SHRI ASHWIN S. MEHTA, MUMBAI V. ACIT, CENTRAL CIRCLE 23, MUMBAI

ITA 5801/MUM/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 3678 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-03-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2005-2006
• Appeal Filed On: 26-09-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: DR DANIEL

Judgement Text

5801/M/13-ASHWINS.MEHTA 1 , , , , INCOME-TAX APPELLATE TRIBUNAL -ABENCH MUMBAI , BEFORE S/SH.RAJENDRA,ACCOUNTANT MEMBER AND AMIT SHUKLA,JUDICIAL MEMBER ./ I.T.A. NO.5801/MUM/2013 / ASSESSMENT YEAR: 2005-06 SHRI ASHWIN S. MEHTA 32, MADHULI, DR. A.B. ROAD, WORLI,MUMBAI-400 018. PAN:ABAPM 2121 M VS. ADDL. CIT- CENTRAL CIRCLE-23 R.NO.409, AAYAKAR BHAVAN M.K. ROAD,MUMBAI-400 020. ( /APPELLANT ) ( / RESPONDENT ) REVENUE BY: DR. DANIEL A SSESSEE BY: SHRI DHARMESH SHAH / DATE OF HEARING: 03.03.2016 / DATE OF PRONOUNCEMENT: 03.03.2016 ,1961 254(1) ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) !' PER RAJENDRA, AM - CHALLENGING THE ORDERS OF CIT(A)-40,MUMBAI,THE ASSE SSEE HAS FILED THE PRESENT APPEAL RAISING VARIOUS GROUNDS. 2. DURING THE COURSE OF HEARING BEFORE US,THE AUTHORIS ED REPRESENTATIVE(AR) STATED THAT THE ASSESSEE WAS NOT INTEREST IN PURSUING GROUNDS NO.1- 3 FILED FOR THE AY.UNDER APPEAL. THEREFORE,SAME STAND DISMISSED,AS NOT PRESSED.HE FU RTHER STATED THAT EFFECTIVE GROUND(GOA- 4)DEALT WITH INTEREST AND SAME NEEDS TO BE ADJUDICA TION. WE FIND THAT GOA-4 IS ABOUT DISALLOWANCE OF INTERES T EXPENDITURE OF RS.72.60 LAKHS.DURING THE COURSE OF HEARING BEFORE US,REPRESENTATIVES OF BOTH THE SIDES AGREED THAT THE ISSUE HAS ARISEN IN THE HARSHAD S.MEHTA(HSM)GROUP ON MANY OCC ASIONS AND THAT THE TRIBUNAL HAD DECIDED THE IDENTICAL ISSUE IN THE CASES OF THE IND IVIDUAL OF THE GROUP AS WELL AS THE CORPORATE ENTITIES OF THE GROUP.WE FIND THAT THE TRIBUNAL HAS RESTORED BACK THE ISSUE TO THE FILE OF THE AO IN ALL SUCH CASES.WE WOULD LIKE TO REPRODUCE THE RELEVANT PORTION OF THE CASE OF PRATIMA H MEHTA,ONE OF THE MEMBERS OF THE HSM GROUP,TO WHICH ONE OF US WAS PARTY (ITA/350/ MUM/ 2013(AY-2009-10 DT.11.5.2015).IN THAT MATTER THE TH IRD GROUND OF APPEAL WAS ABOUT THE DISALLOWANCE OF THE INTEREST EXPENDITURE AND THE T RIBUNAL HAD DECIDED THE CASE AS UNDER : '2. ... GROUND NO.3 WAS STATED TO BE COVERED BY TH E EARLIER DECISION OF THE TRIBUNAL IN GROUP CASE.REFERENCE WAS MADE TO THE DECISION DATED 5/3/2 015 PASSED IN ITA NO. 5135& 5136/MUM/2012 & ITA NOS.2151/MUM/2013 IN THE CASE O F GROWMORE LEASING & INV. LTD. AND REFERENCE WAS MADE TO THE FOLLOWING OBSERVATION S: ' 3. GROUND NO. 4 RELATES TO THE DISALLOWANCE OF INTE REST EXPENSE. THE LD. COUNSEL FOR THE ASSESSEE BROUGHT TO OUR NOTICE THAT THE DECISION RE LIED UPON BY THE LD. CIT(A) WHILE DISPOSING THIS GROUND HAS BEEN SET ASIDE BY THE TRIBUNAL TO T HE FILE OF THE LD. CIT(A). 