DCIT, New Delhi V. Sh. Ishtiaq Ahmed, Lucknow

MA 62/DEL/2012

• Counselvise Citation: [2013] 123 COUNSELVISE.COM (IT) 9851 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 11 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 04-01-2013
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 1997-1998
• Appeal Filed On: 23-03-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SATPAL SINGH
• Assessee Lawyers: J J MEHROTRA
• Keywords: Question of law; Revised return
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI FRIDAY FRIDAY FRIDAY FRIDAY BENCH BENCH BENCH BENCH C CC C : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND SHRI SHRI SHRI SHRI I.C.SUDHIR I.C.SUDHIR I.C.SUDHIR I.C.SUDHIR, JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER MISCELLANEOUS APPLICATION MISCELLANEOUS APPLICATION MISCELLANEOUS APPLICATION MISCELLANEOUS APPLICATION NO. NO. NO. NO.62/DEL/2012 62/DEL/2012 62/DEL/2012 62/DEL/2012 (IN ITA NO.3156/DEL/2010) (IN ITA NO.3156/DEL/2010) (IN ITA NO.3156/DEL/2010) (IN ITA NO.3156/DEL/2010) ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR : : : : 1997 1997 1997 1997- -- -98 9898 98 DEPUTY DEPUTY DEPUTY DEPUTY COMMISSIONER OF COMMISSIONER OF COMMISSIONER OF COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE- -- -6, 6,6, 6, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. VS. VS. VS. VS. SHRI ISHTIAQ AHMED, SHRI ISHTIAQ AHMED, SHRI ISHTIAQ AHMED, SHRI ISHTIAQ AHMED, 1, KAPOORTHALA COMPLEX, 1, KAPOORTHALA COMPLEX, 1, KAPOORTHALA COMPLEX, 1, KAPOORTHALA COMPLEX, ALIGANJ, ALIGANJ, ALIGANJ, ALIGANJ, LUCKNOW. LUCKNOW. LUCKNOW. LUCKNOW. PAN : ACPPA7639A. PAN : ACPPA7639A. PAN : ACPPA7639A. PAN : ACPPA7639A. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SATPAL SINGH, DR. RESPONDENT BY : SHRI J.J.MEHROTRA, CA. ORDER ORDER ORDER ORDER PER G. PER G. PER G. PER G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VP VPVP VP : : : : BY THIS MISCELLANEOUS APPLICATION, THE REVENUE HAS SOUGHT FOR MODIFICATION OF THE ORDER OF THE ITAT DATED 29 TH APRIL, 2011 PASSED IN ITA NO.3156/DEL/2010. 2. AT THE TIME OF HEARING BEFORE US, IT IS STATED B Y THE LEARNED DR THAT THE MISCELLANEOUS APPLICATION IS FILED BY THE REVENUE IN VIEW OF THE OBSERVATION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF THE ASSESSEE IN ITA NO.1292/2011 VIDE ORDER DATED 22 ND DECEMBER, 2011. HE STATED THAT THE FACTS GIVING THE CHRONOLOGY OF E VENTS ARE PROPERLY RECORDED IN THE MISCELLANEOUS APPLICATION. THE SAM E SHOULD BE CONSIDERED AND THE ORDER OF THE ITAT IN ITA NO.3156 /DEL/2010 SHOULD BE MODIFIED IN THE LIGHT OF THE DECISION OF HONBLE ALLAHABAD HIGH COURT, LUCKNOW BENCH DATED 24 TH MAY, 2010 PASSED IN ASSESSEES OWN CASE FOR AY 1996-97. MA-62/DEL/2012 2 3. THE LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTH ER HAND, STATED THAT THE LIMITED DISPUTE BEFORE THE ITAT IN THE PRE SENT APPEAL WAS