ALD AUTOMATIC P.LTD, V. DCIT CIR 15(1),

MA 316/MUM/2014

• Counselvise Citation: [2014] 124 COUNSELVISE.COM (IT) 2551 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 15 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 10-10-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2005-2006
• Appeal Filed On: 25-06-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SAMBIT MISHRA
• Assessee Lawyers: B P AGRAWAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUM BAI .. , , BEFORE SHRI I. P. BANSAL, JM AND SHRI SANJAY ARORA , AM ./M.A. NO. 316/MUM/2014 (ARISING OUT OF ITA NO. 309/MUM/2012) ( / ASSESSMENT YEAR: 2005-06) ALD AUTOMOTIVE PVT. LTD. 13 TH FLOOR, MAKER CHAMBER IV, NARIMAN POINT, MUMBAI 400 021 / VS. DY. CIT, CIRCLE 15(1), ROOM NO. 203, 2 ND FLOOR, MATRU MANDIR, TARDEO ROAD, MUMBAI-400 007 ' ./# ./PAN/GIR NO. AAFCA 0924 K APPLICANT : RESPONDENT APPLICANT BY : SHRI B. P. AGRAWAL RESPONDENT BY : SHRI SAMBIT MISHRA $ % & '( / DATE OF HEARING : 05.09.2014 )*+ & '( / DATE OF PRONOUNCEMENT : 10.10.2014 , / O R D E R PER SANJAY ARORA, A. M.: THIS IS A MISCELLANEOUS PETITION BY THE ASSESSEE IN RESPECT OF AN ORDER U/S. 254(1) OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER) DATED 17.04.2014 BY THE TRIBUNAL IN ITS CASE FOR ASSESSMENT YEAR (A.Y.) 2005-06. 2. THE ASSESSEES GRIEVANCE, AS PROJECTED PER ITS A PPLICATION, IS THAT THE TRIBUNAL HAS NOT TAKEN COGNIZANCE OF THE MATERIAL ON RECORD IN T HE FORM OF THE PAPER-BOOK, VIZ. APPOINTMENT OF THE CHIEF OPERATING OFFICER AND ALSO ITS AUDITED ACCOUNTS, BRINGING OUT THE ASSESSEES CASE OF ITS FINANCIAL AND INFRASTRUCTURA L CAPABILITY TO START BUSINESS IMMEDIATELY. IN FACT, REPRESENTATION DURING HEARING WAS MADE BY THE AUTHORIZED REPRESENTATIVE (AR) 2 MA NO. 316/MUM/2014 (A.Y. 2005-06) ALD AUTOMOTIVE PVT. LTD. VS. DY. CIT TO BRING OUT THE FUNCTIONAL CAPACITY OF THE ASSESSE E-COMPANY TO COMMENCE BUSINESS. AN OMISSION TO CONSIDER THE FACTS AND MATERIAL ON RECO RD HAD LED TO MISCARRIAGE OF JUSTICE. AN OPPORTUNITY TO THE ASSESSEE TO PRESENT ITS CASE, B Y RECALLING THE IMPUGNED ORDER, WAS ACCORDINGLY PRAYED FOR. 3. THE LD. AR (BEING THE SAME WHO REPRESENTED IN AP PELLATE PROCEEDINGS), DURING HEARING, REITERATED THE ASSESSEES CASE, I.E., AS M ADE PER ITS APPLICATION. THE LD. DEPARTMENTAL REPRESENTATIVE, ON THE OTHER HAND, WOU LD SUBMIT THAT THE IMPUGNED ORDER IS A WELL CONSIDERED DECISION, CONSIDERING AND TAKING INTO ACCOUNT THE MATERIAL ON RECORD, SO THAT THERE WAS NO CASE FOR ITS RECALL. AT ANY RATE, THE TRIBUNAL HAS NO POWER TO REVIEW. 4. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATER IAL ON RECORD. WE ARE, TO BEGIN WITH, AT A COMPLETE LOSS TO UNDERS TAND THE ASSESSEES CASE. THE TRIBUNAL HAS PER THE IMPUGNED ORDER ISSUED FINDINGS CONSISTENT WITH THE REVENUES STAND AND FINDINGS. IF THEREFORE ITS ORDER IS RECTIFIABLE , I.E., BEARS A MISTAKE APPARENT FROM THE RECORD, SO WOULD BY IMPLICATION BE THE ORDERS BY TH E AUTHORITIES BELOW, I.E., THE ASSESSING AND THE FIRST APPELLATE AUTHORITY, UNDER CHALLENGE BEFORE IT. THE PETITION IS THUS NOT MAINTAINABLE AT THE VERY THRESHOLD. WE SHALL NEVERTHELESS ALSO DISCUSS THE ASSESSEES M ISCELLANEOUS APPLICATION ON MERITS. IT WOULD BE RELEVANT TO DELINEATE THE IMPUG NED ORDER IN TERMS OF ITS CONFIGURATION. PARA 2 DESCRIBES THE ISSUE ARISING IN APPEAL. PARA 3 ENLISTS THE FACTS. PARA 4, THE CASE OF THE OPPOSING PARTIES, WHILE VIDE PARA 5 THE TRIBUNAL DE TAILS ITS FINDINGS. PARA 5.1 (FORMING PART OF PARA 5) CLARIFIES THE LEGAL POSITION, WHICH THE TRIBUNAL FIND AS WELL SETTLED, BRINGING FORTH THE RELEVANT FACT IN ISSUE TO BE DETERMINED. VIDE PARA 5.2, IT RECORDS ITS FINDINGS OF FACT/S. PARA 5.3 DISCUSSES THE ASSESSEES RELIANCE ON CASE LAW. THE ASSESSEE DOES NOT DISPUTE EITHER THE RECORDING OF THE FACTS BY THE TR IBUNAL (PARA 3) OR THAT OF THE CASE OF THE PARTIES BEFORE IT (PARA 4), OR EVEN ITS UNDERSTANDI NG OF LAW (PARA 4). IT CLAIMS THAT THE TRIBUNAL IN ARRIVING AT ITS FINDING OF FACT HAS TH ROUGH INADVERTENTLY OMITTED TO TAKE COGNIZANCE OF CERTAIN FACTS AND DOCUMENTS. WHAT ARE THOSE FACTS AND DOCUMENTS IS THUS 3 MA NO. 316/MUM/2014 (A.Y. 2005-06) ALD AUTOMOTIVE PVT. LTD. VS. DY. CIT THE LEAST THE ASSESSEE WAS REQUIRED TO POINT OUT OR SPECIFY TO MAKE OUT A CASE THAT IS AT LEAST PRIMA FACIE VALID OR ADMISSIBLE. WE SAY PRIMA FACIE , AS EVEN ON OMISSION OR OVERLOOKING A PARTICULAR FACT, UNLESS THE SAME GOES TO THE ROOT OF THE MATTER, MAY NOT QUALIFY TO BE A MISTAKE RECTIFIABLE U/S.254(2) (REF ER: CIT VS. RAMESH ELECTRIC & TRADING CO. [1993] 203 ITR 497 (BOM)). FURTHER, IT CLAIMS, PER ITS INSTANT APPLICATION, TO BE FUNCTIONALLY IN A POSITION TO COMMENCE BUSINESS, WI THOUT REALIZING THAT THAT IS PRECISELY WHAT THE TRIBUNAL WAS REQUIRED TO DETERMINE IN VIEW OF THE OPPOSING CLAIMS, AND WHICH IT, ON AN EXAMINATION OF AND ON THE BASIS OF THE MATERI AL ON RECORD, FOUND IT AS NOT SO. IT STATES TO HAVE APPOINTED