DCIT 3(2), MUMBAI V. MAHARASHTRA PETROCHEMICALS CORPORATION LTD, MUMBAI

ITA 5856/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 100498 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-08-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 01-10-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIJAY KUMAR SONIDR
• Assessee Lawyers: REEPAL G TRALSHAWALA
• Section: 143(3); 37

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B, MUMBAI , , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI ASHWANI TANEJA, ACCOUNTANT MEMBER ITA NO.5856/MUM/2013 ASSESSMENT YEAR: 2010-11 D.C.I.T.-3(2), R. NO.674, 6 TH FLOOR, AAYAKAR BHAVAN, M.K.ROAD, MUMBAI-400020 / VS. M/S MAHARASHTRA PETROCHEMICALS CORPORATION LTD. 214, MAINE LINES OPP. SNDT, WOMENS UNIVERSITY, MUMBAI-400020 ( / REVENUE) ( '#$ /ASSESSEE) P.A. NO. AAACM3608F / REVENUE BY SHRI VIJAY KUMAR SONI-DR '#$ / ASSESSEE BY SHRI REEPAL G. TRALSHAWALA % & ' ( / DATE OF HEARING : 11/08/2015 ' ( / DATE OF ORDER: 26/08/2015 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DAT ED 26/07/2013 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI, AND RAISED THE FOLLOWING GROUNDS:- M/S MAHARASHTRA PETROCHEMICALS CORPORATION ITA NO.5856/MUM/2013 2 1. 'WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. CIT(A) WAS JUSTIFIED IN ALLOWING THE A PPEAL OF THE ASSESSEE HOLDING THAT THE ASSESSEE WAS ENGAGED IN B USINESS ACTIVITY DURING THE YEAR BY PLACING RELIANCE ON DEC ISION OF HIS PREDECESSOR FOR A.Y. 2003-04, A.Y. 2004-05 AND A.Y. 2005-06 WITHOUT APPRECIATING THE FACT THAT MORE THAN SEVEN YEARS HAD PASSED SINCE A.Y. 2003-04, STILL NO INFRASTRUCTURE WAS DEVELOPED BY THE ASSESSEE COMPANY .. ' 2. 'WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. CIT(A) WAS JUSTIFIED IN ALLOWING THE S ET OFF OF BUSINESS LOSS CLAIMED AGAINST THE INCOME FROM OTHER SOURCES WITHOUT APPRECIATION THE FACT THAT THERE WAS NO BUS INESS ACTIVITY DONE BY THE ASSESSEE COMPANY DURING THE YE AR.' 2. DURING THE HEARING OF THE APPEAL, SHRI VIJAY KU MAR SONI, LD. DR, ADVANCED HIS ARGUMENTS WHICH ARE IDEN TICAL TO THE GROUND RAISED. ON THE OTHER HAND, SHRI REEPAL G. TRALSHAWALA, LD. COUNSEL FOR THE ASSESSEE CONTENDED THAT ON IDENTICAL ISSUE FOR EARLIER YEAR, IT WAS DECIDED IN FAVOUR OF THE ASSESSEE AGAINST WHICH NO APPEAL WAS FILED BY THE DEPARTMENT. THIS FACTUAL MATRIX WAS NOT CONTROVERTE D BY THE LD. DR. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSEE COMPANY IS 100% OWNED BY THE STATE GOVERNMENT AND IS IN THE BUSINESS OF FINANCING THE PETRO CHEMICALS INDUSTRY FROM WHICH IT EARNED INTEREST IN COME. THE ASSESSEE DECLARED TOTAL INCOME OF RS.99,48,016/- IN ITS RETURN FILED ON 13 TH OCTOBER, 2010. THE ASSESSEE WAS COMPLETED AT INCOME OF RS.1,55,54,310/- U/S 143(3) OF THE INCOME TAX ACT,1961 (HEREINAFTER THE ACT) ON 03 RD NOVEMBER, 2012, UNDER THE NORMAL PROVISION OF THE ACT. THE ASSESSING OFFI CER DID NOT ALLOW ANY DEDUCTION FOR EXPENSES INCURRED U/S 36, 3 7 OR U/S M/S MAHARASHTRA PETROCHEMICALS CORPORATION ITA NO.5856/MUM/2013 3 57 OF THE ACT AND TAXED THE ENTIRE RECEIPT OF RS.1, 55,80,611/- AS INCOME FROM OTHER SOURCES BY HOLDING THAT THE AS SESSEE HAS NOT DONE ANY BUSINESS AND FOLLOWED THE DECISION IN TUTICORIN ALKALIES CHEMICALS FERTILIZERS LTD. 227 ITR 172 (SC ). THE CLAIM OF THE ASSESSEE IS THAT THE ASSESSEE DID CARR Y ON BUSINESS ACTIVITY, HOWEVER, WHICH COULD NOT YIELD A NY REVENUE. IT IS NOTED THAT THE LD. COMMISSIONER OF I NCOME TAX (APPEALS), WHILE DECIDING THE ISSUE FOLLOWED THE DE CISION FOR A.Y. 2005-06 AND 2007-08 ORDER DATED 23/08/2010, WH ERE THE FACTS ARE IDENTICAL, WHEREIN, THE ISSUE WAS DEC IDED IN FAVOUR OF THE ASSESSEE AND NO APPEAL WAS FILED BEF ORE THE TRIBUNAL. THIS UNCONTROVERTED FINDING WAS NOT CONTR ADICTED BY THE REVENUE, THEREFORE, ON THE ISSUE OF PARITY AND ALSO IN THE ABSENCE OF ANY CONTRARY FACTS/MATERIAL, WE FIND NO INFIRMITY IN THE CONCLUSION OF THE LD. COMMISSIONER OF INCOME TA X (APPEALS). THE APPEAL OF THE REVENUE, IS THEREFORE, DISMISSED. FINALLY, THE APPEAL OF THE REVENUE IS DISMISSED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 11/08/2015. SD/ - (ASHWANI TANEJA) SD/ - (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER % & MUMBAI; ) DATED : 26/08/2015 F{X~{T? P.S/. . . %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. +,- / THE APPELLANT M/S MAHARASHTRA PETROCHEMICALS CORPORATION ITA NO.5856/MUM/2013 4 2. ./,- / THE RESPONDENT. 3. 0 0 % 1 ( + ) / THE CIT, MUMBAI. 4. 0 0 % 1 / CIT(A)- , MUMBAI 5. 34 .' , 0 +( ' 5 , % & / DR, ITAT, MUMBAI 6. 6# 7& / GUARD FILE. / BY ORDER, /3+ . //TRUE COPY// / (DY./ASSTT. REGISTRAR) , % & / ITAT, MUMBAI