ENVISION INVESTMENTS & FINANCE (P) LTD, MUMBAI v. ADDL CIT RG 9(1), MUMBAI

ITA 867/MUM/2010 | 2006-2007
Pronouncement Date: 28-01-2011 | Result: Allowed

Appeal Details

RSA Number 86719914 RSA 2010
Assessee PAN AAACE2990G
Bench Mumbai
Appeal Number ITA 867/MUM/2010
Duration Of Justice 11 month(s) 23 day(s)
Appellant ENVISION INVESTMENTS & FINANCE (P) LTD, MUMBAI
Respondent ADDL CIT RG 9(1), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 28-01-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted E
Tribunal Order Date 28-01-2011
Date Of Final Hearing 13-01-2011
Next Hearing Date 13-01-2011
Assessment Year 2006-2007
Appeal Filed On 04-02-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E MUMBAI BEFORE SHRI S.V. MEHROTRA (AM) AND SMT ASHA VIJAYAR AGHAVAN (JM) ITA NO. 867/MUM/2010) (ASSESSMENT YEAR-2006-07) M/S. ENVISION INVESTMENTS & FINANCE (P) LTD. 401-A VYAPAR BHAVAN 368/70 NARSI NATHA STREET MASJID (W) MUMBAI-400 009 PAN- AAACE 2990G VS. THE ADDL. CIT RANGE 9(1) AAYAKAR BHAVAN MUMBAI-400 020 (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI VIJAY MEHTA RESPONDENT BY: SHRI S.K. SINGH O R D E R PER SMT. ASHA VIJAYARAGHAVAN (JM) THE APPLICATION FOR CLUBBING THE DEPARTMENTAL APPEA L MADE BY THE ASSESSEE IS REJECTED. WE ARE TAKING UP ONLY THE APPEAL FILED BY THE ASSESSEE. 2. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AG AINST THE ORDER OF THE LD.CIT(A)-19 MUMBAI DATED 14.12.2009 FOR THE A.Y.2 006-07. 3. THE ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF DEALING IN SHARES AND SECURITIES. IN THE RETURN OF INCOME FIL ED THE ASSESSEE HAS SET OFF LOSS ON FALL IN VALUE OF SHARES IN A SUM OF RS. 92 46 676/-. THE SAID LOSS WAS SET OFF AGAINST PROFIT ON SALES/DERIV ATIVES. THE CLAIM OF SET OFF WAS DISALLOWED BY THE AO TREATING THE SAME AS SPECULATION LOSS INVOKING EXPLANATION TO S. 73 OF THE I.T. ACT. THE ASSESSING OFFICER DECLINED TO GRANT CREDIT OF STT OF RS. 38 28 955/- AND ALSO MADE DISALLOWANCE U/S. 14A OF THE ACT. ITA NO. 867/M/10 2 4. AGGRIEVED BY THE ORDER OF THE AO ASSESSEE PREFE RRED AN APPEAL BEFORE THE LEARNED CIT(A). 5. THE LEARNED CIT(A) DISMISSED THE ASSESSEES APPE AL OBSERVING AS UNDER: THE APPELLANT HAD EARNED INCOME IN THE FORM OF DIV IDEND FROM INDIAN COMPANIES AND MUTUAL FUNDS WHICH IS EXEMPT I NCOME. FOLLOWING THE DECISION OF THE HONBLE MUMBAI SPECIA L BENCH IN M/S. DAGA CAPITAL MANAGEMENT PVT.LTD. 15 DTR (MUM)(SB)(TRIB.)68 THE AO HAS COMPUTED DISALLOWANC E UNDER RULE 8D IN A SUM OF RS. 11 94 537/-. RESPECTFULLY FOLLO WING THE DECISION OF THE HONBLE MUMBAI SPECIAL BENCH THE A CTION OF THE AO IS CONFIRMED. 6. AGGRIEVED BY THE ORDER OF THE CIT(A) ASSESSEE P REFERRED AN APPEAL BEFORE US AND RAISED THE FOLLOWING GROUNDS: 1. UNDER THE FACTS AND CIRCUMSTANCE OF YOUR APPELL ANT THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE DISALLOWANCE OF RS. 11 94 537/- U/S. 14A OF THE I.T. ACT 1961. 2. WITHOUT PREJUDICE TO THE ABOVE GROUND THE LEARN ED CIT(A) HAS ERRED IN CONFIRMING THE INVOCATION OF THE PROVISION OF SEC. 14A AND RULE 8D AS MUCH AS THE SAME IS NOT APPLICABLE TO A .Y. 2006-07. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS NOTED THAT THIS ISSUE IS NO MORE RES INTEGRA IN VIEW OF THE RECENT JUDGEMENT DT. 12.8.2010 BY THE HONB LE BOMBAY HIGH COURT IN THE CASE OF GODREJ & BOYCE LTD. VS ACIT HOLDING THAT THE PROVISIONS OF SEC. 14A ARE APPLICABLE IN SUCH CIRCUMSTANCES AND THE DI SALLOWANCE HAS TO BE WORKED OUT BY THE AO ON SOME REASONABLE BASIS. UND ER SUCH CIRCUMSTANCES WE SET ASIDE THE IMPUGNED ORDER AND RESTORE THE MATTER TO THE FILE OF THE AO FOR DECIDING THE QUANTUM OF DISA LLOWANCE AS PER THE ITA NO. 867/M/10 3 AFORENOTED JUDGEMENT AFTER ALLOWING A REASONABLE O PPORTUNITY OF BEING HEARD TO THE ASSESSEE. 8. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 28 TH DAY OF JANUARY 2011 SD/- SD/- (S.V. MEHROTRA) ( ASHA VIJAYARAGHAVAN) ACCOUNTANT MEMBER JUDICIAL M EMBER MUMBAI DATED 28 TH JANUARY 2011. RJ COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT-CONCERNED 4. THE CIT(A)-CENTRAL - I CONCERNED 5. THE DR E BENCH TRUE COPY BY ORDER ASST. REGISTRAR I.T.A.T MUMBAI ITA NO. 867/M/10 4 DATE INITIA LS 1 DRAFT DICTATED ON: 13. 01. 201 1 SR. PS/PS 2. DRAFT PLACED BEFORE AUTHOR: 14. 01 .201 1 ______ SR. PS/PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER: ______ JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER: ______ JM/AM 5. APPROVED DRAFT COMES TO THE SR. PS/PS: SR. PS/ PS 6. KEPT FOR PRONOUNCEMENT ON: ______ SR. PS/PS 7. FILE SENT TO THE BENCH CLERK: ______ SR. PS/PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK: ______ 9 DATE ON WHICH FILE GOES TO THE AR 10 . DATE OF DISPATCH OF ORDER: ______