SAM PROPERTIES P.LTD, MUMBAI v. ITO 10(1)(4), MUMBAI

ITA 4491/MUM/2009 | 2005-2006
Pronouncement Date: 25-02-2011 | Result: Partly Allowed

Appeal Details

RSA Number 449119914 RSA 2009
Assessee PAN AAFCS7614R
Bench Mumbai
Appeal Number ITA 4491/MUM/2009
Duration Of Justice 1 year(s) 6 month(s) 27 day(s)
Appellant SAM PROPERTIES P.LTD, MUMBAI
Respondent ITO 10(1)(4), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 25-02-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted E
Tribunal Order Date 25-02-2011
Date Of Final Hearing 05-01-2011
Next Hearing Date 05-01-2011
Assessment Year 2005-2006
Appeal Filed On 29-07-2009
Judgment Text
1 ITA NO.4491/MUM/2009 IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI MUMBAI MUMBAI MUMBAI E EE E BENCH BENCH BENCH BENCH MUMBAI BENCHES MUMBAI MUMBAI BENCHES MUMBAI MUMBAI BENCHES MUMBAI MUMBAI BENCHES MUMBAI BEFORE SHRI R K PANDA AM BEFORE SHRI R K PANDA AM BEFORE SHRI R K PANDA AM BEFORE SHRI R K PANDA AM & SMT ASHA VIJAYARAGHAVAN JM & SMT ASHA VIJAYARAGHAVAN JM & SMT ASHA VIJAYARAGHAVAN JM & SMT ASHA VIJAYARAGHAVAN JM ITA NO. ITA NO. ITA NO. ITA NO. 4491/MUM/2009 4491/MUM/2009 4491/MUM/2009 4491/MUM/2009 (ASST YEAR (ASST YEAR (ASST YEAR (ASST YEAR 2005 2005 2005 2005- -- -06 0606 06) )) ) SAM PROPERTIES P LTD C/O BHAROOMALA 3M ANIL VILLA OPP: NANAVATI GIRLS COLLEGE V P ROAD VILE PARLE (W) MUMBAI VS THE INCOME TAX WARD 10(1)(4) MUMBAI ( (( ( APPELLANT APPELLANT APPELLANT APPELLANT ) )) ) (RESPONDENT) (RESPONDENT) (RESPONDENT) (RESPONDENT) PAN NO. PAN NO. PAN NO. PAN NO. AAFCS7614R AAFCS7614R AAFCS7614R AAFCS7614R ASSESSEE BY SHRI S C TIWARI REVENUE BY SHRI SURENDRA KUMAR PER R K PANDA AM PER R K PANDA AM PER R K PANDA AM PER R K PANDA AM THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 23.6.2008 OF THE CIT(A)-X MUMBAI RELATING TO ASSES SMENT YEAR 2005-06. 2 FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSE E COMPANY IS THE OWNER OF THE HOUSE PROPERTY WHICH WAS LEASED OUT TO SHRI S OBHRAJ TELREJA AND SMT RAJKUMARI TALEJA DIRECTORS OF THE COMPANY WHO IN TURN SUB-LEASED THE SAME TO M/S E-FUND INTERNATIONAL PVT LTD AND HAVE RECEIVED RENTAL INCOME OF ` . 36 17 712/- EACH. THE ASSESSEE HAS SHOWN TO HAVE RECEIVED RENTAL INCOME FROM THE DIRECTORS AT ` .11 84 736/- WHICH HAS BEEN SHOWN AS BUSINESS INCO ME. 2.1 THE ASSESSING OFFICER NOTED THAT THERE IS NO BU SINESS ACTIVITY IN THE CASE OF THE ASSESSEE COMPANY. THE LOAN TAKEN HAS BEEN UT ILIZED FOR PURCHASE OF PROPERTY WHICH IS THEN LEASED OUT TO THE SAME PERSO NS FROM WHOM LOAN WAS 2 ITA NO.4491/MUM/2009 TAKEN. INTEREST OF ` . 4 62 058/- AND MUNICIPAL TAXES OF ` . 