VISHAL ASSOCIAES, MUMBAI V. DCIT 15(3), MUMBAI

ITA 7472/MUM/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 4107 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 1 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-02-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 01-02-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 19-12-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SUMIT KUMAR
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL ' F ' BENCH, MUMBAI BEFORE SHRI JASON P. BOAZ, ACCOUNTANT MEMBER AND SHRI SANDEEP GOSAIN , JUDICIAL MEMBER ITA NO. 7472 /MUM/201 3 (ASSESSMENT YEAR: 2008 - 09 ) M/ S. VISHAL ASSOCIATES VS. DY. C OMMISSIONER OF B - 3. NEW NATRAJ CHSL, PESTOM SAGAR ROAD NO.5, CHEMBUR MUMBAI 4000 8 9 INCOME TAX - 15(3) MUMBAI PAN - AA EFV9754C APPELLANT RESPONDENT APPELLANT BY: NONE RESPONDENT BY: SHRI SUMIT KUMAR DATE OF HEARING: 01.02 .2016 DATE OF PRONOUNCEMENT: 03 .02 .2016 O R D E R PER JASON P. BOAZ, A.M . THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT(A) - 26 , MUM BAI DATED 03.09 .201 3 FOR A.Y. 2008 - 09 . 2 . THE FACTS OF THE CASE, BRIEFLY ARE AS UNDER: - 2.1 THE ASSESSEE, A FIRM ENGAGED IN THE BUSINESS OF CONSTRUCTION ACTIVITY AND AS LABOUR CONTRACTORS, FILED ITS RETURN FOR A.Y. 2008 - 09 ON 06.10.2008 DECLARING TOTAL INCOME OF ` 66,95,675/ - . THE CASE WAS TAKEN UP FOR SCRUTINY AND THE ASSESSMENT WAS COMPLETED UND ER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) VIDE ORDER DATED 20.12.2010 WHEREIN THE ASSESSEES INCOME WAS DETERMINED AT ` 87,21,200/ - IN VIEW OF THE FOLLOWING ADDITIONS/DISALLOWANCE: - (I) DISALLOWANCE OF O.C. EXPENSES ` 10,00,000/ - (II) DISALLOWANCE UNDER SECTION 40(A09IA) ` 10,25,520/ - 2.2 ON APPEAL, THE LEARNED CIT(A) DISPOSED OFF THE APPEAL VIDE ORDER DATED 03.09.2013 ALLOWING THE ASSESSEE PARTIAL RELIEF. ITA NO. 7472/MUM/2013 M/ S. VISHAL ASSOCIATES 2 3 . AGGRIEVED BY THE ORDER OF THE CIT(A) - 26 , MUMBAI DATED 03.09.2013, THE ASSESSE E HAS PREFERRED THIS APPEAL RAISING THE FOLLOWING GROUNDS: - UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LEARNED CIT(A) HAS ERRED IN CONFIRMING THE DISALLOWANCE OF PROVISION MADE FOR VARIOUS EXPENSES TO BE INCURRED AS PER THE CERTIFICATE OF A RCHITECT SINCE INCOME IN RESPECT OF SUCH EXPENSES WAS CONSIDERED FOR THE PURPOSE OF COMPUTING THE INCOME. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW CIT(A) HAS ERRED IN NOT APPRECIATING THE FACT THAT WHEN AN INCOME IS BROUGHT TO TAX CORRESPON DING EXPENDITURE TO BE INCURRED SHOULD BE ALLOWED AS DEDUCTION ON MATCHING PRINCIPLES AS PER THE LAID DOWN LAW. THE APPELLANT CRAVES RIGHT TO ADD, AMEND, ALTER, DELETE OR MODIFY ANY OF THE GROUNDS OF APPEAL AT THE TIME OF HEARING. 4 . THE CASE WAS FIXED FOR HE ARING ON AT LEAST FIVE OCCASIONS AND ON EACH OF THESE HEARINGS NONE APPEARED ON BEHALF OF THE ASSESSEE. TODAY, I.E. 01.02.2016 , WHEN THE CASE WAS CALLED , NONE APPEARED ON BEHALF OF THE ASSESSEE NOR WAS ANY ADJOURNMENT APPLICATION FILED ON ASSESSEES BEHALF. THE LEARNED D.R. WAS, HOWEVER, PRESENT FOR REVENUE. IN THESE CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE ASSESSEE IS NOT INTERESTED IN PURSUING THE APPEAL SERIOUSLY AND THEREFORE PROCEED TO DISPOSE OFF ASSESSEES APPEAL WITH THE ASSISTANCE OF THE LEARNED D .R. FOR REVENUE AND THE MATERIAL ON RECORD. 5 . IN THIS APPEAL, THE GROUND RAISED (SUPRA) APPEARS TO BE IN RESPECT OF THE DISALLOWANCE OF O.C. EXPENSES OF ` 10,00,000/ - . IN THIS REGARD, THE FINDING OF THE LEARNED CIT(A) AT PARAS 3.2 AND 3.2.1 OF THE IMPUGNED ORDER ARE EXTRACTED HEREUNDER: - 3.2 SUBMISSION OF THE LD. A.R. HAS BEEN CONSIDERED. A QUERY WAS MADE TO THE LD. A.R. REGARDING ACTUAL EXPENSES INCURRED TILL DATE ON ACCOUNT OF O.C. AGAINST THE ABOVE DEBIT. LD. A.R. HAS NOT GIVEN ANY DETAILS OF ACTUAL EXP ENSES INCURRED TILL DATE SINCE THE PROVISION HAS BEEN MADE. IN RESPONSE, LD. A.R. HAS ALSO STATED THAT O.C. FOR THE PROJECT HAS NOT BEEN RECEIVED AS YET. 3.2.1 ON THE FACTS, AS STATED, THE ABSENCE OF DETAILS OF ACTUAL EXPENSES INCURRED AGAINST THE PROVISIO NS OF RS.10 LAKHS AND THE SUBMISSION THAT O.C. FOR THE PROJECT HAS NOT BEEN RECEIVED AS YET, IT IS DIFFICULT TO BELIEVE THAT ANY FURTHER EXPENSE IN CONNECTION WITH THE BUILDING ALREADY COMPLETED IN THE F.Y. 2007 - 08 IS STILL TO BE INCURRED. THEREFORE, APPLY ING MATCHING CONCEPT IT IS HEREBY HELD THAT NO EXPENSE ITA NO. 7472/MUM/2013 M/ S. VISHAL ASSOCIATES 3 HAS ACTUALLY BEEN INCURRED AGAINST THE PROVISIONS OF RS.10 LAKHS MADE BY THE ASSESSEE. THEREFORE, THE ORDER OF THE A.O. IS HEREBY UPHELD AND THIS GROUND IS HEREBY DISMISSED. 5.1 WE HAVE CONSIDERED THE SUBMISSIONS OF THE LEARNED D.R. IN SUPPORT OF THE IMPUGNED ORDER OF THE LEARNED CIT(A) AND PERUSED AND CAREFULLY CONSIDERED THE MATERIAL ON RECORD. WE FIND THAT THE ASSESSEE HAS BEEN UNABLE TO REBUT OR CONTROVERT WITH EVIDENCE THE F INDINGS OF THE AO IN RESPECT OF THE DISALLOWED O.C. EXPENSES AMOUNTING TO ` 10 LAKHS. IN THESE FACTUAL CIRCUMSTANCES, WE DO NOT FIND ANY REASON TO INTERFERE WITH OR DEVIATE FROM THE FINDINGS AS RECORDED BY THE LEARNED CIT(A) ON THIS ISSUE (SUPRA) AND ACCORD INGLY UPHOLD THE IMPUGNED ORDER. 6 . IN THE RESULT, THE ASSESSEES AP PEAL FOR A.Y. 2008 - 09 IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON 3 RD FEBRUARY , 2016 . SD/ - SD/ - ( SANDEEP GOSAIN ) ( JASON P. BOAZ ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 3 RD FEBRUARY , 2016 COPY TO: 1 . THE APPELLANT 2 . THE RESPONDENT 3 . THE CIT(A) 26 , MUMBAI 4 . THE CIT 15 MUMBAI 5 . THE DR, F BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.