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Income Tax Appellate Tribunal, MUMBAI BENCH “F”,
Before: SHRI B.R.BASKARAN & SHRI PAWAN SINGH
O R D E R
PER PAWAN SINGH, JM:
The present appeal filed by the Assessee against the order dated 16.12.2013 passed by the Commissioner of Income Tax (Appeals)-7, Mumbai (‘CIT(A)’ for short) in respect of assessment years 2010-11 on the following grounds of appeal:
1. ADDITION OF IRRECOVERABLE INTEREST OF RS.27,97,000 (Para No. 5.8, Pg No. 6 of the Assessment Order) a. The Ld. CIT(A) erred in law and in facts (i) in confirming the addition made by the Ld. A.O. of irrecoverable interest assumed by Ld. A.O. to be Rs.27,97,000 without any basis (ii) in totally ignoring the decision and order dated 16.08.2012 of his predecessor delivered on identical facts in deciding appeal for immediately preceding year i.e. A.Y.2009-10 (iii) in ignoring that the company on its own on receipt of the interest income has offered it for taxation in subsequent assessment years and in taxing the same income in the year under consideration that had amounted to double taxation. b. Your appellant submits that it had not recognised interest income for many years in past in respect of following parties as no amount was forthcoming from them since past many years and recovery of even principal was in doubt.
Amount added by A.O. i) Sharada Steel Corporation Rs. 16,34,000 ii) Falak Home Developers Pvt. Ltd. Rs. 10,43,000 iii) Mrs. Bharati Satyaj it Dali Rs. 1,20,000 Rs. 27,97,000 c. Your appellant pleads that the addition ofRs.27,97,000/- be deleted in full.
2. LEVY OF INTEREST U/S. 234B of RS.68,937 a. The Ld. AO erred in levying interest u/s 234B ofRs.68,937/- without giving any opportunity of hearing and in not passing any speaking order for levy of interest and in levying interest without applying the mind to the facts of the case and further erred in charging interest in excess of that is permitted in law. b. Your appellant denies any liability to payment of interest and further submit that the tax was paid as per the provisions of the law and that the interest was charged in violation of the provisions of the natural justice in as much as no opportunity for hearing was given. c. Your appellant prays that the interest u/s 234B of Rs.68,937/- be deleted.
The brief facts of the case as gathered from the material available on record are that assessee is a Public Limited Company, engaged in the business of lending and advancing money, acquired by purchase, sales, exchange and investment in movable and immovable property besides other dealing in share etc., filed his return of income for AY 2010-2011, on 09.10.2010 declaring total loss of Rs. 17,68,498/-. The return was selected for scrutiny and after giving an opportunity of hearing to the assessee, the Assessing Officer (AO) made an addition of Rs.294,540/- in respect of Alibaug Property , and initiated penalty proceeding U/s 271(1) © of the Act , a sum of Rs. 12077/- u/s 14A,read with Rule 8D , and further a sum of Rs. 27.97 lakhs in respect of unrealized interest on sticky loans, vide order dated 26.12.2010.
Against the order of AO, the assessee filed an appeal before the CIT(A). The CIT(A) deleted the addition in respect of expenses of Rs. 2,94,540/- and disallowance of Rs. 12,077/- u/s 14A of the Act, however, the addition in respect of unrealized interest on sticky loan was upheld in the impugned order dated 28.01.2013 against which the present appeal is filed before us.
We have heard the representative of the assessee and the revenue and perused the material available on record. The AR of the assessee argued that in respect of previous year similar identical addition were made by the AO which are deleted by the CIT(A) against which an appeal filed by the Revenue being and the assessee filed Cross Objection in the said appeal vide C.O.No. 33/Mum/2014. The appeal of the revenue in the identical facts were dismissed and the assessee has not pressed his objection as the appeal filed by the revenue was dismissed vide judgment and order dated 17.10.2015.
We respectfully following the judgment of co-ordinate bench, we find that assessee involved in the present appeal are squarely covered by the judgment in ITA No. 7338/Mum/2012 in the assessee own case, hence the appeal of the assessee is allowed.
Next ground for our consideration is the levy of interest under Section 234B, which is consequential in nature does not require further discussion as the ground No. 1 of the appeal is accepted.
In the result, appeal filed by the assessee is allowed. Order pronounced in the open court on 06/11/ 2015
Sd/- Sd/- (B. R. BASKARAN) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai; Dated : 06.11.2015 SK PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. The CIT(A) 4. CIT- concerned 5. DR, ITAT, Mumbai 6. Guard File