7 00 603/- HAVE ALSO BEEN DEBITED TO THE P&L ACCOUNT. HOWEVER IN ITS S TATEMENT OF INCOME INTEREST HAS BEEN ADDED BACK AND DISALLOWED BY THE ASSESSEE. THE ASSESSING OFFICER INVOKED PROVISIONS OF SEC. 23(1)(A) AND HELD THE FA IR MARKET VALUE OF THE PROPERTY AT ` . 72 35 424/- WHICH THE DIRECTORS HAVE RECEIVED ON SUB-LEASING OF THE PROPERTY. RELYING ON A COUPLE OF DECISIONS HE TRE ATED THE ALV AT ` . 72 35 424/-. AFTER ALLOWING STATUTORY DEDUCTION U/S 24 OF THE I T ACT THE ASSESSING OFFICER DETERMINED THE INCOME AT ` . 50 64 800/- AS AGAINST ` . 4 48 914/- DECLARED BY THE ASSESSEE. 2.2 IN APPEAL THE CIT(A) FOLLOWING THE DECISION O F THE HONBLE SUPREME COURT IN THE CASE OF SULTAN BROTHERS P LTD VS CIT REPORTE D IN 51 ITR 353(SC) HELD THAT RENTAL INCOME EARNED BY THE ASSESSEE FROM LETTING O UT OF THE PROPERTY HAS TO BE ASSESSED AS INCOME FROM HOUSE PROPERTY. 2.3 SO FAR AS THE ACTION OF THE ASSESSING OFFICER I N SUBSTITUTING THE ALV OF THE PROPERTY AT ` . 72 35 424/- AS AGAINST ` . 11 84 736/- DECLARED BY THE ASSESSEE THE CIT(A) HELD THAT THE ASSESSING OFFICER HAS RIG HTLY INVOKED THE PROVISIONS OF SEC. 23(1)(A) OF THE I T ACT. WHILE DOING SO HE NOTED THAT THE DIFFERENCE BETWEEN THE MARKET VALUE AND THE LEASE RENT CHARGED BY THE ASSESSEE IS HUGE. THE LEASE HAS BEEN MADE TO ITS OWN DIRECTORS. THER EFORE THE BONAFIDE OF THE LEASE DEED IS QUESTIONABLE. WHILE DOING SO HE ALS O RELIED ON A COUPLE OF DECISIONS. 3 ITA NO.4491/MUM/2009 3 AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE ASSES SEE IS IN APPEAL HERE BEFORE US WITH THE FOLLOWING GROUNDS: I) THE ORDER PASSED BY THE LD CIT(A) IS BAD IN LAW. II)THE LD CIT(A) ERRED IN HOLDING THAT INCOME OF TH E APPELLANT DERIVED FROM LETTING OUT THE PROPERTY IS INCOME FROM HOUSE PROPE RTY AND NOT INCOME FROM BUSINESS AS CLAIMED BY THE APPELLANT. III). THE LD CIT(A) FURTHER ERRED IN NOT ALLOWING T HE EXPENSES CLAIMED BY THE APPELLANT IN THE P&L ACCOUNT. IV) WITHOUT PREJUDICE THE LD CIT(A) ERRED IN HOLDI NG THAT IN PLACE OF RENTAL INCOME DECLARED BY THE APPELLANT THE RENTAL INCOME RECEIVED BY THE TWO SUB LESSEES DIRECTORS IS ASSESSABLE IN THE HANDS OF THE APPELLANT COMPANY AS INCOME FROM HOUSE PROPERTY EVEN THOUGH THE TWO D IRECTORS HAVE PAID TAXES ON THE SAID INCOME THUS SUBJECTING THE SAID I NCOME TO DOUBLE TAXATION. V) IT IS PRAYED THAT THE ADDITION MADE TO THE INCOM E OF THE APPELLANT MAY PLEASE BE DELETED AND THE INCOME DECLARED BY THE AP PELLANT MAY BE HELD AS INCOME FROM HOUSE AND THE EXPENSES CLAIMED IN T HE P&L ACCOUNT MAY BE ALLOWED. 