WITH REGARD TO THE QUANTUM OF DEDUCTION PERMISSIBLE UNDE R SECTION 57(III) OF THE INCOME-TAX ACT, 1961. THE ISSUE OF ALLOWABILIT Y OF DEDUCTION WAS ALREADY SETTLED BY THE ITAT IN THE EARLIER DECISION WHEREIN THE ITAT HAS SET ASIDE THE MATTER TO THE FILE OF THE ASSESSING O FFICER. WHILE GIVING EFFECT TO THE ORDER OF THE ITAT, THE ASSESSING OFFI CER HIMSELF HAS ALLOWED THE RELIEF UNDER SECTION 57(III). IN THE S ECOND ROUND OF APPEAL, THE ONLY DISPUTE WAS WITH REGARD TO THE QUANTUM OF DEDUCTION ALLOWABLE UNDER SECTION 57(III) AND NOT PER SE TO THE ALLOWABILITY OF DEDUCTION. HE, THEREFORE, SUBMITTED THAT THE MISCE LLANEOUS APPLICATION FILED BY THE REVENUE DESERVES TO BE DISMISSED. 4. WE HAVE CAREFULLY CONSIDERED THE ARGUMENTS OF BO TH THE SIDES AND PERUSED THE MATERIAL PLACED BEFORE US. WE FIND THAT IN THE REVENUES MISCELLANEOUS APPLICATION, THE CHRONOLOGY OF EVENTS HAS BEEN PROPERLY RECORDED. THE SAME IS REPRODUCED HER EIN BELOW FOR READY REFERENCE:- IN THIS CASE RETURN OF INCOME SHOWING TOTAL LOSS O F RS.13,11,150/- WAS FURNISHED ON 29.10.97. IN THE O RIGINAL RETURN FILED THE ASSESSEE HAD CLAIMED DEDUCTION UND ER SECTION 57(III) IN RESPECT OF INTEREST ON BORROWED CAPITAL FOR THE PURPOSE OF INVESTMENTS IN SHARES OF THE GROUP COMPANIES. DURING THE COURSE OF ASSESSMENT PROCEED INGS THE ASSESSEE REVISED ITS CLAIM FROM RS.20,26,566/- TO RS.28,68,440/- VIDE REVISED STATEMENT OF INCOME DAT ED 12.10.1999. THE THEN ASSESSING OFFICER DID NOT ENT ERTAIN THE CLAIM OF THE ASSESSEE IN RESPECT OF INTEREST ON BORROWED CAPITAL. IN THE ASSESSMENT, ADDITION OF RS.20,26,566/- WAS MADE. THE ASSESSMENT WAS COMPLE TED MA-62/DEL/2012 3 U/S 144 ON 30.03.2000 AT ASSESSED INCOME OF RS.11,75,005/-. THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A). LD .CIT(A) VIDE HIS ORDER DATED 28.02.2002 DELETED THE ADDITIO N OF RS.20,26,566/- BEING DISALLOWANCE OF INTEREST CLAIM ED BY THE ASSESSEE U/S 57(III). AFTER APPEAL EFFECT TO T HE ORDER OF CIT(A), TOTAL LOSS WAS DETERMINED OF RS.12,66,210/- . THE DEPARTMENT FILED THE APPEAL BEFORE HONBLE ITAT AGA INST THE ORDER OF THE LD.CIT(A). THE HONBLE TRIBUNAL V IDE ORDER DATED 19-07-2005 HELD AS FOLLOWS:- THE ISSUES RELATING TO THE INTEREST ON BORROWED CA PITAL WAS SET ASIDE BY THE TRIBUNAL IN THE A.Y. 1996-97 AND A S NO NEW FACTS HAVE BEEN BROUGHT BEFORE US, CONCURRING WITH THE SAME, WE SET ASIDE THE ISSUE AND RESTORE BACK TO TH E FILE OF THE ASSESSING OFFICER FOR PASSING AN ORDER AFRESH. THE ASSESSING OFFICER SUBSEQUENT TO THE ORDER OF TH E HONBLE TRIBUNAL AGAIN EXAMINED THE MATTER & ALLOWE D THE CLAIM OF THE ASSESSEE TO THE EXTENT OF RS.20,26,566 /- ONLY U/S 57(III) AND TOTAL LOSS WAS COMPUTED AT RS.12,66 ,210/- IN ORDER DATED 06/12/06 U/S 143(3)/251/254 OF THE I.T. ACT 1961. IN THE ORDER DATED 06.12.2006, THE THEN AO OBSERVED THAT THE ASSESSING OFFICER SHOULD HAVE REV ISED HIS CLAIM BY WAY OF REVISED RETURN