SACHIN N. MORAKHIA, V. ITO 4(2(1),

MA 760/MUM/2012

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 0337 (ITAT-MUMBAI)
• Duration Of Justice: 4 month(s) 22 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 08-05-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 17-12-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Speculation loss
• Section: 143(3); 234B; 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC MUMBAI BEFORE SHRI VIJAY PAL RAO, JM AND SHRI N.K. BILLAIY A, AM M.A. NO.760/MUM/2012 (ARISING OUT OF ITA NO. 1122/MUM/2012) ASSESSMENT YEAR 2008-09 SACHIN N. MORAKHIA PG 14, ROTUNDA,B.S.MARG,FORT MUMBAI PIN : 40001 PAN: AADPM9633L INCOME TAX OFFICER, WARD-4(2) (1), MUMBAI-400020 (APPLICANT) (RESPONDENT) APPLICANT BY : SH. K.GOPAL RESPONDENT BY : NONE (DR) DATE OF HEARING : 26/04/2013 DATE OF PRONOUNCEMENT : 08/05/2013 ORDER PER: VIJAY PAL RAO, JM: THIS MISCELLANEOUS APPLICATION BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 1 ST JUNE, 2012 OF THIS TRIBUNAL. WHEREBY THE APPEAL BY THE ASSESSEE IN IT NO. 1122/ 2012 FOR THE ASSESSMENT YEAR 2008-09 WAS DISPOSED OFF. 2. WE HAVE HEARD THE LEARNED AR AND CAREFULLY PERU SED THE RELEVANT MATERIAL ON RECORD. SINCE NO BODY HAS APPEARED ON BEHALF OF THE REVENUE THEREFORE, WE DO NOT HAVE THE PRIVILEGE TO HEAR THE DEPARTMENTAL REP RESENTATIVE. MA/670/2012 SACHIN N. MORKHIA 3. THE GRIEVANCE OF THE ASSESSEE AS RAISED IN THIS MISCELLANEOUS APPLICATION IS THAT NONE OF THE GROUND RAISED IN THE ASSESSEES AP PEAL HAS BEEN ADJUDICATED BY THE TRIBUNAL AND THE FINDINGS GIVEN IN THE IMPUGNED ORD ER PERTAINS TO A GROUND WHICH IS STRANGER TO THE APPEAL OF THE ASSESSEE. AFTER GO ING THROUGH THE GROUND RAISED BY THE ASSESSEE IN THE APPEAL AND THE FINDING GIVEN BY THE TRIBUNAL SMC BENCH IN THE IMPUGNED ORDER, WE FIND THAT THE GROUND WHICH HAS B EEN ADJUDICATED AND REPRODUCED IN PARA 2 IN THE IMPUGNED ORDER AS UNDER . GROUND NO. 2. READS AS UNDER: 2 ON THE FACTS AND CIRCUMSTANCES OF THE CASE AS W ELL AS IN LAW, THE LEARNED CIT (A) HAS ERRED IN CONFIRMING THE ACTION OF LEARNED ASSESSING OFFICER IN TREATING LONG TERM CAPITAL GAIN OF RS. 2,67,247/ - AS INCOME FROM OTHER SOURCES WITHOUT CONSIDERING THE FACTS AND CIRCUMSTA NCES OF THE CASE. 4. IT IS APPARENT THAT ABOVE GROUND WHICH HAS BEEN ADJUDICATED BY THE TRIBUNAL DOES NOT MATCH WITH ANY OF THE GROUND AS RAISED BY THE ASSESSEE IN THE APPEAL AS UNDER: GROUNDS OF APPEAL 1 . THE LD. COMMISSIONER OF INCOME-TAX (APPE ALS) [HEREINAFTER REFERRED AS CIT(A) ERRED IN PASSING THE ORDER DATED 09/12/201 1 CONFIRMING THE ACTION OF THE LD. A. 0. IN DETERMINING THE TOTAL I NCOME OF THE