SHRI SUSHIL CHANDRAKANT SHAH, MUMBAI V. D.C.I.T.- 6(1), MUMBAI

ITA 823/MUM/2018

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 8528 (ITAT-MUMBAI)
• Duration Of Justice: 10 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-12-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 09-02-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: CHAITANYA ANJARIA
• Keywords: Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC , MUMBAI BEFORE SHRI C.N. PRASAD, HON'BLE JUDICIAL MEMBER ITA NO . 823 /MUM/201 8 (A.Y: 2011 - 12) SHRI SUSHIL CHANDRAKANT SHAH 3 10, CREATIVE INDUSTRIAL ESTATE, 78, N.M. JOSHI MARG , CHINCHPOKLI, MUMBAI 400 011 PAN: AAKPS 0961 L V . D .C.I.T CIRCLE 6(1) ROOM NO. 506, 5 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI - 400 020 (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE DEPARTMENT BY : SHRI CHAITANYA ANJARIA DATE OF HEARING : 31.12.2018 DATE OF PRONOUNCEMENT : 31 .12 .2018 O R D E R PER C. N. PRASAD (JM) 1. THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 12, MUMBAI [HEREINAFTER IN SHORT LD.CIT(A)] DATED 04.09.2017 FOR THE ASSESSMENT YEAR 2011 - 12. 2. ASSESSEE HAS RAISED THE FOLLOWING GROUNDS IN ITS APPEAL: - 1. THE LEARNED CIT (A) ERRED IN NOT PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD DURING THE COURSE OF APPELLATE HEARING. YOUR APPELLANT SUBMITS THAT THE CASE OF THE APPELLANT BE SET ASIDE FOR HEARING AND PROPER OPPORTUNITY OF BEING HEARD BE PROVIDED. 2. WITHOUT PREJUDICE TO THE ABOVE. 2 ITA NO.823/MUM/2018 (A.Y: 2011 - 12) SHRI SUSHIL CHANDRAKANT SHAH THE LEARNED CIT (A) ERRED IN DISALLOW ING THE INTEREST EXPENSE OF .11,52,080/ - PAID TO M/S FRP ACCESSORIES BY STATING THAT EXPENDITURE IS NOT WHOLLY OR EXCLUSIVELY FOR THE PURPOSE OF EARNING REMUNERATION INCOME. YOUR APPELLANT SUBMITS THAT INTEREST PAID TO PARTNERSHIP FIRM M/S. FRP ACCESSORIES OUGHT TO BE ALLOWED AS DEDUCTION AS CLAIMED. 3. THE APPELLANT CRAVES LEAVE TO RESERVE TO HIM THE RIGHT TO ADD , TO AMEND OR TO ALTER ANY OF THE GROUNDS OF APPEAL AT OR BEFORE THE TIME HEARING AND TO PRODUCE SUCH FURTHER EVIDENCES, DOCUMENTS AND PAPERS AS MAY BE NECESSARY 3. WHEN THE APPEAL WAS POSTED FOR HEARING ON 29.11.2018 , AT THE REQUEST OF THE ASSESSEES COUNSE L VIDE LETTER DATED 17.11.2018 THE HEARING OF APPEAL WAS ADJOURNED TO 31.12.2018. WHEN THE MATTER CAME UP FOR HEARING ON 31.12.2018, NONE APPEARED ON BEHALF OF THE ASSESSEE NOR ANY ADJOURNMENT WAS SOUGHT. THEREFORE, I DISPOSE OF F THIS APPEAL ON MERITS BY HEARING THE LD.DR. 4. LD. DR SUBMITTED THAT ASSESSEE RAISED IN ITS GROUNDS OF APPEAL THAT LD.CIT(A) DID NOT PROVID E ADEQUATE OPPORTUNITY OF BEING HEARD AND T HEREFORE CASE MAY BE SET ASIDE FOR HEARING TO THE LD.CIT(A). LD. DR REFERRING TO THE ORDER OF THE LD. CIT(A) SUBMITTED THAT THE CASE WAS POSTED FOR NUMBER OF TIMES FROM TIME TO TIME AND THE ASSESSEE ALWAYS SOUGHT TIME BEFORE THE LD.CIT(A) AND FINALLY NOBODY REPRESENTED THE MATER HENCE THE ORDER WAS PASSED BY THE LD.CIT(A) ON MERITS. THEREFORE, IT IS NOT C ORRECT TO SAY THAT NO PROPER OPPORTUNITY AS GIVEN BY THE LD.CIT(A). 5. COMING TO THE MERITS OF THE DISALLOWANCE OF INTEREST EXPENSES, LD. DR SUBMITTED THAT ASSESSEE CLAIMED INTEREST EXPENSES AGAINST 3 ITA NO.823/MUM/2018 (A.Y: 2011 - 12) SHRI SUSHIL CHANDRAKANT SHAH REMUNERATION RECEIVED BY THE ASSESSEE FROM THE FIRM M/S. FRP ACCESSORIES . LD. DR SUBMITTED THAT THE CLAIM OF INTEREST EXPENSES AGAINST REMUNERATION WAS RIGHTLY DENIED BY THE ASSESSING OFFICER AS THE INTEREST EXPENSES WAS NOT INCURRED WHOLLY AND EXCLUSIVELY TO EARN REMUNERATION AND THIS DISALLOWANCE WAS SUSTAINED B Y THE LD.CIT(A). 6. HEARD THE LD. DR, PERUSED THE ORDERS OF THE AUTHORITIES BELOW. 7. ASSESSING OFFICER DENIED THE CLAIM OF THE ASSESSEE FOR INTEREST EXPENSES AGAINST REMUNERATION RECEIVED ON THE GROUND THAT ASSESSEE RECEIVED REMUNERATION FOR THE SERVICES RENDER ED TO THE FIRM AND NO INTEREST WAS RECEIVED BY THE ASSESSEE FROM THE FIRM. IT WAS ALSO OBSERVED THAT INTEREST EXPENSES WERE NOT INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF EARNING THE REMUNERATION AND T HEREFORE THE SAID EXPENSES CANNOT BE ALLOWED AS DEDUCTION AGAINST REMUNERATION. THIS ACTION OF THE ASSESSING OFFICER HAS BEEN UPHELD BY THE LD.CIT(A). IT IS ALSO OBSERVED BY THE LD.CIT(A) THAT NO EXPLANATION HAS BEEN FURNISHED BY THE ASSESSEE IN SUPPORT OF ITS CLAIM ALONG WITH EVIDENCES AND T HEREFORE THE CLAIM OF THE ASSESSEE WAS DENIED. EVEN BEFORE ME , NONE APPEARED NOR THE FINDINGS OF THE LOWER AUTHORITIES HAVE BEEN REBUTTED. IN THE CIRCUMSTANCES, I UPHOLD THE ORDERS OF THE AUTHORITIES BELOW. GROUND S RAISED BY THE ASSESSEE ARE REJECTED. 4 ITA NO.823/MUM/2018 (A.Y: 2011 - 12) SHRI SUSHIL CHANDRAKANT SHAH 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 31 ST DECEMBER , 2018 SD/ - (C.N. PRASAD) JUDICIAL MEMBER MUMBAI / DATED 31 / 12 / 2018 GIRIDHAR , S R. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY// BY ORDER (ASSTT. REGISTRAR) ITAT, MUM