4 THE LD COUNSEL FOR THE ASSESSEE SUBMITTED THAT TH E CIT(A) WAS NOT JUSTIFIED IN TREATING THE RENTAL INCOME AS INCOME FROM HOUSE PROPERTY AS AGAINST BUSINESS INCOME DECLARED BY THE ASSESSEE. SO FAR AS THE SUB STITUTION OF FAIR MARKET VALUE OF THE PROPERTY AT ` 72 35 424/- IS CONCERNED AS AGAINST ACTUAL RENTAL INCOME OF ` . 11 84 736/- RECEIVED BY THE ASSESSEE HE SUBMI TTED THAT SUCH ADDITION IS UN- WARRANTED BOTH ON FACTS AND ON LAW. REFERRING TO THE ORDER OF THE TRIBUNAL IN CASE OF SMT RAJKUMARI TALREJA AND SHRI SHOBHRAJ B T ALREJA VIDE ITA NOS 1812 & 1811/MUM/05 FOR THE AYS 2002-03 HE SUBMITTED THAT THE TRIBUNAL IN THE SAID ORDER HAS HELD THAT THE ASSESSEES ARE THE DEEMED OW NER OF THE PROPERTY. THUS THE BONAFIDE OF THE AGREEMENT HAS NOT BEEN DOUBTED. 4 ITA NO.4491/MUM/2009 4.1 REFERRING TO THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF AKSHAY TEXTILES TRADING & AGENCY P LTD REPORTED IN 214 CTR 316 (BOM)/304 ITR 401 HE SUBMITTED THAT WHEN THE PROPERTY IS LEASED OUT TO THE TENANT AND THE TENANT SUBLETS THE PROPERTY FOR HIGHER RENT AND WHE N THERE IS NO EVIDENCE THAT TRANSACTION WAS NOT GENUINE THE AMOUNT PAID BY THE SUB LESSEE CANNOT BE ASSESSED AS INCOME OF THE ASSESSEE. THE ALV WOULD B E THE VALUE IN TERMS OF THAT CONTRACT. 4.2 HE SUBMITTED THAT THE RENTAL INCOME RECEIVED BY THE ASSESSEE IS MORE THAN THE MUNICIPAL RATEABLE VALUE. THEREFORE IN VI EW OF THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF SHIELA KAUSHIS H VS CIT REPORTED IN 131 ITR 435 AND IN VIEW OF VARIOUS OTHER DECISIONS THE CIT (A) IS NOT JUSTIFIED IN CONFIRMING ORDER OF THE ASSESSING OFFICER IN ADOPT ING THE FIGURE OF ` . 72 35 424/- AS AGAINST THE ACTUAL RENT RECEIVED AT ` . 11 84 736/- WHICH IS MORE THAN THE MUNICIPAL RATEABLE VALUE. 4.3 THE LD DR ON THE OTHER HAND WHILE SUPPORTING T HE ORDERS OF THE AUTHORITIES BELOW SUBMITTED THAT THE PROVISIONS OF SEC. 23(1)(A ) ARE CLEARLY APPLICABLE WHICH SPEAKS OF THE MARKET RENT. THE MARKET RENT IN THE INSTANT CASE SHOULD BE ` . 72 35 424/ WHICH THE DIRECTORS HAVE RECEIVED ON ACC OUNT OF SUBLETTING OF THE PROPERTY. 4.4 THE LD COUNSEL FOR THE ASSESSEE IN HIS REJOIN DER SUBMITTED THAT AS PER PROVISIONS OF SEC. 23(1)(A) THE ANNUAL VALUE OF T HE PROPERTY SHALL BE DEEMED TO 5 ITA NO.4491/MUM/2009 BE THE SUM FOR WHICH THE PROPERTY MIGHT REASONABLY BE EXPECTED TO LET FROM YEAR TO YEAR AND THE PROVISIONS DO NOT SPEAK OF MARKET RENT. SIMILARLY AS PER PROVISIONS OF SEC. 23(1)(B) ANNUAL VALUE SHALL BE DEEMED TO BE ACTUAL RENT RECEIVED OR RECEIVABLE. HE SUBMITTED THAT IN ABSEN CE OF MARKET RENT EITHER ACTUAL RENT RECEIVED OR THE MUNICIPAL RATEABLE VALU E WHICHEVER IS HIGHER HAS TO BE TAKEN. SINCE THE ACTUAL RENT RECEIVED BY THE A SSESSEE IS ` . 11 84 736/- WHICH IS HIGHER THAN THE MUNICIPAL RATEABLE VALUE; THEREFORE THE SAME HAS TO BE ADOPTED. 5 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS MADE BY BOTH THE PARTIES PERUSED THE ORDERS OF THE AUTHORITIES BELOW AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECISIONS CITED BEFORE US. THERE IS NO DISPUTE TO THE FACT THAT THE ASSESSEE C OMPANY IS THE OWNER OF THE PROPERTY WHICH HAS BEEN LEASED OUT TO ITS DIRECTOR S FOR ANNUAL RENT OF ` . 11 84 736/-. THERE IS ALSO NO DISPUTE TO THE FACT THAT THE DIRECTORS HAVE SUB- LEASED THE PROPERTY TO M/S E-FUND INTERNATIONAL P L TD AT ANNUAL RENT OF RS. 72 35 424/-. ACCORDING TO THE ASSESSEE SUCH INCOME FROM LETTING OUT OF THE PROPERTY SHOULD BE TREATED AS BUSINESS INCOME. ACCO RDING TO THE REVENUE THE INCOME HAS TO BE TREAD AS INCOME FROM HOUSE PROPERT Y AND ANNUAL LET OUT VALUE SHOULD BE RS. 72 35 424/- AS AGAINST THE RENT RECEI VE SHOWN AT RS. 11 84 736/-. 5.1 SO FAR AS THE TREATMENT OF INCOME RECEIVED ON A CCOUNT OF LEASED OUT OF THE PROPERTY AS BUSINESS INCOME IS CONCERNED WE ARE OF THE CONSIDERED OPINION THAT THE REVENUE AUTHORITIES ARE JUSTIFIED IN TREATING T HE SAME AS INCOME FROM HOUSE PROPERTY AS AGAINST BUSINESS INCOME TREATED BY THE ASSESSEE IN VIEW OF THE 6 ITA NO.4491/MUM/2009 DECISIONS OF THE HONBLE SUPREME COURT IN THE CASE OF SULTAN BROTHERS P LTD (SUPRA) AND SHAMBHU INVESTMENTS REPORTED IN 263 ITR 143. THE GROUNDS OF APPEAL NO 1 II & III BY THE ASSESSEE ARE ACCORDING LY DISMISSED. 5.2 SO FAR AS THE SUBSTITUTION OF THE ANNUAL VALUE OF THE PROPERTY AT ` . 72 35 424/- AS AGAINST ANNUAL VALUE AT ` . 11 84 736/- IS CONCERNED WE FIND THE BONAFIDE OF THE AGREEMENT BETWEEN THE ASSESSEE COMPANY AND ITS DIRECTORS HAS NOT BEEN PROVED TO BE FALSE. FURTHER IT IS TH E SUBMISSION OF THE LD COUNSEL FOR THE ASSESSEE ON THE BASIS OF MATERIAL PLACED ON RECORD THAT THE MUNICIPAL RATEABLE VALUE IS LESS THAN THE ACTUAL RENT RECEIVE D BY THE ASSESSEE. 5.3 IT HAS BEEN HELD BY THE JURISDICTIONAL HIGH COU RT IN THE CASE OF AKSHAY TEXTILES TRADING & AGENCY P LTD (SUPRA) THAT WHEN A PROPERTY HAS BEEN LET OUT TO A TENANT WHO SUB LEASES THE SAME FOR HIGHER RENT A ND WHEN THERE IS NO EVIDENCE THAT THE TRANSACTION WAS NOT GENUINE THEN RENT PAID BY THE SUB-LESSEE IS NOT ASSESSABLE AS INCOME OF THE ASSESSEE. THE ANNUAL VA LUE WOULD BE THE VALUE IN TERMS OF THE CONTRACT. THE RELEVANT PORTION OF THE ORDER OF THE JURISDICTIONAL HIGH COURT READ AS UNDER: ( AT PAGE 407) WE MAY ALSO NOTE THAT S. 23 BEFORE ITS AMENDMENT B Y FINANCE ACT 2001 W.E.F. 1ST APRIL 2001 READS AS UNDER: '23(1) FOR THE PURPOSES OF S. 22 THE ANNUAL VALUE OF ANY PROPERTY SHALL BE DEEMED TO BE : (A) THE SUM FOR WHICH THE PROPERTY MIGHT REASONABLY BE EXPECTED TO LET FROM YEAR TO YEAR; (B) WHERE THE PROPERTY IS LET AND THE ANNUAL RENT R ECEIVED OR RECEIVABLE BY THE OWNER IN RESPECT THEREOF IS IN EX CESS OF THE SUM REFERRED TO IN CLAUSE (A) THE AMOUNT SO RECEIVED OR RECEIVABLE.' 7 ITA NO.4491/MUM/2009 THIS WAS NECESSITATED ON ACCOUNT OF THE SUPREME COU RT INTERPRETING S. 23(1) AS IT THEN STOOD AND TO BRING WITHIN ITS A MBIT THOSE CASES WHERE HIGHER RENT HAD BEEN RECEIVED THAN THE ANNUAL LETTING VALUE. IN OTHER WORDS WHERE THE ANNUAL RENT RECEIVABLE WAS MORE THAN THE ANNUAL LETTING VALUE. ON BEHALF OF THE REVENUE CONSIDERING THE EXPRESSION RECEIVABLE IN S. 23(1)(B) LEARNED COUNSEL SEEKS TO CONTEND THAT WHA T HAS TO BE CONSIDERED IS THE RENT WHICH IS RECEIVABLE AS RENT FROM THE PREMISES. IT IS THEREFORE SUBMITTED THAT THE RENT WHICH THE TE NANT WAS RECEIVING FROM RELIANCE WOULD BE THE RENT RECEIVABLE. ON THE OTHER HAND ON BEHALF OF THE ASSESSEE LEARNED COUNSEL EXPLAINS THA T THE EXPRESSION 'RECEIVABLE' IS IN THE CONTEXT OF THE RENT RESERVED IN TERMS OF THE AGREEMENT. AS AN ILLUSTRATION IT IS SUBMITTED THAT IF THE RENT RECEIVED PER ANNUM IS RS. 12 000 EVEN THOUGH RS. 6 000 IS PA ID FOR THE PURPOSE OF TAX INCIDENCE WHAT HAS TO BE CONSIDERED IS RS. 1 2 000 AS THAT IS THE RENT RECEIVABLE. WE HAVE GIVEN OUR ANXIOUS CONSIDERATION TO THE RIVA L CONTENTIONS. SEC. 23(1)(A) USES THE EXPRESSION 'THE SUM FOR WHICH THE PROPERTY MIGHT REASONABLY BE EXPECTED TO BE LET FROM YEAR TO YEAR. ' THIS HAS TO BE CONSIDERED IN THE CONTEXT OF THE APPLICABLE RENT LA WS. THE COURTS HAVE CONSTRUED THE RENT RECEIVABLE IN SUCH CIRCUMSTANCES TO BE EITHER THE STANDARD RENT OR THE RATEABLE VALUE AS FIXED BY THE LOCAL AUTHORITY. THOUGH THE RATEABLE VALUE MAY ALSO ON OCCASIONS HAS TO CONSIDER THE STANDARD RENT IN CASES WHERE THE RENT LAW MAY BE AP PLICABLE. BEFORE THE AMENDMENT BROUGHT ABOUT TO S. 23 BY THE FINANCE ACT 2001 W.E.F. 1ST APRIL 2002 EVEN IF AN ASSESSEE HAD RECEIVED HIGHER RENT THAN THE STANDARD RENT THE ADDITIONAL AMOUNT WOULD NOT BE TH E SUBJECT OF TAX. TO OVERCOME THIS OMISSION THE SECTION WAS SUBSTITUTED TO COVER ALSO THOSE CASES WHERE RENT RECEIVED WAS HIGHER THAN THE STAND ARD RENT OR RENT BASED ON MUNICIPAL RATEABLE VALUE. IF THE ARGUMENT OF THE ASSESSEE (SIC- REVENUE) IS TO BE CONSIDERED THEN EXPRESSION 'REASO NABLE' WOULD HAVE TO BE GIVEN DIFFERENT MEANING. IN OUR OPINION IT IS NOT POSSIBLE TO GIVE A MEANING OF WIDER AMPLITUDE THAN WHAT IS CONTAINED I N S. 23(1)(A). THE LEGISLATURE HAS SUBSTITUTED THE PROVISION AND BROUG HT IN S. 23(1)(B) TO COVER THE PART OF THE ANNUAL VALUE WHICH OTHERWISE WOULD NOT FALL WITHIN THE TAX AMBIT BEFORE ITS AMENDMENT. IN THAT CONTEXT THE EXPRESSION 'RECEIVABLE' WOULD MEAN THAT THOUGH THE ANNUAL VALU E IS FIXED IN TERMS OF THE AGREEMENT EVEN THOUGH IT IS NOT RECEIVED IN THE RELEVANT YEAR YET THE SAME WOULD BE ASSESSABLE TO TAX IN TERMS OF THE ILLUSTRATION GIVEN ON BEHALF OF THE ASSESSEE. THE CONTENTION TH EREFORE AS URGED ON BEHALF OF THE REVENUE ON THE CONSTRUCTION OF EXPRES SION 'RECEIVABLE' WILL HAVE TO BE REJECTED. 10. THE ISSUE WHETHER THE CONTRACT BETWEEN RELIANCE AND THE INTERMEDIARY TENANT IS A SHAM CANNOT BE GONE INTO A S THE QUESTION WOULD NOT ARISE IN THE ABSENCE OF IT BEING IN ISSUE RAISED BEFORE THE TRIBUNAL. THAT QUESTION AS FRAMED DOES NOT THEREFOR E ARISE. FURTHER AS NOTED EARLIER IT IS NOT THE CONTENTION OF REVENUE T HAT THE CONTRACT BETWEEN THE ASSESSEE AND THE TENANT IS SHAM. THE AN NUAL VALUE WOULD AND BE THE VALUE IN TERMS OF THAT CONTRACT. THEREFO RE THE ANNUAL VALUE IS THE ANNUAL VALUE RECEIVED OR RECEIVABLE BY THE O WNER FROM THE TENANT 8 ITA NO.4491/MUM/2009 IRRESPECTIVE WHETHER TENANT ON SUCH LETTING HAS REC EIVED HIGHER RENT FROM RIL. 11. CONSIDERING THE ABOVE IN OUR OPINION THE QUEST ION OF LAW AT 'A' AS FRAMED WOULD NOT ARISE. QUESTION B HAS TO BE ANSWER ED IN THE AFFIRMATIVE AND AGAINST THE REVENUE. CONSEQUENTLY APPEAL STANDS DISMISSED. 6 SINCE IN THE INSTANT CASE THE ACTUAL RENT RECEIV ED BY THE ASSESSEE IS MORE THAN THE MUNICIPAL RATEABLE VALUE AS CLAIMED BY THE LD COUNSEL FOR THE ASSESSEE; THEREFORE IN VIEW OF THE DECISION OF THE JURISDICT IONAL HIGH COURT (CITED SUPRA) AND IN VIEW OF THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF SMT SHIELA KAUSHISH (SUPRA) WE ARE OF THE CONSIDERED O PINION THAT REVENUE AUTHORITIES ARE NOT JUSTIFIED IN SUBSTITUTING THE A MOUNT OF ` . 72 35 424/- AS AGAINST THE ACTUAL RENT OF ` . 11 84 736/- RECEIVED BY THE ASSESSEE. HOWEVER SINCE THE MUNICIPAL RATEABLE VALUE HAS NOT BEEN VER IFIED BY EITHER OF THE LOWER AUTHORITIES WE DEEM IT PROPER TO RESTORE THE MATTE R TO THE FILE OF THE ASSESSING OFFICER TO VERIFY THE SAME AND ALLOW APPROPRIATE RE LIEF IN THE LIGHT OF OUR OBSERVATIONS ABOVE. THE ORDER OF THE CIT(A) IS ACC ORDINGLY SET ASIDE AND GROUNDS OF APPEAL NOS 4 & 5 BY THE ASSESSEE ARE ALLOWED IN TERMS INDICATED ABOVE. 7 IN THE RESULT THE APPEAL FILED BY THE ASSESSEE I S PARTLY ALLOWED. ORDER PRONOUNCED ON THE 25 TH DAY OF FEB 2011. SD/- SD/- ( (( ( SMT ASHA VIJAYARAGHAVAN SMT ASHA VIJAYARAGHAVAN SMT ASHA VIJAYARAGHAVAN SMT ASHA VIJAYARAGHAVAN ) )) ) JUDI CIAL MEMBER ( (( ( R K PANDA R K PANDA R K PANDA R K PANDA ) )) ) ACCOUNTANT MEMBER PLACE: MUMBAI : DATED: 25 TH FEB 2011 RAJ* 9 ITA NO.4491/MUM/2009 COPY FORWARDED TO: 1 APPELLANT 2 RESPONDENT 3 CIT 4 CIT(A) 5 DR /TRUE COPY/ BY ORDER DY /AR ITAT MUMBAI