M/s Chadha Super Cars Pvt. Ltd., Ludhiana V. ACIT, Ludhiana

MA 66/CHANDI/2015

• Counselvise Citation: [2015] 124 COUNSELVISE.COM (IT) 3744 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 month(s) 16 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 10-12-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2010-2011
• Appeal Filed On: 25-08-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Assessee Lawyers: KULDIP SINGH
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS. ANNAPURNA MEHROTRA, ACCOUNTANT MEMBER MISC. APPLICATION NO. 66/CHD/2015 (IN ITA NO.304/CHD/2015) ASSESSMENT YEAR:2010-11 M/S CHADHA SUPER CARS PVT. LTD., VS. THE ACIT G.T. ROAD CHHOTI LINE JUGIANA, LUDHIANA LUDHIANA PAN NO. AABCC6944R (APPELLANT) (RESPONDENT) APPELLANT BY : SH. KULDIP SINGH RESPONDENT BY : SH. S.K. MITTAL DATE OF HEARING : 20/11/2015 DATE OF PRONOUNCEMENT : 10/12/2015 ORDER PER ANNAPURNA MEHROTRA A.M. THROUGH THIS MISCELLANEOUS APPLICATION THE ASSESSEE HAS SOUGHT RECALLING OF THE ORDER OF TRIBUNAL IN ITA NO. 304/CHD/2015. 2. BRIEFLY STATED THE APPEAL IN ITA NO. 304/CHD/201 5 WAS FILED BY THE ASSESSEE AGAINST THE DISALLOWANCE OF RS. 19,12,761/ - MADE U/S 14A READ WITH RULE 8D OF THE INCOME TAX RULES, 1962. THE HONBLE TRIBUNAL DISMISSED THE APPEAL, VIDE THEIR ORDER DT. 03/07/2015, FOLLOWING THE ORDER PASSED IN THE ASSESSES OWN CASE IN EARLIER YEAR WHEREIN IT WAS HE LD THAT SINCE THE ASSESSEE HAD NOT MENTIONED AS TO WHICH PARTICULAR FUNDS WERE BOR ROWED FOR WHICH PARTICULAR REQUIREMENT, RULE 8D WAS APPLICABLE. THE HONBLE T RIBUNAL FURTHER OBSERVED THAT IN THE IMPUGNED YEAR THE ASSESSEE HAD SUBMITTED A D ETAIL OF INTEREST PAID ON SPECIFIC AND NON-SPECIFIC PURPOSE LOAN AND WORKED O UT THE DISALLOWANCE U/S 2 14A AT RS. 10,23,246/- INSTEAD OF RS. 19,12,761/- A S WORKED OUT BY THE AO. THE HONBLE TRIBUNAL AFTER EXAMINING THE SAME HELD THAT SINCE CERTAIN ENTRIES MENTIONED AS TRANSFER IN KOTAK MAHINDRA BANK LTD., ONE OF THE NON-SPECIFIC PURPOSE LOANS, WERE NOT EXPLAINED TO THEM, AND FURT HER SINCE THE INTEREST PAID ON ACCOUNT OF THE SAME WAS WORKED OUT BEFORE THE BE NCH AT RS. 1,84,81,863/- WHILE THE SAME WAS SHOWN AS 1,29,98,806/- TO THE LD . CIT(A), THE CONTENTION OF THE ASSESSEE WAS NOT ACCEPTABLE. 3. IN THIS MISC. APPLICATION FILED BEFORE US, LD. A R HAS STATED THAT THE IMPUGNED ORDER HAD BEEN PASSED ON THE BASIS OF CERT AIN WRONG FACTS AND THEREFORE REQUESTED RECALLING THE SAME. 4. LD. AR HAS STATED THAT DURING THE COURSE OF HEAR ING IT WAS EXPLAINED TO THE BENCH THAT THE MAJOR PORTION OF INTEREST PAID DURIN G THE YEAR PERTAINED TO FUNDS USED IN THE BUSINESS OF THE ASSESSEE AND HENCE NO D ISALLOWANCE U/S 14A COULD BE MADE WITH RESPECT TO THE SAME. LD. AR SUBMITTED IT WAS EXPLAINED TO THE BENCH THAT MAJOR PART OF INTEREST HAD BEEN PAID BY THE ASSESSEE IN RESPECT OF INVENTORY FUNDING LOAN ACCOUNT MAINTAINED WITH KOTA K MAHINDRA PRIME LIMITED FROM WHICH MONEY COULD BE WITHDRAWN ONLY BY ITS PRI NCIPAL CREDITOR, M/S TOYOTA KIRLOSKAR MOTORS PVT. LTD., AGAINST PURCHASES MADE, AS PER TERMS AND CONDITION OF OPERATING OF THIS ACCOUNT. LD. AR STATED THAT IN VI EW OF THE SAME IT WAS EXPLAINED TO THE BENCH THAT THE INTEREST PAID ON TH IS ACCOUNT BEING FOR BUSINESS PURPOSES ONLY, THE SAME TO BE EXCLUDED WHILE CALCUL ATING THE DISALLOWANCE U/S 14A. 5. LD. AR SUBMITTED THAT THE HONBLE TRIBUNAL REJEC TED THIS CONTENTION OF THE ASSESSEE, SINCE IT FOUND THAT CERTAIN ENTRIES IN TH E BANK WERE NOT EXPLAINED AND ALSO THERE WAS DISCREPANCY IN THE AMOUNT OF INTERES T ON THIS ACCOUNT AS SUBMITTED BEFORE THE HONBLE BENCH AND TO THE LD. C IT(A). 3 BEFORE US, LD. AR HAS STATED THAT THE IMPUGNED ENTR IES PERTAINED TO DEPOSITS IN THE LOAN ACCOUNT FROM WHERE WITHDRAWALS HAVE BEEN M ADE FOR MAKING PAYMENTS FOR PURCHASE ONLY. LD. AR FURTHER STATED T HAT EVEN THE MONEY IN TERM LOANS ACCOUNT AND CAR LOAN ACCOUNT WERE TRANSFERRED TO INVENTORY FUNDING LOAN ACCOUNT AND UTILIZED FOR PAYMENT AGAINST PURCH ASE. LD. AR PLEADED THAT ALL THESE FACTS WERE EVIDENT FROM THE PAPER BOOK FI LED BEFORE THE HONBLE TRIBUNAL. THUS THE LD. AR STATED THAT THE ENTRIES S TOOD EXPLAINED. AS FOR THE DISCREPANCY POINTED OUT BY THE HONBLE BENCH IN THE AMOUNT OF INTEREST, LD. AR ACKNOWLEDGED THE MISTAKE AND STATED THAT IT PERTAIN ED ONLY TO DIFFERENCE IN PRESENTATION. LD. AR FURTHER FILED A RECONCILIATION OF THE SAME. 6. LD. DR ON THE OTHER HAND STATED THAT FROM THE SU BMISSION MADE BY THE LD. AR IT WAS EVIDENT THAT THERE WAS NO MISTAKE IN THE ORDER OF THE HONBLE TRIBUNAL. LD. DR STATED THAT THE MISC. APPLICATION SHOULD THE REFORE BE REJECTED. 7. AFTER CONSIDERING THE ABOVE SUBMISSIONS WE ARE O F THE OPINION THAT THE OBSERVATIONS MADE BY THE HONBLE TRIBUNAL IN ITS OR DER, THAT CERTAIN ENTRIES IN KOTAK MAHINDRA PRIME LIMITED LOAN ACCOUNT WERE NOT EXPLAINED BEFORE THEM, IS CORRECT, WHICH IS EVIDENT FROM THE FACT THAT THE LD . AR HAS NOW SOUGHT TO EXPLAIN THE SAME THROUGH ITS MISCELLANEOUS APPLICATION. LD. AR HAS POINTED OUT NO MISTAKE IN THE ABOVE OBSERVATION OF THE TRIBUNAL. I N FACT WE FIND THAT LD. AR HAS ATTEMPTED TO CLEAR THE DISCREPANCIES BEFORE US WHIC H IS NOT PERMISSIBLE IN AN MISCELLANEOUS APPLICATION. FURTHER AS REGARDS THE D ISCREPANCY IN THE AMOUNT OF INTEREST MENTIONED BEFORE THE HONBLE BENCH AND THA T BEFORE THE LD. CIT(A), WE FIND THAT IT HAS BEEN ADMITTED BY THE LD. AR TO BE A MISTAKE ON THEIR PART WHICH HAS NOW BEEN SOUGHT TO BE CLARIFIED BY WAY OF A REC ONCILIATION STATEMENT. ADMITTEDLY THEREFORE THERE WAS NO MISTAKE IN THE OR DER OF THE HONBLE TRIBUNAL. POWERS U/S 254(2) OF THE ACT, CAN BE EXERCISED BY T HE TRIBUNAL FOR RECTIFYING MISTAKES APPARENT FROM RECORD ONLY. THE HONBLE DEL HI HIGH COURT IN THE CASE OF 4 SMT. BALJEET JOLLY VS. CIT 250 ITR 113 HAS EXPLAINE D THE MEANING OF MISTAKE APPARENT FROM RECORD AS THOSE WHICH APPEAR TO BE S O EX-FACIE AND ARE INCAPABLE OF ARGUMENT OR DEBATE. THE HONBLE HIGH C OURT HELD THAT WHERE AN ERROR WAS FAR FROM SELF EVIDENT, IT CEASED TO BE AN APPARENT ERROR. THE HONBLE CALCUTTA HIGH COURT HAS ELABORATED ON THE MEANING O F MISTAKES APPARENT FROM RECORD IN THE CASE OF HINDUSTAN LEVER LTD. VS. JC IT AND OTHERS(2006) 284 ITR 42 (CAL) WHEREIN IT HAS HELD AS FOLLOWS : A MISTAKE MUST BE APPARENT FROM THE RECORDS, MEAN ING THEREBY NO EXTERNAL HELP EITHER ON FACT OR IN LAW IS REQUIRED TO DETECT SUCH MISTAKE. THE MISTAKE MUST BE SO OBVIOUS THAT IT CAN EASILY BE CORRECTED, TO W IT AN ARITHMETICAL MISTAKE, A WRONG QUOTATION OF SECTION, ETC. IN VIEW OF THE SAME, SINCE THERE WAS NO APPARENT MI STAKE IN THE ORDER OF THE HONBLE ITAT, THE MISC. APPLICATION FILED NEEDS TO BE REJECTED. FURTHER WE FIND THAT ON THE BASIS OF MATERIAL BEFOR E IT, HONBLE TRIBUNAL FOUND THAT THE ENTRIES WERE NOT EXPLAINED AND THERE WAS D ISCREPANCY IN THE FIGURE OF INTEREST AND HENCE TOOK A VIEW THAT THE ASSESSEE CO NTENTION COULD NOT BE ENTERTAINED. HAVING TAKEN ONE POSSIBLE VIEW ON THE BASIS OF THE MATERIAL ON RECORD, THE ORDER OF THE TRIBUNAL CANNOT BE REVIEWE D IN THE MISCELLANEOUS APPLICATION. THE HONBLE ANDHRA PRADESH HIGH COURT IN THE CASE OF CIT VS. IDEAL ENGINEERS 251 ITR 743(AP) HAS WHILE DEALING WITH TH E POWER OF THE TRIBUNAL U/S 254(2) HELD AS FOLLOWS. (II) THAT THE QUESTION REFERRED TO THE COURT INCLU DED THE INCIDENTAL QUESTION RELATING TO THE JURISDICTION AND COMPETENCY OF THE TRIBUNAL TO REVIEW ITS EARLIER ORDER REJECTING THE MISCELLANEOUS APPLICATIONS TWIC E WHEREIN SIMILAR RELIEF WAS SOUGHT BY THE ASSESSEE. IT IS WELL SETTLED THAT A S TATUTORY TRIBUNAL OR AN AUTHORITY CANNOT EXERCISE REVIEW POWER UNLESS THE STATUTE WHI CH CREATES SUCH TRIBUNAL OR AUTHORITY GRANTS SUCH POWER SPECIFICALLY TO SUCH TR IBUNAL OR AUTHORITY. THE EARLIER TWO MISCELLANEOUS PETITIONS WERE REJECTED BY THE TR IBUNAL NOT ON TECHNICAL GROUNDS BUT ON THE MERITS. THE ORDER MADE BY THE TR IBUNAL ON THE THIRD MISCELLANEOUS PETITION WAS TANTAMOUNT TO REVIEW OF ITS EARLIER ORDER WHICH WAS NOT PERMISSIBLE. THE HONBLE CALCUTTA HIGH COURT HAS TAKEN A SIMILAR VIEW IN THE CASE OF CIT VS. ANAMIKA BUILDERS (P) LTD. 251 ITR 585 (CAL) WHEREIN IT HAS HELD AS FOLLOWS: 5 HELD, THAT ONCE A POSSIBLE VIEW HAD BEEN TAKEN BY THE TRIBUNAL ON THE BASIS OF THE MATERIAL ON RECORD IN ITS APPELLATE ORDER THAT COULD NOT BE CHANGED ON A MISCELLANEOUS APPLICATION. THEREFORE, THE ORDER PAS SED BY THE TRIBUNAL UNDER SECTION 254 OF THE INCOME-TAX ACT, 1961, WAS NOT SU STAINABLE IN LAW. IN VIEW OF THE ABOVE WE HOLD THAT SINCE THERE WAS N O APPARENT MISTAKE IN THE ORDER OF THE TRIBUNAL AND FURTHER SINCE THE TRIBUNA L HAVING TAKEN A VIEW, CANNOT REVIEW THE SAME U/S 254(2), THE MISC. APPLICATION F ILED BY THE ASSESSEE IS REJECTED. 8. IN THE RESULT MISC. APPLICATION OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (BHAVNESH SAINI) (ANNAPURNA MEHROTRA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 10/12/2015 AG COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT, TH E CIT(A), THE DR