VIJAY HARKISON DESAI, MUMBAI V. ACIT 19(2), MUMBAI

ITA 582/MUM/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 78900 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-06-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: F
• Assessment Year: 2009-2010
• Appeal Filed On: 21-01-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: PITAMBAR DAS
• Assessee Lawyers: A F KHASGIWALA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH, MUM BAI , BEFORE SHRI D. MANMOHAN, VP AND SHRI SANJAY ARORA, AM I.T.A. NO. 582/MUM/2013 ( / ASSESSMENT YEAR: 2009-10) VIJAY HARKISON DESAI GALA NO.6/33, MITTAL INDUSTRIAL ESTATE, ANDHERI KURLA ROAD, ANDHERI (E), MUMBAI-400 059 VS. ASST. CIT 19(2), 3 RD FLOOR, PIRAMAL CHAMBER, LALBAUG, PAREL, MUMBAI-400 012 ! ' ./PAN/GIR NO. AABPD 4907 C ( !# /APPELLANT ) : ( $%!# / RESPONDENT ) !#&' / APPELLANT BY : SHRI A. F. KHASGIWALA $%!#&' / RESPONDENT BY : SHRI PITAMBAR DAS ( )*&+, / DATE OF HEARING : 09.04.2014 -./&+, / DATE OF PRONOUNCEMENT : 06.06.2014 0 O R D E R PER SANJAY ARORA, A. M.: THIS IS AN APPEAL BY THE ASSESSEE DIRECTED AGAINST THE ORDER BY THE COMMISSIONER OF INCOME TAX (APPEALS)-30, MUMBAI (CIT(A) FOR SH ORT) DATED 05.11.2012, DISMISSING THE ASSESSEES APPEAL CONTESTING ITS ASSESSMENT U/S .143(3) OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER) FOR THE ASSESSMENT YEAR (A. Y.) 2009-10 VIDE ORDER DATED 18.11.2011. 2. AT THE VERY OUTSET, IT WAS SUBMITTED BY THE LD. AUTHORIZED REPRESENTATIVE (AR), THE ASSESSEES COUNSEL, THAT THE ISSUES ARISING IN HIS APPEAL, BEING TWO IN NUMBER, ARE COVERED 2 ITA NO. 582/MUM/2013 (A.Y. 2009-10) VIJAY HARKISON DESAI VS. ASST. CIT BY THE ORDER BY THE TRIBUNAL IN ITS OWN CASE FOR TH E IMMEDIATELY PRECEDING YEAR, I.E., A.Y. 2008-09, TAKING US THROUGH THE RELEVANT PARTS OF TH E SAID ORDER (IN ITA NO.4158/MUM(F)/2012 DATED 19.07.2013) ADDUCED BY HI M (COPY ON RECORD). 3. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATER IAL ON RECORD. WE SHALL PROCEED ISSUE-WISE; THE APPEAL RAISING TWO EFFECTIVE GROUND S, I.E., GROUND NOS. 1 & 2. GROUND # 1 AGITATES THE DISALLOWANCE IN THE SUM OF RS.2,13,738 /- EFFECTED U/S.14A. THE SAME IS ONLY IN RESPECT OF THE INDIRECT, ADMINISTRATIVE EXPENDIT URE, RECKONED AT 0.5% OF THE AVERAGE INVESTMENT IN SHARES, I.E., IN TERMS OF RULE 8D, MA NDATORY FOR THE CURRENT YEAR. THE ASSESSEES CASE, AS ALSO FOR THE IMMEDIATELY PRECED ING YEAR, IS THAT IT MAINTAINS DIFFERENT SET OF ACCOUNTS, I.E., FOR HIS BUSINESS AND PERSONA L PURPOSES, AND THAT NO EXPENDITURE IN FACT HAS BEEN INCURRED TOWARD EARNING THE DIVIDEND INCOME AND LONG-TERM CAPITAL GAIN ON SHARES, I.E., THE TWO INCOMES NOT FORMING PART OF T