JOINT COMMISSIONER OF INCOME TAX (OSD) 2(1) (1), MUMBAI V. BANK OF INDIA, MUMBAI

MA 404/MUM/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 8309 (ITAT-MUMBAI)
• Duration Of Justice: 10 month(s) 11 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 12-04-2019
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: L
• Assessment Year: 2009-2010
• Appeal Filed On: 01-06-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: DURGA DUTT LD
• Assessee Lawyers: C NARESH LD
• Keywords: Period of limitation; Time period of passing order

Judgement Text

1 M.A.NO.404/MUM/2018 ARISING OUT OF ITA.NO.2833/MUM/2015 BANK OF INDIA ASSESSMENT YEAR: 2009-10 IN THE INCOME TAX APPELLATE TRIBUNAL I BENCH, MUMBAI , , BEFORE HONBLE SHRI SANDEEP GOSAIN, JM AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM M.A NO. 404/MUM/2018 [ARISING OUT OF I.T.A. NO.2833/MUM/2015] ( / ASSESSMENT YEAR: 2009-10) JOINT COMMISSIONER OF INCOME TAX (OSD), CIRCLE-2(1)(1) ROOM NO. 561 AAYKAR BHAWAN, M.K.ROAD MUMBAI 400 020 / VS. BANK O F INDIA STAR HOUSE, C-5, G-BLOCK BANDRA-KURLA COMPLEX BANDRA(E), MUMBAI-400 051. ./ ./PAN/GIR NO. AAACB-0472-C ( /APPELLANT ) : ( / RESPONDENT ) A SSESSEE BY : SHRI C.NARESH, LD. AR REVENUE BY : SHRI DURGA DUTT, LD. DR !' / DATE OF HEARING : 01/02/2019 #$ !' / DATE OF PRONOUNCEMENT : 12/04/2019 / O R D E R PER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER):- 1. BY WAY OF THIS MISCELLANEOUS APPLICATION, THE RE VENUE SEEKS CERTAIN RECTIFICATION IN TRIBUNAL ORDER ITA NO. 2833/MUM/20 15 DATED 08/11/2017 IN ASSESSEES APPEAL FOR ASSESSMENT YEAR 2009-10. 2 M.A.NO.404/MUM/2018 ARISING OUT OF ITA.NO.2833/MUM/2015 BANK OF INDIA ASSESSMENT YEAR: 2009-10 2.1 THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSES SEE [AR], SHRI C.NARESH , AT THE OUTSET, RAISED A PRELIMINARY ISSUE BY SUBM ITTING THAT THE ORDER WAS PASSED BY TRIBUNAL ON 08/11/2017 WHEREAS THIS APPLICATION HAS BEEN FILED ON 01/06/2018 I.E. BEYOND SIX MONTHS FRO M THE END OF THE MONTH IN WHICH THE ORDER WAS PASSED AND THEREFORE, APPLIC ATION STOOD BARRED BY LIMITATION IN TERMS OF SECTION 254(2) SINCE THE PER IOD OF LIMITATION WAS TO BE RECKONED FROM THE END OF THE MONTH IN WHICH THE ORD ER WAS PASSED . PER CONTRA , LD. DR DREW ATTENTION TO AUTHORIZATION MEMO DATED 24/05/2018 TO SUBMIT THAT THE COPY OF THE TRIBUNALS ORDER WAS RE CEIVED ONLY ON 23/01/2018 AND THEREFORE, CONSIDERING THIS DATE, TH E APPLICATION WAS WITHIN THE STIPULATED TIME LIMIT. OUR ATTENTION HAS BEEN D RAWN TO THE FOLLOWING ORDERS OF THE TRIBUNAL IN THIS REGARD: - I) SHRI JAGMOHAN GURBAKSHISH SINGH VS DCIT [MA NOS. 40,42/CHD/2018 DATED 27/04/2018 ITAT, CHANDIGARH] II) ACIT VS INDO GLOBAL WAREHOUSING & SERVICES P. L TD. [MA NO.16/PUN/2018 DATED 17/12/2018 