AHUJA PLATINUM PROPERTIES P.LTD, V. DCIT RG 9(1),

MA 446/MUM/2013

• Counselvise Citation: [2014] 124 COUNSELVISE.COM (IT) 2126 (ITAT-MUMBAI)
• Duration Of Justice: 6 month(s) 27 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 07-07-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 11-12-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PITAMBAR DAS
• Assessee Lawyers: REEPAL TRALSHAWALA
• Keywords: Commercial expediency

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. NOS. 445 & 446/MUM/2013 (ARISING OUT OF ITA NOS. 7153/MUM/2010 & 2953/MUM/2 011) ( / ASSESSMENT YEAR: 2005-06 & 2007-08) AHUJA PLATINUM PROPERTIES LTD. A-1, RAJPIPLA LINKING ROAD, SANTACRUZ (W), MUMBAI-400 054 / VS. DY. CIT, RANGE 9(1), ROOM NO. 223, AAYAKAR BHAVAN, M. K. ROAD, MUMBAI-400 020 ' ./# ./PAN/GIR NO. AAECA 4138 L APPLICANT : RESPONDENT APPLICANT BY : SHRI REEPAL TRALSHAWALA RESPONDENT BY : SHRI PITAMBAR DAS $ % & '( / DATE OF HEARING : 09.05.2014 )*+ & '( / DATE OF PRONOUNCEMENT : 07.07.2014 , / O R D E R PER SANJAY ARORA, A. M.: THESE ARE A SET OF TWO MISCELLANEOUS PETITIONS BY T HE ASSESSEE, I.E., FOR ASSESSMENT YEARS (A.YS.) 2005-06 & 2007-08, IN RESPECT OF THE COMBINED ORDER BY THE TRIBUNAL DATED 30.10.2013 IN ITS CASE FOR THE SAID YEARS. 2. VIDE THE INSTANT MISCELLANEOUS APPLICATIONS (MAS ) THE ASSESSEE IMPUGNS THE DECISION BY THE TRIBUNAL QUA GROUND NO. 2 OF THE REVENUES APPEALS FOR BOTH THE YEARS, WHEREBY THE REVENUE AGITATES THE DELETION OF THE DI SALLOWANCE OF INTEREST PAID BY THE ASSESSEE TO M/S. AHUJA PROPERTIES, A GROUP CONCERN, DISALLOWED IN PART BY THE ASSESSING 2 MA NOS. 445 & 446/MUM/2013 (A.YS. 05-06 & 07-08) AHUJA PLATINUM PROPERTIES LTD. VS. DY. CIT OFFICER (A.O.) BY INVOKING SECTION 40A(2)(A) OF THE ACT. THE RELEVANT GROUNDS READ AS UNDER: A.Y. 2005-06 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS.1,12,10 ,471/- BEING EXCESS PAYMENT OF INTEREST MADE, OVERLOOKING THE FACT THAT THE ASSESSEE COULD NOT ESTABLISH WITH EVIDENCE THAT THE PAYMENTS MADE TO A SSOCIATE CONCERNS OF THE ASSESSEE WERE DETERMINED BY REASONS OF COMMERCIAL E XPEDIENCY. A.Y. 2007-08 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS.1,22,57 ,536/- WHICH REPRESENTS THE AMOUNT OF INTEREST PAID TO M/S. AHUJA PROPERTIE S & DISALLOWED BY THE ASSESSING OFFICER BY HOLDING THAT THE PAYMENT WAS E XCESSIVE AND NOT DETERMINED BY THE COMMERCIAL EXPEDIENCY, DESPITE AD EQUATE MATERIAL BROUGHT ON RECORD DURING THE ASSESSMENT PROCEEDINGS THAT THE PAYMENT WAS UNJUSTIFIED FROM COMMERCIAL POINT OF VIEW. THE TWO GROUNDS, HEARD TOGETHER, WERE SO WITH REFER ENCE TO THE TRIBUNALS ORDER FOR A.Y. 2003-04 (IN ITA NO. 4558/MUM(H)/2007 DATED 24.06.20 11), WHEREBY THE DISALLOWANCE, SIMILARLY MADE, STOOD DELETED. THE SAME STOOD IN FA CT FOLLOWED BY THE TRIBUNAL FOR A.Y. 2006-07, THE ORDER FOR WHICH YEAR WAS ALSO ADDUCED DURING HEARING. THIS FACT WAS NOT CONTESTED BY THE REVENUE DURING HEARING. THE TRIBUN AL, HOWEVER, HAS RESTORED THE MATTER BACK TO THE FILE OF THE FIRST APPELLATE AUTHORITY V IDE THE IMPUGNED ORDER AND, FURTHER, MADE OBSERVATIONS THEREIN DETRIMENTAL TO IT. NO QUERIES HAD BEEN RAISED NOR ANY CLARIFICATION SOUGHT AT THE TIME OF HEARING. THERE IS ALSO NO REF ERENCE TO THE TRIBUNALS ORDER FOR A.Y. 2006-07, ALSO RELIED UPON BY THE ASSESSEE. ACCORDIN GLY, THE IMPUGNED ORDER BE RECALLED QUA THIS GROUND/S, AND DECIDED AFRESH IN CONSONANCE WIT H SECTION 254 OF THE ACT. 3. BEFORE US, WHILE THE AUTHORIZED REPRESENTATI VE (AR) REITERATED ITS CASE AS MADE OUT PER THE MISCELLANEOUS PETITIONS, THE LD. DEPARTMENT AL REPRESENTATIVE (DR) PLACED RELIANCE ON THE IMPUGNED ORDER, STATING OF IT TO BE IN CONSO NANCE WITH LAW AND UPON APPRECIATION OF 3 MA NOS. 445 & 446/MUM/2013 (A.YS. 05-06 & 07-08) AHUJA PLATINUM PROPERTIES LTD. VS. DY. CIT FACTS, AND WHAT THE ASSESSEE SEEKS IN THE GARB OF R ECTIFICATION PROCEEDINGS IS ONLY ITS REVIEW, IMPERMISSIBLE U/S. 254(2) OF THE ACT. 4. WE HAVE HEARD THE PARTIES, AND PERUSED TH E MATERIAL ON RECORD. 4.1 THE TRIBUNALS ORDER FOR A.Y. 2003-04, SOL ELY RELIED UPON BY THE ASSESSEE IN ARGUING THE INSTANT APPEALS, HAS BEEN FOUND BY THE TRIBUNAL PER THE IMPUGNED ORDER AS DISTINGUISHABLE ON FACTS. THE ASSESSEE HAD FOR BOTH THE YEARS RENDERED SPECIFIC EXPLANATION/S TO THE ASSESSING OFFICERS CHARGE FOR APPLYING THE PROVISION OF S. 40A(2)(A) OF THE ACT, AND IT IS THIS EXPLANATION THAT HAD BEE N CONSIDERED BY HIM, FINDING IT UNACCEPTABLE. THAT HE ADDITIONALLY DREW SUPPORT FRO M HIS OBSERVATIONS MADE WHILE FRAMING THE ASSESSMENT FOR A.Y. 2003-04 OR, AS THE CASE MAY BE, A.Y. 2006-07, SUPPLEMENTING HIS STAND, IS ONLY ANOTHER MATTER. HO WEVER, FINDING THAT THE LD. CIT(A) HAD NOT CONSIDERED THE RESPECTIVE CASES OF THE PARTIES ON MERITS, HAVING IN FACT DECIDED DE HORS THE ASSESSEES EXPLANATION, THE MATTER WAS RESTORED BY THE TRIBUNAL BACK TO HIS FILE FOR ADJUDICATION AFRESH IN ACCORDANCE WITH LAW AND THE FACTS FOR THOSE YEARS; ITS DECISION (FOR BOTH THE YEARS), BEING AS UNDER: 6.4 UNDER THE CIRCUMSTANCES, THEREFORE, WE ONLY CO NSIDER IT FIT AND PROPER TO RESTORE THIS ISSUE BACK TO THE FILE OF TH E LD. CIT(A) FOR AN ADJUDICATION AFRESH IN ACCORDANCE WITH LAW, BY ISSU ING DEFINITE FINDINGS OF FACT, AND AFTER ALLOWING PROPER OPPORTUNITY OF HEAR ING TO BOTH THE SIDES. WE DECIDE ACCORDINGLY. 4.2 THE ASSESSEES ENTIRE CASE BEFORE IT BEING WITH REFERENCE TO THE TRIBUNALS ORDER FOR A.Y. 2003-04, THE ONLY MANNER IN OUR VIEW IN WHICH A CASE U/S.254(2) COULD BE VALIDLY MADE OUT BY IT WAS BY SHOWING A MISTAKE/S ATTENDING THE IMPUGNED ORDER, VIZ. THE IDENTITY OF FACTS; AS TO HOW THE TRIBUNALS ORDER RELIED UPO N DID INDEED ADDRESS ITSELF TO THE ASSESSEES EXPLANATION, WHICH HAS NOT BEEN. IN FACT , THE DIFFERENCE IS PATENT FROM THE CONSIDERABLE DIFFERENCE IN THE INTEREST RATES OBTAI NING FROM YEAR TO YEAR, BEING VARIABLE, BESIDES NON-SPECIFICATION OF THE BROKERAGE RATE. RE FERENCE IN THIS REGARD MAY BE MADE TO PARAS 6.1 TO 6.3 OF THE IMPUGNED ORDER. THE NON-REF ERENCE TO ORDER FOR A.Y. 2006-07 IS ALSO TO NO CONSEQUENCE, AS OBSERVED DURING HEARING ITSELF IN-AS-MUCH AS NO INDEPENDENT 4 MA NOS. 445 & 446/MUM/2013 (A.YS. 05-06 & 07-08) AHUJA PLATINUM PROPERTIES LTD. VS. DY. CIT FINDINGS STAND ISSUED BY THE TRIBUNAL FOR THAT YEAR , AND THE PARENT OR THE BASE ORDER CONTINUES TO BE THAT FOR A.Y. 2003-04. THE ARGUMENT OF THE PAYER FIRM BEING AT LOSS, IT IS FURTHER CONTENDED, HAD NOT BEEN CONSIDERED BY THE T RIBUNAL. THE ARGUMENT IS MISPLACED. THE ASSESSEE, IN STATING SO, FAILS TO BEAR IN MIND THAT THESE ARE NOT REVIEW PROCEEDINGS, WHICH COULD BE ARGUED WITH REFERENCE TO THE CONSIDE RATION OR OTHERWISE OF EACH AND EVERY ARGUMENT ADVANCED IN-AS-MUCH AS A VIEW, ONE WAY OR THE OTHER, IS TO BE FORMED (REFER : CIT VS. RAMESH ELECTIRC & TRDG. CO. [1993] 203 ITR 497 (BOM)). IN FACT, THE SAME NEVER FORMED PART OF THE ASSESSEES EXPLANATION ON MERITS FOR IT TO BE CONSIDERED. THIRDLY, THE MATTER STANDS NOT DECIDED BY THE TRIBUNAL BUT ONLY RESTORED BACK TO THE FILE OF THE FIRST APPELLATE AUTHORITY IN VIEW OF THE FINDING OF NO PR OPER CONSIDERATION BY HIM, SO THAT THE ASSESSEE SHALL HAVE DUE OPPORTUNITY OF EXPLAINING A ND PRESENTING ITS CASE BEFORE HIM. THIS WOULD ALSO MEET THE ASSESSEES GRIEVANCE WITH REG ARD TO NO CLARIFICATION OR QUERY HAVING BEEN PUT TO IT BY THE BENCH DURING THE HEARING OF T HE APPEAL, EVEN AS IT NEEDS TO APPRECIATED AND CLARIFIED THAT THE CLARIFICATIONS A ND QUERIES COULD ONLY BE WITH REFERENCE TO THE ARGUMENTS RAISED BEFORE IT. IN FINE, THE TRIBUNAL HAS, ON THE BASIS OF THE FACT S AND CIRCUMSTANCES OF THE CASE, INCLUDING THE ASSESSEES EXPLANATION, FINDING THAT THE CASE AS MADE OUT BY THE REVENUE AS NOT COVERED BY THE FINDINGS ISSUED BY THE TRIBUNAL FOR A.Y. 2003-04 AND, TWO, ABSENCE OF PROPER CONSIDERATION BY THE FIRST APPELLATE AUTHORI TY, RESTORED THE MATTER BACK TO HIS FILE. WE SEE NO SCOPE FOR INTERFERENCE U/S.254 (2) IN THE FACTS AND CIRCUMSTANCES OF THE CASE. WE DECIDE ACCORDINGLY. 5. IN THE RESULT, THE MISCELLANEOUS APPLICATIONS AR E DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON JULY 07, 2014 SD/- SD/- (I. P. BANSAL) (SANJAY ARORA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER $ % MUMBAI; - DATED : 07.07.2014 5 MA NOS. 445 & 446/MUM/2013 (A.YS. 05-06 & 07-08) AHUJA PLATINUM PROPERTIES LTD. VS. DY. CIT . ../ ROSHANI , SR. PS ! ' #$%& ' &$ / COPY OF THE ORDER FORWARDED TO : 1. '. / THE APPLICANT 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