HARSH ESTATE PVT. LTD., MUMBAI V. A.C.I.T. C.C. 31, MUMBAI

ITA 7292/MUM/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 75779 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-02-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: H
• Assessment Year: 2003-2004
• Appeal Filed On: 07-12-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: DR P DANIEL
• Assessee Lawyers: DHERMESH SHAH
• Keywords: Opportunity of being heard
• Section: 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI . . , . . , BEFORE SHRI B R MITTAL, JM & SHRI B R BASKARAN , AM ./I.T.A. NOS.7291 & 7292/MUM/2012 ( # # # # # ## # / ASSESSMENT YEARS: 2001-02 & 2003-04) HARSH ESTATE P LTD 32 MADHULI - 3 RD FLOOR A B ROAD, WORLI MUMBAI 18 / VS. THE ASST COMMR OF INCOME TAX CEN CIR 31, MUMBAI ./PAN AAACH3480L ( & /APPELLANT ) ( '(& / RESPONDENT ) & ) / APPELLANT BY : SHRI DHERMESH SHAH '(& ) / RESPONDENT BY : DR P DANIEL, DR ) , /DATE OF HEARING : 25.02.2014 ) , / DATE OF PRONOUNCEMENT :26 TH FEB 2014 / O R D E R PER B R BASKARAN, AM : BOTH THE APPEALS FILED BY THE ASSESSEE ARE DIRECTE D AGAINST THE SEPARATE ORDERS PASSED BY LD CIT(A)-37, MUMBAI AND THEY RELATED TO THE ASSESSMENT YEARS 2001-02 AND 2003-04. SINCE THE ISSUES URGED IN BOTH THE AP PEALS ARE IDENTICAL IN NATURE, BOTH WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY TH IS COMMON ORDER, FOR THE SAKE OF CONVENIENCE. HARSH ESTATE P LTD 2 2. AT THE TIME OF HEARING, THE LD COUNSEL FOR THE A SSESSEE SUBMITTED THAT HE IS NOT PRESSING THE GROUNDS NUMBERED AS 1 & 2 IN BOTH THE YEARS AND IN THIS REGARD, HE MADE NECESSARY ENDORSEMENT IN THE FILE BY AFFIXING HIS SIGNATURE. ACCORDINGLY, WE DISMISS THOSE GROUNDS IN BOTH THE YEARS AS NOT PRES SED. 3. IN BOTH THE YEARS, THE ASSESSEE HAS RAISED AN AD DITIONAL GROUND, WHICH READS AS UNDER:- THE LD CIT(A) OUGHT TO HAVE APPRECIATED THAT AS PER THE DECISION OF HONBLE SPECIAL COURT DATED 30.04.2010 IN MP NO.41 OF 1999, THE ASSETS UNDER CONSIDERATION AND THE CONSEQUENTIAL INCOME BELONGS TO SHRI HARSHAD S MEHTA AND HENCE THE INCOME ASSESSED BY THE ASSESSING OFFI CER OUGHT TO HAVE BEEN TAXED IN THE HANDS OF SHRI HARSHAD S MEHTA AND NOT IN THE HANDS OF APPELLANT. 4. BOTH THE PARTIES SUBMITTED THAT AN IDENTICAL GROUND WAS URGED BEFORE THE CO- ORDINATE BENCH OF TRIBUNAL IN ONE OF THE GROUP CASE S NAMED SHRI HITESH S MEHTA IN ITA NOS. 5587 TO 5589/MUM/2011 AND THE TRIBUNAL HAS DISMISSED THE SAME BY HOLDING THAT THIS GROUND IS ACADEMIC IN NATURE. TH E LD A.R FURNISHED A COPY OF ORDER DATED 12.06.2013 PASSED BY THE CO-ORDINATE BENCH OF TRIBUNAL IN THE HANDS OF SHRI HITESH S MEHTA (REFERRED SUPRA). WE HAVE GONE THRO UGH THE ORDER AND, FOR THE SAKE OF CONVENIENCE, EXTRACT BELOW THE RELEVANT OBSERVAT IONS MADE BY THE TRIBUNAL:- 5. HOWEVER, AFTER GOING THROUGH THE ADDITIONAL G ROUND RAISED BY THE ASSESSEE FOR ALL THE ASSESSMENT YEARS INVOLVED HERE BEFORE US, WE FOUND THAT THE GROUND IS FULLY ACADEMIC IN NATURE FOR THE REAS ON THAT IF THE HONBLE SUPREME COURT DECIDES SOMETHING, THAT HAS TO BE FOL LOWED WITHOUT ANY DISPUTE. THE DECISION OF THE HONBLE APEX COURT IS LAW OF LAND, WHICH TO BE FOLLOWED BY EVERY AUTHORITY. THEREFORE, IN OUR VIE W, NO DIRECTION IS TO BE REQUIRED TO BE GIVEN TO THE AO IN THIS RESPECT BECA USE IF THE HONBLE APEX COURT DECIDES THAT ALL THE INCOME BELONGS TO SHRI H ARSHAD S MEHTA, THEN THE INCOME