ACIT 25(2), MUMBAI V. ITD ITD CEM JV, MUMBAI

ITA 6276/MUM/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 6388 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-02-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2013-2014
• Appeal Filed On: 16-10-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BHARTI SINGH

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH C, MUMBAI BEFORE SHRI RAJESH KUMAR, ACCOUNTANT MEMBER AND SHRI RAM LAL NEGI, JUDICIAL MEMBER ITA NOS.6274 & 6276/M/2017 ASSESSMENT YEARS: 2012-13 & 2013-14 ACIT 25(2), R. NO.508, C-10, 5 TH FLOOR, PRATYAKSHA KAR BHAVAN, BANDRA KURLA COMPLEX, BANDRA (E), MUMBAI - 400051 VS. M/S. ITD CEM INDIA JV, NATIONAL PLASTIC BUILDING, A-SUBHASH ROAD, PARANJAPE B SCHEME, VILE PARLE (EAST), MUMBAI 400 057 PAN: AAAAI1305D (APPELLANT) (R ESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI VIJAY MEHTA, A.R. REVENUE BY : MS. BHARTI SINGH, D.R. DATE OF HEARING : 10.01.2019 DATE OF PRONOUNCEMENT : 07.02.2019 O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE REVEN UE AGAINST THE ORDER DATED 31.07.2017 OF THE COMMISSIO NER OF INCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS TH E CIT(A)] RELEVANT TO ASSESSMENT YEAR 2012-13. 2. THE ISSUE RAISED IN THE FIRST GROUND OF APPEAL I S AGAINST THE ORDER OF LD. CIT(A) DELETING THE ADDITION OF RS.95, 40,036/- AS DISALLOWED BY THE AO ON ACCOUNT OF SALARY AND RELAT ED EXPENSES UNDER SECTION 40(BA) OF THE ACT AND THE ISSUE IN SE COND GROUND OF APPEAL IS THAT THE LD. CIT(A) HAS WRONGLY DELETE D THE ADDITION MADE BY THE AO IN RESPECT OF ADMINISTRATIVE EXPENSE S OF RS.21,71,076/- UNDER SECTION 40(BA) OF THE ACT. ITA NO.6274/M/2017 M/S. ITD CEM INDIA JV 2 3. AT THE OUTSET, THE LD. A.R. SUBMITTED BEFORE THE BENCH THAT THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSE SSEE BY THE DECISION OF THE CO-ORDINATE BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE VIDE ORDER DATED 30.07.2018 IN A.Y. 2008-0 9 IN ITA NO.4225/M/2012 WHICH WAS ALSO REPORTED IN (2018) 17 2 ITD 313/97 TAXMANN.COM (MUM-TRIB) WHEREIN IT HAS BEEN H ELD BY THE CO-ORDINATE BENCH OF THE TRIBUNAL THAT THE PAYM ENT MADE BY THE ASSESSEE TO THE MEMBER OF AOP IS JUST A REIMBUR SEMENT OF EXPENSES AND NOT SHARE OF INCOME TO THE MEMBER. TH E LD. A.R. SUBMITTED THAT THE AO PRIMARILY HARPED ON THE PLEA THAT THE ORDER OF THE ITAT IN ITA NO.4225/M/2012 DATED 09.04 .2018 A.Y. 2008-09 HAS NOT BEEN ACCEPTED BY THE DEPARTMENT AND APPEAL IS FILED AGAINST THE SAID ORDER IN THE HONBLE BOMBAY HIGH COURT. HOWEVER, NOW THE HIGH COURT HAS RESTORED THE MATTER TO THE TRIBUNAL TO DECIDE THE ISSUE AFRESH WHETHER THE PRO VISIONS OF SECTION 40(BA) ARE APPLICABLE OR NOT. THEREAFTER , THE COORDINATE BENCH VIDE ITS ORDER DATED 30.07.2018 PASSED THE O RDER ALLOWING THE APPEAL OF THE ASSESSEE BY HOLDING THAT PROVISIO NS OF SECTION 40(BA) OF THE ACT ARE NOT APPLICABLE TO THE REIMBUR SEMENT OF EXPENSES TO THE MEMBER OF THE AOP AS SAME IS NOT A SHARE OF INCOME FROM AOP IN THE HANDS OF THE MEMBER. THEREF ORE, THE PRESENT APPEAL OF THE REVENUE SHOULD BE DISMISSED. 4. THE LD. D.R., ON THE OTHER HAND, RELIED ON THE G ROUNDS OF APPEAL AND ORDER OF AO. 5. AFTER HEARING BOTH THE PARTIES AND PERUSING THE MATERIAL ON RECORD, WE OBSERVE THAT IDENTICAL ISSUE HAS BEEN DE CIDED BY THE TRIBUNAL IN ITA NO.4225/M/2012 A.Y. 2008-09 VIDE OR DER DATED 30.07.2018 WHEREIN IDENTICAL ISSUE HAS BEEN DECIDED IN FAVOUR ITA NO.6274/M/2017 M/S. ITD CEM INDIA JV 3 OF THE ASSESSEE BY HOLDING THAT THE PROVISIONS OF S ECTION 40(BA) OF THE ACT ARE NOT APPLICABLE TO THE REIMBURSEMENT OF EXPENSES TO THE MEMBER OF AOP AS THAT IS NOT IN THE FORM OF INC OME TO THE MEMBER OF AOP. THE LD. CIT(A) WHILE PASSING THE OR DER HAS FOLLOWED THE ORDER OF HIS PREDECESSOR AND ALSO THE ORDER OF TRIBUNAL IN ASSESSEES OWN CASE FOR A.Y. 2011-12. IN VIEW OF THE ABOVE FACTS, WE DO NOT FIND ANY INFIRMITY IN THE OR DER OF LD. CIT(A). ACCORDINGLY, WE HEREBY DISMISS THE APPEAL OF THE REVENUE AND THE ORDER OF LD. CIT(A) IS HEREBY UPHEL D. 6. THE ISSUES IN ITA NO.6276/M/2017 IS IDENTICAL TO ONES AS DECIDED BY US IN ITA NO.6274/M/2017. THEREFORE, OU R FINDINGS/DECISION IN ITA NO.6274/M/2017 WOULD, MUTA TIS MUTANDIS, APPLY TO THIS APPEAL AS WELL. 7. IN THE RESULT, BOTH THE APPEALS OF THE REVENUE A RE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 07.02.2019. SD/- SD/- ( RAM LAL NEGI) (RAJESH KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 07.02.2019. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORDER D Y/ASSTT. REGISTRAR, ITAT, MUMBAI.