ITO WD 5(2)(3), MUMBAI V. LEADING BRANDS OF THE WORLD P.LTD, MUMBAI

ITA 7081/MUM/2012

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9342 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-03-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 26-02-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 26-11-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASGHAR ZAIN
• Assessee Lawyers: NISHANT RUPAREL
• Keywords: Business income
• Section: 133(6); 144

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES A , MUMBAI , , , BEFORE SHRI SANJAY ARORA , A M AND SHRI AMIT SHUKLA , J M ITA NO. 7081 /MUM/20 1 2 : ASST.YEAR 200 8 - 200 9 THE INCOME TAX OFFICER WARD 5(2)(3) MUMBAI. / VS. M/S. LEADING BRANDS OF THE WORLD PRIVATE LIMITED C/O.ANIL A.MASAND & CO., CAS 3, SHEWA APARTMENT, 33 - B, 3 RD FLOOR KHAR, MUMBAI 400 052. PAN : AABCL1832F. ( / APPELLANT) ( / RESPONDENT) /APPELLANT BY : SHRI ASGHAR ZAIN /RESPONDENT BY : SHRI NISHANT RUPAREL / DATE OF HEARING : 26 .02.2015 / DATE OF PRONOUNCEMENT : 13 .03 .2015. / O R D E R PER AMIT SHUKLA (JM) : THIS APPEAL HAS BEEN PREFERRED BY THE DEPARTMENT AGAINST THE ORDER DATED 21.09.2012 , PASSED BY THE COMMI SSIONER OF INCOME - TAX (APPEALS) - 9 , MUMBAI, [ ` CIT(A) FOR SHORT ] FOR THE QUANTUM OF ASSESSMENT PASSED U/S 14 4 , FOR THE ASSESSMENT YEAR 2008 - 200 9, ON THE FOLLOWING GROUND OF APPEAL: - 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) HAS ERRED IN GRANTING RELIEF OF RS.82,43,737/ - OUT OF RS.86,93,177/ - ADDED BY THE ASSESSING OFFICER WITHOUT REMANDING BACK THE ISSUE TO THE ASSESSING OFFICER? ITA NO. 7081 /MUM/201 2 M/S. LEADING BRANDS OF THE WORLD PVT.LTD. 2 2. BRIEF FACTS OF THE CASE ARE THAT, THE ASSESSEE - COMPANY IS ENGAGED IN THE BUSINESS OF BRAND DEVELOPMENT. VARIOUS NOTICES WERE SENT TO THE ASSESSEE ON THE ADDRESS MENTIONED IN THE RETURN OF INCOME, HOWEVER, ALL THE NOTICES WERE RETURNED BACK UNSERVED. FINALLY, THE ASSESSING OFFICER (AO) COMPLETED THE ASSESSMENT U/S 144. FROM THE AIR INFORMAT ION, THE AO GATHERED THE ADDRESS OF THE ASSESSEE S CLIENTS, TO WHOM ASSESSEE HAD RENDERED ITS SERVICES. NOTICES U/S 133(6) WERE SENT TO THESE PARTIES AND INFORMATION WAS SOUGHT FOR THE TRANSACTION DETAILS. AFTER RECEIVING THE INFORMATION, THE AO OBSERVED T HAT THE ASSESSEE HAD SHOWN RECEIPTS FROM ITS BUSINESS AT RS.76,20,408 AND OTHER INCOME OF RS.23,23,889. AGAINST THIS INCOME, THE ASSESSEE HAD CLAIMED VARIOUS EXPENSES AND DECLARED INCOME OF RS.3,87,925. HE FURTHER OBSERVED THAT OUT OF VARIOUS NOTICES SENT TO THE PARTIES, MOST OF THEM HAVE CONFIRMED THEIR TRANSACTION WITH THE ASSESSEE, EXCEPT FOR M/S. VOX PUBLIC RELATIONS PRIVATE LIMITED (`VOX FOR SHORT ), IN WHOSE CASE THE NOTICE RETURNED BACK AS UNSERVED. SINCE IT WAS NOT ASCERTAINABLE WHETHER THIS INCOME W AS INCLUDED IN THE ASSESSEE S GROSS RECEIPT OR NOT, THE RECEIPT SHOWN FR OM THIS PARTY AGGREGATING TO RS.86,93,177 WAS ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 3. BEFORE THE LEARNED CIT(A), THE ASSESSEE SUBMITTED THAT , ONLY AN AMOUNT OF RS.2,24,720 WAS RECEIVED FROM VOX, WHICH WAS ON ACCOUNT OF PROMOTION OF BRAND