AATUR HOLDING P.LTD, MUMBAI V. ASST CEN CIR 31, MUMBAI

ITA 599/MUM/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3914 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-08-2016
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 29-01-2015
• Court: TRIBUNAL
• Keywords: Opportunity of being heard
• Section: 234B

Judgement Text

, . . , IN THE INCOME TAX APPELLATE TRIBUNAL SMC , BENCH MUMBAI BEFORE SHRI R.C.SHARMA , A CCOUNTANT MEMBER ./ ITA NO . 599 /MUM /20 1 5 ( / ASSESSMENT YEAR : 20 11 - 20 12 ) AATUR HOLDING S PVT. LTD., 32, MADHULI, 3 RD FLOOR, A.B.ROAD, WORLI, MUMBAI - 400018 VS. ACIT,CC - 31, CENTRAL RANGE - 7, MUMBAI - 400020 ./ ./ PAN/GIR NO. : A A BC A 1472 C ( / APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE B Y : SHRI DHARMESH SHAH /REVENUE BY : DR. P.DANIEL, STANDING COUNSEL / DATE OF HEARING : 08 / 0 8 /2016 / DATE OF PRONOUNCEMENT 08 /0 8 /201 6 / O R D E R TH IS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF C IT (A) FOR ASSESSMENT YEAR 20 11 - 2012, IN THE MATTER OF ORDER PASSED U./S.143(3) OF THE I.T.ACT. 2. THERE IS A DELAY OF 9 DAYS IN FILING THE APPEAL. AFTER GOING THROUGH THE REASONS FOR DELAY, I CONDONE THE SAME AND APPEAL IS HEARD ON ME RITS. 3. THE ASSESSEE IS AGGRIEVED FOR DISALLOWANCE OF INTEREST EXPENSES OF RS.6,14,669/ - . LD. AR PLACED ON RECORD ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2007 - 08, DATED 23 - 9 - 2015, WHEREIN SIMILAR ISSUE WAS DECIDED BY THE TRIBU NAL AFTER OBSERVING AS UNDER : - 3: GROUND NO. 4 RELATES TO THE DISALLOWANCE OF INTEREST EXPENSE. THE LD. COUNSEL FOR THE ASSESSEE 40UGHT TO OUR NOTICE THAT THE DECISION RELIED UPON BY THE LD. CIT(A) WHILE DISPOSING THIS GROUND HAS BEEN SET ASIDE BY THE TRI BUNAL TO THE FILE OF THE LD. CIT(A). 4. THE LD. DEPARTMENTAL REPRESENTATIVE COULD NOT BRING ANY DISTINGUISHING DECISION IN FAVOUR OF THE REVENUE. 5. WE HAVE ITA NO. 599 /2015 2 CAREFULLY PERUSED THE ORDERS OF THE AUTHORITIES BELOW. WHILE DISPOSING THE GROUND RELATING TO THE D ISALLOWANCE OF INTEREST, WE FIND THAT 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 IT A NOS. 2139, 2140 AND 21411MUMJ2013 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) FOR FRESH ADJUDICATION. RESPECTFULLY FOLLOWING THE FINDINGS OF THE CO ORDINATE BENCH, WE RESTORE THIS ISSUE TO THE FI LES OF THE LD. CIT(A) FOR FRESH ADJUDICATION AFTER GIVING REASONABLE OPPORTUNITY 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 PENDING 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 IMP UGNED ORDER. WE, THEREFORE, DIRECT 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 ACCORDANCE WITH THE METHOD OF ACCOUNTING FOLL OWED BY THEM AND AS PER THE PROVISIONS OF THE LAW. GROUND NO. 4 IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE.' 3. LD. SPECIAL COUNSEL DID NOT CONTROVERT TO SUCH CONTENTION 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 PURP OSES FOR BOTH THE YEARS. ' FOLLOWING THE ABOVE, WE ALLOW GROUND NO.5 FOR STATISTICAL PURPOSES FOR THE YEAR UNDER APPEAL. GROUND NO.6 CONSEQUENTIAL IN NATURE, HENCE IS NOT BEING ADJUDICATED. 4. AS THE FACTS AND CIRCUMSTANCES DURING THE YEAR UNDER CONSID ERATION ARE SAME, RESPECTFULLY, FOLLOWING THE ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE MATTER IS RESTORED BACK TO THE FILE OF CIT(A) FOR DECIDING AFRESH AS PER THE DIRECTION GIVEN BY THE TRIBUNAL IN ITS ORDER DATED 23 - 9 - 2015. 