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Income Tax Appellate Tribunal, MUMBAI BENCH “A”, MUMBAI
Before: SHRI AMIT SHUKLA & SHRI RAJESH KUMAR
आदेश ORDER PER BENCH:
The aforesaid appeals have been filed by the assessee against separate impugned orders of even dated 18.01.2013, passed by CIT(A)-36, Mumbai, for the quantum of assessment passed under section 143(3) r.w.s. 153C for the assessment year 2005-06, 2006-07 and 2007-08. Since issue arising in all the appeals are common arising out of identical set of facts, therefore, same were heard together and are being disposed off by way of this consolidate order.
2 Alliance Intermediateries and Network P Ltd ITAs No. 2700/Mum/2013 ITA No. 2701/Mum/2013 2. At the outset, the Ld. Counsel submitted that, ground no. 1, 2, 3, 5, 6 and 7 are not pressed, therefore, same were being dismissed as not pressed. The only effective ground raised vide ground No. 4 is on account of disallowance of expenses by the CIT(A) on ad-hoc basis. The Ld. Counsel, Shri Bhupendra Shah, submitted that, the assessee in its profits & loss account had debited aggregate amount of expenses of Rs. 2,78,358/-. The income of the assessee has been assessed by applying 0.15% of profit on the total deposits appearing in the bank account. Out of the said income, the expenses aggregating to Rs. 2,78,358/- has been claimed by the assessee. The AO disallowed the entire expenditure on the ground that, assessee could not produce all the vouchers. Accordingly, he disallowed the entire expenses. The Ld. CIT(A) directed the AO to allow 20% of the above expenses and relief of Rs. 55,672/- was granted and balance expenses were disallowed.
The Ld. Counsel before us submitted that, the Tribunal in various cases have held that, if the income has been assessed after taking profit of 0.15% of the deposits, then the expenses claimed should be allowed to the extent of 50%. In support of his contentions he has relied upon the following decisions: Sr.No. Particulars of Tribunal order/case ITA/Citation 1 M/s Mihir Agencies Pvt Ltd. 6435-6441/Mum/2012 2 Goldstar Finvest Pvt Ltd. 2699/Mum/2013 & 887/mum/2012 3 Order of CIT(A)-40 Mumbai -- Mahasagar Securities Pvt Ltd.
Ld. DR also admitted that, similar issues have been decided in various orders of the Tribunal.
On perusal of the impugned orders, we find that this precise issue of allowance of expenditures, when the profit has been taken at 0.15% of the total deposits, had come-up for consideration before the Tribunal in various cases including the decisions relied
3 Alliance Intermediateries and Network P Ltd ITAs No. 2700/Mum/2013 ITA No. 2701/Mum/2013 upon by the Ld. Counsel. In the case of M/s Mihir Agencies Pvt Ltd., the Tribunal had held the expenses to the extent of 50% should be allowed. This decision again is based on various other decisions. Accordingly, consistent with the same we hold that the disallowance of expenditure should be restricted to 50% and balance 50% of expenditure shall be allowed. Accordingly, we hold that a disallowance of expenditure should be restricted to 50% and balance 50% of expenditure shall be allowed. Accordingly, the ground raised by the assessee is partly allowed.
In the result, appeal of the assessee is partly allowed.
Similarly, in AY 2006-07 and 2007-08 also, we restrict the disallowance to 50%. Accordingly, the appeal for the assessment year 2006-07 and 2007-08 are treated as partly allowed.
To sum-up: All the impugned appeals stands partly allowed. Order pronounced in the open court on 24th February, 2016.
Sd/- Sd/- (राजेश कुमार) (अिमत शु�ला) लेखा सद�य �याईक सद�य (RAJESH KUMAR) (AMIT SHUKLA) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, Date: 24th February, 2016 ��त/Copy to:- 1) अपीलाथ� /The Appellant. 2) ��यथ� /The Respondent. 3) The CIT(A) -36, Mumbai. 4) The Commissioner of Income Tax Central -II, Mumbai. 5) िवभागीय �ितिनिध ““ए” ”, आयकर अपीलीय अिधकरण, मुंबई/ The D.R. “A” Bench, Mumbai. 6) गाड� फाईल \ Copy to Guard File.