M/S J V GOKAL & COMPANY PVT LTD., MUMBAI V. CIT (A)-2, MUMBAI, MUMBAI

ITA 6618/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 1641 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-06-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2010-2011
• Appeal Filed On: 23-10-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RITUJA PAWAR
• Keywords: Opportunity of being heard
• Section: 92C; 143(3); 10AA; 201; 143(2); 154

Judgement Text

M/S J.V GOKAL & COMPANY PVT. LTD. VS. CIT - 2 ITA NO. 6618/MUM/2019 A.Y 2010 - 11 1 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH F MUMBAI BEFORE SHRI RAJESH KUMAR (ACCOUNTANT MEMBER) AND SHRI RAVISH SOOD (JUDICIAL MEMBER) ITA NO. 6618/MUM/2019 (ASSESSMENT YEAR: 201 0 - 11) M/S J.V GOKAL & COMPANY PVT. LTD; 2 ND FLOOR, KASTURI BUILDING, J. TATA ROAD, CHURCHGATE, MUMBAI 400 020. VS. COMMISSIONER OF INCOME - TAX (APPEALS) - 2, ROOM NO. 529, 5 TH FLOOR, AAYKAR BHAVAN, M.K ROAD, MUMBAI 400 020. PAN NO. AAACJ1222A (ASSESSEE) (REVENUE) ASSESSEE BY : MS. RITUJA PAWAR, A.R REVENUE BY : SHRI. JITENDRA KUMAR, D.R DATE OF HEARING : 17/06/2021 DATE OF PRONOUNCEMENT : 18 /06/2021 ORDER PER RAVISH SOOD, J.M: THE PRESENT APPEAL FILED BY THE ASSESSEE COMPANY IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A) - 2, MUMBAI [FOR SHORT CIT(A)], DATED 30.07.2019, WHICH IN TURN ARISES FROM HIS ORDER DATED 29.03.2016 THAT WAS PASSED WHILE DISPOSING OFF THE APPEAL FILED B Y THE ASSESSEE AGAINST THE ASSESSMENT ORDER PASSED BY THE A.O UNDER SEC. 143(3) R.W.S 92C OF THE INCOME - TAX ACT, 1961, DATED 05.12.2013 FOR ASSESSMENT YEAR 2010 - 11. 2. BRIEFLY STATED, THE ASSESSEE COMPANY WHICH IS ENGAGED IN T H E BUSINESS OF EXPORT OF TEA & OTHER TRADITIONAL/NON - TRADITIONAL ITEMS HAD E - FILED ITS RETURN OF INCOME FOR A.Y 2010 - 11 ON 24.09.2010, DECLARING AN INCOME OF RS. NIL. SUBSEQUENTLY, THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY ASSESSMENT U/S 143(2) OF THE ACT. 3. ORIGINAL ASSESS MENT WAS FRAMED BY THE A.O VIDE HIS ORDER PASSED U/S 143(3) R.W.S 92C, DATED 05.12.2013, WHEREIN HE HAD AFTER INTER ALIA, VIZ. (I). DISALLOWING THE EXPENSES THAT WERE M/S J.V GOKAL & COMPANY PVT. LTD. VS. CIT - 2 ITA NO. 6618/MUM/2019 A.Y 2010 - 11 2 INCURRED BY THE ASSESSEE AS REGARDS ITS LIAS I ON OFFICE AT MOSCOW AMOUNTING TO RS. 29,91,3 24/ - ; AND (II). CAPPING THE ASSESSEES CLAIM FOR EXEMPTION U/S 10AA AT RS. 3,92,84,237/ - (AS AGAINST ITS CLAIM OF EXEMPTION OF RS. 7,54,73,966/ - ), THEREIN ASSESSED THE INCOME OF THE ASSESSEE COMPANY AT RS. 3,91,81,050/ - UNDER THE NORMAL PROVISIONS OF THE ACT. 4. AGGRIEVED, THE ASSESSEE ASSAILED THE ASSESSMENT ORDER BEFORE THE CIT(A) ON BOTH THE AFORESAID ISSUES, VIZ. (I). DISALLOWANCE OF ITS CLAIM FOR DEDUCTION OF EXPENSES INCURRED AS REGARDS ITS LIASION OFFICE AT MOSCOW AMOUNTING TO RS. 29,91,324/ - ; AND (II). CAPPING OF ITS EXEMPTION U/S 10AA AT RS. 3,92,84,237/ - (AS AGAINST ITS CLAIM OF EXEMPTION OF RS. 7,54,73,966/ - ) . THE CIT(A) WHILE DISPOSING OFF THE APPEAL VIDE HIS ORDER DATED 29.03.2016 FOU ND FAVOUR WITH THE ASSESSEES CLAIM FOR DEDUCTION OF THE EXPENDITURE THAT W ERE INCURRED W.R.T T H E MOSCOW LIASION OFFICE, AND DIRECTED THE A.O TO ALLOCATE THE SAID EXPENSES IN THE RATIO OF EXPORTS OF THE ASSESSEES UNITS (10AA UNITS AND NON 10AA UNITS). HOW EVER, THE CIT(A) FAILED TO ADDRESS THE ASSESSEES GRIEVANCE THAT THE A.O HAD ERRED IN CAPPING ITS CLAIM FOR EXEMPTION AT AN AMOUNT OF RS. 3,92,84,237/ - AS AGAINST RS. 7,54,73,966/ - SO CLAIMED BY IT. 5. SEEKING RECTIFICATION OF THE AFORESAID MISTAKE, THE AS SESSEE FILED AN APPLICATION DATED 13.03.2019 WITH THE CIT(A), WHEREIN IT WAS STATED THAT THE ASSESSEES SPECIFIC GRIEVANCE AS REGARDS THE CAPPING OF ITS EXEMPTION U/S 10AA AT RS. 3,92,84,237/ - AS AGAINST ITS CLAIM OF RS. 7,54,73,966/ - HAD REMAINED OMITTED TO BE ADDRESSED WHILE DISPOSING OFF THE APPEAL. HOWEVER, THE CIT(A) HOLDING A CONVICTION THAT THE GROUND ON DEDUCTION U/S 10AA HAD ALREADY BEEN DECIDED WHILE DISPOSING OFF THE APPEAL, THUS, VIDE HIS IMPUGNED ORDER DATED 30.07.2019 REJECTED THE AFORESAID AP PLICATION OF THE ASSESSEE. 6. AGGRIEVED, THE ASSESSEE HAS ASSAILED THE REJECTION OF ITS APPLICATION FILED U/S 154 IN APPEAL BEFORE US. LD. A.R TOOK US THROUGH THE GENESIS OF THE CONTROVERSY IN QUESTION. IT WAS SUBMITTED BY THE LD. A.R THAT THOUGH TH E CIT(A) WHILE DISPOSING OFF THE APPEAL HAD ADDRESSED THE ASSESSEES GRIEVANCE AS REGARDS THE DISALLOWANCE OF THE EXPENSES THAT WERE INCURRED W.R.T ITS MOSCOW LIASION OFFICE, HOWEVER, HE HAD OMITTED TO ADDRESS THE SPECIFIC GRIEVANCE THAT WAS RAISED BY THE ASSESSEE AS REGARDS CAPPING OF ITS EXEMPTION U/S 10AA OF THE ACT. IT WAS SUBMITTED BY THE LD. A.R THAT THE FAILURE ON THE PART OF THE CIT(A) TO DISPOSE OFF THE AFORE SAID SPECIFIC GROUND OF APPEAL THAT WAS RAISED BY THE ASSESSEE, WAS BEYOND ANY DOUBT, A MI STAKE , THAT WAS GLARING, PATENT, OBVIOUS AND APPARENT FROM RECORD , WHICH, THUS, RENDERED THE SAME M/S J.V GOKAL & COMPANY PVT. LTD. VS. CIT - 2 ITA NO. 6618/MUM/2019 A.Y 2010 - 11 3 AMENABLE FOR RECTIFICATION U/S 154 OF THE ACT. IT WAS, THUS, SUBMITTED BY THE LD. A.R THAT THE CIT(A) HAD ERRED IN DECLINING TO RECTIFY HIS AFORESAID MISTAKE AND HAD WRONGLY REJECTED THE ASSESSEES APPLICATION. 