JUST DIAL P. LTD, MUMBAI v. ADDL CIT RGT -1, MUMBAI

ITA 3072/MUM/2009 | 2005-2006
Pronouncement Date: 25-10-2016

Appeal Details

RSA Number 307219914 RSA 2009
Assessee PAN AAACA8049G
Bench Mumbai
Appeal Number ITA 3072/MUM/2009
Duration Of Justice 7 year(s) 5 month(s) 14 day(s)
Appellant JUST DIAL P. LTD, MUMBAI
Respondent ADDL CIT RGT -1, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 25-10-2016
Appeal Filed By Assessee
Bench Allotted G
Tribunal Order Date 25-10-2016
Date Of Final Hearing 24-10-2016
Next Hearing Date 24-10-2016
Assessment Year 2005-2006
Appeal Filed On 11-05-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES G MUMBAI BEFORE SHRI AMIT SHUKLA (JUDICIAL MEMBER) AND SHRI ASHWANI TANEJA (ACCOUNTANT MEMBER) I.T.A. NO.3072 /MUM/2009 (ASSESSMENT YEAR : 2005-06) M/S JUST DIAL PVT LTD M-501B PALM COURT COMPLEX BESIDES GOREGAON SPORTS CLUB NEW LINK ROAD MALAD (W) MUMBAI 400 064 VS ADDL CIT RANGE-1 NEW DELHI PAN : AAACA8049G (APPELLANT) (RESPONDENT) APPELLANT BY SHRI NIMESH JAMBUSARIA RESPONDENT BY SHRI PREMANAND J DATE OF HEARING : 25-10-2016 DATE OF PRONOUNCEMENT : 25 -10-2016 O R D E R PER ASHWANI TANEJA AM: THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE O RDER OF COMMISSIONER OF INCOME-TAX (APPEALS)-IV DELHI [HER EINAFTER CALLED CIT(A)] DATED 04-03-2009 PASSED AGAINST THE ASSESSMENT ORDE R U/S 143(3) DATED 12-12-2007 FOR A.Y. 2005-06 ON THE FOLLOWING GROUND S: 1. ON THE FACTS AND IN THE CIRCUMSTANCES AND IN LAW THE LEARNED CIT(A) ERRED IN DISMISSING THE APPEAL. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW THE LEARNED CIT(A) ERRED IN DISMISSING THE APP EAL THAT 2 I.T.A. NO.3072/MUM/2009 TOO WITHOUT GIVING FULL AND PROPER OPPORTUNITY OF B EING HEARD IN THE MATTER. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW THE LEARNED CIT(A) ERRED IN DISMISSING THE APPEAL T HAT TOO WITHOUT APPRECIATING THE FACTS AND CIRCUMSTANCES OF THE CASE FULLY AND PROPERLY. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LEARNED CIT(A) ERRED IN UPHOLDING THE A CTION OF THE A.O. IN MAKING AN ADDITION OF RS.13 83 621/- BEING DEFERRED REVENUE RECEIPTS. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LEARNED CIT(A) ERRED IN UPHOLDING THE A CTION OF THE AO IN MAKING AN ADDITION OF RS.6 61 880/- BEING GRA TUITY PAYMENT. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LEARNED CIT(A) ERRED IN UPHOLDING THE A CTION OF THE A.O. IN ADDING AN AMOUNT OF RS. 1 68 750/- BEING DE PRECIATION CLAIMED ON GOODWILL. 7. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LEARNED 011(A) ERRED IN UPHOLDING THE A CTION OF THE A.O. IN ADDING AN AMOUNT OF RS.27 180/- AS DISALLOW ANCE OF EXPENDITURE ESTIMATED 10% OF DIVIDEND INCOME.. 8. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LEARNED AO ERRED IN DISMISSING THE G:OU ND OF APPEAL RELATING TO INTEREST CHARGED UIS.234B AND 23 40. 2. DURING THE COURSE OF HEARING ARGUMENTS WERE MADE BY SHRI NIMESH JAMBUSARIA ON BEHALF OF THE ASSESSEE AND BY SHRI PR EMANAND J ON BEHALF OF THE REVENUE. 3 I.T.A. NO.3072/MUM/2009 3. GROUNDS 1 2 3 & 8 ARE GENERAL AND DO NOT NEED ANY SPECIFIC ADJUDICATION AND THEREFORE THEY ARE DISMISSED. 4. GROUND 4: IN THIS GROUND THE ASSESSEE HAS CHALLENGED ACTION OF LD. CIT(A) IN UPHOLDING THE ACTION OF AO IN MAKING ADDITION OF RS.13 83 621/- BEING DEFERRED REVENUE RECEIPTS. IT IS NOTED FROM THE PERUSAL OF THE ORDER OF THE LD. CIT(A) THAT WHILE U PHOLDING THIS ADDITION HE HAS RELIED UPON HIS ORDER FOR A.Y. 2003-04. DURING THE COURSE OF HEARING IT WAS JOINTLY STATED BY BOTH THE PARTIES THAT THE ISS UE IN A.Y. 2003-04 REACHED BEFORE THE TRIBUNAL WHEREIN IT HAS BEEN SEN T BACK TO THE FILE OF THE AO FOR FRESH ADJUDICATION IN TERMS OF THE DIREC TIONS GIVEN BY THE TRIBUNAL IN TERMS OF THE DIRECTIONS GIVEN BY THE TR IBUNAL VIDE ORDER DATED 14-06-2016 IN ITA |NO.123/DEL/2008. 5. WE HAVE GONE THROUGH THE ORDER OF THE TRIBUNAL FOR A.Y. 2003-04 AND ALSO THE ORDERS PASSED BY THE LOWER AUTHORITIES FOR THE YEAR BEFORE US. IT IS NOTED THAT THE ISSUE OF TREATMENT OF DEFERRED REVENUE INCOME HAS BEEN DISCUSSED IN DETAIL BY THE TRIBUNAL FOR A.Y. 2 003-04 AND THEREAFTER THE SAME WAS SENT BACK TO THE FILE OF AO FOR FRESH ADJUDICATION WITH CERTAIN DIRECTIONS. BOTH THE PARTIES UNANIMOUSLY A GREED BEFORE US THAT THE FACTS ARE IDENTICAL AND IN THIS YEAR ALSO THE ISSUE NEEDS TO BE SENT BACK TO THE FILE OF THE AO. THUS THE ISSUE IN THI S YEAR ALSO IS SENT BACK TO THE FILE OF THE AO FOR FRESH ADJUDICATION. THE AO IS DIRECTED TO FOLLOW THE DIRECTIONS GIVEN BY THE TRIBUNAL FOR A.Y. 2003-04. THIS GROUND MAY BE TREATED AS ALLOWED FOR STATISTICAL PURPOSE. 6. GROUND 5: IN THIS GROUND THE ASSESSEE HAS CHALLENGED THE AC TION OF LD. CIT(A) IN UPHOLDING THE ACTION OF AO IN MAKI NG AN ADDITION OF RS.6 61 880 BEING GRATUITY PAYMENT. 4 I.T.A. NO.3072/MUM/2009 7. DURING THE COURSE OF HEARING IT WAS STATED BY THE L D. COUNSEL OF THE ASSESSEE THAT THIS ISSUE HAS BEEN DECIDED BY THE TR IBUNAL IN ASSESSEES FAVOUR FOR A.Y. 2003-04. THE LD. DR DID NOT OPPOSE THE SUBMISSION OF THE ASSESSEE AND FAIRLY AGREED THAT THE FACTS ARE IDENT ICAL. 8. WE HAVE GONE THROUGH THE ORDER OF THE LOWER AUTHORI TIES AS ALSO THE ORDER OF THE TRIBUNAL FOR A.Y. 2003-04. IT IS NOTE D THAT AFTER VERIFYING THE FACTS IN DETAIL THE TRIBUNAL DECIDED THIS ISSUE IN FAVOUR OF THE ASSESSEE BY OBSERVING AS UNDER:- 1 4. THE LEARNED COUNSEL OF THE ASSESSEE COMPANY SUBMITTED THAT THIS ISSUE IS ALSO COVERED IN FAVOUR COVERED IN FAVOUR OF THE ASSESSEE COMPANY AS THE APPROVAL O F THE GRATUITY FUND HAS ALREADY BEEN ACCEPTED BY THE CONCERNED COMMISSIONER OF INCOME TAX VIDE APPROVAL NO CIT- 9/GRATUITY APPROVAL/2010- 11 DATED 28-10-2010 WHICH IS PLACED AT PAPER BOOK FILED WITH-THE TRIBUNAL AT PAGE NO.66 WHICH AP PROVAL IS EFFECTIVE FROM 0 . 