ON OR BEFORE 31.03.1 999. AS THE REVISED COMPUTATION FILED BY HIM WAS BEYOND THE STIPULATED PERIOD, THE SAME CANNOT BE ACCEPTED. THE ASSESSEE AGAIN FILED APPEAL BEFORE LD.CIT(A). LD.CIT(A) VIDE HIS ORDER DATED 13.04.2010 IN APPEAL NO.273/06 -07, DIRECTED THE AO TO ALLOW THE CLAIM OF THE ASSESSEE TO THE MA-62/DEL/2012 4 EXTENT OF RS.26,68,440/- (IT APPEARS THAT THE FIGUR E WAS INADVERTENTLY MENTIONED AT RS.26,68,440/- IN PLACE OF RS.28,68,440/- CLAIMED BY THE ASSESSEE IN REVISED STATEMENT OF INCOME) AND MODIFY THE ASSTT. ACCORDIN GLY. DEPARTMENT FILED APPEAL BEFORE HONBLE ITAT AGAINST THE ORDER DATED 13.04.2010 OF LD.CIT(A). HONBLE ITAT IN ITS ORDER DATED 29.04.2011 HELD THA T WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(A ). HE HAS DIRECTED THE AO TO ALLOW THE CORRECT DEDUCTION IN T HE LIGHT OF THE TRIBUNAL ORDER ON THE SAME ISSUE IN THE PREC EDING YEAR AS WELL AS IN THE YEAR IN QUESTION. WE DECLIN E TO INTERFERE. REVENUE DID NOT ACCEPT THE DECISION OF HONBLE ITAT AND FILED APPEAL BEFORE HONBLE HIGH COURT DELHI. IN I TA NO.1292/2011 DATED 22.12.2011, HONBLE HIGH COURT H AS OBSERVED THAT BY THE ORDER DATED 24.05.2010 PASSED IN ITA NO.31/2005 BY THE HIGH COURT OF ALLAHABAD, THE SUBSTANTIAL QUESTION OF LAW ON THIS ISSUE HAVE BEEN ANSWERED IN FAVOUR OF THE REVENUE AND THE FINDINGS RECORDED BY THE TRIBUNAL WERE REVERSED. HONBLE HI GH COURT FURTHER OBSERVED THAT IT IS NOTICED THAT THE CROSS- APPEALS HAVE BEEN DECIDED WITHOUT REFERRING TO & WI THOUT TAKING INTO CONSIDERATION THE ORDER DATED 24.05.201 0 PASSED BY THE ALLAHABAD HIGH COURT. HONBLE HIGH COURT HELD THAT :- WE FEEL REVENUE SHOULD FILE AN APPLIC ATION UNDER SECTION 254(2) BEFORE THE TRIBUNAL. IF THEY DO NOT SUCCEED THEY WILL BE AT LIBERTY TO FILE AN APPLICAT ION TO REVIVE THE PRESENT APPEAL. THE APPEAL WILL BE TREA TED AS DISPOSED OF. MA-62/DEL/2012 5 ACCORDINGLY, THE LD.CIT(CENTRAL)-I HAS AUTHORIZED F OR FILING OF MISCELLANEOUS APPLICATION BEFORE HONBLE ITAT IN TH E CASE OF SH.ISHTIAQ AHMAD, FOR ASSTT. YEAR 1997-98 IN ACC ORDANCE WITH THE DIRECTION OF HONBLE HIGH COURT, DELHI ARI SING OUT OF ORDER DATED 29.04.2011 OF HONBLE ITAT IN ITA NO.3156/DEL/2010 & C.O. NO.248/DEL/2010. 5. THAT THE HONBLE JURISDICTIONAL HIGH COURT IN IT S ORDER DATED 22 ND DECEMBER, 2011 IN ITA NO.1292/2011 HELD AS UNDER:- LD. COUNSEL FOR THE APPELLANT HAS DRAWN OUR ATTENT ION TO THE ORDER DATED 24.5.2010 PASSED IN ITA NO.31/2005 BY HIGH COURT OF ALLAHABAD, LUCKNOW BENCH. BY THE SAI D ORDER THE SUBSTANTIAL QUESTIONS OF LAW ARISING OUT OF THE EARLIER ORDER OF THE TRIBUNAL DATED 19.7.2005 HAVE BEEN ANS WERED IN FAVOUR OF THE REVENUE AND THE FINDINGS RECORDED BY THE TRIBUNAL WERE REVERSED. BY THE SAME ORDER DATED 19.7.2005, THE TRIBUNAL HAD ASKED THE ASSESSING OFF ICER TO CONSIDER THE CLAIM OF THE ASSESSEE FOR FURTHER DEDU CTION OF ABOUT RS.8,00,000/-. SUBSEQUENT ORDER PASSED BY TH E