCOME DURING THE YEAR. 5. THE LD. D.R. SUBMITTED THAT ONLY INVESTMENT MADE ON 31.03.09 WHICH YIELD THE INCOME HAS TO BE CONSIDERED FOR CAL CULATING THE VALUE OF INVESTMENT. 6. WE FIND THAT LD. D.R. FAIRLY CONCEDED. IN THE IN TEREST OF JUSTICE AND FAIRPLAY, WE RESTORE THIS ISSUE BACK TO THE FIL E OF AO TO DECIDE THE AVERAGE VALUE OF INVESTMENT AS PER THE DECISION OF SPECIAL BENCH IN THE CASE OF ACIT VS. VIREET INVESTMENT (P.) LTD. 82 TAXMANN.COM 415 (DELHI TRIB.) (SB). 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 31.10.2017. SD/- SD/- (RAJESH KUMAR) (D.T. GARASIA) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 31.10.2017. * KISHORE, SR. P.S. ITA NO.5630/M/2015 M/S. YASH RAJ FILMS PVT. LTD. 3 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.