FORTUNE CAPITAL SERVICES, MUMBAI V. ACIT 12(1), MUMBAI

ITA 6280/MUM/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 83880 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-09-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 01-05-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 12-10-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PAVAN KUMAR BIRLA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH, MUM BAI , , BEFORE SHRI JOGINDER SINGH, JM AND SHRI SANJAY ARO RA, AM ./ I.T.A. NO.6280/MUM/2012 ( / ASSESSMENT YEAR: 2008-09) FORTUNE CAPITAL SERVICES 2 ND FLOOR, K. K. CHAMBERS, SIR P. T. MARG, FORT, MUMBAI-400 001 / VS. ASST. CIT-12(1), MUMBAI-400 001 ! ./' ./PAN/GIR NO. AAAFF 6359 F ( !# /APPELLANT ) : ( $%!# / RESPONDENT ) !# & ' / APPELLANT BY : NONE $%!# & ' / RESPONDENT BY : SHRI PAVAN KUMAR BIRLA ( )*+ & ,- / DATE OF HEARING : 25.09.2014 DATE OF ORDER : 24.11.2014 . / 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)-23, MUMBAI (CIT(A) FOR SH ORT) DATED 30.08.2012, 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.) 2008-09 VIDE ORDER DATED 03.12.2010. 2. NONE APPEARED FOR AND ON BEHALF OF THE ASSESSEE- APPELLANT WHEN ITS APPEAL WAS CALLED OUT FOR HEARING, NOR ANY ADJOURNMENT APPLICA TION STANDS RECEIVED. THERE HAS BEEN NO REPRESENTATION BY OR FOR AND ON BEHALF OF THE AS SESSEE EVEN ON THE EARLIER OCCASIONS 2 ITA NO.6280/MUM/2012 (A.Y. 2008-09) FORTUNE CAPITAL SERVICES VS. ASST. CIT WHEN THE APPEAL WAS POSTED FOR HEARING. AS OBSERVED VIDE ORDER SHEET ENTRY DATED 24.02.2014, THE DEFECT (IN THE APPEAL MEMO) HAS NOT BEEN RECTIFIED. UNDER THE CIRCUMSTANCES, INCLUDING THE ISSUE AS WELL AS THE S UM UNDER REFERENCE, IT WAS CONSIDERED PROPER TO PROCEED TO DECIDE THE APPEAL AFTER HEARIN G THE REVENUE, THE PARTY BEFORE US. 3. THE APPEAL AGITATES A SINGLE ISSUE, I.E., DISALL OWANCE U/S.14A, EFFECTED AT RS.31,108/-, SINCE CONFIRMED BY THE LD. CIT(A). WHI LE THE REVENUES CASE IS BASED ON THE DECISIONS BY THE LARGER BENCH OF THE TRIBUNAL IN TH E CASE OF CHEMINVEST LTD. V. ITO [2009] 121 ITD 318 (DEL-SB), SO THAT NO DECISION BY ITS DIVISION BENCH, AS IN THE CASE OF JNJ HOLDINGS P. LTD. VS. ACIT (IN ITA NO.3411/MUM/2009 DATED 08.06.2012), WOULD HOLD. THE ASSESSEES OBJECTION FOR EXCLUDING THE SH ARES HELD AS STOCK-IN-TRADE IN RECKONING THE VALUE OF THE INVESTMENTS, I.E., IN CO MPUTING THE DISALLOWANCE QUA INDIRECT EXPENDITURE U/R.8D(2)(III), STANDS NEGATED ON THE B ASIS OF THE DECISIONS BY THE SPECIAL BENCH IN THE CASE OF ITO VS. DAGA CAPITAL MANAGEMENT PVT. LTD. [2009] 312 ITR (AT) 1 (MUM.) (SB) AND JT. CIT VS. AMERICAN EXPRESS BANK LTD. [2012] 138 ITD 288 (MUM). AGGRIEVED, THE ASSESSEE IS IN SECOND APPEAL. 