DCIT CC-47, MUMBAI V. ZAHIR K. DHUNJIBHOY, MUMBAI

ITA 5807/MUM/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 100538 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 11 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-08-2015
• Appeal Filed By: Department
• Bench Allotted: G
• Next Hearing Date: 09-06-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 16-08-2011
• Court: TRIBUNAL
• Department Lawyers: NEIL PHILIP
• Keywords: Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER AND AMIT SHUKLA, JUDICIAL MEMBER I.T.A. NO. 5807/M/2011 (AY:2007 - 2008 ) I.T.A. NO. 6 894/M/2011 (AY:2008 - 2009 ) DCIT, CENTRAL CIRCLE - 47, MUMBAI. / VS. MR. ZAHIR K. DHUNJIBHOY, IMROZ, 6 - A, MOUNT PLEASANT ROAD, MUMBAI - 06. ./ PAN : ABUPD 0801 H ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : SHRI NEIL PHILIP, DR / RESPONDENT BY : NONE / DATE OF HEARING : 04.08.2015 / DATE OF PRONOUNCEMENT : 04.08.2015 / O R D E R PER D. KARUNAKARA RAO, AM: THERE ARE TWO APPEALS UNDER CONSIDERATION. BOTH THESE APPEALS ARE FILED BY THE REVENUE AGAINST DIFFERENT ORDERS OF THE CIT (A) - 38, MUMBAI FOR THE ASSESSMENT YEARS 2007 - 08 AND 2008 - 09. SINCE, THE ISSUES RAISED IN BOTH THE APPEALS ARE IDENTICAL, THEREFORE, FOR THE SAKE OF COMPLETENESS OF THIS ORDER, THEY ARE C LUBBED, HEARD COMBINEDLY AND DISPOSED OF IN THIS CONSOLIDATED ORDER. APPEAL WISE ADJUDICATION IS GIVEN IN THE FOLLOWING PARAGRAPHS OF THIS ORDER. 2. GROUND RAISED BY THE REVENUE FOR THE AY 2007 - 08 IS AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT (A) ERRED IN HOLDING THAT LEASE RENT RECEIVED FROM M/S. FIVE STAR SHIPPING CO. PVT LTD WAS AGRICULTURAL INCOME IGNORING THIS FACTS THAT NO AGRICULTURAL ACTIVITY WAS CARRIED OUT BY THE LESSEE NAMELY M/S. FIVE STAR SHIPPING CO. PVT LTD AND IT WAS A COLLUSIVE TRANSACTION BETWEEN THE ASSESSEE, THE DIRECTOR AND THE LESSEE COMPANY. 3. GROUND RAISED BY THE REVENUE FOR THE AY 20 08 - 09 IS AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT (A) ERRED IN HOLDING THAT LEASE RENT AT RS. 9,69,631/ - RECEIVED FROM M/S. FIVE STAR SHIPPING CO. PVT LTD WAS AGRICULTURAL INCOME IGNORING THIS FACTS THAT NO AGRICULTURAL ACTIVITY WAS CARRIED OUT BY THE LESSEE NAMELY M/S. FIVE S TAR SHIPPING CO. PVT LTD AND IT WAS A COLLUSIVE TRANSACTION BETWEEN THE ASSESSEE, THE DIRECTOR AND THE LESSEE COMPANY. 2 4 . IN THESE APPEAL S , THE REVENUE CHALLENGED THE CIT (A)S DECISION IN DELETING THE ADDITION S OF RS. 9,69,630 / - ( AY 2007 - 08/ - ) AND RS. 9,69,631/ - (A Y 2008 - 09 ) MADE BY THE AO BY HOLDING THAT THE SAME IS NON - AGRICULTURAL INCOME . THE TAX EFFECT FOR EACH OF THE PRESENT APPEAL IS LESS THAN RS. 4 LAKHS AND ACCORDING TO INSTRUCTION NO.5/2008, DATED 15.5.2008 OF THE CBDT, NO APPEAL SHOULD BE FIL ED BY THE DEPARTMENT BEFORE THE TRIBUNAL IF THE TAX EFFECT IS LESS THAN RS. 4 LAKHS. IT IS ALSO HELD BY THE HONBLE BOMBAY HIGH COURT IN THE FOLLOWING CASES THAT THE INSTRUCTIONS OF THE CBDT DESCRIBING THE LIMIT TO THE TAX EFFECT WOULD BE APPLICABLE TO TH E PENDING APPEALS ALSO. (I) CIT VS. SMT. VIJAYA KAVEKAR [(2013) 30 TAXMANN.COM 412], BOMBAY HIGH COURT (II) CIT VS. MADHUKAR INAMDAR [(2009) 185 TAXMAN 101], BOMBAY HIGH COURT 5 . LD DR DID NOT CONTROVERT TO THE FACT THAT THE TAX EFFECT IN THE PRESENT APPEAL IS LESS THAN RS. 4 LAKHS. 6 . IN THIS VIEW OF THE SITUATION, BOTH THE APPEAL S FILED BY THE REVENUE ARE DISMISSED ON ACCOUNT OF LOW TAX EFFECT. ORDER PRONOUNCED IN THE OPEN COURT ON 4 TH AUGUST , 2015 IMMEDIATELY AFTER COMPLETION OF HEARING. SD/ - SD/ - (AMIT SHUKLA) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; 4.8 .2015 . . ./ OKK , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, 3 ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI