Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD
Before: SHRI WASEEM AHMED&
The instant appeal filed by the assessee is directed against the order dated 22.03.2017 passed by the Commissioner of Income Tax (Appeals)-3, Vadodara arising out of the order dated 26.03.2015 passed by the ITO, Ward – 3(1)(1), Vadodara under section 143(3) of the Income Tax Act, 1961 (hereinafter referred as to “the Act”) for the Assessment Year 2012-13.
The assessee, an individual filed its return of income through electronic media on 15.09.2012 total income at Rs.10,06,130/- which was processed u/s 143(1) of the Act.
- 2 - Shri Mohamed Ibrahim Bloch vs. ITO Asst.Year – 2012-13 Under scrutiny notice u/s 143(2) dated 06.08.2013 was served upon the assessee. The assessee is a Cine Producer & Director and engaged in the business of theater management and consultancy. During the year under consideration it was found by the Learned AO that the assessee has written off two liabilities in the manner as follows: “1. White City Entertainment Pvt. Ltd. - Rs.1,07,36,000/- 2. Anil Samani - Rs.2,13,80,762/-
The assessee has further claimed against the above credit written off of Rs.3,21,16,762/- certain cost of production. The details of cost of production claimed against the above credit written off are as follows: 1. Cost of Production (Kkabhh Film) Rs.70,16,806/- 2. Cost of Production (Ishq Deewana Film) Rs.1,35,81,190/- Total Rs.2,05,97,996/-…”
Accordingly, the assessee has credited income of Rs.1,15,18,796/- which has been embedded into the “Sundry Balance written off” of Rs.1,07,36,000/- shown as income of Mehul Kumar. The assessee has claimed write off of such cost of production of two films namely “Kkabhh” and “Ishq Deewana”. In terms of the letter dated 23.01.2015 issued by the Learned AO certain documents including ledger of cost of production were submitted by the assessee. However, the assessee failed to submit supporting evidences with reference to such cost of production of these two films and ultimately show-cause was issued to the assessee as to why Rs.2,05,97,998/- should not be disallowed. The reply rendered by the assessee was not found suitable and finally the assessment was completed upon making an addition of Rs.2,05,97,996/- towards disallowance of sundry debtors written off and Rs.2,37,739/- towards disallowance of expenses. The claim of write off expenses was disallowed on the ground that the expenses were relating to different projects and the other disallowance was made on the ground that such expenses were not incurred only and exclusively for the purpose of business. Both the disallowances were confirmed by the first appellate authority in appeal preferred by the assessee. Hence the assessee before us.
- 3 - Shri Mohamed Ibrahim Bloch vs. ITO Asst.Year – 2012-13
At the time of hearing of the instant appeal, the Learned Counsel appearing for the assessee submitted before us that the Learned AO has made such disallowances of expense in the absence of evidences relating to the expenses incurred since not produced before him. The Learned AR also made an application under Rule 29 of the Income Tax (Appellate Tribunal) Rules, 1963 for admitting additional evidences being the details of cost of production and bills and other evidences towards expenses in order to justify assessee’s claim before us. The documents are annexed in the paper book so submitted before us by the Learned AR. It was also further submitted by the assessee’s counsel that those documents could not be filed before the Learned AO as the assessee was passing through a bad face of financial crises; the movies which the assessee started producing were prolonged and were ultimately abandoned in which the assessee has incurred huge cost. The assessee was also remained involved in handling finance and repayment of loans which were borrowed for making these films. In that view of the matter, she submitted before us that the matter be remitted to the file of the Learned AO for adjudication of the same on the basis of the additional evidences so submitted before us. The Learned DR, however, has not raised any objection to such contention made by the Learned AR.
Heard the respective parties, perused the relevant materials available on record. It appears that the explanation rendered by the assessee for not producing those documents before the authorities below seems to be genuine and therefore, we are of the considered opinion that in order to prevent the miscarriage of justice, another opportunity of hearing be given to the assessee to represent his case effectively before the authorities below. In that view of the matter, we restore the issue to the file of the Learned AO with the further direction upon him to consider the matter afresh upon giving an opportunity of being heard to the assessee and upon considering additional evidences to be submitted before - 4 - Shri Mohamed Ibrahim Bloch vs. ITO Asst.Year – 2012-13 him and to pass orders in accordance with law. Hence, assessee’s appeal is allowed for statistical purposes.