4. THE ONLY ISSUE ARISING IN THIS APPEAL, THEREFORE , IS WHETHER THE DISALLOWANCE U/S.14A WOULD HOLD IN RESPECT OF SHARES YIELDING DI VIDEND INCOME, ETC., I.E., INCOME/S NOT FORMING PART OF THE TOTAL INCOME, WHERE THE SAID SH ARES ARE HELD AS STOCK-IN-TRADE OF THE ASSESSEES BUSINESS. THIS ISSUE HAS BEEN THE SUBJEC T MATTER OF CONTRARY DECISIONS BY THE TRIBUNAL, PARTICULARLY AFTER THE DECISION IN THE CA SE OF CCI LTD. VS. JT. CIT [2012] 20 TAXMANN.COM 196 (KAR)/[2012] 250 CTR 291 (KAR), BEI NG ALSO RELIED UPON BY THE ASSESSEE. THE TRIBUNAL PER ITS LARGER BENCH DECISIO N IN D. H. SECURITIES (P.) LTD. VS. DY. CIT [2014] 146 ITD 1 (MUM) (TM) HAS SINCE, FOLLOWING T HE DECISION BY THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF GODREJ & BOYCE MFG. CO. LTD. V. DY. CIT [2010] 328 ITR 81 (BOM), CONFIRMED THAT IT WOULD. THE DECI SION BY IT IN DAGA CAPITAL MANAGEMENT PVT. LTD. (SUPRA), HOLDING LIKE-WISE, WOULD THEREFORE CONTIN UE TO OBTAIN, WHILE THE DECISION IN D. H. SECURITIES (P.) LTD. (SUPRA) CAN ONLY BE CONSIDERED AS APPLYING GODREJ & BOYCE MFG. CO. LTD. (SUPRA). ACCORDINGLY, S.14A WOULD APPLY, AND 3 ITA NO.6280/MUM/2012 (A.Y. 2008-09) FORTUNE CAPITAL SERVICES VS. ASST. CIT DISALLOWANCE THERE-UNDER OBTAIN, EVEN WHERE THE SHA RES ARE HELD AS STOCK-IN-TRADE, NOTWITHSTANDING THE DECISION BY THE NON-JURISDICTIO NAL HIGH COURT IN CCI LTD . (SUPRA). REFERENCE FOR THE PURPOSE MAY ALSO BE MADE TO THE D ECISION IN THE CASE OF DY. CIT VS. DAMANI ESTATES & FINANCE (P.) LTD. [2013] 25 ITR 683 (MUM)(TRIB), WHICH ALSO BEARS REFERENCE TO THE DECISION IN DHANUKA & SONS VS. CIT [2011] 339 ITR 319 (CAL). WE, ACCORDINGLY, FIND NO INFIRMITY IN THE ORDERS OF THE AUTHORITIES BELOW, WHICH STAND UPHELD IN RESULT. WE DECIDE ACCORDINGLY. 5. IN THE RESULT, THE ASSESSEES APPEAL IS DISMISSE D. /0,1 )23/, & / & , 4 ORDER PRONOUNCED IN THE OPEN COURT ON SEPTEMBER 25, 2014 AT THE CONCLUSION OF THE HEARING SD/- SD/- (JOGINDER SINGH) (SANJAY ARORA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER ( 5+ MUMBAI; 6) DATED : 24.11.2014 *.). ./ ROSHANI , SR. PS !' # $%&' (!'% / COPY OF THE ORDER FORWARDED TO : 1. !# / THE APPELLANT 2. $%!# / THE RESPONDENT 3. ( 7, ( ) / THE CIT(A) 4. ( 7, / CIT - CONCERNED 5. :*; $,)2 , - 20 , ( 5+ / DR, ITAT, MUMBAI 6. <3 =+ / GUARD FILE !' ) / BY ORDER, */)+ , (DY./ASSTT. REGISTRAR) , ( 5+ / ITAT, MUMBAI