ITAT, PUNE] III) SRINIVAS SASIDHAR CHAGANTY VS ITO [MA NO.05/HY D/2017 DATED 12/07/2017 ITAT, HYDERABAD] 2.2 WE HAVE CAREFULLY CONSIDERED THE GIVEN FACTUAL MATRIX. THE UNDISPUTED POSITION THAT EMERGES IS THE FACT THAT THE ORDER OF THE TRIBUNAL HAS BEEN RECEIVED BY THE REVENUE ONLY ON 23/01/2018 WHICH IS EVIDENT FROM AUTHORIZATION MEMO DATED 24/05/2018 AS PLACED ON RECORD. THE APPLICATI ON SEEKING RECTIFICATION AGAINST THE SAME HAS BEEN FIL ED ON 01/06/2018 WHICH IS WITHIN 6 MONTHS FROM THE DATE OF RECEIPT OF ORDE R UNDER QUESTION. SO FAR AS THE STATUTORY PROVISIONS AS CONTAINED IN SECTION 254(2) IS CONCERNED, WE 3 M.A.NO.404/MUM/2018 ARISING OUT OF ITA.NO.2833/MUM/2015 BANK OF INDIA ASSESSMENT YEAR: 2009-10 FIND THAT THERE COULD BE NO QUARREL AS TO THE EXPRE SSION USED THEREIN SINCE THE PRESCRIBED PERIOD IS SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE ORDER WAS PASSED. HOWEVER, IN TERMS OF RULE 35 OF INCOME TAX (APPELLATE TRIBUNAL RULES), 1963, THE ORDER OF THE TRIBUNAL IS TO BE COMMUNICATED TO THE ASSESSEE AS WELL AS COMMISSIONER. IN OUR CONSID ERED OPINION, UNTIL THE ORDER IS COMMUNICATED TO THE RESPECTIVE PARTIES, TH E PARTIES COULD NOT COME TO KNOW THE CONTENTS OF THE ORDER AND WOULD NOT COM E TO KNOW OF ANY ERRORS IN THE SAME. THEREFORE, NO FURTHER COURSE OF ACTION COULD BE CHALKED OUT AGAINST THE SAME INCLUDING FILING OF RECTIFICATION ETC. HENCE, UNTIL & UNLESS THE ORDER OF THE TRIBUNAL IS COMMUNICATED TO THE RE SPECTIVE PARTIES, THE FURTHER COURSE OF ACTION AGAINST THE SAME WOULD REM AIN IN DORMANT STAGE AND THE PARTIES WOULD NOT BE ABLE TO EXERCISE THEIR RIGHTS UNLESS SERVED WITH THE ORDER AGAINST WHICH THIS RIGHT ARISES. THE DELA Y IN COMMUNICATING THE ORDER, IN OUR OPINION, COULD NEITHER DEPRIVE THE EF FECTED PARTIES OF THEIR VESTED RIGHT TO CONTEST THE SAME IN FURTHER APPEAL OR FILE RECTIFICATION AGAINST THE SAME NOR COULD IT OPERATE SO AS TO CURTAIL THE EFFECTIVE TIME AVAILABLE TO DO SO. 2.3 UPON PERUSAL OF THE JUDICIAL PRONOUNCEMENTS AS CITED BEFORE US. WE FIND THAT THE CHANDIGARH TRIBUNAL IN SHRI JAGOMOHAN GURBAKSHISH SINGH [SUPRA] CONSIDERING THE DECISION OF HONBLE GUJARAT HIGH C OURT IN PETERPLAST SYNTHETICS P. LTD VS ACIT [2013 86 CCH 0314] & LILA DHAR T. KUSHLANI VS COMMISSIONER OF CUSTOMS [TAX APPEAL NO. 915 OF 2016 DATED 25/01/2017] CONCLUDED THAT THE DATE OF DISPATCH / RECEIPT OF TH E COPY OF THE RELEVANT 4 M.A.NO.404/MUM/2018 ARISING OUT OF ITA.NO.2833/MUM/2015 BANK OF INDIA ASSESSMENT YEAR: 2009-10 ORDER AND NOT THE DATE OF PASSING OF THE ORDER WAS TO BE CONSIDERED FOR THE PURPOSE OF RECKONING THE PERIOD OF LIMITATION. THE HONBLE GUJARAT HIGH COURT IN THE CASE OF PETERPLAST SYNTHETICS P. LTD. [SUPRA] HAS OBSERVED THAT THE DATE OF ORDER WOULD MEAN AND MUST BE CONSTRUED AS MEANING THE DATE OF COMMUNICATION OR KNOWLEDGE, ACTUAL OR CONSTRUCTI VE, OF THE ORDER SOUGHT TO BE REVIEWED. THESE DECISIONS STRENGTHEN OUR AFORESAID VIEW. 2.4 THE PUNE TRIBUNAL IN ACIT VS INDO GLOBAL WAREHOUSING & SERVICES P. LTD. [SUPRA] AFTER CONSIDERING THE ABOVE DECISION AS WE LL AS THE DECISION OF PUNE TRIBUNAL IN SHRI KASTURILAL SARDARILAL LUTHRA VS DCIT [MA NO.38/PUN/2017 DATED 04/04/2018] & THE DECISION OF MUMBAI TRIBUNAL IN DCIT VS HITA LAND PRIVATE LIMITED [MA NO. 103/MUM/2 017 DATED 25/04/2017], DISMISSED THE PRELIMINARY ISSUE AND PROCEEDED TO DE CIDE THE APPLICATION ON MERITS. 2.5 THE HYDERABAD TRIBUNAL IN SRINIVAS SASIDHAR CHAGANTY VS. ITO [SUPRA] HAS TAKEN A VIEW THAT THE PERIOD OF LIMITATION WAS TO BE RECKONED FROM THE END OF THE MONTH IN WHICH THE ORDER WAS PA SSED / UPLOADED ON THE WEBSITE. HOWEVER, WE HAVE ALREADY NOTED THAT IN TER MS OF RULE 35 OF INCOME TAX (APPELLATE TRIBUNAL RULES), 1963, THE ORDER WAS TO BE COMMUNICATED TO THE RESPECTIVE PARTIES AND UPLOADIN G OF THE ORDER ON THE WEBSITE IS NOT ONE OF THE PRESCRIBED MODES OF COMMU NICATION TO THE PARTIES. THEREFORE, UNLESS THE ORDER IS COMMUNICATED IN THE PRESCRIBED MANNER, THE PARTIES WOULD NOT COME TO KNOW THE CONTENTS OF THE ORDER AND COULD NOT CHALK OUT FURTHER COURSE OF ACTION AGAINST THE SAME . THEREFORE, MERE 5 M.A.NO.404/MUM/2018 ARISING OUT OF ITA.NO.2833/MUM/2015 BANK OF INDIA ASSESSMENT YEAR: 2009-10 UPLOADING OF THE ORDER IN THE WEBSITE, IN OUR CONSI DERED OPINION, WOULD NOT TRIGGER THE START OF LIMITATION PERIOD AGAINST THE RESPECTIVE PARTIES. 2.6 APPLYING THE AFORESAID PRINCIPLES TO THE FACTUA L MATRIX, WE FIND THAT AS COUNTED FROM THE DATE OF RECEIPT OF THE ORDER I.E. 23/01/2018, THE APPLICATION IS WITHIN TIME AND THEREFORE, WE PROCEED TO DISPOSE -OFF THE SAME AS ARGUED BEFORE US. 3. THE FIRST ERROR POINTED OUT BY THE REVENUE IS TH AT THE CONCLUSION DRAWN IN PARA 10 WHILE ADJUDICATING FIFTH GROUND OF ASSESSEES APPEA L REGARDING DISALLOWANCE OF LEASE PREMIUM WOULD NEED CORRECTION SINCE WHILE ADJUDICATING THE ISSUE, RELIANCE WAS PLACED ON THE DECISION OF THIS TRIBUNAL FOR AYS 2007-08 & 2008-09 WHEREIN THE MATTER WAS DE CIDED AGAINST THE ASSESSEE. UPON PERUSAL, WE CONCUR WITH THE SAME. AC CORDINGLY, THE LAST LINE OF PARA 10 IN THE STATED ORDER MAY BE READ AS UNDER: - FOLLOWING THE ORDERS FOR EARLIER YEARS, WE DISMISS GROUND NO. 5 4.1 THE SECOND MISTAKE IS STATED TO HAVE ARISEN WHI LE ADJUDICATING THE ISSUE OF DEDUCTION U/S 36(1)(VIII). IT HAS BEEN SUB MITTED THAT DURING ASSESSMENT PROCEEDINGS, LD. AO FOUND THAT THE ASSES SEE HAD CLAIMED DEDUCTION U/S 36(1)(VIII) IN RESPECT OF THE PROFITS EARNED ON ELIGIBLE BUSINESS. WHILE ARRIVING AT THE PROFITS, THE ASSESSEE HAD ALL OCATED EXPENSES RELATING TO ELIGIBLE BUSINESS BASED ON FUNDS DEPLOYED WHICH WERE COMPUTED AFTER CONSIDERING THE AMOUNT OF DEPOSITS, ASSETS, BORROWI NGS AND OTHER LIABILITIES. HOWEVER, LD. AO WAS OF THE OPINION THAT ONLY TOTAL OF ASSETS / LIABILITIES WERE TO BE CONSIDERED WHILE COMPUTING THE FUNDS DEPLOYED . ACCORDINGLY, THE 6 M.A.NO.404/MUM/2018 ARISING OUT OF ITA.NO.2833/MUM/2015 BANK OF INDIA ASSESSMENT YEAR: 2009-10 EXPENSES WERE RE-ALLOCATED AND THE DEDUCTION WAS RE STRICTED TO RS.133 CRORES AS AGAINST RS.150 CRORES CLAIMED BY THE ASSE SSEE. THE LD. CIT(A) CONFIRMED THE ACTION OF LD. AO WHICH WAS CONTESTED BY THE ASSESSEE BEFORE THIS TRIBUNAL. IT HAS FURTHER BEEN SUBMITTED THAT THE ASSESSEES CLAIM WAS ALLOWED BY THE TRIBUNAL RELYING UPON THE ORDERS OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR AYS 2007-08 & 2008-09. THE LD. DR SUBMITTED THAT, HOWEVER, THE ISSUE IN AY 2007-08 WAS ONLY WIT H RESPECT TO APPLICABILITY OF PROVISIONS OF SECTION 36(1)(VIII) TO THE ASSESSE E WHEREAS THE ISSUE IN THIS YEAR WAS REGARDING THE ALLOCATION OF EXPENSES TO EL IGIBLE BUSINESS. THEREFORE, THE ISSUE HAS NOT BEEN CONSIDERED IN PRO PER PERSPECTIVE AND THE DECISION IS NOT ACCEPTABLE. THE LD. AR SUBMITTED TH AT THE AFORESAID FACTS WERE ALREADY NOTED BY THE CO-ORDINATE BENCH IN PARA 6 AND THE MATTER WAS ADJUDICATED AFTER CONSIDERING THE SAME. 4.2 UPON PERUSAL OF PARA 6, WE FIND THAT IT IS TRUE THAT THESE FACTS WERE ALREADY NOTED BY THE BENCH WHILE ADJUDICATING THE I SSUE. IT IS NOT THE CASE OF THE REVENUE THAT CERTAIN FACTS WERE OVERLOOKED WHIC H RESULTED INTO CERTAIN ERROR IN THE ORDER. THE ONLY POINT URGE IS THAT THE DECISION IS NOT ACCEPTABLE SINCE THE ISSUE HAS NOT BEEN CONSIDERED IN PROPER P ERSPECTIVE. HOWEVER, WHEN THE DECISION HAS BEEN RENDERED WITH DUE APPREC IATION OF FACTS AND THERE ARE NO SLIPPAGES, IT COULD NOT BE SAID THAT T HERE WAS MISTAKE APPARENT FROM RECORD WHICH WAS AMENABLE TO RECTIFICATION. TH ERE IS NO POWER WITH TRIBUNAL TO REVIEW THE ISSUES UNLESS EXPRESSLY PROV IDED UNDER LAW. FURTHER, THE REVENUE HAS AN ALTERNATIVE REMEDY UNDER LAW TO CONTEST THE DECISION 7 M.A.NO.404/MUM/2018 ARISING OUT OF ITA.NO.2833/MUM/2015 BANK OF INDIA ASSESSMENT YEAR: 2009-10 BEFORE HIGHER JUDICIAL AUTHORITIES. THEREFORE, FIND ING NO MISTAKE APPARENT FROM RECORD, THIS PLEA STAND REJECTED. 5. THE APPLICATION STANDS PARTLY ALLOWED IN TERMS O F OUR ABOVE ORDER. ORDER PRONOUNCED IN THE OPEN COURT ON 12 TH APRIL, 2019. SD/- SD/- (SANDEEP GOSAIN) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 12/04/2019 SR.PS:-JAISY VARGHESE #$ %$ / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT CONCERNED 5. !'# , # , / DR, ITAT, MUMBAI 6. !%&' / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI.