EAST & WEST CLOTHING P. LTD, MUMBAI V. ITO WD 8(1)(3), MUMBAI

ITA 7298/MUM/2008

• Counselvise Citation: 729819914 RSA 2008
• Duration Of Justice: 2 year(s) 10 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-11-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: I
• Next Hearing Date: 01-11-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 26-12-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: C G K NAIR
• Assessee Lawyers: R C JAIN
• Keywords: Business income; Notional interest

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH I MUMBAI BEFORE SHRI B.R. MITTAL (JUDICIAL MEMBER) AND SHRI P.M. JAGTAP (ACCOUNTANT MEMBER) ITA NO.7298/MUM/2008 ASSESSMENT YEAR- 2005-06 M/S. EAST & WEST CLOTHING PVT. LTD., C/O MACLEODS PHARMACEUTICALS LTD., ATLANTA ARCADE, MAROL CHURCH ROAD, ANDHERI (E), MUMBAI-400 064 PAN AAACE 7810R VS. THE ITO, WARD 8(1)(3), AAYAKAR BHAVAN, MUMBAI-400 020 (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI R.C. JAIN RESPONDENT BY: SHRI C.G.K. NAIR DATE OF HEARING :01.11.2011 DATE OF PRONOUNCEMENT:09.11.2011 O R D E R PER B.R. MITTAL, JM : THE ASSESSEE HAS FILED THIS APPEAL FOR ASSESSMENT Y EAR 2005-06 AGAINST ORDER OF LD. CIT(A) DT.27.10.2008. 2. GROUND NO. 1 OF THE APPEAL READS AS UNDER: THE LD. CIT(A) IN CONFIRMING THE DISALLOWANCE OF E XPENSES AGAINST BUSINESS INCOME ERRED IN NOT CONSIDERING TH E SUBMISSIONS MADE BEFORE HIM THAT 90% OF DISALLOWANC E WAS EXCESSIVE & UNREASONABLE AND THAT IN ANY EVENT THE EXPENDITURE INCURRED ON MAINTAINING CORPORATE STRUCTURE OUGHT T O HAVE BEEN ALLOWED AS DEDUCTION. 3. AT THE TIME OF HEARING, LD. AR SUBMITTED THAT TH E ABOVE GROUND IS NOT PRESSED THEREFORE IT IS DISMISSED AS NOT PRESSED. ITA NO. 7298/M/08 2 4. IN GROUND NO. 2, ASSESSEE HAS DISPUTED THE ORDER OF LD. CIT(A) IN CONFIRMING THE ADDITION OF ANNUAL LETTING VALUE OF THE PROPERTY IN RESPECT OF NOTIONAL INTEREST/USUFRUCTS OF THE PROPERTY IN THE COMPUTATION OF INCOME UNDER THE HEAD INCOME PROPERTY. 5. AT THE TIME OF HEARING, LD. AR SUBMITTED THAT SI MILAR ISSUE ON IDENTICAL FACTS HAD BEEN CONSIDERED BY ITAT IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2006-07 AND 2007-08 IN ITA NOS. 3296 & 3297/MU M/2010 BY ORDER DT. 29.6.2011 AND BY FOLLOWING THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS MONI KUMAR SUBBA AND OTHERS 333 ITR 38 (DEL) DECIDED THE ISSUE IN FAVOUR OF ASSESSEE. HE SUBMITTED THAT THE MATTER COULD BE RESTORED TO AO FOLLOWING THE SAID DECISION OF ITAT TO DETERM INE THE ANNUAL RATEABLE VALUE. TO SUBSTANTIATE, HE FURNISHED A COPY OF SAI D ORDER DT. 29.6.2011. THE LD. DEPARTMENTAL REPRESENTATIVE HAS NOT OBJECTED TH E ABOVE SUBMISSION OF LD. AR. 6. WE HAVE CONSIDERED THE SUBMISSIONS OF LD. REPRES ENTATIVE OF THE PARTIES AND EARLIER ORDER DT. 29.6.2011 (SUPRA). I N VIEW OF ABOVE, WE DECIDE THE ISSUE IN FAVOUR OF ASSESSEE AND RESTORE THE SAM E TO AO TO DETERMINE THE ANNUAL RATEABLE VALUE. HENCE GROUND NO. 2 OF APPEA L IS ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED IN PART FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 9 TH DAY OF NOVEMBER, 2011 SD/- SD/- ( P.M. JAGTAP) (B.R. MITTAL ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 9 TH NOVEMBER, 2011 RJ ITA NO. 7298/M/08 3 COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT-CONCERNED 4. THE CIT(A)-CONCERNED 5. THE DR I BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR, I.T.A.T, MUMBAI