KAMAL KISHORE RATHI,MUMBAI V. DY.CIT CC 4 (3), MUMBAI

MA 467/MUM/2023

AI Insights

The case involves Mr. Kamal Kishore Rathi, the appellant, who filed a Miscellaneous Application against the order of the Income Tax Appellate Tribunal, which had previously confirmed the disallowance of Rs.10,50,000 claimed as salary expenses for the assessment year 2010-11. The disallowance was based on the examination of the income tax returns of the individuals to whom the salaries were purportedly paid, which showed inconsistencies and non-compliance with the norms for salaried individuals. The appellant argued that the Tribunal had not fully adjudicated on the disallowance of Rs.7,80,000 and had not considered a previous CIT appeal order which allowed similar salary expenses. However, the Tribunal found that the issues had been adequately addressed in the original order and that the principles of consistency and opportunity to be heard had been observed.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 473358 (ITAT-MUMBAI)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 29-01-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: HEMANSHU JOSHI
• Assessee Lawyers: VIJAY SHAH
• Keywords: Business income; Opportunity of being heard; Salary income

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, ‘SMC’ BENCH MUMBAI BEFORE: SHRI NARENDRA KUMAR BILLAIYA, ACCOUNTANT MEMBER & SHRI AMIT SHUKLA, JUDICIAL MEMBER, MA No.467/Mum/2023 (Arising out of ITA No.7758/Mum/2019) (Assessment Year :2010-11) Mr. Kamal Kishore Rathi 115B, Shalimar Miracle Opp. ICICI Bank S.V. Road Goregaon West Mumbai- 400 002 Vs. Dy. CIT, Central Circle- 4(3), Mumbai PAN/GIR No.AAGPR1508N (Appellant) .. (Respondent) Assessee by Shri Vijay Shah Revenue by Shri Hemanshu Joshi Date of Hearing 13/12/2024 Date of Pronouncement 29/01/2025 आदेश / O R D E R PER AMIT SHUKLA (J.M): The aforesaid Miscellaneous Application has been filed by the assessee against order dated 18/04/2023 passed in MA No.7758/Mum/2019. The assessee in the present Miscellaneous Application has challenged the finding of the Tribunal with regard to disallowance of salary of Rs.10,50,000/- in the following manner:- MA No. 467/Mum/2023 Kamal Kishore Rathi 2 “13. So far as question of disallowance of salary of Rs. 10,50,000/- claimed to have been paid by the assessee to different persons is concerned, the AO has duly thrashed the case of four persons namely Mr. Indrapratap Singh, Mr. Jitendra Chandrabhan Singh, Ms. Sandhya Badekar & Mr. Amit Mahade on random basis and issued notice to them under section 131, examined their income tax returns. Even summons issued to Mr. Jitendra Chandrabhan Singh was not served at the given address. However, the assessee filed the written submissions of Mr. Jitendra Chandrabhan Singh along with his return of income wherein he has offered total income at Rs. 1,40,140/- in the head \"business income\" instead of \"salary\". He has also filed return in ITR-2 which has not a valid return for salaried person. 14. Similarly the AO has examined the case of Ms. Sandhya Badekar whom assessee claimed to have paid the salary of Rs. 1,50,000/- by the assessee as per ledger brought on record but she also filed the ITR-4 for A.Y. 2010-11 which is valid form only for \"business income\" instead of salary income. Furthermore summons issued to Mr. Amit Mahade was not served at the given address nor he was produced by the assessee. So in these circumstances, we are of the considered view that both AO as well as the Ld. CIT(A) have duly thrashed the facts and made the disallowance of Rs.10,50,000/- on account of salary expenses claimed by the assessee and we find no illegality or perversity in the impugned disallowance.” 2. Now in the Miscellaneous Application the assessee has contended as under:- 3. The appellant has paid salary of Rs 10,50,000/- to six persons and honorable tribunal has confirmed the disallowance of full salary of Rs 10,50,000/- on the basis of the return of Income of Ms. Sandhya Badekar and Mr Amit Mahade, therefore this ground is not fully adjudicated, therefore the mistake of disallowance of Rs.7,80,000/- is crept in the order because salary of Rs. 7,80,000/- is being disallowed without giving proper opportunity of being heard. MA No. 467/Mum/2023 Kamal Kishore Rathi 3 4. Appellant submitted CIT appeal order for A.Y2009-10 in which full salary of Rs.9,00,000/- is being allowed and no further appeal is filed by department against CIT appeal order, therefore CIT Appeal order becomes final. The ITAT has not considered the order filed by the appellant to allow the salary expenses on the principle of the consistency This is an error crept in the order which requires the grounds of appeal to be reheard Appellant submits the copy of the CIT order for the year 2009-10 5. The appellant has argued the CIT Appeal 2009-10 should be followed for allowing the salary expenses of Rs. 10,50,000/- and DR has also argued in this respect but honorable tribunal has inadvertently not considered the said ground at full length, this is a mistake occurred inadvertently while finalizing the order 6. Honorable tribunal has asked to make written submission in support of the grounds of appeal The appellant has made written submission and claimed salary expenses on the basis of CIT appeal allowing salaries and wages for the year 2009- 10 in point no 6 & 7. Of the written submissions 7. No opportunity was provided by AO to cross examine Mr Indrapratap Singh and salary paid was disallowed based on letter dated 04/09/2018 to the AO. 3. Accordingly, it was submitted that the order of the Tribunal should be recalled. 4. After hearing both the parties and on perusal of the facts on record it is seen that the Tribunal has dealt this issue in detail and has given the reasons for confirming the disallowance confirmed by the ld. CIT(A). Once the Tribunal has decided the issue after taking the note of the fact that ld. AO had carried out enquiry by sending notice u/s.131 and after examining the Income Tax returns and taking into account that the notice of summons issued to two persons MA No. 467/Mum/2023 Kamal Kishore Rathi 4 were not served upon the given address nor in the Income Tax returns, the salary was disclosed. Now without bringing any other material on record, such a finding of the Tribunal cannot be disturbed. Accordingly, we do not find any substance in the Miscellaneous Application filed by the assessee and same is dismissed. 5. In the result, Miscellaneous Application filed by assessee is dismissed. Order pronounced on 29th January, 2025. Sd/- (NARENDRA KUMAR BILLAIYA) Sd/- (AMIT SHUKLA) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai; Dated 29/01/2025 KARUNA, sr.ps Copy of the Order forwarded to : BY ORDER, (Asstt. Registrar) ITAT, Mumbai Date Initial 1. Draft dictated on Sr.PS 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// MA No. 467/Mum/2023 Kamal Kishore Rathi 5 2. Draft placed before author Sr.PS 3. Draft proposed & placed before the second member JM/AM 4. Draft discussed/approved by Second Member. JM/AM 5. Approved Draft comes to the Sr.PS/PS Sr.PS/P S 6. Kept for pronouncement on Sr.PS 7. File sent to the Bench Clerk Sr.PS 8. Date on which file goes to the AR 9. Date on which file goes to the Head Clerk. 10. Date of dispatch of Order. 11. Dictation Pad is enclosed Yes "