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Income Tax Appellate Tribunal, MUMBAI BENCHES “D”, MUMBAI
Before: SHRI D.KARUNAKARA RAO (AM) & SHRI RAM LAL NEGI (JM)
This appeal has been directed against the order dt. 24/11/2015 passed by the CIT(Appeals)-21, Mumbai for the Asst. year 2009-10. The case was called for hearing, none appeared on behalf of the assessee, Perusal of records revelas that on the last date of hearing i.e.,16/03/2016 adjournment was sought by the counsel for the assessee and accordingly the case was fixed for today i.e. 30/03/2016. We are therefore, of the considered view that the assessee is no more interested in pursuing the present appeal. Accordingly we are decided to hear the appeal ex parte.
Brief facts of the case emanating from the record are that the assessee, an individual filed her return of income for the A.Y. 2009-10 on 23/02/2010 declaring the total income of Rs. 4,37,930/-After scrutiny, assessment was completed on 25/07/2011 u/s 143(3). The case was re-opened u/s 147 of the Income Tax Act, 1961 (in short ‘the Act’) on 14/10/2013 by issuing notice u/s 148. In response thereof, the assessee vide letter dt. 20/11/2013., asked the AO to treat the return of income filed on 23/02/2010 as the final the return. The AO after seeking the details of expenses and explanations made an addition of Rs. 1,80,718/- paid towards interest on loan taken by the assessee for the purpose other than professional activities.
Aggrieved by the impugned assessment order the assessee filed an appeal before the Ld. CIT(A) challenging the validity of reopening and the addition aforesaid made by the AO. The Ld. CIT(A) after hearing the parties and dismissed both the grounds of the appeal of the assessee, holding that there is no infirmity to the assessment orders. The assessee has challenged the impugned order on the following effective grounds:-
The Ld. CIT(A) has erred in upholding the reassessment by ITO 9(3)(2) u/s 147 r.w.s. 143(3) of the IT Act dated 30th September 2014 in which the Ld. ITO 9(3)(2) had erred in reopening an assessment already completed u/s 143(3) and reassessing income based on existing information without uncovering any new facts. The Original Income was already assessed as submitted, by the learned ITO on 25th July 2011.
2. The Ld. CIT(A) has erred in confirming addition to the total Income a sum of Rs. 1,80,718/- being interest paid to banks.
The Ld. DR heavenly relying upon the order passed by the Ld. CIT(A) submitted that the impugned order does not suffer from any leagal infirmity as the same has been passed in accordance with the settled law. Hence, there is no merit in the appeal of the assessee and the same is liable to be dismissed.
We have considered the submission of the Ld. DR and gone through the material placed before us. The Ld. CIT(A) has dismissed the first grounds of appeal of the assessee relying upon the ratio laid down by the Hon’ble Supreme Court in the case of Sri Krisha P. Ltd. 221 ITR 538 (SC) in which it was held that merely because claim is reflected in the accounts does no ipso facto constitute a full and true disclosure of facts, and Shushil Kumar Jalan vs. ITA 34/Gau/2011 dated. 03/02/2011 in which it is held that when assessee participates in assessment proceedings after rejection of objections to reopening, it is not open for the assessee to take up the issue thereafter. So far as the second grounds concerned the Ld. CIT(A) has dismissed the second grounds of appeal held as under:-
“I have considered the explanation of the AR which is same as was furnished to the assessing officer. Firstly, in the current year M/s. Sumit Bioscience Pvt. Ltd. has shown book profits of Rs. 5,76,859/- Secondly, it is clearly admitted that the loans were given to the company for its purposes of meeting working capital and not for appellant’s own business. There is no basis to claim the interest payment against professional fees. There is no compulsion to give interest free loans to the company for earning professional fees. Thus on merits there is no basis to no uphold the order of the assessing officer.”
In our considered opinion the impugned order is based on the facts of the case and in accordance with the settled law. The order dies not suffer from any legal infirmity to interfere with the same. We therefore uphold the order passed by the Ld. CIT(A) and dismiss both the grounds of appeal of the assessee.
In the result, the assessee’s appeal for the Asst. year 2009-10 is dismissed.