HE TOTAL INCOME FOR THE YEAR. THE ASSESSING OFFICER (A.O.) HAS NOT, IN CONSIDERING TH E ASSESSEES CASE, RECORDED ANY DISSATISFACTION IN TERMS OF SECTION 14A(2). THE SAM E FOUND ACCEPTANCE BY THE TRIBUNAL FOR THE PRECEDING YEAR, RESTORING THE MATTER BACK TO TH E FILE OF THE A.O. TO GIVE DEFINITE FINDINGS IN THE MATTER, AND THEREBY COMPLY WITH THE MANDATE OF SECTION 14A(2). THE SAME IS MANDATORY, EVEN AS EXPLAINED BY THE HONBLE JURI SDICTIONAL HIGH COURT IN THE CASE OF GODREJ & BOYCE MFG. CO. LTD. V. DY. CIT [2010] 328 ITR 81 (BOM). THE INITIAL ONUS TO PRESENT ITS CASE IN THE MATTER THOUGH WOULD ONLY BE ON THE ASSESSEE, EVEN AS EXPLAINED BY THE TRIBUNAL, AS IN THE CASES OF AFL P. LTD. VS. ASST. CIT [2013] 28 ITR (TRIB) 263 (MUM) AND KUNAL CORPORATION VS. ASST. CIT [2013] 28 ITR (TRIB) 277 (MUM). UNDER THE CIRCUMSTANCES, WE ONLY CONSIDER IT FIT AND PROPER T O, CONSISTENT WITH THE LAW AS WELL AS THE OBTAINING FACTS, RESTORE THE MATTER BACK TO THE FIL E OF THE A.O. WITH LIKE DIRECTIONS. WE DECIDE ACCORDINGLY. 4. THE SECOND AND THE ONLY OTHER GROUND BY THE ASSE SSEE IS IN RESPECT OF THE PART DISALLOWANCE OF ITS CLAIM IN RESPECT OF EXPENDITURE ON TELEPHONE AND MOTOR CAR, INCLUDING INSURANCE AND DEPRECATION THEREON, I.E., TOWARD THE PERSONAL USER OF THE SAID ASSETS, AT 15% THEREOF, LEADING TO THE IMPUGNED DISALLOWANCE O F RS.2,58,821/-. THE SAID ISSUE, ALSO 3 ITA NO. 582/MUM/2013 (A.Y. 2009-10) VIJAY HARKISON DESAI VS. ASST. CIT ARISING IN THE ASSESSEES CASE FOR THE IMMEDIATELY PRECEDING YEAR; THE TRIBUNAL CONSIDERED IT JUSTIFIABLE TO RESTRICT THE DISALLOWANCE TO 5% O F THE TOTAL EXPENDITURE. UNDER THE CIRCUMSTANCES, WITH NO CHANGE IN THE FACTS AND CIRC UMSTANCES OF THE CASE, I.E., WITH REFERENCE TO THAT OBTAINING FOR THAT YEAR, BEING BR OUGHT TO OUR NOTICE, WE ARE DISINCLINED TO VARY THE PERCENTAGE OF THE EXPENDITURE CONSIDERED D ISALLOWABLE BY THE TRIBUNAL. WE, ACCORDINGLY, RESTRICT THE SAME TO 5%, AS BY THE TRI BUNAL FOR THE IMMEDIATELY PRECEDING YEAR. WE MAY, HOWEVER, CLARIFY THAT THE MATTER IS C LEARLY FACTUAL, AND DOES NOT LAY ANY GROUND FOR PRECEDENCE. WE DECIDE ACCORDINGLY. 5. IN THE RESULT, THE ASSESSEES APPEAL IS PARTLY A LLOWED AND PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON JUNE 6, 2014 SD/- SD/- (D. MANMOHAN) (SANJAY ARORA) / VICE PRESIDENT / ACCOUNTANT MEMBER ( 1* MUMBAI; 2 DATED : 06.06.2014 )3 ROSHANI , SR. PS !' # $%&' (!'% COPY OF THE ORDER FORWARDED TO : 1. !# / THE APPELLANT 2. $%!# / THE RESPONDENT 3. ( 4+ 5 6 / THE CIT(A) 4. ( 4+ / CIT - CONCERNED 5. 7)89 $3+3:; ,:;/ ( 1* / DR, ITAT, MUMBAI 6. 9<=* GUARD FILE !' ) / BY ORDER, */)+ , (DY./ASSTT. REGISTRAR) , ( 1* / ITAT, MUMBAI