METRO MOTORS AUTO DIVISION, MUMBAI V. DCIT 16(3), MUMBAI

ITA 919/MUM/2012

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8254 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 9 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 10-02-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AKHILENDRA YADAV
• Keywords: Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'B' BENCH, MUM BAI . , , BEFORE SHRI D. KARUNAKARA RAO, AM & SHRI AMIT SHUKL A, JM ./ ITA NO. 919/MUM/2012 ( / ASSESSMENT YEAR: 2008-09) GMMCO LTD. (SUCCESSOR OF / VS. D C I T 16(3) METRO MOTORS AUTO DIVISION) MAKER BHAWAN NO. 2, 2 ND FLOOR 18 NEW MARINE LINES MUMBAI 400020 MATRU MANDIR MUMBAI 400007 ./ PAN AABFM7783R / APPELLANT !' / RESPONDENT # $ / APPELLANT BY: SHRI MAYUR KISNADWALA !' # $ / RESPONDENT BY: SHRI AKHILENDRA YADAV %& # ( / DATE OF HEARING: 04.12.2014 )*+ # ( / DATE OF PRONOUNCEMENT: 04.12.2014 / O R D E R PER D. KARUNAKARA RAO, AM THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A)-27, MUMBAI DATED 22.12.2011 FOR AY 2008-09 IN CONNECTIO N WITH THE CLAIM OF NON-COMPETE FEES OF ` 10 LAKHS PAID TO BOMBAY METRO MOTORS LTD. 2. AT THE OUTSET THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT SIMILAR CLAIMS WERE MADE IN THE PAST AND THE ISSUE TRAVELLED TO THE HON'BLE HIGH COURT. THE LEARNED COUNSEL FILED A COPY OF THE JUDGEMENT OF THE HON'BLE HIGH COURT IN ASSESSEES OWN CASE FOR AY 2002-03 DA TED 28 TH AUGUST, 2014 AND BROUGHT OUT ATTENTION TO PARA 6 OF THE SAID JUD GEMENT AND STATED THAT THE CLAIM OF THE ASSESSEE IS ALLOWABLE UNDER THE CI RCUMSTANCES WHERE THERE IS WRITTEN CONTRACT BETWEEN THE PARTIES FOR PAYMENT OF NON-COMPETE FEES. THE COUNSEL FIRMLY MENTIONED THAT DURING THE YEAR UNDER CONSIDERATION THERE IS ONLY AN ORAL CONTRACT OTHERWISE THE FACT ARE IDENTI CAL AND THE SAID JUDGEMENT APPLIES SQUARELY TO AY 2008-09 ALSO. ITA NO. 919/MUM/2012 GMMCO LTD. 2 3. THE LEARNED D.R. SUBMITTED THAT ABSENCE OF WRITTEN CONTRACT MAKES A DIFFERENCE AND THE EXISTENCE OF ORAL CONTRACT, IF A NY, WAS NOT DEEPLY EXAMINED BY THE AUTHORITIES BELOW. AFTER HEARING BO TH THE PARTIES WE FIND THAT THE ALLOWABILITY OF NON-COMPLETE FEES WHEN THE RE IS A CONTRACT EXISTING IS A SETTLED ISSUE. THE ONLY DIFFERENCE THAT IS TO BE EXAMINED BY THE AO IN THE REMAND PROCEEDINGS NOW RELATES TO THE EXISTENCE OF ANY CONTRACT, WHETHER WRITTEN OF ORAL. FOR THIS PURPOSE WE REMAND THE MAT TER TO THE FILE OF THE AO FOR FRESH ADJUDICATION OF THE ISSUE IN THE LIGHT OF THE SAID JUDGEMENT OF THE HON'BLE HIGH COURT AFTER GIVING A FAIR OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ACCORDINGLY ASSESSEES GROUND IS ALLOWED. 4. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ,- %./, # 0 1# 23 4 5 6 # 7 89 ORDER PRONOUNCED IN THE OPEN COURT ON 4 TH DECEMBER, 2014. # )*+ 0 :%- 04.12.2014 * # ;& SD/- SD/- ( AMIT SHUKLA ) ( D. KARUNAKARA RAO ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER <& MUMBAI, :% DATED: 4 TH DECEMBER, 2014 COPY TO: 1. / THE APPELLANT 2. !' / THE RESPONDENT 3. ( )/ THE CIT(A) 27, MUMBAI 4. / THE CIT 16, MUMBAI CITY 5. =>; !%?. , ( ?. , <& THE DR, B BENCH, ITAT, MUMBAI 6. ;/ @& / GUARD FILE. % / BY ORDER '= ! //TRUE COPY// ASSISTANT REGISTRAR , <& ITAT, MUMBAI BENCHES, MUMBAI N.P.