GURUVASTU PROPERTIES P.LTD, MUMBAI V. DCIT 1(1)(4), MUMBAI

ITA 5850/MUM/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 0046 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-06-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 19-06-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 30-12-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAJAT MITTAL
• Keywords: Capital receipt
• Section: 143(3); 142(1); 115JB

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH , JM AND SHRI RAJESH KUMAR, AM ITA NO. 5850 / MUM/ 20 1 5 ( / ASSESSMENT YEAR: 20 1 1 - 12 ) GURUVASTU PROPERTIES PVT LT D, 47,7 TH FLOOR, TARDEO AC MARKET, TARDEO, MUMBAI - 400034 / VS. INCOME TAX OFFICER, 1(1)(4), 5 TH FLOOR, AAYAKAR BHAVAN, M K ROAD, MUMBAI - 400020 ( / APPELLANT) : ( / RESPONDENT ) ./ PAN : AACCG4501H ( / APP ELLANT) : ( / RESPONDENT ) / APPELLANT BY : NONE /R E SPONDENT BY : SHRI RAJAT MITTAL / DATE OF HEARING : 1 9.6 .2017 / DATE OF PRONOUNCEMENT : 21. 6 . 201 7 / O R D E R P ER RAJESH KUMAR, A. M: THE CAPTIONED IS APPEAL BY THE ASSESSEE PERTAINING TO ASSESSMENT YEAR 201 1 - 12 . THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE CIT(A) - 2 , MUMBAI , DATED 30. 10 .2015 WHICH IN TURN HAS ARISEN FROM AN ORDER PASSED BY THE ASSESSING OFF ICER DATED 17.1.2014 UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961(IN SHORT THE ACT). 2 ITA NO. 585 0 /MUM/201 5 2. AT THE OUTSET, WE WOULD LIKE TO MENTION HERE THAT NEITHER THE ASSESSEE NOR HIS AUTHORIZED REPRESENTATIVE APPEARED BEFORE THIS TRIBUNAL WHEN THE APPEAL WAS CALLED FOR HEARING NOR WAS ANY APPLICATION SEEKING ADJOURNMENT OF THE HEARING RECEIVED IN THE OFFICE OF THE TRIBUNAL DESPITE SERVICE OF NOTICE THROUGH RPAD ON THE PREVIOUS HEARING ON 28.9.2016, 29.11.2016,12.0.2017, 20.3.2017, 9.5.2017 . THEREFORE, WE PROCEED TO D ISPOSE OF THE APPEAL OF THE ASSESSEE EX - PARTE AFTER HEARING THE LD.DR. 3 . THE FACTS IN BRIEF ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME ON 26.9.2011 DECLARING A TOTAL INCOME OF RS.23,92,583/ - UNDER THE NORMAL PROVISIONS OF ACT AND RS.21,10,711/ - UND ER THE PROVISIONS OF SECTION 115JB OF THE ACT. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND STATUTORY NOTICES UNDER SECTION 143(2) AND 142(1) WERE ISSUED AND SERVED UPON THE ASSESSEE. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO FOUND TH AT THE ASSESSEE HAS INVESTED RS.50 LAKHS IN REC BONDS AND CLAIMED EXEMPTION THEREON U/S 54EC OF THE ACT OUT OF TOTAL CAPITAL GAINS OF RS.71,60,630/ - AND THE BALANCE AMOUNT OF RS.21,60,630/ - OFFERED TO TAX AT THE RATE OF 20%. THE AO NOTICED THAT WHILE C ALCULATING THE NET INCOME U/S 115JB, THE ASSESSEE REDUCED THE INVESTMENT MADE IN BONDS OF RS.50 LAKHS FROM THE BOOK PROFIT OF RS.71,10,711/ - AND DETERMINED THE ADJUSTED BOOK PROFIT AT RS.21,10,711/ - . THE AO AFTER ISSUING NOTICE TO THE ASSESSEE AND CONSID ERING HE SUBMISSION AND CONTENTIONS AS RAISED BY T HE ASSE SSEE IN REPLY TO THE NOTICE, DETERMINE D THE BOOK PROFIT AT 3 ITA NO. 585 0 /MUM/201 5 RS.71,10,711/ - WITHOUT ALLOWING DEDUCTION OF RS.50 LAKHS INVESTED U/S 54EC OF THE ACT IN RAC BONDS. 4. IN THE APPEAL PROCEEDINGS, THE LD. CIT(A) UPHELD THE ORDER OF THE AO AFTER CONSIDERING THE SUBMISSIONS MADE BY THE ASSESSEE AS HAS BEEN INCORPORATED IN APPEAL ORDER AT PARA 3.1 OF THE APPELLATE ORDER AND THE LD.CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE BY OBSERVING AND HOLDING AS UNDER : 3.3 I HAVE I HAVE GONE THROUGH THE HON'BLE BOMBAY HIGH COURT'S DECISION IN THE CASE OF SURAJ JEWELLERY (I) P. LTD. AS RELIED BY THE AR OF THE APPELLANT WHE RE THE ISSUE IS CONNECTED TO CAPITAL RECEIPT WHICH DID NOT FORM PART OF ITS BO OK . PROFIT U /S 11 5JB OF THE ACT. MOREOVER, THE DECISION IN THE CASE OF M/S. SUT LEJ COTTON MILLS LTD. VS ACIT IS RENDERED BY HO N BLE CALCUTTA HIGH COURT WHI CH MAY NOT BE RELEVANT FOR THE APPELLANT'S CASE AS THE JURISDICTIONAL BOMB AY HIGH COURT HAS GIVEN A CLEAR F INDING IN THE CASE OF VEEKAY LAL INVESTMENT C O. PVT. LTD. 249 ITR 597. ACCORDINGLY, I AM MORE RELYING ON THE JURISDICTI ON BOMBAY HIGH COURT'S DECISION IN THE CASE OF VEEKAY LAL INVESTMENT CO. P VT LTD. WHEREIN IT HAS GIVEN A CATEGORICAL FINDING AGAINST THE ASSESSEE F OR T HE SAME ISSUE. LOOKING INTO THE ABOVE FACTS, I AM OF THE CONSIDERED OPINION THAT THE ACTIONS OF THE AO BY NOT CONSIDERING HE INVESTMENTS MADE U/S 54EC IS FOUND TO BE CORRECT. ACCORDINGLY, THIS GROUND OF APPEAL IS DISMISSED. 5 . WE HAVE CONSIDERED TH E SUBMISSIONS MADE BY THE LD. DR AND PERU SED THE MATERIAL PLACED BEFORE US INCLUDING THE ORDERS OF AUTHORITIES BELOW . WE FIND THAT THE LD.CIT(A) HAS TAKEN A VIEW AFTER CONSIDERING THE ORDER OF HONBLE BOMBAY HIGH COURT IN THE CASE OF VEEKAY LAL INVESTMENT CO. PVT. LTD. 249 ITR 597 AND UPHELD THE ORDER PASSED BY THE AO. DURING THE COURSE OF HEARING, THERE WAS NO MATERIAL BEFORE US TO 4 ITA NO. 585 0 /MUM/201 5 CONTROVERT THE FINDINGS OF THE LD.CIT(A) AND THEREFORE, WE ARE INCLINED TO UPHOLD THE ORDER OF T HE LD.CIT(A) BY DISMISSIN G THE APPEAL OF THE ASSESSEE. 6. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 21ST JUNE , 2017. SD SD ( MAHAVIR SINGH ) (RAJESH KUMAR) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 21. 6 .2017 SRL,SR.PS / 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 F ILE / BY ORDER, TRUE COPY / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI