DCIT 2(2), MUMBAI V. MAHINDRA & MAHINDRA LTD, MUMBAI

MA 592/MUM/2018

• Counselvise Citation: [2019] 111 COUNSELVISE.COM (IT) 5597 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 23 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 17-10-2019
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: J
• Assessment Year: 2002-2003
• Appeal Filed On: 24-09-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Retrospective amendment; Bad and doubtful debts; Set aside

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL J , BENCH MUMBAI BEFORE SHRI M.BALAGANESH, AM & SHRI AMARJIT SINGH, JM M A NO. 592 /MUM/201 8 (ARISING OUT OF ITA NO. 5575/MUM/2012 ( ASSESSMENT YEAR : 2002 - 03 ) & M A NO. 591 /MUM/201 8 (ARISING OUT OF ITA NO. 6 961/MUM/2012 ( ASSESSMENT YEAR : 2003 - 04 ) M/S. MAHINDRA & MAHINDRA LTD GROUND FLOOR, MAHINDRA TOWERS WORLI ROAD, NO.13, WORLI, MUMBAI 400 018 VS. DCIT CIRCLE 2(2) ROOM NO.545, 5 TH FLOOR AAYAKAR BHAVAN M.K.ROAD, MUMBAI 400 001 PAN/GIR NO. AAACM3025E ( APPELLANT ) .. (RESPONDENT ) ASSESSEE BY SHRI KETAN VED REVENUE BY SHRI MANOJ KUMAR SINGH DATE OF HEARING 26 / 07 /2019 DATE OF PRONOUNCEMENT 17 / 10 /2019 / O R D E R PER AMARJIT SINGH (J.M.) : MA NO.592/MUM/2018 (A.Y.2002 - 03) LET US TAKE UP THE MA NO.592/MUM/2018 FOR A.Y.2002 - 03. BY VIRTUE OF THIS MISCELLANEOUS APPLICATION, THE ASSESSEE SEEKS TO BRING TO THE ATTENTION OF THIS TRIBUNAL TO RECTIFY CERTAIN MISTAKES THAT HAD CREPT IN IN THE ORDER PASSED BY THIS TRIBUNAL DATED 21/0 3/2018. MA NOS.591/MUM/2018 & 592/MUM/2018 M/S. MAHINDRA AND MAHINDRA LIMITED 2 2. WE FIND THAT THE ASSESSEE IN PARA 3 OF ITS MISCELLANEOUS APPLICATION HAD POINTED OUT AS UNDER: - 3. UNDER THE DETAILS OF RETURN OF INCOME FOR AY 2002 - 03 ON PAGE 1, RETURNED INCOME HAS BEEN INADVERTENTLY STATED AS RS. 156,34,64,632 / - INSTEAD OF RETURNED LOSS OF RS. 156,34,64,632/ - . 2.1. WE FIND THAT CLAIM OF ASSESSEE TO BE CORRECT AND ACCORDINGLY, WE MODIFY THE ORDER OF THIS TRIBUNAL IN PAGE 1 THEREON, THAT RETURNED LOSS SHOULD BE RS.156,34,64,632/ - AS AGAINST RETURNED INCOME WRONGLY MENTION ED IN THE TABULATION IN THE SAID ORDER. 3. WE FIND THAT THE ASSESSEE HAS MENTIONED IN PARA 4 OF ITS MISCELLANEOUS APPLICATION AS UNDER: - 4. IN PARA 2 ON PAGE 1, IT IS STATED THAT : 'EXCEPT FOR THE GROUNDS NO. 1,2,17 AND 18 ALL THE REMAINING GROUNDS ARE COVERED.' HOWEVER, AS PER THE CHART SUBMITTED DURING THE COURSE OF HEARING, ALL GROUNDS EXCEPT GROUND NO. 1,2, 16 AND 18 WERE STATED TO BE COVERED. IN THE ABOVE PARA, GROUND NO 17 HAS BEEN WRONGLY QUOTED INSTEAD OF GROUND NO 16. FURTHER, IN THE SAME PARA , INCOME TAX APPEAL NUMBERS FOR AY 2008 - 09 AND AY 1999 - 00 HAVE BEEN WRONGLY STATED AS UNDER. ASSESSMENT YEAR APPEAL NO 2008 - 09 ITA/586/MUM/2015 1999 - 00 ITA/3037/MUM/2009 CORRECT APPEAL NUMBERS ARE GIVEN BELOW. ASSESSMENT YEAR APPEAL NO 2008 - 09 ITA/586/MUM/2013 1999 - 00 ITA/3070/MUM/200 9 MA NOS.591/MUM/2018 & 592/MUM/2018 M/S. MAHINDRA AND MAHINDRA LIMITED 3 3.1. ON VERIFICATION OF THE RECORDS, WE FIND THAT THE CLAIM MADE BY THE ASSESSEE HEREIN IS CORRECT. ACCORDINGLY, WE MODIFY PARA 2 OF OUR ORDER AS UNDER: - ASSESSMENT YEAR APPEAL NO 2008 - 09 ITA/586/MUM/2013 1999 - 00 ITA/3070/MUM/2009 FURTHER PARA 2 OF THE ORDER SHOULD BE READ AS EXCEPT FOR GROUND NOS. 1,2, 16 AND 18 , ALL THE REMAINING GROUNDS ARE COVERED. TO THIS EXTENT PARA 2 OF THE ORDER PASSED BY THIS TRIBUNAL STANDS MODIFIED. 4. THE NEXT POINT RAISED BY THE ASSESSEE IN ITS MISCELLANEOUS APPLICATION IN PARA 5 OF IS AS UNDER: - 5. IN PARA 2.1 ON PAGE 2, IT IS STATED THAT; 'RESPECTFULLY FOLLOWING THE ORDERS OF THE A Y. S. 2008 - 09, 1999 - 2000, 2000 - 07 AND 2001 - 02 (SUPRA), WE DECIDE GROUNDS NO.3A., 4 AND 5 AGAINST THE ASSESSEE.' IN THE ABOVE PARA, GROUND NO 3A HAS BEEN WRONGLY QUOTED IN PLACE OF GROUND NO 3. IN THE TABLE PRODUCED ON PAGE 2 OF THE ORDER, IT CAN BE SEEN THAT GROUND NO 3 IS DECIDED AGAINST THE ASSESSEE AND GROUND NO 3A IS DECIDED IN FAVOUR OF THE ASSESSEE. 4.1. ON VERIFICATION OF THE RECORDS, WE FIND THE CLAIM OF THE ASSESSEE TO BE CORRECT AND ACCORDINGLY, PARA 2.1 OF THE ORDER DATED 21/03/2018 STANDS MODIFIED AS UNDER: - MA NOS.591/MUM/2018 & 592/MUM/2018 M/S. MAHINDRA AND MAHINDRA LIMITED 4 RESPECTFULLY FOLLOWING THE ORDERS OF THE A.Y.S.2008 - 09, 1999 - 2000, 2000 - 01 AND 2001 - 02 (SUPRA), WE DECIDE THE GROUNDS NO.3,4 AND 5 AGAINST THE ASSESSEE. GROUNDS NO.10,12 AND 15 ARE SET ASIDE AND REMAINING GROU N DS ARE DECIDED IN FAVOUR OF THE A SSESSEE. 