5. WITH REGARD TO CHARGING OF INTEREST U/S.234B & 234C, I FOUND THAT SIMILAR ISSUE HAS BEEN DEALT WITH BY THE TRIBUNAL IN ASSESSEES OWN CASE AND THE MATTER WAS RESTORED BACK TO THE FILE OF AO. THE TRIBUNAL HAVE ITA NO. 599 /2015 3 DEALT WITH THE ISSUE OF CHARGING OF INTEREST IN ITS ORDER DATED 23 - 9 - 2015 AS UNDER : - '3.NEXT GROUND OF APPEAL IS ABOUT LEVY OF INTEREST U/S. 234 OF THE ACT. BEFORE US, AR STATED THAT THE ASSESSEE WAS A NOTIFIED ENTITY, THAT THE PROVISIONS OF S. 234A, 234B AND 234C.OF THE ACT WERE DEEMED TO HAVE COMPLIED WITH, THAT THE ASSETS WE RE ALREADY IN ATTACHMENT OF THE CUSTODIAN APPOINTED UNDER THE PROVISIONS OF THE SPECIAL COURTS ACT.THAT THE TRIBUNAL IN THE CASE OF THE APPELLANT AND SEVERAL OTHER ENTITIES HAD HELD THE VIEW IN FAVOUR OF THE APPE LLANT, THAT THE HON 'BLE BOMBAY HIGH COURT IN THE CASE OF DIVINE HOLDINGS PVT. LTD. AND CASCADE HOLDINGS PVT. LTD. HAD HELD THAT THE PROVISIONS OF SECTIONS 234A,234B AND 234C OF THE ACT WERE MANDATORY AND WERE APPLICABLE TO THE NOTIFIED ENTITIES ALSO THAT THE ASSESSEE WAS IN THE PROCESS OF FILING AN APPEAL AGAINST THE SAID ORDER BEFORE THE HON'BLE SUPREME COURT THAT THE INCOME EARNED IN THE YEAR UNDER CONSIDERATION WAS SUBJECTED TO PROVISIONS OF TDS, THAT THE CHANGEABILITY OF THE SECTION 234A, 234B AND 234C OF THE ACT SHOULD BE AFTER CONSIDERING THE A MOUNT OF TAX DEDUCTIBLE AT SOURCE ON THE INCOME ASSESSED. THE APPELLANT RELIES IN THIS REGARD ON THE FOLLOWING DECISIONS. HE RELIED UPON THE CASES OF MOTOROLA INC. V. DC I T [95 I TD 269 (DEL. (SB)J, SEDCO FORES DRILLING CO. LTD. [264 FTR 320J,NGC NETWORK ASI A LLC [3 F 3 ITR 187 ] SUMMIT BHATACHARYA [ 300 ITR (AJ) 341' (BOM)(SB)J, VIJAL GOPA L JINDAL [ITA NO. 4333/DEL/2009] & EMILLO RUIZ BERDEJO [320 FTR 190 (BOM)].DR RELIED UPON THE CASES OF DEVINE HOLDINGS PVT. LTD. ' 3.1. WE HAVE HEARD THE RIVAL SUBMISSIONS A ND PERUSED THE MATERIAL BEFORE US. WE FIND THAT IN THE CASE OF DEVINE HOLDINGS PVT. LTD. HON 'BLE BOMBAY HIGH COURT HAS HELD THAT PROVISIONS OF SECTION 234A, 234B AND 234C WERE APPLICABLE TO THE NOTIFIED PERSON ALSO. THEREFORE, UPHOLDING THE ORDER OF THE F AA TO THAT EXTENT. WE HOLD THAT PROVISIONS OF SECTION 234 OF THE ACT ARE APPLICABLE. AS FAR AS CALCULATION PART IS CONCERNED, WE FIND MERITS IN THE SUBMISSION MADE BY THE ASSESSEE. THEREFORE, WE ARE RESTORING BACK THE ISSUE TO THE FILE OF THE AO FOR FRESH ADJUDICATION WHO WOULD DECIDE THE ISSUE AFTER CONSIDERING THE AMOUNT TAXED DEDUCTIBLE AT SOURCE ON THE INCOME ASSESSED AND AFTER AFFORDING A REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. GROUND NO.5 IS ALLOWED IN PART IN FAVOUR OF THE ASSESSEE. RESP ECTFULLY, FOLLOWING THE ABOVE ORDER WE RESTORE BACK THE ISSUE TO THE FILE OF THE AO WHO WOULD LEVY THE INTEREST AS PER THE PROVISIONS OF SECTION 234 OF THE ACT AND GIVE CREDIT FOR THE TDS AMOUNTS. GROUND NO.6 FOR ALL THE THREE A Y.S. STANDS PARTLY ALLOWED, IN FAVOUR OF THE =. 6. AS THE FACTS AND CIRCUMSTANCES DURING THE YEAR UNDER CONSIDERATION ARE SAME, RESPECTFULLY FOLLOWING THE ORDER OF THE TRIBUNAL IN ASSESSEES ITA NO. 599 /2015 4 OWN CASE, THE MATTER IS RESTORED BACK TO THE FILE OF AO FOR DECIDING AFRESH AS PER THE DIR ECTION GIVEN BY THE TRIBUNAL. 7 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED IN PART FOR STATISTICAL PURPOSES . O RDER PRONOUNCED IN THE OPEN COURT ON THIS 08 /0 8 / 201 6 . SD/ - ( R.C.SHARMA ) / ACCOUNTANT MEMBER MUMBAI ; DATED 08 /0 8 /201 6 . . /PKM , . / PS / COPY OF THE ORDER FORWARDED TO : / BY ORDER, / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CI T(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRUE COPY//