Ito 5(3)(2), Mumbai vs Department Of Income Tax

आयकर अपील य अ धकरण, मुंबई यायपीठ "ई" मुंबई IN THE INCOME TAX APPELLATE TRIBUNAL" E" BENCH, MUMBAI BEFORE S/SHRI B.R.BASKARAN (AM) AND AMIT SHUKLA, (JM) सव ी बी.आर.बा करन, लेखा सद य एवं अ मत शु ला, या यक सद य के सम

आयकर अपील सं./I.T.A. No.2671/Mum/2012 ( नधारण वष / Assessment Year :2008-09)

M/s Shethia Audio Video Pvt बनाम/ Income Tax Officer - 5(3)(2), Ltd., Vs. Aayakar Bhavan , 45, Appollo Industrial Estate, M K Road, Off Mahakali Caves Road, Mumbai-400020 Andheri(E), Mumbai-400093 (अपीलाथ /Appellant) .. ( यथ / Respondent)

थायी ले ख ा सं . /जीआइआर सं . /PAN/GIR No. :AABCS6486N

अपीलाथ ओर से / Assessees by Dr J Shivaram and Ms. Neelam C Jadhav यथ क ओर से/Revenue by Shri N V Nadkarni

सुनवाई क तार ख / Date of Hearing : 21.4.2015 घोषणा क तार ख /Date of Pronouncement : 24.4.2015

आदे श / O R D E R

PER B.R. BASKARAN (AM)

The appeal filed by the assessee is directed against the order dated 11.01.2012 passed by Ld CIT(A)-9, Mumbai and it relates to the assessment year 2008-09. The assessee is aggrieved by the decision of Ld CIT(A) in confirming the assessment of advance receipt of Rs.2,58,58,410/- as income of the assessee.

2. We heard the parties and perused the record. The assessee company is dealing in CDs and VCDs and acquires rights for various titles as well as rights for its own home production. The assessee had shown a 2 I T A N o . 2 6 7 1 / Mu m / 2 0 1 2

sum of Rs.2.72,93,924/- as unsecured loan in the name of M/s Moser Baer India Ltd. When the AO called for confirmation letter, the assessee admitted that it was not an unsecured loan, but advance royalty amount. The assessee submitted that the above said advance royalty amount shall be adjusted over a period of seven years. The AO further noticed that M/s Moser Baer Limited had given an amount of Rs.3.00 crores to the assessee and had also deducted tax at source of Rs.33.99 lakhs on the above said payment. The AO noticed that M/s Moser Baer Limited had carried forward an amount of Rs.14,35,514/- in its books of account, where as the assessee had carried forward an amount of Rs.2,72,93,924/-. Hence, the AO assessed the difference between the two amounts cited above, i.e., Rs.2,58,58,410/- as income of the assessee and the Ld CIT(A) also confirmed the same.

3. At the time of hearing, the Ld A.R submitted that the assessing officer has made the impugned addition on the basis of accounting treatment given by M/s Moser Baer India Limited and the same is not binding upon the assessee. He submitted that the fact that the other party has deducted tax at source on the payment of Rs.3.00 crores will also not alter the character of the payment. He submitted that the assessee had received the sum of Rs.3.00 crores as advance payment only, which shall be adjusted over a period of seven years. Accordingly, the assessee has been appropriating the above said sum in accordance with the agreement reached with M/s Moser baer. He submitted that both the assessing officer and Ld CIT(A) have not examined the agreement entered between the parties, which will clarify all the issues. Accordingly he prayed that this issue may be set aside to the file of the assessing officer for fresh consideration.

3 I T A N o . 2 6 7 1 / Mu m / 2 0 1 2

4. The Ld D.R did not object to the plea put forth by Ld A.R.

5. Having regard to the submissions made by Ld A.R, we are of the view that there is some merit in the plea put forth by the assessee. Accordingly, we are of the view that this issue requires fresh examination at the end of the assessing officer by duly considering all the relevant documents and details. Accordingly, we set aside the order of Ld CIT(A) on this issue and restore the same to the file of the AO with the direction to examine this issue afresh by duly considering all the information and explanation that may be furnished by the assessee. We also direct the assessee to furnish all the details that may be called for by the assessing officer.

6. In the result, the appeal filed by the assessee is treated as allowed for statistical purposes.

The above order was pronounced in the open court on 24th Apr, 2015.

घोषणा खल ु े यायालय म दनांकः24th Apr, 2015 को क गई ।

Sd sd (अ मत शु ला / AMIT SHUKLA) (बी.आर.बा करन / B.R. BASKARAN) या यक सद य / JUDICIAL MEMBER लेखा सद य / ACCOUNTANT MEMBER

मुंबई Mumbai: 24th Apr,2015. व. न.स./ SRL , Sr. PS

आदे श क त ल प अ े षत/Copy of the Order forwarded to :

1. अपीलाथ / The Appellant

2. यथ / The Respondent.

3. आयकर आयु त(अपील) / The CIT(A)- concerned

4. आयकर आयु त / CIT concerned

5. वभागीय त न ध, आयकर अपील य अ धकरण, मुंबई / DR, ITAT, Mumbai concerned

6. गाड फाईल / Guard file.

आदे शानुसार/ BY ORDER,

True copy सहायक पंजीकार (Asstt. Registrar) आयकर अपील य अ धकरण, मुंबई /ITAT, Mumbai