HAS TO BE ASSESSED IN THE HANDS OF SHRI HARS HAD S MEHTA, NOT IN THE HARSH ESTATE P LTD 3 HANDS OF ANY OTHER PERSON. THEREFORE, IN OUR VIEW, THERE IS NO NEED TO ISSUE ANY DIRECTION AS THE DECISION OF THE HONBLE SUPREM E COURT HAS TO BE FOLLOWED IN ANY CASE. ACCORDINGLY, BY ADMITTING THE GROUNDS RAISED BY THE ASSESSEE FOR ALL THESE YEARS, WE TREAT THE SAME AS ACADEMIC IN N ATURE. CONSISTENT WITH THE VIEW TAKEN BY THE CO-ORDINATE B ENCH, WE ALSO ADMIT THE ADDITIONAL GROUND RAISED IN BOTH THE YEARS AND DISMISS THE SAM E BY TREATING THEM AS ACADEMIC IN NATURE. 5. THE NEXT ISSUE RELATES TO THE DISALLOWANCE OF INTEREST EXPENSES IN BOTH THE YEARS. BOTH THE PARTIES ADMITTED THAT THIS ISSUE IS COVERE D BY THE DECISION DATED 26.04.2013 RENDERED BY THE CO-ORDINATE BENCH OF THE TRIBUNAL I N THE CASE OF HITESH S MEHTA IN ITA NO. 7726 & 7727/M/2010. WE NOTICE THAT THE CO- ORDINATE BENCH OF TRIBUNAL IN THE ABOVE CITED CASE HAS SET ASIDE THE MATTER TO TH E FILE OF LD CIT(A), SINCE THE ISSUE RELATING TO THE REJECTION/RELIABILITY OF BOOKS OF A CCOUNTS WAS ALSO SET ASIDE TO THE FILE OF THE LD CIT(A). BOTH THE PARTIES BEFORE US SUBMITTE D THAT THEY WILL NOT HAVE ANY GRIEVANCE, IF THIS MATTER IS ALSO SET ASIDE TO THE FILE OF LD CIT(A) FOR FRESH CONSIDERATION. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) ON THIS ISSUE AND RESTORE THE SAME TO HIS FILE FOR FRESH CONSIDERATIO N IN ACCORDANCE WITH LAW AFTER AFFORDING NECESSARY OPPORTUNITY OF BEING HEARD TO T HE ASSESSEE. 6. THE NEXT ISSUE RELATES TO THE LEVY OF INTERE ST U/S 234A AND 234B OF THE ACT. THE LD A.R, BY PLACING RELIANCE ON THE DECISION DATED 2 6.4.2013 PASSED BY THE CO-ORDINATE BENCH OF TRIBUNAL IN THE CASE OF HITESH S MEHTA IN ITA NO.7498 & 7732/M/2010, SUBMITTED THAT ISSUE OF LEVY OF INTEREST U/S 234A A ND 234B IS PREMATURE IN NATURE, SINCE CERTAIN ISSUES ARE SET ASIDE TO THE FILE OF L D CIT(A) FOR FRESH ADJUDICATION. HE HARSH ESTATE P LTD 4 FURTHER SUBMITTED THAT THE AO HAS COMMITTED MISTAKE S IN COMPUTING INTEREST U/S 234B OF THE ACT. 7. ON THE CONTRARY, THE LD D.R SUBMITTED THAT T HE CO-ORDINATE BENCH OF TRIBUNAL HAS HELD IN THE CASE OF M/S ZEST HOLDINGS PVT LTD ( ITA NO.8202/MUM/2010) THAT THE LEVY OF INTEREST U/S 234A, 234B AND 234C IS MANDATO RY. 8. WE HAVE HEARD RIVAL CONTENTIONS ON THIS ISSUE. THE IMPUGNED ISSUE HAS SINCE BEEN SETTLED BY HONBLE SUPREME COURT IN THE CASE O F KARANVIR SINGH GOSSAL VS. CIT (25 TAXMANN.COM 213 (SC), WHEREIN THE HONBLE APEX COURT HAS HELD THAT LEVY OF INTEREST U/S 234A/234B IS MANDATORY. HENCE, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF LD CIT(A) ON THIS ISSUE. WITH RE GARD TO THE SUBMISSION OF LD A.R THAT THERE ARE MISTAKES IN THE CALCULATION OF INTER EST U/S 234B, IN OUR VIEW, WE NEED NOT GIVE ANY DIRECTION IN THAT REGARD, SINCE THE AS SESSEE COULD GET IT RECTIFIED BY FILING NECESSARY APPLICATION BEFORE THE AO. 9. IN THE RESULT, THE APPEALS OF THE ASSESSES A RE PARTLY ALLOWED FOR STATISTICAL PURPOSES. 0 #0 ) 2) 45 ) ORDER PRONOUNCED IN THE OPEN COURT ON 26 TH FEB 2014 . ) 26TH FEB 2014 ) SD/- SD/- ( B R MITTAL ) ( B R BASKARAN ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; ; DATED 26 TH , FEB 2014 .../ RAJ , SR. PS HARSH ESTATE P LTD 5 ) '> ?> ) '> ?> ) '> ?> ) '> ?>/ 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// / // / ( DY./ASSTT. REGISTRAR) , , , , / ITAT, MUMBAI