APPELLANT AT RS. 80,770/- AS AGAINST RETURNED INCOME OF RS. 7,46 0/- VIDE ORDER DATED 09.12.2011 PASSED UNDER SECTION 143(3) OF THE INCOM E TAX ACT, 1961 BY MAKING FOLLOWING ADDITIONS AND DISALLOWANCE: MA/670/2012 SACHIN N. MORKHIA SR. NO. PARTICULARS OF ADDITIONS/DISALLOWANCE AMOUNT (RS.) A DISALLOWANCE UNDER SECTION 14A READ WITH RULE 8D 49,589 B DISALLOWANCE OF BUSINESS PROMOTION EXPENDITURE TREATING THE SAME AS PRIOR PERIOD EXPENSES 23,725 C DENYING THE BENEFIT OF CARRY FORWARD OF SHORT TER M CAPITAL LOSS 11,93,886 D DENYING THE BENEFIT OF CARRY FORWARD OF SPECULATI ON LOSS 28,926 A DISALLOWANCE UNDER SECTION 14A READ WITH RULE SD RS.49.589/ - 2. THE LD . CIT(A) ERRED IN CONFIRMING THE ACTION OF THE 14. A. 0. IN MAKING DISALLOWANCE UNDER SECTION 14A BY INVOKIN G THE PROVISIONS OF RULE SD WITHOUT APPRECIATING THE FACT THAT PROVISIONS OF SECTION 14A ARE NOT AT ALL ATTRACTED TO THE FACTS OF THE APPELLANTS CASE. THE APPELLANT, THEREFORE, PRAYS THAT THE DISALLOWANCE OF RS.49,589/- BY INVOKING THE PRO VISIONS OF SECTION 14A READ WITH RULE 3D IS NOT AT ALL JUSTIFI ED AND HENCE, THE SAME MAY BE DELETED. 3. THE LD. CIT(A) FAILED TO APPRECIATE THAT THE RUL E 8D CAN BE INVOKED ONLY AFTER THE 14. A. 0. IS SATISFIED THAT SUB SECTION (1) TO SECTION 14A IS NOT APPLICABLE. HENCE, DISALL OWANCE OF RS.49,589/- IS NOT AT ALL JUSTIFIED AND THE SAME MA Y BE DELETED. 4. THE LD.. CIT(A) FAILED TO APPRECIATE THAT THE AP PELLANT HAS NOT INCURRED ANY EXPENDITURE FOR EARNING THE TAX FR EE DIVIDEND AND INTEREST INCOME. THE APPELLANT, THEREF ORE, PRAYS THAT THE DISALLOWANCE OF EXPENDITURE AMOUNTING TO R S. 49,589/- UNDER SECTION 14A OF THE ACT BY INVOKING T HE PROVISIONS OF RULE 8D IS NOT AT ALL JUSTIFIED AND T HE SAME MAY BE DELETED MA/670/2012 SACHIN N. MORKHIA B DISALLOWANCE OF BUSINESS PROMOTION EXPENDITURE TREA TING THE SAME AS PRIOR PERIOD EXPENSES - RS. 23.7251 - 5. THE LD. CIT(A) ERRED IN CONFIRMING THE ACTION OF THE LD. A O IN DISALLOWING THE BUSINESS PROMOTION EXPENSES TREATI NG THE SAME AS PRIOR PERIOD EXPENSES AMOUNTING TO !23,725/- WITHOUT APPRECIATIN G THE FACTS THAT THE BUSINESS PROMOTION EXPENSES ARE INCURRED IN COURSE OF BUSINE SS ACTIVITY. THE APPELLANT, THEREFORE, PRAYS THAT THE DISALLOWANCE OF BUSINESS PROMOTION EXPENSES IS NOT AT ALL JUSTIFIED AND HENCE, THE SAME MAY BE DELETED. C DENYING THE BENEFIT OF CARRY FORWARD OF SHORT TERM CAPITAL LOSS RS. 1,93.886/ - 6. THE LD. CIT(A) ERRED IN CONFIRMING THE ACTION OF THE IA. A. 0. IN DENYING THE BENEFIT OF CARRY FORWARD OF SHORT TE RM CAPITAL LOSS AMOUNTING TO RS. 1,93,886/- TO THE SUBSEQUENT ASSESSMENT YEAR BY HOLDING THAT THE SAME HAS NOT BE EN CLAIMED IN RETURN OF INCOME. THE APPELLANT PRAYS TH AT THE DENYING THE BENEFIT OF CARRY FORWARD OF SHORT TENN CAPITAL LOSS IS WITHOUT ANY BASIS AND HENCE, THE SAME MAY B E ALLOWED TO BE CARRIED FORWARD TO THE SUBSEQUENT ASSESSMENT YEARS. 