6-0 . 9-2002 TO M/S JUST DIAL PRIVATE LIMITED EMPLOYEES GROUP GRATUITY SCHEME. THE LEARNED COUNSEL FOR THE ASSESSEE COMPANY ALSO SUBMITTED THAT THE ISSUE CAM E UP BEFORE THE TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO 3200/MUM/2010 FOR THE ASSESSMENT YEAR 2006-07 WHEREBY THE TRIBUNAL VIDE ORDERS DATED 28 TH FEBRUARY 2014 ALLOWED THIS GROUND OF APPEAL RAISED BY THE ASSESSEE COMPANY . THE RELEVANT FINDINGS ARE AS UNDER: - 14. THE LEARNED COUNSEL FOR THE ASSESSEE COMPANY SUBMITTED THAT THIS ISSUE IS ALSO COVERED IN FAVOUR OF THE AS SESSEE COMPANY AS THE APPROVAL OF THE GRATUITY FUND HAS ALREADY BEEN ACCORDED BY THE CONCERNED COMMISSIONER OF INCOME TAX VIDE APPROVAL NO.CIT- 9/GRATUITY APPROVAL/2010-11 DATED 28-1-2010 WHICH I S PLACED AT PAPER BOOK FILED WITH THE TRIBUNAL AT PAGE NO.66 W HICH APPROVAL IS EFFECTIVE FROM 06-09-2002 TO M/S JUST DIAL PRIVATE LIMITED EMPLOYEES GROUP GRATYUITY SCHEME. THE LEARNED COUNSEL FOR TH E ASSESSEE COMPANY ALSO SUBMITTED THAT THE ISSUE CAME UP BEFOR E THE TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO. 3200/MUM./2010 FOR THE ASSESSMENT YEAR 2006-07 WHEREBY THE TRIBUNAL VIDE O RDERS DATE 28 TH 5 I.T.A. NO.3072/MUM/2009 FEBRUARY 2014 ALLOWED THIS GROUND OF APPEAL RAISED BY THE ASSESSEE COMPANY. THE RELEVANT FINDINGS OF THE TRIBUNAL AR E AS UNDER:- '8. GROUND NO. 5 PERTAINS TO DISALLOWANCE OF GRATUI TY PAID AT RS.13 80 005/- 9. THE AR SUBMITTED THAT THE ISSUE IS SINCE COVERED AS THE APPROVAL FOR THE SAME HAS BEEN ACCORDED BY THE CONCERNED CIT. VIDE APPEAL NO. C1T9/GRANTING APPROVAL/2010-11 DATED 28.10.2010. THIS LETTER OF APPROVAL WAS OBVIOUSLY N OT AVAILABLE AT THE TIME WHEN THE IMPUGNED ORDER WAS PASSED AND THE CIT(A) H AD CORRECTLY DISALLOWED BECAUSE THE ASSESSEE COULD NOT PRODUCE ANY EVIDENCE TO THIS EFFECT AT THE TIME OF HEARING. 10. THE AR. SUBMITTED THAT SINCE THE ISSLIC IS NOW APPROVED BY THE CIT AS PER THE LETTER OF APPROVAL APPENDED IN T HE APB THE ISSUE BE NOW HELD IN FAVOUR OF THE ASSESSEE. 11.THE DR ACCEPTED THE FACTUM OF APPROVAL. 12 . IN THESE CIRCUMSTANCES THE ASSESSEE'S PRAYER FOR ALLOWANCE OF THE GRATUITY PAYMENT IS ALLOWED. THE O RDER OF THE CIT(A)(A) IS THUS SET ASIDE ON THIS ISSUE AND T HE A.O IS DIRECTED TO ALLOW THE EXPENSE.' RESPECTFULLY FOLLOWING THE DECISION OF THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEE'S OWN. CASE IN ITA NO3200/MUM/ 2010 VIDE ORDERS DATED 28-02-2014 FOR ASSESSMENT YEAR 2006 07 WE SET ASIDE THE ORDERS OF THE LEARNED CIT(A) AND THE AO IS DIRECTED THE ALLOW THE EXPENSES EFFECTIVE FROM THE DATE OF APPROVAL OF GRATUITY SCHEME OF THE ASSESSEE COMPANY I.E. 06-09-2002 BY T HE LEARNED CIT(A)-9 SUBJECT TO THE DIRECTIONS TO AO TO VERIFY THE CONTRIBUTION HAVING BEEN MADE BY THE ASSESSEE COMPANY TO THE ABOVE STATED APPROVED GRATUITY SCHEME AS APPROVED BY LEARNED CIT -9 AND ACCORDINGLY WE ALLOW THE GROUNDS NO. 7 & 8 AS INDICATED ABOVE . THE ASSESSEE COMPANY IS DIRECTED TO APPEAR BEFORE THE AO AND PROVIDE EVIDENCES AND EXPLANATION TO COMPLY WITH REGARD TO DIRECTIONS ISSUED BY US FOR VERIFICATION AS INDICATED ABOVE . THE AO SHALL PROVIDE PROPER AND ADEQUATE OPPORTUNITY OF BEING HE ARD TO THE ASSESSEE COMPANY IN ACCORDANCE WITH PRINCIPLES OF N ATURAL JUSTICE IN ACCORDANCE WITH LAW. WE ORDER ACCORDINGLY. 6 I.T.A. NO.3072/MUM/2009 9. THE LD. COUNSEL HAD PLACED BEFORE US COPY OF THE OR DER DATED 28- 10-2010 GRANTING APPROVAL TO EMPLOYEES GROUP GRATUI TY SCHEME W.E.F. 06- 09-2002. AFTER TAKING INTO ACCOUNT TOTALITY OF FAC TS AND CIRCUMSTANCES OF THE CASE THIS ISSUE IS SENT BACK TO THE FILE OF TH E ASSESSING OFFICER WITH THE SAME DIRECTIONS AS WERE GIVEN BY THE TRIBUNAL FOR A .Y. 2003-04. THE ASSESSING OFFICER AS WELL AS THE ASSESSEE SHALL FOL LOW THE DIRECTIONS GIVEN BY THE TRIBUNAL IN THE AFORESAID ORDER. THE ASSESS ING OFFICER SHALL PROVIDE RELIEF ACCORDINGLY. THIS GROUND MAY BE TREATED AS ALLOWED FOR STATISTICAL PURPOSE. 10. GROUND 6: THIS GROUND DEALS WITH THE ACTION OF THE LD. CIT(A) IN UPHOLDING THE ACTION OF ASSESSING OFFICER IN MAKING DISALLOWANCE OF RS.1 68 750 BEING THE AMOUNT OF DEPRECIATION ON GOO DWILL. 11. DURING THE COURSE OF HEARING IT WAS STATED BY THE LD. COUNSEL THAT THIS ISSUE WAS DECIDED BY THE TRIBUNAL IN FAVOUR OF THE ASSESSEE IN ITS ORDER FOR A.Y. 2003-04 (SUPRA). 12. PER CONTRA THE LD. DR AGREED THAT THIS ISSUE IS CO VERED IN FAVOUR OF THE ASSESSEE BY THE ORDER OF THE TRIBUNAL AS WELL A S BY THE JUDGEMENT OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS SMI FS SECURITIES LTD 348 ITR 302 (SC). 13. WE HAVE GONE THROUGH THE ORDERS PASSED BY THE LOWER AUTHORITIES AS WELL AS THE ORDER FOR A.Y. 2003-04. IT IS NOTED THAT THE TRIBUNAL HAS ALLOWED THE CLAIM OF DEPRECIATION ON GOODWILL WITH THE FOLLOWING OBSERVATIONS:- 12. THE LEARNED COUNSEL FOR THE ASSESSEE COMPANY S UBMITTED THAT THIS ISSUE IS COVERED IN FAVOUR OF THE ASSESSE E COMPANY BY 7 I.T.A. NO.3072/MUM/2009 THE DECISION OF HONBLE SUPREME COURT IN THE CASE O F CIT V. SMIFS SECURITIES LTD. (2012) 348 ITR 302 (SC). THE LEAR NED COUNSEL FOR THE ASSESSEE COMPANY ALSO SUBMITTED THAT THE ISSUE CAME BEFORE THE TRIBUNAL IN ASSESSEE COMPANYS OWN CASE IN ITA NO.3200/MUM/2010 FOR THE ASSESSMENT YEAR 2006-07 AN D FOLLOWING THE DECISION OF HONBLE APEX COURT IN THE CASE OF SMIFS SECURITIES LTD.(SUPRA) THE TRIBUNAL ALLOWED THE GR OUND RAISED BY THE ASSESSEE COMPANY VIDE ORDERS DATED 28-02-2010 F OR THE ASSESSMENT YEAR 2006-07 VIDE ORDERS DATED 28-02-201 4 HELD AS UNDER:- 4. GROUND NO.4 PERTAINS TO DEPRECIATION ON GOODWILL. THE A.R. SUBMITTED THAT THE ISSUE IS COV ERED BY THE DECISION OF HONBLE SUPREME COURT IN THE CASE O F CIT(A) VS SMIFS SECURITIES LTD. REPORTED IN 348 ITR 302 THEREFORE THE DECISION ON THE HONBLE SUPREME COUR T OF INDIA ON THIS ISSUE HAS TO BE FOLLOWED AND AS A CONSEQUENCE OF WHICH THE ISSUE HAS TO BE ALLOWED I N FAVOUR OF THE ASSESSEE. 5. THE LD. DEPARTMENTAL REPRESENTATIVE ACCEPTED THA T THE ISSUE IS SQUARELY COVERED BY THE DECISION OF HO NBLE SUPREME COURT. 6. SINCE THE ISSUE IS COVERED BY THE HONBLE SUPREM E COURT IN THE CASE OF SMIFS SECURITIES LTD.(SUPRA) AS ACCEPTED BY EITHER PARTIES THE GROUND IS ALLOWED. HENCE THE ORDER OF THE CIT(A)(A) IS SET ASIDE ON THIS ISS UE AND THE AO IS DIRECTED TO ALLOW THE CLAIM OF DEPRECIATI ON. GROUND NO.4 IS THEREFORE ALLOWED. RESPECTFULLY FOLLOWING THE DECISION OF HONBLE APEX COURT IN THE CASE OF SMIFS SECURITIES LTD (SUPRA) AND ALSO THE D ECISION OF CO- ORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEE COMPANY S OWN CASE IN ITA NO.3200/MUM/2010 FOR ASSESSMENT YEAR 2006-07 WE SET ASIDE THE APPELLATE ORDERS OF THE LEARNED CIT(A) AN D DIRECT THE ASSESSING OFFICER TO ALLOW THE CLAIM OF DEPRECIATIO N ON GOODWILL AS PER LAW IN ACCORDANCE WITH THE PROVISIONS OF THE ACT. THE GROUND NO.5 & 6 ARE ALLOWED AS INDICATED ABOVE. WE ORDER ACCORDINGLY. 8 I.T.A. NO.3072/MUM/2009 14. DURING THE COURSE OF HEARING BOTH THE PARTIES AGRE ED THAT FACTS ARE IDENTICAL. THUS RESPECTFULLY FOLLOWING THE ORDER OF THE TRIBUNAL FOR A.Y. 2003-04 THIS ISSUE IS DECIDED IN FAVOUR OF THE ASS ESSEE. THE ASSESSING OFFICER IS DIRECTED TO ALLOW THE CLAIM OF DEPRECIAT ION ON GOODWILL IN ACCORDANCE WITH THE PROVISIONS OF THE ACT. THIS GR OUND MAY BE TREATED AS ALLOWED. 15. GROUND 7 IS NOT PRESSED; HENCE DISMISSED. 16. IN THE RESULT APPEAL OF THE ASSESSEE IS PARTLY ALL OWED. ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE CONCL USION OF THE HEARING. SD/- SD/- (AMIT SHUKLA) (ASHWANI TANEJA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI DT : 7 TH NOVEMBER 2016 PK/- COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. THE CIT 5. THE LD. DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE G-BENCH (TRUE COPY) BY ORDER ASSTT.REGISTRAR ITAT MUMBAI BENCHES