EVENT FOR BMW. VOX HAD PAID RS.2,24,720 AND HAS DEDUCTED TAX TO THE EXTENT OF RS.25,461. THIS IS FULLY CORROBORATED FROM THE REPORT IN FORM 26AS . HAD THERE BEE N A TRANSACTION OF RS.86,93,177, THEN THE SAME WOULD HAVE BEEN DULY REFLECTED. THE LEARNED CIT(A) NOTED DOWN THE RELEVANT REPORT IN FORM 26AS, WHICH WAS AS UNDER: - ITA NO. 7081 /MUM/201 2 M/S. LEADING BRANDS OF THE WORLD PVT.LTD. 3 SR. NO . NAME OF THE DEDUCTOR TAN OF THE DEDUCTOR SECTION UNDER WHICH DEDUCTIO N MADE DATE O F PAYMEN T / CREDIT AMOUNT PAID / CREDITE D TAX DEDUCTED (TDS + SURCHARG E + EDUCATION CESS) TDS DEPOSITE D STATUS OF BOOKIN G (P/F/U) @ DATE OF BOOKIN G 1 VOX PUBLIC RELATION S INDIA PVT LTD. DELVO7013 G 194J 30.08. 2007 224720 23146 23146 F 19 - 10 - 2007 2 VOX PUBLIC RELATION S INDIA PVT LTD. DELVO7013 G 194J 13.09. 2007 224720 2315 2315 F 01 - 11 - 2007 BASED ON THIS INFORMATION , HE REDUCED THE SAID ADDITION TO RS.4,49,540 AFTER OBSERVING AND HOLDING AS UNDER: - 5.4.2. UNDER THE CIRCUMSTANCES, THE MAXIMUM DISALLOWANCE THAT COULD HAVE BEEN MADE BY THE LAO AMOUNT TO RS.4,49,540/ - . SECONDLY, THE GROSS RECEIPTS AS PER THE AIR FIGURE IS RECORDED AT RS.86,93,177/ - AND THE GROSS RECEIPTS AS PER FORM NO.26AS HAS BEEN RECORDED AT RS.90,30,257/ - . ON THE OTHER HAND TH E APPELLANT HAS DISCLOSED GROSS RECEIPTS OF RS.76,20,408/ - UNDER THE HEAD BUSINESS INCOME AND OTHER INCOME OF RS.23,23,889/ - . THE LAO IS DIRECTED TO VERIFY THE EXACT AMOUNT OF RECEIPTS RECEIVED FROM M/S.VOX PUBLIC RELATIONS INDIA PVT. LTD. AND RESTRICT THE ADDITION TO THAT EXTENT ONLY BECAUSE THE LAO HAS HIMSELF STATED THAT ALL PARTIES HAVE CONFIRMED THE TRANSACTIONS WITH THE APPELLANT EXCEPT M/S.VOX PUBLIC RELATIONS INDIA PVT. LTD. IN VIEW OF THE ABOVE, THE ADDITION OF RS.86,93,177/ - IS REDUCED TO RS.4,49, 540/ - . 4. AFTER HEARING BOTH THE PARTIES, IT IS NOTICED THAT THE AO HAS TAKEN THE GROSS RECEIPT FROM VOX AT RS.86,93,177 , WITHOUT POINTING OUT ANY MATERIAL AS TO HOW SUCH A RECEIPT HAS BEEN EARNED BY THE ASSESSEE FROM M/S. VOX. THE CIT(A) HAS EXAMINED THE FORM 26AS, WHEREIN IT HAS BEEN CLEARLY MENTIONED THAT ONLY TWO PAYMENTS WERE RECEIVED AND TDS WAS DEDUCTED ON SUCH ITA NO. 7081 /MUM/201 2 M/S. LEADING BRANDS OF THE WORLD PVT.LTD. 4 PAYMENTS . THUS, THERE IS NO BASIS FOR THE AO FOR ESTIMATING SUCH A HUGE INCOME. THE LEARNED CIT(A) HAS ALREADY NOTED THE FIGURE OF GROSS RECEIPT MENTIONED IN THE AIR AND AS RECORDED IN FORM NO.26AS AND HAS ALREADY ADDED THE DIFFERENCE TO THE INCOME OF THE ASSESSEE. THUS, OVER AND ABOVE SUCH AN ADDITION, THERE IS NO MATERIAL FOR MAKING FURTHER ADDITION. ACCORDINGLY, THE FINDING OF THE CIT(A) IS AFFIRMED AND THE GROUND RAISED BY THE REVENUE IS DISMISSED. 5 . IN THE RESULT, THE REVENUE S APPEAL IS DISMISSED. ORDER PRONOUNCED ON THIS 13 TH DAY OF MARCH , 2015 . SD/ - SD/ - ( SANJAY ARORA ) ( AMIT SHUKLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; DATED : 13 TH MARCH , 2015 . DEVDAS* / COPY OF THE ORDER FORWARDED TO : / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT , MUMBAI. 4. / CIT(A) - 9 , MUMBAI 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE.