SUDHIR S MEHTA, MUMBAI V. DEPUTY COMMISSIONER OF INCOME TAX - CENTRAL CIRCLE 4(1), MUMBAI

ITA 7132/MUM/2018

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 8614 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Assessment Year: 2013-2014
• Appeal Filed On: 11-12-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: DR P DANIEL
• Keywords: TDS; Set aside
• Section: 69C; 234B; 14A; 6; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH G, MUMBAI BEFORE SHRI RAJESH KUMAR, ACCOUNTANT MEMBER AND SHRI RAM LAL NEGI, JUDICIAL MEMBER ITA NOS.7132 & 7133/M/2018 ASSESSMENT YEARS: 2013-14 & 2015-16 MR. SUDHIR S. MEHTA, 32, MADHULI, D.A.B. ROAD, WORLI, MUMBAI 400 026 PAN: ABAPM 4496R VS. DCIT CENTRAL CIRCLE-4(1), ROOM NO.1916, 19 TH FLOOR, AIR INDIA BUILDING, NARIMAN POINT, MUMBAI 400021 (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : MS. MITALI GOPANI, A.R. REVENUE BY : DR. P. DANIEL, D.R. DATE OF HEARING : 09.12.2020 DATE OF PRONOUNCEMENT : .08.01.2021 O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESSEE AGAINST THE ORDER DATED 11.10.2018 OF THE COMMISSIONER OF INCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS THE CIT(A)] RELEVANT TO ASSESSMENT YEAR 2013-14 & 2015-16. ITA NO.7132/M/2018 (A.Y. 2013-14) 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER: 1. THE LD. COMMISSIONER OF INCOME-TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS IN CONFIRMING DISALLOWANCE OF INTEREST EXPENDITURE AMOUNTING TO RS.2,16,15,024/-. 2. THE LD. COMMISSIONER OF INCOME-TAX (APPEALS) OUGHT TO HAVE CAPITALIZED THE INTEREST EXPENDITURE TO THE EXTENT DISALLOWED U/S. 14A OF THE ACT. ITA NO.7132 & 7133/M/2018 MR. SUDHIR S. MEHTA 2 3. THE LD. COMMISSIONER OF INCOME-TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS IN CONFIRMING THE ESTIMATED ADDITION ON ACCOUNT OF PERSONAL HOUSEHOLD EXPENSES TO THE TUNE OF RS. 6,00,000/- U/S. 69C OF THE ACT. 4. THE LD. COMMISSIONER OF INCOME-TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS THAT IN CONFIRMING THE LEVY OF INTEREST U/S. 234A, 234B AND 234C OF THE ACT. 5. THE LD. COMMISSIONER OF INCOME-TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS IN NOT APPRECIATING THAT THE INCOME ASSESSED IN THE HANDS OF THE APPELLANT WERE SUBJECTED TO THE PROVISIONS OF TDS AND HENCE ON THE SAID AMOUNT OF TAX, NO INTEREST CAN BE COMPUTED U/S. 234A, 234B AND 234C OF THE ACT. 6. THE APPELLANT CRAVES LEAVE OF YOUR HONOUR TO ADD TO, ALTER, AMEND AND/OR DELETE ALL OR ANY OF THE FOREGOING GROUNDS OF APPEAL. 3. THE ISSUE RAISED IN GROUND NO.1 IS AGAINST THE CONFIRMATION OF DISALLOWANCE OF RS.2,16,15,024/- BY LD. CIT(A) AS MADE BY THE AO ON ACCOUNT OF INTEREST EXPENDITURE. 4. THE LD. COUNSEL OF THE ASSESSEE AT THE OUTSET SUBMITTED THAT THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF CO-ORDINATE BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO.7147/M/2018 DATED 13.11.2020 AND THEREFORE THE GROUND MAY KINDLY BE DECIDED IN FAVOUR OF THE ASSESSEE. THE LD. D.R. FAIRLY CONCEDED TO THE FACT THAT THE ISSUE IS SQUARELY COVERED BY THE DECISION OF THE CO-ORDINATE BENCH OF THE TRIBUNAL HOWEVER RELIED ON THE GROUND RAISED BY THE REVENUE. 5. WE HAVE PERUSED THE DECISION OF THE CO-ORDINATE BENCH OF THE TRIBUNAL IN ITA NO.7147/M/2018 A.Y. 2013-14 AND FIND THAT THE ISSUE IS COVERED UNDER IDENTICAL FACTS BY THE DECISION OF THE CO-ORDINATE BENCH OF THE TRIBUNAL WHICH HAS BEEN PASSED BY FOLLOWING THE DECISION FOR THE EARLIER ASSESSMENT YEAR. ACCORDINGLY, WE ARE INCLINED TO ACCEPT THE SUBMISSIONS OF THE LD. A.R. AND CONSEQUENTLY GROUND NO.1 IS ALLOWED. ITA NO.7132 & 7133/M/2018 MR. SUDHIR S. MEHTA 3 6. THE ISSUE RAISED IN GROUND NO.2 IS AGAINST THE ORDER OF LD. CIT(A) ON THE GROUND THAT LD. CIT(A) OUGHT TO HAVE CAPITALIZED THE INTEREST EXPENDITURE TO THE EXTENT DISALLOWED UNDER SECTION 14A OF THE ACT. 7. THE LD. A.R. SUBMITTED THAT THIS GROUND IS ALSO COVERED IN FAVOUR OF THE ASSESSEE BY THE ABOVE DECISION OF THE CO-ORDINATE BENCH OF THE TRIBUNAL VIDE PARA NO.10 TO 12 WHEREIN IDENTICAL ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE. THE LD. D.R. FAIRLY CONCEDED, HOWEVER, RELIED ON THE GROUNDS RAISED IN THE APPEAL. 8. WE FIND THAT THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE SAID DECISION OF THE TRIBUNAL IN ITA NO.7147/M/2018 (SUPRA) VIDE PARA NO.10 TO 12. WE, THEREFORE, RESPECTFULLY FOLLOWING THE SAME, ALLOW THE GROUND RAISED BY THE ASSESSEE. THE GROUND NO 2 IS ALLOWED. 9. THE ISSUE RAISED IN GROUND NO.3 IS AGAINST THE ORDER OF LD. CIT(A) CONFIRMING ESTIMATED ADDITION OF RS.6 LAKHS AS MADE BY THE AO TOWARDS PERSONAL HOUSEHOLD EXPENSES UNDER SECTION 69C. 10. AFTER HEARING BOTH THE PARTIES AND PERUSING THE ORDER OF THE COORDINATE BENCH IN ITA NO.7147/M/2018 (SUPRA), WE FIND THAT THE CO-ORDINATE BENCH OF THE TRIBUNAL HAS DECIDED THE ISSUE UNDER IDENTICAL FACTS IN FAVOUR OF THE ASSESSEE VIDE PARA N.14 TO 17. WE, THEREFORE, RESPECTFULLY FOLLOWING THE SAME ALLOW THE ITA NO.7132 & 7133/M/2018 MR. SUDHIR S. MEHTA 4 GROUND RAISED BY THE ASSESSEE BY SETTING ASIDE THE ORDER OF LD. CIT(A). ACCORDINGLY GROUND NO. 3 IS ALLOWED. 11. THE ISSUE RAISED IN GROUND NO.4 IS AGAINST THE ORDER OF LD. CIT(A) CONFIRMING THE LEVY OF INTEREST UNDER SECTION 234A, 234B & 234C AS MADE BY THE AO. 12. AFTER PERUSING THE FACTS ON RECORD AND THE IMPUGNED ORDER, WE FIND THAT THE ISSUE IS DECIDED AGAINST THE ASSESSEE BY FOLLOWING THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF ANJUM H. GHASWALLA (252 ITR 1) SC WHEREIN IT HAS BEEN HELD THAT CHARGING OF INTEREST ON THE ABOVE THREE SECTIONS IS MANDATORY. WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LD. CIT(A) AND ACCORDINGLY GROUND NO.4 IS DISMISSED. 13. THE ISSUE RAISED IN GROUND NO.5 IS AGAINST THE ORDER OF LD. CIT(A) WHO HAS FAILED TO APPRECIATE THAT INCOME EARNED IN THE HANDS OF ASSESSEE WAS SUBJECTED TO TDS AND HENCE NO INTEREST SHOULD BE CHARGED UNDER SECTION 234A, 234B & 234C OF THE ACT. 14. THE LD. A.R. SUBMITTED THAT THIS ISSUE IS ALSO COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE COORDINATE BENCH IN ASSESSEE OWN CASE IN ITA NO. 7147/MUM/2018 AY 2014-15 VIDE PARA NO.18 AND THEREFORE THE GROUND MAY KINDLY BE ALLOWED. LD DR RELIED ON THE ORDER OF CIT(A). 15. WE HAVE PERUSED THE ORDER OF THE CO-ORDINATE BENCH OF THE TRIBUNAL. WE FIND THAT THE ISSUE HAS BEEN SET ASIDE TO THE FILE OF THE AO TO VERIFY THAT WHERE THE INCOME IS SUBJECTED TO PROVISIONS OF TDS, NO INTEREST CAN BE CHARGED UNDER SECTION 234A, 234B & 234C OF THE ACT. IN THE CURRENT YEAR ALSO WE ARE SENDING THE ITA NO.7132 & 7133/M/2018 MR. SUDHIR S. MEHTA 5 ISSUE BACK TO THE FILE OF THE AO WITH A DIRECTION NOT TO CHARGE ANY INTEREST UNDER SECTION 234A, 234B & 234C OF THE ACT IN CASE OF INCOME EARNED IS SUBJECTED TO TDS. GROUND NO.5 IS ALLOWED FOR STATISTICAL PURPOSES. 16. THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ITA NO.7133/M/2018 (2015-16) 17. THE GROUNDS RAISED IN THE CURRENT YEAR ARE IDENTICAL TO ONE AS DECIDED BY US IN ITA NO.7132/M/2018. SINCE THE FACTS AND ISSUES INVOLVED ARE IDENTICAL IN NATURE, OUR FINDINGS IN ITA NO.7132/M/2018 ON ALL THE GROUNDS WOULD, MUTATIS MUTANDIS, APPLY TO THE GROUNDS RAISED BY THE ASSESSEE IN ITA NO.7133/M/2018 ALSO. ACCORDINGLY, GROUND NOS.1, 2, 3 ARE ALLOWED, GROUND NO.4 IS DISMISSED AND GROUND NO.5 IS STATISTICALLY ALLOWED. 18. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 08.01.2021. SD/- SD/- ( RAM LAL NEGI) (RAJESH KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 08.01.2021. * KISHORE, SR. P.S. ITA NO.7132 & 7133/M/2018 MR. SUDHIR S. MEHTA 6 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.