ASSESSING OFFICER BECAME SUBJECT MATTER OF CHALLENG E BEFORE THE TRIBUNAL IN TWO CROSS-APPEALS, WHICH HAV E BEEN DECIDED BY THE IMPUGNED ORDER DATED 29.4.2011. IT IS NOTICED THAT THE CROSS-APPEALS HAVE BEEN DECIDED WI THOUT REFERRING TO AND WITHOUT TAKING INTO CONSIDERATION THE ORDER DATED 24.5.2010 PASSED BY THE ALLAHABAD HIGH COURT, LUCKNOW BENCH. IN THESE CIRCUMSTANCES, WE FEEL THAT REVENUE SHOULD FILE AN APPLICATION UNDER SECTION 254(2) BEFORE THE TRIBUNA L. IF THEY DO NOT SUCCEED THEY WILL BE AT LIBERTY TO FILE AN MA-62/DEL/2012 6 APPLICATION TO REVIVE THE PRESENT APPEAL. THE APPE AL WILL BE TREATED AS DISPOSED OF. NO COSTS. 6. THUS, AS PER THE HONBLE HIGH COURT, THE IMPUGNE D ORDER OF THE ITAT DATED 29 TH APRIL, 2011 WAS PASSED WITHOUT TAKING INTO CONSIDERATION THE ORDER OF HONBLE ALLAHABAD HIGH C OURT, LUCKNOW BENCH DATED 24 TH MAY, 2010. IT MAY BE CLARIFIED THAT THE ASSESSEE S CASE FOR AY 1996-97 WAS DECIDED BY THE ITAT, LUCKNO W BENCH AND THEREFORE, THE APPEAL AGAINST THE SAID DECISION WAS FILED BY THE REVENUE BEFORE THE HONBLE ALLAHABAD HIGH COURT. T HEREAFTER, THE APPEALS OF THE ASSESSEE HAVE BEEN TRANSFERRED TO DE LHI. ACCORDINGLY, APPEAL FOR AY 1997-98 IS ADJUDICATED BY THE ITAT, D ELHI BENCH AND CONSEQUENTLY, THE APPEAL THERE AGAINST WAS FILED AN D DECIDED BY THE HONBLE DELHI HIGH COURT. IN THE ORIGINAL ORDER OF ITAT FOR AY 1997-98, THE DECISION OF ITAT FOR AY 1996-97 WAS FOLLOWED. THE SAID DECISION OF ITAT FOR AY 1996-97 IS SUBSEQUENTLY ADJUDICATED UPO N BY THE HONBLE ALLAHABAD HIGH COURT, LUCKNOW BENCH. ADMITTEDLY, T HE SAME WAS NOT CONSIDERED BY THE ITAT WHILE ADJUDICATING THE APPEA L OF THE YEAR UNDER CONSIDERATION. IN VIEW OF THE ABOVE, WE DEEM IT PR OPER TO RECALL THE ORDER OF THE ITAT IN ITA NO.3156/DEL/2010 AND ALSO C.O. NO.248/DEL/2010 AND DIRECT THAT THE SAME WOULD BE R EFIXED FOR HEARING AFRESH ON 11 TH APRIL, 2013. 7. IN THE RESULT, THE MISCELLANEOUS APPLICATION FIL ED BY THE REVENUE IS ALLOWED. DECISION PRONOUNCED IN THE OPEN COURT ON 4 TH JANUARY, 2013. SD/- SD/- ( (( (I.C.SUDHIR I.C.SUDHIR I.C.SUDHIR I.C.SUDHIR) )) ) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) JUDICIAL JUDICIAL JUDICIAL JUDICIAL MEMBE MEMBE MEMBE MEMBER RR R VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT DATED : 04.01.2013 VK. MA-62/DEL/2012 7 COPY FORWARDED TO: - 1. APPELLANT : DEPUTY COMMISSIONER OF INCOME TAX, DEPUTY COMMISSIONER OF INCOME TAX, DEPUTY COMMISSIONER OF INCOME TAX, DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE- -- -6, NEW DELHI. 6, NEW DELHI. 6, NEW DELHI. 6, NEW DELHI. 2. RESPONDENT : SHRI ISHTIAQ AHMED, SHRI ISHTIAQ AHMED, SHRI ISHTIAQ AHMED, SHRI ISHTIAQ AHMED, 1, KAPOORTHALA COMPLEX, 1, KAPOORTHALA COMPLEX, 1, KAPOORTHALA COMPLEX, 1, KAPOORTHALA COMPLEX, ALIGANJ, LUCKNOW. ALIGANJ, LUCKNOW. ALIGANJ, LUCKNOW. ALIGANJ, LUCKNOW. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR