PATODIA SYNTEX LTD, MUMBAI V. ITO 3(2)(4), MUMBAI

ITA 6521/MUM/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 59733 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2005-2006
• Appeal Filed On: 03-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M K MEHTA
• Keywords: Opportunity of being heard
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIB UNAL MUMBAI BENCHES C, MUMBAI BEFORE SHRI R.S.SYAL, AM AND SHRI R.S.PADVEKAR, JM ITA NO.6521/MUM/2010 : ASST. YEAR 2005-2006 M/S.PATODIA SYNTEX LIMITED C/O.SHANKARLAL JAIN & ASSOCIATES 12, ENGINEER BUILDING 265 PRINCESS STREET, MUMBAI 400 002. PAN : AAACP4751E. THE INCOME TAX OFFICER WARD 3(2)(4) MUMBAI. (APPELLANT) VS. (RESPONDENT) APPELLANT BY : SHRI S.L.JAIN RESPONDENT BY : SHRI M.K.MEHTA DATE OF HEARING : 24.01.2012. DATE OF PRONOUNCEMEN T : 31.01.2012 O R D E R PER R.S.SYAL, AM : THIS APPEAL BY ASSESSEE ARISES OUT OF THE ORDER PAS SED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) ON 26.05.2010 IN RELATION TO ASSESSMENT YEAR 2005-2006. 2. THE ONLY ISSUE RAISED IN THIS APPEAL IS AGAINST THE CONFIRMATION OF DISALLOWANCE OF ` 14,34,830 MADE BY THE ASSESSING OFFICER U/S 14A OF THE ACT. THE ASSESSING OFFICER WHILE FRAMING THE ASSESSMENT ORDER WORKED OUT DISALLOWANCE U/S 14A TO THE TUNE OF ` 14,34,830 BY FOLLOWING SOME ORDER OF THE TRIBUNAL. THE LEARNED CIT(A) UPHELD THE VIEW TAKEN BY THE ASSESSING OFFICER AND ALSO DIRECTED HIM TO RECOMPUTED THE AMOUNT DISA LLOWABLE IN ACCORDANCE WITH THE SPECIAL BENCH ORDER OF THE I.T.A.T MUMBAI BENCH IN THE CASE OF DAGA CAPITAL MANAGEMENT LTD. 199 TTJ 289 (SB) (MUM.) . 3. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS NOTED THAT THE QUESTION OF MAKING DIS ALLOWANCE U/S 14A IS NO MORE RES INTEGRA IN VIEW OF THE JUDGMENT OF THE HONBLE BOMBAY HIG H COURT IN GODREJ & BOYCE LTD. MFG. CO. VS. DCIT [(2010) 328 I TR 81 (BOM)] HOLDING ITA NO.6521/MUM/2010 M/S.PATODIA SYNTEX LIMITED. 2 THAT THE PROVISIONS OF SECTION 14A ARE APPLICABLE IN CIRCUMSTANCES AS ARE PREVAILING PRESENTLY AND THE DISALLOWANCE HAS TO BE WORKED OUT BY THE AO ON SOME `REASONABLE BASIS AND NOT RULE 8D. UNDER SUCH CIRCUMSTANCES, WE SET ASIDE THE IMPUGNED ORDER AND RESTORE THE MATTER TO THE FILE OF THE AO FOR DECIDING THE QUANTUM OF DISALLOWANCE, AS PER THE AF ORE-NOTED JUDGMENT, AFTER ALLOWING A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 4. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATIST ICAL PURPOSES. ORDER PRONOUNCED ON THIS 31 ST DAY OF JANUARY, 2012. SD/- SD/- (R.S.PADVEKAR) (R.S.SYAL) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI : 31 ST JANUARY, 2012. DEVDAS* COPY TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT CONCERNED 4. THE CIT(A)-VII, MUMBAI. 5. THE DR/ITAT, MUMBAI. 6. GUARD FILE. TRUE COPY. BY ORDER ASSISTANT REGISTRAR, ITAT, MUMBAI.