ASST CIT 15(1)(2), MUMBAI V. DESH CONSULTANCY SERVICES P. LTD, NAVI MUMBAI

ITA 7315/MUM/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 2518 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-07-2016
• Appeal Filed By: Department
• Bench Allotted: D
• Assessment Year: 2011-2012
• Appeal Filed On: 08-12-2014
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI BEFORE S/ SHRI B.R. BASKARAN (AM) & PAWAN SINGH (JM) I.T.A. NO. 7315 /MUM/ 20 1 4 (ASSESSMENT YEAR 2011 - 12 ) ACIT - 15(1)(2) ROOM NO. 403 4 TH FLOOR AAYAKAR BHAVAN M.K. ROAD MUMBAI - 400 020. VS. M/S. DESH CONSULTANCY SERVICES PVT. LTD. 101 - 105 B SHIV CHAMBERS SECTOR - 11, BELAPUR NAVI MUMBAI - 400 614. ( APPELLANT ) ( RESPONDENT ) PAN NO . AACCS0044L ASSESSEE BY SHRI S.L. JAIN DEPARTMENT BY SHRI NITIN WAGHMODE DATE OF HEARING 12 . 7 . 201 6 DATE OF PRONOU NCEMENT 20. 7 . 201 6 O R D E R PER B.R. BASKARAN (AM) : - THE APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 26.9.2014 PASSED BY LEARNED CIT(A) - 22, MUMBAI AND IT RELATES TO A.Y. 2011 - 12 . 2. THE REVENUE IS AGGRIEVED BY THE DECISION OF LEARNED CIT(A) IN DELETING THE DISALLOWANCE OF CHIT DISCOUNT CLAIMED BY THE ASSESSEE. 3. WE HAVE HEARD THE PARTIES AND PERUSED THE RECORD. THE ASSESSEE COMPANY HAS SUBSCRIBED TO CHIT FUND SCHEMES FLOAT ED BY M/S. SHRIRAM CHITS (MAHARASHTRA) LIMITED. IT HA D CLAIMED CHIT DISCOUNT ON PRO RATA BASIS AND ACCORDINGLY CLAIMED A SUM OF ` 4.05 CRORES AS DEDUCTION. THE ASSESSING OFFICER DISALLOWED THE SAID CLAIM BY HOLDING THAT THE ASSESSEE HAS NOT BROUGHT ANY EVID ENCE ON RECORD TO SHOW THAT IT HAS INVESTED IN CHIT FUND SCHEMES AND HAS INCURRED SUCH A HUGE DISCOUNT OF ` 4.05 CRORES. ACCORDINGLY, THE ASSESSING OFFICER DISALLOWED THE ABOVE SAID CLAIM. IN THE APPELLATE PROCEEDINGS, LEARNED CIT(A) TOOK THE VIEW THAT THE DISALLOWANCE HAS BEEN MADE BY THE ASSESSING DESH CONSU LTANCY SERVICES P. LTD. 2 OFFICER , AS HE DID NOT ACCEPT THE METHOD OF ACCOUNTING FOLLOWED BY THE ASSESSEE . THE ASSESSEE HAD CLAIMED DISCOUNT OF CHIT FUND ON PRO RATA BASIS FOLLOWING THE DECISION TAKEN BY THE ASSESSING OFFICER IN THE ASSESSMEN T YEAR 2003 - 04. LEARNED CIT(A) TOOK THE VIEW T HAT THE ASSESSING OFFICER SHOULD NOT HAVE DISTURB ED THE SAID METHOD FOLLOWED BY THE ASSESSEE AS PER DECISION TAKEN BY THE ASSESSING OFFICER HIMSELF IN A.Y. 2003 - 04. ACCORDINGLY, BY FOLLOWING THE DECISION RENDERED BY HON'BLE SUPREME COURT IN THE CASE OF CI T VS. BILAHARI INVESTMENTS (P) LTD. (299 ITR 1), LEARNED CIT(A) TOOK THE VIEW THAT THERE IS NO REASON TO DISTURB THE METHOD CONSISTENTLY ADOPTED BY THE ASSESSEE. 4. WE NOTICED THAT LEARNED CIT(A) HAS MISDIRECTED HIMSELF IN APPRECIATING THE REASONS ON WHI CH DISALLOWANCE WAS MADE BY THE ASSESSING OFFICER. AS NOTICED EARLIER THE ASSESSING OFFICER DISALLOWED THE CLAIM ON THE REASONING THAT THE ASSESSEE HAS NOT FURNISHED ANY EVIDENCE. FROM THE ASSESSMENT ORDER, WE NOTICED THAT THE ASSESSING OFFICER HAS NOT DI SCUSSED ANYTHING ABOUT THE METHOD OF ACCOUNTING ON CHIT DISCOUNT AND HENCE WE ARE OF THE VIEW THAT THIS ISSUE REQUIRES FRESH EXAMINATION AT THE END OF LEARNED CIT(A). ACCORDINGLY, WE SET ASIDE THE ORDER OF LEARNED CIT(A) AND RESTORE THIS ISSUE TO HIS FILE WITH THE DIRECTION TO ADJUDICATE THE SAME AFRESH AFTER HEARING THE ASSESSEE ON THE GROUND ON WHICH THE DISALLOWANCE WAS MADE BY THE ASSESSING OFFICER. 5. IN THE RESULT, APPEAL FILED BY THE REVENUE IS TREATED AS ALLOWED FOR STATISTICAL PURPO S ES. ORDER HAS BE EN PRONOUNCED IN THE COURT ON 20 .7.2016 SD/ - SD/ - (PAWAN SINGH) (B.R.BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 20 / 7 / 20 1 6 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) DESH CONSU LTANCY SERVICES P. LTD. 3 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( DY./ASSTT. REGISTRAR) ITAT, MUMBAI PS