ACIT CC 22, MUMBAI V. RANI MUKHERJI, MUMBAI

ITA 6972/MUM/2011

• Counselvise Citation: 697219914 RSA 2011
• Duration Of Justice: 2 year(s) 9 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-07-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 19-05-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 14-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIKRAM BATRA
• Assessee Lawyers: B V JHAVERI
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH D, MUMBAI BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND DR. S.T.M. PAVALAN, JUDICIAL MEMBER ITA NO. 6972/MUM/2011 ASSESSMENT YEAR: 2008-09 ACIT CC-22 403, 4 TH FLOOR AAYKAR BHAVAN M.K. ROAD MUMBAI -400 020 VS. MS.RANI MUKHERJI, 701, VIDYA APTS. 7 TH FLOOR, JANAKI KUTIR, CHURCH ROAD, JUHU MUMBAI- 400 049 (APPELLANT) (RESPONDENT) PERMANENT ACCOUN T NO. : - AA LPM 8973 B ITA NO. 6971/MUM/2011 ASSESSMENT YEAR: 2008-09 ACIT CC-22 403, 4 TH FLOOR AAYKAR BHAVAN M.K. ROAD MUMBAI -400 020 VS. SHRI RAJA MUKHERJI, E-702/703, CRYSTAL PLAZA, NEW LINK ROAD ANDHERI (W) MUMBAI 400 053 (APPELLANT) (RESPONDENT) PERMANENT ACCOUNT NO. :- AALPM 0043J ASSESSEE BY : SHRI B.V. JHAVERI REVENUE BY : SHRI VIKRAM BATRA DATE OF HEARING : 19.05.2014 DATE OF PRONOUNCEMENT : 16.07.2014 O R D E R PER DR. S.T.M. PAVALAN, JM: THESE APPEALS FILED BY THE REVENUE ARE DIRECTED AG AINST TWO SEPARATE ORDERS OF THE LD.CIT(A)-39, MUMBAI, BOTH DATED 14.07.2011 IN RESPECT OF THE ABOVE NAMED ASSESSEES MENTIONED IN THE SHORT CAUSE TITLE PERTAI NING TO THE ASSESSMENT YEAR 2008-09. SINCE COMMON ISSUE IS INVOLVED IN BOTH THE APPEALS, THE SAME ARE HEARD TOGETHER AND DISPOSED OFF BY THIS COMMON ORDER. ITA NO. 6972/MUM/2011 ITA NO. 6971/MUM/2011 MS.RANI MUKHERJI & SHRI RAJA MUKHERJI, ASSESSMENT YEAR: 2008-09 2 2. THE ONLY ISSUE INVOLVED IN BOTH THE APPEALS RELA TES TO THE ALLOWABILITY OF THE LOSS OF RS.2,34,30,938/- IS TO BE IN THE HANDS OF E ITHER MS. RANI MUKHERJI OR MR. RAJA MUKHERJI. THE RELEVANT FACTS ARE THAT DURING THE AS SESSMENT PROCEEDINGS, THE AO FOUND THAT M/S. J.R. ENTERPRISES, A PROPRIETARY CON CERN OF SHRI RAJA MUKHERJI HAD UNSECURED LOAN OF RS.2.30 CRORES ON 31.03.2006 AND RS.4.37 CRORES AS ON 31.03.2007 FROM MS. RANI MUKHERJI ON THE LIABILITY SIDE UNDER THE HEAD FILM AND SERIAL PRODUCTION. ACCORDING TO THE AO, MR.RAJA MUK HERJI HAD BEEN PRODUCING A BENGALI FILM BIDDHARTARE LEKHA, WHEREBY, DURING T HE YEAR UNDER CONSIDERATION HE INCURRED LOSS ON THE FILM AND SHRI RAJA MUKHERJI IN STEAD OF CLAIMING THE LOSS, TRANSFERRED THE SAME TO THE ACCOUNT OF MS. RANI MUK HERJI AND REDUCED THE UNSECURED LOAN FROM RS.4.37 CRORES BUT RS.2.07 CROR ES. THE SAID LOSS WAS CLAIMED BY MS. RANI MUKHERJI IN THE TAX ASSESSMENT. HOWEVER, T HE AO HELD THAT THE LOSS SHOULD BE ALLOWED ONLY IN THE HANDS OF SHRI RAJA MUKHERJI AND NOT IN THE HANDS OF MS. RANI MUKHERJI. ACCORDINGLY THE AO DISALLOWED THE LOSS CL AIMED IN THE HAND OF MS. RANI MUKHERJI AND ALLOWED THE SAME IN THE HAND OF MR.RAJ A MUKHERJI. ON APPEAL, THE LD.CIT(A) HELD THAT THE DOCUMENTS FILED BY MS. RANI MUKHERJI CLEARLY ESTABLISHED THE FACT THAT MS.RANI MUKHERJI WAS THE PRODUCER OF THE FILM AND SHE HAD TO BEAR THE LOSSES INCURRED. ACCORDINGLY, THE LD.CIT(A) DIRECTE D THE AO TO ALLOW THE LOSS OF RS.2,34,30,938/- IN THE HANDS OF MS. RANI MUKHERJI AND WITHDRAW THE IMPUGNED LOSS ALLOWED IN THE HANDS OF MR.RAJA MUKHERJI. AGGRIEVED BY THE IMPUGNED DECISION, THE REVENUE HAS PREFERRED THESE APPEALS BEFORE US. 3. HAVING HEARD BOTH THE SIDES AND PERUSED THE MATE RIAL ON RECORD, IT IS NOT DISPUTED THAT THERE IS A LOSS OF RS.2,34,30,938/- I NCURRED IN PRODUCING THE BENGALI FILM BIDDHARTARE LEKHA DURING THE YEAR UNDER CONS IDERATION. THE ONLY DISPUTE IS IN WHOSE HAND THE SAID LOSS IS TO BE ALLOWED. IN THIS CONNECTION, IT IS PERTINENT TO MENTION THAT THE PERUSAL OF AGREEMENT BETWEEN MS. R ANI MUKHERJI AND M/S. J.R. ENTERPRISES CLEARLY EVIDENCES THAT MS. RANI MUKHERJ I IS THE PRODUCER OF THE FILM AND HER BROTHER MR.RAJA MUKHERJI IS THE EXECUTIVE PRODU CER WHO HAS TAKEN UP ALL THE RESPONSIBILITY OF PRODUCING FILM FOR AN ON BEHALF O F MS. RANI MUKHERJI. FURTHER, FROM THE COPIES OF THE ACCOUNTS OF M/S. J.R. ENTERTAINER S IN THE BOOKS OF MS. RANI MUKHERJI AND RANI MUKHERJIS ACCOUNT IN THE BOOKS O F M/S. J.R. ENTERTAINERS FOR THE YEAR UNDER CONSIDERATION CLEARLY PROVES THAT THE MS . RANI MUKHERJI HAS GIVEN FUNDS ITA NO. 6972/MUM/2011 ITA NO. 6971/MUM/2011 MS.RANI MUKHERJI & SHRI RAJA MUKHERJI, ASSESSMENT YEAR: 2008-09 3 TO HER BROTHER RAJA MUKHERJI FOR PRODUCING FILM FOR AND ON HER BEHALF FURTHER MS. RANI MUKHERJI AS THE PRODUCER OF THE FILM AND HAS F ILED THE STATEMENT U/S 285B OF THE ACT BEFORE THE DCIT CENTRE CIRCLE-22 MUMBAI ON 30.04.2007 GIVING COMPLETE DETAILS OF THE EXPENSES INCURRED OR TO BE INCURRED BY HER FOR PRODUCTION TO BENGALI FILM IN EXCESS OF RS.50,000/-. MS. RANI MUKHERJI IN HER BALANCE SHEET FILED WITH THE RETURN OF INCOME FOR THE ASSESSMENT YEARS 2006-07 A ND 2007-08 HAS DECLARED HER INVESTMENT IN FILM PRODUCTION AND THE SAID FACT HAS BEEN ACCEPTED IN HER ASSESSMENT ORDERS PASSED U/S 143(3) OF THE ACT. MR. RAJA MUKHE RJI HAS ALSO SHOWN IN HIS BALANCE SHEET AND PROFIT AND LOSS ACCOUNT THAT HE HAS BEEN PRODUCING THE FILM ON BEHALF OF MS. RANI MUKHERJI AND THE SAID FACT HAS BEEN ACCEPT ED BY COMPLETING THE ASSESSMENT ORDERS U/S 143(3) FOR THE ASSESSMENT YEA RS 2006-07 AND 2007-08. CONSIDERING THE ENTIRETY OF THE FACTS, THE LD.CIT(A ) HAS RIGHTLY HELD THAT MS. RANI MUKHERJI AS THE PRODUCER OF THE FILM AND HAS TO BEA R THE LOSSES INCURRED. THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE DECISION OF THE LD.CIT(A) DIRECTING THE AO TO ALLOW THE IMPUGNED LOSS IN THE HANDS OF MS. RANI MUKHERJI AND WITHDRAW THE SAID LOSS IN THE HANDS OF SHRI RAJA MUKHERJI. 4. IN THE RESULT, BOTH THE APPEALS FILED BY THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 16 TH DAY OF JULY, 2014. [ SD/- SD/- (P.M. JAGTAP) (DR. S.T.M. PAVALAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 16.07.2014 *SRIVASTAVA COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR D BENCH //TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.