7. THE LD. CIT(A) FAILED TO APPRECIATE THAT APPELLA NT IS ELIGIBLE TO CLAIM THE BENEFIT OF CARRY FORWARD OF SHORT TERM CAPITAL LOSS. HENCE, THE DISALLOWANCE OF CARRY FORWARD OF S HORT TERM CAPITAL LOSS AMOUNTING TO RS.11,93,886/- IS NOT AT ALL JUSTIFIED AND THE SAME MAY BE DELETED. D DENYING THE BENEFIT OF CARRY FORWARD OF SPECULATI ON LOSS - RS.28.926/ - 8. THE LD. CIT(A) ERRED IN CONFIRMING THE ACTION OF THE 14. A. 0. IN DENYING THE BENEFIT OF CARRY FORWARD OF SPECULAT ION LOSS AMOUNTING TO RS.28,926/- TO THE SUBSEQUENT ASSESSME NT YEAR BY HOLDING THAT THE SAME HAS NOT BEEN CLAIMED IN RE TURN OF INCOME. THE APPELLANT PRAYS THAT THE DENYING THE BE NEFIT OF CARRY FORWARD OF SPECULATION LOSS IS WITHOUT ANY BA SIS AND HENCE, THE SAME MAY BE DELETED MA/670/2012 SACHIN N. MORKHIA 9. THE LD. CIT(A) FAILED TO APPRECIATE THAT APPELLA NT IS ELIGIBLE TO CLAIM THE BENEFIT OF CARRY FORWARD OF SPECULATIO N LOSS SUSTAINED DURING THE IMPUGNED ASSESSMENT YEAR. HENC E, THE DISALLOWANCE OF CARRY FORWARD OF SPECULATION LOSS A MOUNTING TO !28,926/- IS NOT AT ALL JUSTIFIED AND THE SAME M AY BE DELETED E LEN OF INTEREST UNDER SECTION 234B AND 234C NOT JUSTIFIED : 10. THE LD. CIT(A) ERRED IN LEVYING INTEREST UNDER SECTION 234B AND 23 WITHOUT APPRECIATING THE FACT THAT THE APPELLANT DENIES HI S LIABILITY TO THE SAME. 11 THE APPELLANT CRAVES LEAVE TO ADD, ALTER, RESCI ND OR AMEND ANY OF THE GROUNDS. 5. AS IT IS EVIDENT THAT NONE OF THE GROUNDS RAISED BY THE ASSESSEE IN THE APPEAL HAS BEEN ADJUDICATED BY THE TRIBUNAL AND THEREFORE, THERE IS APPARENT ERROR ON THE FACE OF THE ORDER OF THE TRIBUNAL WHICH REQUIRED TO BE RECTIFIED. ACCORDINGLY WE RECALL THE IMPUGNED ORDER DATED 1 ST JUNE, 2012 FOR FRESH HEARING THE APPEAL OF THE ASSESSEE AFRESH. THE REGISTRY IS DIRECTED TO FIX TH E APPEAL OF THE ASSESSEE FOR FRESH HEARING IN REGULAR COURSE. NOTICE OF HEARING BE I SSUED TO THE PARTIES. 6. IN THE RESULT, MISCELLANEOUS APPLICATION OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 8 TH MAY, 2013. SD/- SD/- ( N. K. BILLAIYA ) ( VIJAY PAL RAO ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATE: 8 TH MAY, 2013 PRAMOD KUMAR MA/670/2012 SACHIN N. MORKHIA COPY OF THE ORDER FORWARDED TO : 1. APPLICANT 2. RESPONDENT 3. THE CONCERNED CIT (A) 4. THE CONCERNED CIT 5. DR D BENCH, ITAT, MUMBAI 6. GUARD FILE //TRUE COPY// / BY ORDER, DY./ASST. REGISTRAR ITAT, MUMBAI