CHIEF OPERATING OFFICER NO DOUBT AN ENABLING FACTOR, WHICH HAS NOT BEEN CONSIDERED BY THE TRIBUNAL. HOWEVER, THE S AID FACT IS NOT ONLY DULY NOTED BY THE TRIBUNAL AT PARAS 3 AND 4 OF ITS ORDER, BUT RATHER IS THE STARTING POINT OF ITS DISCUSSION ON FACTS, WHICH READS AS UNDER: 5.2 COMING TO THE FACTS OF THE CASE, THE COMPANY C LAIMS TO HAVE APPOINTED MD AS WELL AS CHIEF OPERATIONS MANAGER, P UTTING THE INFRASTRUCTURE IN PLACE BY ACQUIRING OFFICE PREMISE S, STAFF, FURNITURE AND FITTINGS, ETC. NO .. HOW COULD THEN, WE WONDER, IT CLAIM AN OMISSION BY THE TRIBUNAL IN NOTICING OR CONSIDERING THE SAID FACT. FURTHER, THE COMPANY NOW HERE SPECIFIES THE CLEAR DATE WHEN ITS BUSINESS WAS SET UP. THIS IS IN VIEW OF THE CLEAR L EGAL POSITION THAT ONLY THE EXPENDITURE POST SET-UP, SO THAT IT IS ABLE TO COMMENCE BUSINES S, WHICH WOULD STAND TO BE ALLOWED EVEN IF THE ASSESSEES BUSINESS IS NOT ACTUALLY COM MENCED. AS NOTED BY THE TRIBUNAL, THE ASSESSEE-COMPANY, ON THE OTHER HAND, CLAIMS ENTIRE EXPENSES INCURRED SINCE ITS INCEPTION, SO THAT BY IMPLICATION BUSINESS IS ESTABLISHED UPON INCORPORATION ITSELF. THAT IS, THE ASSESSEES STAND RAISES CLAIMS THAT RATHER ARE BOTH UNSUPPORTED AS WELL AS BIZARRE. THE ISSUE, AS OBSERVED BY IT AT PARA 5.3, IN VIEW OF TH E SETTLED POSITION OF LAW, IS PRIMARILY FACTUAL, WHICH STANDS DECIDED BY THE TRIBUNAL ON FI NDINGS OF FACT BASED ON THE MATERIAL ON RECORD, FINDING THE ASSESSEES CASE UNPROVED, IF NO T ACTUALLY DISPROVED. NO CASE FOR RECTIFICATION IS IN OUR VIEW ACCORDINGLY MADE OUT. 4 MA NO. 316/MUM/2014 (A.Y. 2005-06) ALD AUTOMOTIVE PVT. LTD. VS. DY. CIT THE ASSESSEES APPLICATION (VIDE PARA 4 THEREOF) RE FERS TO PARA 5.6 OF THE IMPUGNED ORDER, WHICH WE FIND AS NON-EXISTENT. WE THOUGH OBS ERVE A TYPOGRAPHICAL MISTAKE; THE WORD INCENTIVE AT LINE 12 OF PAGE 6 (PARA 5.3) OF THE ORDER BE READ AS INTENSIVE. WE DECIDE ACCORDINGLY. 5. IN THE RESULT, THE ASSESSEES MISCELLANEOUS APPL ICATION IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON OCTOBER 10, 2 014 SD/- SD/- (I. P. BANSAL) (SANJAY ARORA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER $ % MUMBAI; - DATED : 10.10.2014 . ../ ROSHANI , SR. PS ! ' #$%& ' &$ / COPY OF THE ORDER FORWARDED TO : 1. '. / THE APPELLANT 2. /0'. / THE RESPONDENT 3. $ 1' ( ) / THE CIT(A) 4. $ 1' / CIT - CONCERNED 5. 45 /' 6 , ( 6+ , $ % / DR, ITAT, MUMBAI 6. 578 9% / GUARD FILE ! ( / BY ORDER, )/(* + (DY./ASSTT. REGISTRAR) , $ % / ITAT, MUMBAI