7. PER CONTRA, THE LD. D.R RELIED ON THE ORDER OF THE CIT(A). IT WAS SUBMITTED BY THE LD. D.R THAT AS NO MISTAKE DID EMERGE FROM THE ORDER OF THE CIT(A), THEREFORE, NO INFIRMITY COULD BE ATTRIBUTED TO THE REJECTI ON OF THE APPLICATION THAT WAS FILED BY THE ASSESSEE U/S 154 OF THE ACT. 8. W E HAVE HEARD THE AUTHORISED REPRESENTATIVES FOR BOTH THE PARTIES, PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND THE MATERIAL AVAILABLE ON RECORD. A S IS DISCERNIBLE FROM THE ORDER THAT WAS PASSED BY THE CIT(A) WHILE DISPOSING OFF THE ASSESSEES APPEAL, WE FIND , THAT THOUGH THE ASSESSEE HAD SPECIFICALLY VIDE GROUND NO. II ASSAILED THE CAPPING OF ITS EXEMPTION U/S 10AA AT RS. 3,92,84,237/ - AS AGAINST I TS CLAIM OF RS. 7,54,73,966/ - , HOWEVER, THE SAME HAD NOT BEEN ADDRESSED AND TH E REIN ADJUDICATED UPON BY THE FIRST APPELLATE AUTHORITY. IN OUR CONSIDERED VIEW, THE FAILURE OR OMISSION ON THE PART OF THE CIT(A) TO DISPOSE OFF A SPECIFIC GROUND OF APPEAL THAT WAS RAISED BEFORE HIM, AS CLAIMED BY THE ASSESSEE, AND RIGHTLY SO, WOULD CLEARLY FALL WITHIN THE REALM OF A MISTAKE THAT IS GLARING, PATENT, OBVIOUS AND APPARENT FROM RECORD, WHICH THEREIN WOULD RENDER HIS ORDER AMENABLE FOR RECTIFICATION U/S 154 OF THE A CT. WE, THUS, NOT BEING ABLE TO PERSUADE OURSELVES TO SUBSCRIBE TO THE REJECTION OF THE APPLICATION FILED BY THE ASSESSEE U/S 154 OF THE ACT, THUS, SET - ASIDE THE ORDER OF THE CIT(A) . ACCORDINGLY, WE RESTORE THE APPLICATION FILED BY THE ASSESSEE TO THE FILE OF THE CIT(A), WITH A DIRECTION TO DISPOSE OFF THE SAME BY WAY OF A SPEAKING ORDER AS REGARDS THE SPECIFIC GROUND NO. II THAT WAS RAISED BY THE ASSESSEE IN ITS APPEAL BEFORE HIM. NEEDLESS TO SAY, THE CIT(A) IN THE COURSE OF THE SET - ASIDE PROCEEDING SHA LL AFFORD A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 9. RESULTANTLY, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES IN TERMS OF OUR AFORESAID OBSERVATIONS. ORDER PRO NOUNCED IN THE OPEN COURT ON 18 /06/2021 . SD/ - SD/ - (RAJESH KUMAR) (RAVISH SOOD) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; DATED: 18 .06.2021 PS: ROHIT M/S J.V GOKAL & COMPANY PVT. LTD. VS. CIT - 2 ITA NO. 6618/MUM/2019 A.Y 2010 - 11 4 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) - 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE . BY ORDER, //TRUE COPY// (SR. PRIVATE SECRETARY) ITAT, MUMBAI