5. THE NEXT GROUND RAISED BY THE ASSESSEE IN ITS MISCELLANEOUS APPLICATION IS WITH REGARD TO UPHOLDING THE ACTION OF THE ASSESSING OFFICER TOWARDS DISALLOWANCE MADE FOR PROVISION FOR DOUBTFUL DEBTS WHILE COMPUTING BOOK PROFITS U/S.115JB OF THE A CT. WE FIND THAT THE ASSESSEE HAD MADE PROVISION FOR DOUBTFUL DEBTS IN THE SUM OF RS.6.16 CRORES AND HAD CLAIMED THE SAME AS DEDUCTION WHILE COMPUTING THE BOOK PROFITS U/S.115JB OF THE ACT IN THE RETURN OF INCOME. THE LD. AO ADDED THE SAME IN THE ASSESSMEN T U/S.115JB OF THE ACT. THEN, THIS MATTER HAD TRAVELLED BEFORE THIS TRIBUNAL, WHEREIN THE LD. AR OF THE ASSESSEE HAD CONCEDED THIS ISSUE TO BE DECIDED AGAINST THE ASSESSEE IN VIEW OF RETROSPECTIVE AMENDMENT BROUGHT IN THE SECTION. THIS TRIBUNAL HAD DULY NO TED THE SAME IN PARA 6 OF ITS ORDER IN PAGE 11 AND HAD ACCORDINGLY DISMISSED GROUND NO.16 RAISED BY THE ASSESSEE THEREON. WE FIND THAT, NOW THE ASSESSEE HAS PREFERRED A MISCELLANEOUS APPLICATION ON THE GROUND THAT THE CO - ORDINATE BENCH DECISION OF MUMBAI T RIBUNAL IN THE CASE OF DCIT VS. TRENT LTD. IN ITA NO.1073/MUM/2005 DATED 18/05/2012 WAS NOT CONSIDERED BY THIS TRIBUNAL WHILE ADJUDICATING THIS ISSUE. HE ARGUED THAT NON - CONSIDERATION OF THE CO - ORDINATE BENCH DECISION OF THIS TRIBUNAL WOULD CONSTITUTE MIST AKE APPARENT ON RECORD WARRANTING RECTIFICATION U/S.254(2) OF THE ACT. MA NOS.591/MUM/2018 & 592/MUM/2018 M/S. MAHINDRA AND MAHINDRA LIMITED 5 5.1. WE FIND THAT WHEN THE AUTHORISED REPRESENTATIVE OF THE ASSESSEE HAD CONCEDED THE ISSUE BEFORE THIS TRIBUNAL AT THE TIME OF HEARING IN VIEW OF THE RETROSPECTIVE AMENDMENT BROUGHT IN THE STATUTE, THERE CANNOT BE ANY OCCASION FOR THE LD. AR TO HAVE EVEN QUOTED THE AFORESAID DECISION OF MUMBAI TRIBUNAL AT THE TIME OF HEARING. HENCE, THE REQUEST OF THE LD. AR THAT THE AFORESAID MUMBAI TRIBUNAL DECISION HAD NOT BEEN CONSIDERED DESERVES TO BE DISMISSED. IN ANY CASE, WHEN THE LD. AR ADMITS AT THE TIME OF HEARING THAT THE SAID GROUND WAS NOT PRESSED BY HIM IN VIEW OF THE RETROSPECTIVE AMENDMENT IN THE STATUTE AND ESPECIALLY THE FACT OF ADMISSION BY THE LD. AR IS NOT IN DISPUTE BEFORE US, IN OUR CONSIDERED OPINION, THE SAME WOULD ONLY CONSTITUTE MISTAKE COMMITTED BY THE LD. AR ON BEHALF OF THE ASSESSEE. HENCE, IT WOULD NOT FALL UNDER THE AMBIT OF MISTAKE APPARENT ON RECORD COMMITTED BY THE TRIBUNAL IN THE ORDER WARRANTING RECTIFICATION U/S.254 (2) OF THE ACT. HENCE, THE GROUND RAISED BY THE ASSESSEE IN ITS MISCELLANEOUS APPLICATION VIDE PARAS 6 TO 9 ARE HEREBY DISMISSED. 