SHALIMAR CARPETS & MARKETING, MUMBAI V. ITO 5(3)-2, MUMBAI

ITA 6326/MUM/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 56203 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Next Hearing Date: 14-12-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 25-08-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: O A MAO
• Assessee Lawyers: RAKESH K MILWANI
• Keywords: Opportunity of being heard
• Section: 14A

Judgement Text

1 ITA NO. 6326/MUM/2010 M/S SHALIM AR CARPETS & MARKETING PVT. LTD. IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI E BENCH MUMBAI BENCHES, MUMBAI BEFORE SHRI N.V. VASUDEVAN, JM AND SHRI R.K. PANDA , A.M. ITA NO. 6326/MUM/2010 (ASST YEAR 2007-08) M/S SHALIMAR CARPETS & MARKETING P. LTD., 1, BASEMENT, TARDEO AIR CONDITIONED MARKET, TARDEO ROAD, MUMBAI 400 034. VS INCOME TAX OFFICER 5(3)-2, AAYAKAR BHAWAN, MARSHI KARVE ROAD, CHURCHGATE,, MUMBAI -20. (APPELLANT) (RESPONDENT) PAN NO. AABCS7764F APPELLANT BY S HRI RAKESH K. MILWANI RESPONDENT BY SHRI O.A. MAO DATE OF HEARING 14.12.2011 DATE OF PRONOUNCEMENT 21.12.2011 ORDER PER R K PANDA, AM THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 24.06.2010 OF THE COMMISSIONER OF INCOME TAX (A)- 9 , MUMBAI RELATING TO ASSESSMENT YEAR 2007-08. 2. THE ASSESSEE IN ITS ONLY EFFECTIVE GROUND HAS CH ALLENGED THE ORDER OF THE LD. CIT(A) IN CONFIRMING THE DISALLOWANCE OF RS . 1,79,200/-U/S 14A OF THE INCOME TAX ACT, 1961. 3. FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSEE IS IN THE BUSINESS OF TRADING AND JOB WORK OF FLOORING. THE ASSESSEE REC EIVED DIVIDEND OF RS. 1,83,250/- DURING THE YEAR WHICH IT CLAIMED EXEMPT U/S 10(33) OF THE ACT. 2 ITA NO. 6326/MUM/2010 M/S SHALIM AR CARPETS & MARKETING PVT. LTD. THE A.O. BY APPLYING THE PROVISIONS OF SECTION 14A OF THE ACT READ WITH RULE 8-D DISALLOWED AN AMOUNT OF RS. 1,79,200/-. IN APPE AL, THE LD. CIT(A) CONFIRMED THE DISALLOWANCE MADE BY THE A.O. FOR WHI CH THE ASSESSEE IS IN APPEAL BEFORE US. 4. BOTH THE PARTIES FAIRLY AGREED THAT RULE 8D OF T HE INCOME TAX RULES, 1962 IS NOT APPLICABLE TO A.Y. 2007-08 IN VIEW OF T HE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF GODREJ BOY CE MFG. CO. LTD. VS. DCIT REPORTED IN 328 ITR 81. HOWEVER, SOME REASONABLE DI SALLOWANCE HAS TO BE MADE AND, THEREFORE, THE ISSUE SHOULD GO BACK TO TH E FILE OF THE A.O. FOR DECIDING THE ISSUE AFRESH IN THE LIGHT OF THE DECIS ION OF THE HONBLE JURISDICTIONAL HIGH COURT CITED ABOVE. IN VIEW OF T HE ABOVE SUBMISSIONS MADE BY BOTH SIDES, WE DEEM IT PROPER TO RESTORE TH E ISSUE TO THE FILE OF THE A.O. FOR FRESH ADJUDICATION IN THE LIGHT OF THE RAT IO LAID DOWN BY THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF GODREJ BOY CE MFG. CO. LTD. (SUPRA) AND IN ACCORDANCE WITH LAW. NEEDLES TO SAY THE A.O. SHALL GIVE ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE HOL D AND DIRECT ACCORDINGLY. THE GROUND RAISED BY THE ASSESSEE IS ACCORDINGLY PA RTLY ALLOWED FOR STATISTICAL PURPOSE. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED ON 21.12.2011. SD/- ( N.V. VASUDEVAN ) JUDICIAL MEMBER SD/- ( R K PANDA ) ACCOUNTANT MEMBER PLACE: MUMBAI : DATED: 21.12.2011. RK 3 ITA NO. 6326/MUM/2010 M/S SHALIM AR CARPETS & MARKETING PVT. LTD. COPY FORWARDED TO: 1 APPELLANT 2 RESPONDENT 3 CIT, -5, MUMBAI 4 CIT(A) - 9, MUMBAI 5 DR BENCH E 6 MASTER FILE /TRUE COPY/ BY ORDER DY /AR, ITAT, MUMBAI