4. THE LD. DEPARTMENTAL REPRESENTATIVE COULD NOT BRING ANY DIS TINGUISHING DECISION IN FAVOUR OF THE REVENUE. 5. WE HAVE CAREFULLY PERUSED THE ORDERS OF THE AUTH ORITIES BELOW. WHILE DISPOSING THE GROUND RELATING TO THE DISALLOWANCE OF INTEREST,WE FIND TH AT THE LD. CIT(A) HAS FOLLOWED THE FINDINGS GIVEN IN THE CASE OF EMINENT HOLDINGS PVT. LTD. WE FIND THAT THE TRIBUNAL IN THE CASE OF EMINENT HOLDINGS IN ITA NOS. 2139, 2140 AND 2141/MU M/2013 HAVE FOLLOWED THE DECISION OF THE TRIBUNAL GIVEN IN COMMON GROUP CASE OF HITESH S . MEHTA AT PARA 2.3 OF THE ORDER AND RESTORED THE MATTER TO THE FILE OF THE LD. CIT(A) F OR FRESH ADJUDICATION. RESPECTFULLY FOLLOWING 5801/M/13-ASHWINS.MEHTA 2 THE FINDINGS OF THE CO ORDINATE BENCH, WE RESTORE T HIS ISSUE TO THE FILES OF THE LD. CIT(A) FOR FRESH ADJUDICATION AFTER GIVING REASONABLE OPPORTUN ITY OF BEING HEARD TO THE ASSESSEE. 6. BEFORE CLOSING THIS ISSUE, THE LD. COUNSEL FOR THE ASSESSEE POINTED OUT THAT THE LD. CIT(A) HAS HELD THAT THE ISSUE OF INTEREST EXPENDITURE IS PEND ING BEFORE THE HON'BLE SPECIAL COURT. IT IS THE SAY OF THE LD. COUNSEL THAT THE PROCEEDINGS IN WHICH THE SAID ISSUE OF INTEREST WAS ISSUED BY THE CUSTODIAN HAVE BEEN ALREADY CONCLUDED WHICH FACT HAS ALREADY BEEN RECORDED BY THE LD. CIT(A) IN THE IMPUGNED ORDER. WE, THEREFORE,DIR ECT THE LD. CIT(A) TO CONSIDER THIS FACT WHILE DECIDING THE ISSUE AFRESH. THE LD. CIT(A) MAY ALSO DIRECT FOR THE TAXING OF INCOME IN THE HANDS OF THE RECIPIENT (FAMILY MEMBERS) IN ACCORDAN CE WITH THE METHOD OF ACCOUNTING FOLLOWED BY THEM AND AS PER THE PROVISIONS OF THE L AW. GROUND NO. 4 IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE.' 3. LD. SPECIAL COUNSEL DID NOT CONTROVERT TO SUCH C ONTENTION OF LD. AR THAT THE ISSUE IS COVERED BY THE AFOREMENTIONED DECISION. 4. IN VIEW OF THE SITUATION, AFTER HEARING BOTH THE PARTIES, WE PASS SIMILAR ORDER AND THIS GROUND IS CONSIDERED TO BE ALLOWED FOR STATISTICAL PURPOSES IN THE MANNER AFORESAID.' FOLLOWING THE ABOVE, WE PASS SIMILAR ORDER. GROUND NO.4 IS ALLOWED FOR STATISTICAL PURPOSES FOR BOTH THE YEARS. FOLLOWING THE ABOVE,WE ALLOW GROUND NO.5 FOR STATIS TICAL PURPOSES FOR THE YEAR UNDER APPEAL. RESPECTFULLY FOLLOWING THE ORDERS OF THE EARLIER YE ARS OF THE MEMBERS OF THE HARSHAD MEHTA GROUP,WE ARE REMITTING BACK THE ISSUE TO THE FILE O F THE FAA FOR FRESH ADJUDICATION. AS A RESULT,APPEAL FILED BY THE ASSESSEE STANDS PAR TLY ALLOWED. . ORDER PRONOUN CED IN THE OPEN COURT ON 3 RD ,MARCH, 2016. 3 ! , 2016 SD/- SD/- ( / AMIT SHUKLA ) ( / RAJENDRA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI, DATE: 03.03.2016 . . . .. . JV.SR.PS. / COPY OF THE ORDER FORWARDED TO : 1. APPELLANT / 2. RESPONDENT / 3. THE CONCERNED CIT(A)/ , 4. THE CONCERNED CIT / 5. DR D BENCH, ITAT, MUMBAI / , A , . . . 6. GUARD FILE/ //TRUE COPY// / BY ORDER, / DY./ASST. REGISTRAR , /ITAT, MUMBAI.