6. IN THE RESULT, MISCELLANEOUS APPLICATION OF THE ASSESSEE IN MA NO.592/MUM/2018 IS PARTLY ALLOWED AND THE OTHER CONTENTS OF THE ORIGINAL ORDER DATED 21/03/2018 SHALL REMAIN UNCHANGED SUBJECT TO MODIFICATIONS CONTAINED HEREINABOVE. MA NO.591/MUM/2018 (A.Y.2003 - 04) 7. WE FIND THAT THE ASSESSEE IN PARA 3 OF ITS MISCELLANEOUS APPLICATION HAS STATED AS UNDER: - MA NOS.591/MUM/2018 & 592/MUM/2018 M/S. MAHINDRA AND MAHINDRA LIMITED 6 3. UNDER THE DETAILS OF RETURN OF INCOME FOR AY 2003 - 04 ON PAGE 1, RETURNED INCOME HAS BEEN WRONGLY STATED AS RS. 1 0 7 , 83,98,160/ - INSTEAD OF RETURNED LOSS OF RS. 107,83,98,160/ - . FURTHER, UNDER THE HEAD 'ASSESSED INCOME', GROSS TOTAL INCOME OF RS. 7,68,35.530/ - HAS BEEN WRONGL Y REPORTED INSTEAD OF TOTAL INCOME OF RS. 7,44,69, 530/ - . 7.1. ON VERIFICATION OF RECORDS, WE FIND THAT THE CLAIM OF THE ASSESSEE TO BE CORRECT AND ACCORDINGLY, THE FIGURES MENTIONED IN THE TABLE IN PARA 1 OF OUR ORDER DATED 21/03/2018 FOR THE A.Y.2003 - 04 HAD TO BE READ AS UNDER: - RETURNED LOSS RS.107,83,98,160/ - AS AGAINST RETURNED INCOME WRONGLY MENTIONED. FURTHER UNDER THE HEAD ASSESSED INCOME, THIS TRIBUNAL HAD WRONGLY MENTIONED THE GROSS TOTAL INCOME FIGURE OF RS.7,68,35,530 INSTEAD OF TOTAL INCOM E FIGURE OF RS.7,44,69,530/ - . 7.2. ACCORDINGLY, PARA 1 OF THE ORDER DATED 21/03/2018 STANDS MODIFIED TO THE ABOVE EXTENT. 8. WE FIND THAT ASSESSEE IN PARA 4 OF ITS APPLICATION HAD MENTIONED AS UNDER: - 4. IN PARA 8 ON PAGE 16, THE AMOUNT OF EXPENDITURE IN RESPECT OF EURO II PROJECT HAS BEEN WRONGLY STATED AS RS. 5 . 14 LAKHS INSTEAD OF RS. 54.14 LAKHS. 8.1. ON VERIFICATION OF THE RECORDS, WE FIND THE CLAIM OF THE ASSESSEE TO BE CORRECT AND ACCORDINGLY, THE TABULATION MENTIONED IN PAGE 16 PARA 8 UNDER GRO UND NO.6 SHOULD BE READ AS UNDER: - DEVELOPMENT EXPENSES - EURO I I I PROJECT 54.14 LAKHS - DECIDED AGAINST THE ASSESSEE MA NOS.591/MUM/2018 & 592/MUM/2018 M/S. MAHINDRA AND MAHINDRA LIMITED 7 9. WE FIND THAT ASSESSEE HAS RAISED A SIMILAR GROUND WITH REGARD TO ADDITION FOR PROVISION FOR DOUBTFUL DEBTS WHILE COMPUTING BOOK P ROFITS U/S.115JB OF THE ACT AS WAS RAISED BY IT FOR THE A.Y.2002 - 03. WE HAVE ALREADY HELD HEREINABOVE FOR THE A.Y.2002 - 03 THAT THE SAME WOULD NOT CONSTITUTE MISTAKE ON RECORD FROM THE SIDE OF THE TRIBUNAL WARRANTING RECTIFICATION U/S.254(2) OF THE ACT. WE FIND THAT THERE IS A SLIGHT MODIFICATION THAT IS REQUIRED ON THE FIGURE OF PROVISION FOR DOUBTFUL DEBTS AS HAD BEEN POINTED OUT BY