ACIT 12(1), MUMBAI V. M/S. B.S. INTERNATIONAL, MUMBAI

ITA 803/MUM/2011

• Counselvise Citation: 80319914 RSA 2011
• Duration Of Justice: 2 year(s) 10 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-12-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 28-11-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 28-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R K SAHU
• Assessee Lawyers: SANJAY B VORA
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH G , MUMBAI BEFORE SHRI P.M. JAGTAP , ACCOUNTANT MEMBER AND SHRI SANJAY GARG , JUDICIAL MEMBER ITA NO. 803/M/11 ASSESSMENT YEAR: 2007 - 08 ACIT 12(1), ROOM NO.117, AAYAKAR BHAVAN, M.K. MARG, MUMBAI 400 0 20 VS. M/S. B.S. INTERNATIONAL, 4 TH FLOOR, DAS CHAMBERS, 25, DALAL STREET, MUMBAI 400 001 PAN: AAAFB1141M (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SANJAY B. VORA REVENUE BY : SHRI R.K. SAHU , D.R. DATE OF HEARING : 28.11.13 DATE OF PRONOUNCEMENT : 06.12.13 O R D E R PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE REVENUE AGAINST THE ORDER OF THE CIT(A) DATED 12.11.10. THE REVENUE HAS CHALLENGED THE ACT ION OF THE LD. CIT(A) IN DIRECTING THE AO TO COMPUTE THE REASONABLE DISALLOWANCE UNDER SECTION 14A FOLLOWING THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF GODREJ & BOYCE MANUFACTURING CO. LTD. VS. DCIT [(2010) 328 ITR 81 (BOM . )] . THE RE VENUE HAS CLAIMED THAT SINCE THE DEPARTMENT HAS PROPOSED SLP AGAINST THE ABOVE DECISION OF THE HONBLE BOMBAY HIGH COURT AND HENCE THE ORDER OF THE CIT(A) IS REQUIRED TO BE SET ASIDE. 2. IT MAY BE OBSERVED THAT THE RELEVANT ASSESSMENT YEAR INVOLVED IN T HIS CASE IS ASSESSMENT YEAR 2007 - 08. THE LD. CIT(A) HAS GIVEN THE DIRECTIONS TO ITA NO.803/M/11 M/S. B.S. INTERNATIONAL 2 CALCULATE THE DISALLOWANCE UNDER SECTION 14A FOLLOWING THE PROPOSITION OF LAW LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF GODREJ & BOYCE MANUFACTURING CO. LTD. (SUPRA). IT MAY BE FURTHER OBSERVED THAT IN THE CASE OF GODREJ & BOYCE MANUFACTURING CO. LTD. 328 ITR 81, THE HON'BLE BOMBAY HIGH COURT HAS HELD THAT RULE 8D R.W.S. 14A(2) IS NOT ARBITRARY OR UNREASONABLE BUT CAN BE APPLIED ONLY IF THE ASSESSEE'S METH OD IS NOT SATISFACTORY. IT HAS BEEN FURTHER HELD THAT RULE 8D IS NOT RETROSPECTIVE AND APPLIES FROM A.Y. 2008 - 09. FOR THE YEARS FOR WHICH RULE 8D IS NOT APPLICABLE AND IN THE EVENT THAT THE AO IS NOT SATISFIED WITH THE EXPLANATION/WORKING GIVEN BY THE ASSE SSEE, DISALLOWANCE U/S. 14A HAS TO BE MADE ON A REASONABLE BASIS. ALMOST SIMILAR VIEW HAS BEEN EXPRESSED BY HON'BLE DELHI HIGH COURT IN THE CASE OF MAXOPP INVESTMENT LTD. & OTHERS V. CIT 247 ITR 162. 3 . THE LAW LAID DOWN BY THE JURISDICTIONAL HIGH COURT IS BINDING ON THE SUBORDINATE COURTS INCLUDING THIS TRIBUNAL. MERELY BECAUSE THE REVENUE HAS PREFERRED AN APPEAL AGAINST THE ORDER OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF GODREJ & BOYCE MANUFA CTURING CO. LTD(SUPRA), THAT ITSELF CAN NOT BE A SAID TO HAVE ANY EFFECT ON THE BINDING NATURE OF THE JUDGMENT OF THE H ONBLE HIGH COURT UPON THIS TRIBUNAL. ACCORDINGLY WE DO NOT FIND ANY MERIT IN THIS APPEAL AND THE SAME IS HEREBY DISMISSED. ORDER P RONOUNCED IN THE OPEN COURT ON 06.12. 2013. SD/ - SD/ - ( P.M. JAGTAP ) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 06.12. 2013. * KISHORE ITA NO.803/M/11 M/S. B.S. INTERNATIONAL 3 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT ( A) CONCERNED, MUMBAI THE DR C BENCH //TRUE COPY// [ BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.