DCIT- CC- 3(3),CENTRAL RANGE-3, MUMBAI V. MGN AGRO PROPERTIES PVT. LTD. (SUCCESSOR TO WELSPUN FINTRADE PVT. LTD.), MUMBAI

MA 32/MUM/2020

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 9209 (ITAT-MUMBAI)
• Duration Of Justice: 6 month(s) 20 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 11-08-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2013-2014
• Appeal Filed On: 22-01-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AKTAR H ANSARI
• Assessee Lawyers: AJAY NAGPAL
• Section: 14A; 115JB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH D MUMBAI BEFORE SHRI SAKTIJIT DEY (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) M.A. NO. 32/MUM/2020 (ITA NO. 3177/MUM/2018) ASSESSMENT YEAR: 2013 - 14 DCIT CC 3(3), CENTRAL RANGE - 3, ROOM NO. 1923, 19 TH FLOOR, AIR INDIA BUILDING, NARIMAN POINT, MUMBAI - 400021. VS. M/S MGN AGRO PROPERTIES PVT. LTD. (SUCCESSOR TO WELSPUN FINTRADE P LTD.), 9 TH FLOOR, B - WING, KAMALA MILLS COMPOUND, SENAPATI BAPAT MARG, LOWER PAREL, MUMBAI - 400013. PAN NO. AAACW2877J APPELLANT RESPONDENT REVENUE BY : MR. AKTAR H. ANSARI, DR ASSESSEE BY : MR. AJAY NAG PAL , AR DATE OF HEARING : 13/03/2020 DATE OF PRONOUNCEMENT : 11/08/2020 ORDER PER N.K. PRADHAN, AM BY MEANS OF THIS MISCELLANEOUS APPLICATION (MA), THE APPLICANT SEEKS RECTIFICATION OF THE ORDER DATED 22.07.2019 PASSED BY THE ITAT D BENCH MUMBAI (ITA NO. 3177/MUM/2018 ) FOR THE ASSESSMENT YEAR (AY) 2013 - 14. 2. THE LD. DEPARTMENTAL REPRESENTATIVE (DR) SUBMITS THAT THE APPEAL WAS FILED BY THE REVENUE IN THE INSTANT CASE ON THREE GROUND OF APPEAL, WHEREAS, THE TRIBUNAL HAS ADJUDICATED ONLY THE 2 ND AND 3 RD GROUND LEAVING THE 1 ST GROUND UNDECIDED. M/S MGN AGRO PROPERTIES PVT. LTD. MA NO. 32/MUM/2020 2 ON THE OTHER HAND , THE LD. COUNSEL FOR THE ASSESSEE SUBMITS THAT TH E TRIBUNAL HAS DECIDED ALL THE THREE GROUNDS OF APPEAL. 3. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIALS ON RECORD. THE GROUNDS OF APPEAL FILED BY THE REVENUE READ AS UNDER : 1. ON T HE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) ERRED IN RESTRICTING THE DISALLOWANCE U/S 14A OF THE ACT R.W.R 8D(2)(III) TO THE EXTENT OF EXPENSES CLAIMED BY THE ASSESSEE, EVEN THOUGH THE CBDT CIRCULAR NO. 5/2014 DATED 11.02.2014 W HICH CLARIFY ON RULES OF 8D DOES NOT SPECIFY ANY SUCH LIMIT. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) ERRED IN RESTRICTING THE BOOK PROFIT U/S 115JB(2) TO 50% OF EXPENSES CLAIMED WITHOUT GIVING ANY PROPER BASIS FOR ADOPTI NG THIS VALUE. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) WHILE DECIDING ON THE ISSUE OF ADDITION OF DISALLOWANCE U/S 14A TO BOOK PROFIT U/S 115JB(2) ERRED IN NOT CONSIDERING THE DECISION OF F BENCH OF ITAT, MUMBAI IN THE CASE OF VIRAJ PROFILES LTD. (2016) 156 ITD 72, MUMBAI WHICH IS SQUARELY COVERED IN FAVOUR OF THE REVENUE. BRIEFLY STATED, THE FACTS ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR (AY) 2013 - 14 ON 17.09.2012 DECLARING TOTAL INCOME OF RS.57,880/ - . THE ASSESSING OFFICER (AO) ARRIVED AT A TOTAL TAXABLE INCOME OF RS.3,51,54,530/ - UNDER NORMAL PROVISIONS AND BOOK PROFIT OF RS.18,38,31,897/ - U/S 115JB OF THE ACT. AS PER THE NORMAL PROVISION, TAX PAYABLE IS LESS THAN THE TAX CALCULA TED U/S 115JB OF THE ACT. THEREFORE, THE AO CONSIDERED FOR TAX PURPOSE THE BOOK PROFIT OF RS.18,38,31,897/ - U/S 115JB OF THE ACT. AS THE AO CONSIDERED FOR TAX PURPOSE, THE BOOK PROFIT OF RS.18,38,31,897/ - U/S 115JB OF THE ACT, THE BENCH HAS RIGHTLY FOLLOW ED THE M/S MGN AGRO PROPERTIES PVT. LTD. MA NO. 32/MUM/2020 3 DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF ACIT V. VIREET INVESTMENT PVT. LTD. (2017) 82 TAXMANN.COM 415 (DELHI - TRIB.) (SB). NEEDLESS TO SAY, THE 1 ST GROUND OF APPEAL CANNOT BE SEEN IN ISOLATION. IT IS TO BE READ ALONG WITH THE 2 ND AND 3 RD GROUND OF APPEAL. AS THERE IS NO MISTAKE APPARENT FROM RECORD IN THE IMPUGNED ORDER, THE MA FILED BY THE REVENUE IS DISMISSED. WE NOTE THAT THIS APPEAL WAS HEARD IN 13.03.2020 .THE PRONOUNCEMENT IS DELAYED DUE TO LOCKDOWN IN VIEW OF COVID - 19 P ANDEMIC. ORDER IS PRONOUNCED TODAY AS PER RULE 34(4) BY PLACING IT ON THE NOTICE BOARD . SD/ - SD/ - (SAKTIJIT DEY) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED: 11/08 /2020 RAHUL SHARMA, SR. P.S. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) - 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE . BY ORDER, //TRUE COPY// ( ASSISTANT REGISTRAR ) ITAT, MUMBAI