THE ASSESSEE IN ITS MISCELLANEOUS APPLICATION. THOUGH ASSESSEE HAD MADE PROVISION FOR DOUBTFUL DEBTS IN THE SUM OF RS.29,34,1 0,327/ - DURING THE YEAR UNDER CONSIDERATION, THIS SUM HAS BEEN WRONGLY MENTIONED AS RS.6.16 CRORES BY THIS TRIBUNAL BASED ON THE CHART SUBMITTED BY THE ASSESSEE AT THE TIME OF HEARING. THE LD. AR BEFORE US AT THE TIME OF MISCELLANEOUS APPLICATION HEREIN FA IRLY STATED THAT THE MISTAKE HAD CREPT IN IN THE CHART GIVEN BY THE ASSESSEE. HENCE, WE HOLD THAT AFORESAID FIGURE MENTIONED IN PARA 11 PAGE 16 OF THE ORDER DATED 21/03/2018 SHOULD BE READ AT 29.34 CRORES INSTEAD OF RS.6.16 CRORES. ACCORDINGLY, THE ISSUES RAISED IN PARA 5 TO 8 BY THE ASSESSEE IN ITS MISCELLANEOUS APPLICATION ARE DISMISSED. 10. THE LAST ISSUE RAISED BY THE ASSESSEE IS WITH REGARD TO NON - ADJUDICATION OF GROUND NO.12 BY THIS TRIBUNAL ON THE ASPECT OF PROVISION FOR WARRANTY OF RS.23,48,01,000 / - U/S.115JB OF THE ACT. 10.1. ON VERIFICATION OF THE FACTS, WE FIND THAT THIS ISSUE HAS NOT BEEN ADJUDICATED BY THIS TRIBUNAL. HENCE, WE FIND THE CLAIM OF THE ASSESSEE TO MA NOS.591/MUM/2018 & 592/MUM/2018 M/S. MAHINDRA AND MAHINDRA LIMITED 8 BE RIGHT AND WE ARE INCLINED TO RECALL THE ORDER OF THIS TRIBUNAL DATED 21/03/2018 F OR THE LIMITED PURPOSE OF ADJUDICATION OF THIS ISSUE ALONE I.E. GROUND NO.12 RAISED BY THE ASSESSEE WITH REGARD TO ADDITION OF PROVISION FOR WARRANTY VIS - - VIS UNDER COMPUTATION OF BOOK PROFITS U/S.115JB OF THE ACT. 11. IN THE RESULT, MISCELLANEOUS APPLIC ATION OF THE ASSESSEE IN MA NO.591/MUM/2018 IS PARTLY ALLOWED AND THE OTHER CONTENTS OF THE ORIGINAL ORDER DATED 21/03/2018 SHALL REMAIN UNCHANGED SUBJECT TO MODIFICATIONS CONTAINED HEREINABOVE. 12. REGISTRY IS DIRECTED TO RE - FIX THE APPEAL IN ITA NO.696 1/MUM/2012 FOR A.Y.2003 - 04 FOR THE LIMITED PURPOSE OF ADJUDICATION OF GROUND NO.12 RAISED THEREON. 13. IN THE RESULT, MISCELLANEOUS APPLICATIONS OF THE ASSESSEE ARE PARTLY ALLOWED. OR DER PRONOUNCED IN THE OPEN COURT ON THIS 17 / 10 /2019 SD / - ( M.BALAGANESH) SD/ - ( AMARJIT SINGH ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; DATED 17 / 10 / 2019 KARUNA , SR.PS MA NOS.591/MUM/2018 & 592/MUM/2018 M/S. MAHINDRA AND MAHINDRA LIMITED 9 COPY OF THE ORDER FORWARDED TO : BY ORDER, ( ASSTT. REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3 . THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//