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2015 (3) TMI 721 - HC - Income TaxDisallowance of loss - Tribunal remanding the issue to the file of Assessing Officer without giving any independent finding and cogent reasons as to how the CIT (Appeals) s finding were incorrect - Held that - If the notice was issued calling upon the assessee to produce certain documents and the assessee failed to produce the document, the power by the AO was required to be exercised judiciously to examine and to find out to what extent, the disallowance could be made, but it could not be to the fullest extent that too without any discussion and on a mere ground that the assessee failed to produce the document in support thereof. The aforesaid aspect was not appreciated in the appeal and therefore, the Tribunal has remanded the matter. It is not that in every case, the Tribunal may examine the material on its own if there is failure to consider the material by AO or in appeal by the CIT (Appeals). But when no material whatsoever was considered and just an adverse inference was drawn in disallowing the claim and such was not interfered in the appeal, if the Tribunal has exercised the discretion of remanding the matter in view of the reasons recorded herein above, such an exercise of discretion could not be said to be perverse. We do not find that any substantial question of law would arise on such a point. The attempt to rely upon the decision of this Court in case of Rajesh Babulal Damania (2000 (6) TMI 5 - GUJARAT High Court) is ill-founded, because in the said case, the CIT (Appeals), at the appellate stage, had already examined the material and had given finding of facts, which was not appreciated by the Tribunal after considering the material and therefore, the observations were made by this Court in the said decision. Such are not the fact situation in the present case since no material is examined neither by the AO nor by the CIT (Appeals). - Decided against revenue. Disallowance of claim of revenue expenses - Tribunal remanding the issue to the file of Assessing Officer without giving any independent finding and cogent reasons as to how the CIT (Appeals) s finding were incorrect - Held that - Discretion exercised by the Tribunal cannot be said to be perverse, which may call for interference in the present appeal before us, which is limited to substantial questions of law. No substantial questions of law would arise as canvassed. - Decided against revenue. Disallowance of claim, rebate and reversal of claims and claim of writing off - Tribunal remanding the issue to the file of Assessing Officer - Held that - Tribunal having found that the examination was required on the part of the AO to decide the issue in light of the decision of the Apex Court in case of TRF Limited (2010 (2) TMI 211 - SUPREME COURT ) and therefore, the discretion has been exercised for sending the matter back to the AO. Such an exercise of discretion cannot be said to be perverse. Disallowance of the claim for deduction of interest - Tribunal remanding the issue to the file of Assessing Officer - Held that - The investments were made out of interest free funds and not borrowed funds and on the other hand, we find that ClT (A) has given finding that assessee does not have any surplus funds. In view of the contrary facts, we are of the view that the factual position needs to be re-examined. Tribunal found that the factual aspects including that of the availability of the free fund at the time of making investment was required to be examined and therefore, the discretion has been correctly exercised by the Tribunal to send the matter back to the AO - Decided against revenue. Disallowance of hire charges - Tribunal remanding the issue to the file of Assessing Officer - Held that -CIT (Appeals) as well as the Tribunal has gone by the earlier decision including that of the Tribunal for the Assessment Year 1999-2000. The learned counsel for the revenue has brought to our notice that the decision of the Tribunal, which has been relied upon for the Assessment Year 1999-2000, was carried before this Court 2011 (2) TMI 1349 - GUJARAT HIGH COURT decided on 21.2.2011 and the said appeal has been dismissed, as no substantial question of law was found for consideration by this Court.- Decided against revenue.
Issues Involved:
- Disallowance of loss - Disallowance of revenue expenses - Disallowance of claim, rebate, and reversal of claims - Disallowance of claim of writing off - Disallowance under section 36(1)(iii) of the Act - Disallowance of hire charges Analysis: Disallowance of Loss: The AO disallowed the claim for gross loss in absence of produced evidence, invoking power under section 144 of the Income Tax Act. The CIT (Appeals) upheld this view without examining the material. The Tribunal remanded the issue back to the AO for verification, finding the AO's approach unjustified in disallowing the entire gross profit without proper examination. The Tribunal's exercise of discretion in remanding the matter was deemed not perverse, and no substantial question of law was found to arise. Disallowance of Revenue Expenses: Similar to the disallowance of loss, the AO disallowed the claim for revenue expenses without material support. The Tribunal remitted the matter back to the AO for reexamination, directing the assessee to submit all required details. The Tribunal's exercise of discretion was not found to be perverse, and no substantial questions of law were identified. Disallowance of Claim, Rebate, and Reversal of Claims: The AO disallowed the total claim, which was upheld by the CIT (Appeals). The Tribunal found the issue needed reexamination in light of a specific court decision and remanded it back to the AO. The Tribunal's exercise of discretion in sending the matter back was considered reasonable, and no substantial questions of law were determined. Disallowance of Claim of Writing Off: The AO disallowed the claim in absence of produced evidence. The Tribunal found the issue needed reexamination in light of a specific court decision and remanded it back to the AO. The Tribunal's exercise of discretion was not considered perverse, and no substantial questions of law were found. Disallowance under Section 36(1)(iii) of the Act: The AO disallowed the claim for deduction of interest. The Tribunal found conflicting facts regarding the availability of free funds and directed reexamination by the AO. The Tribunal's discretion in sending the matter back was not deemed perverse, and no substantial questions of law were identified. Disallowance of Hire Charges: The Tribunal upheld the decision based on a previous Tribunal ruling for the Assessment Year 1999-2000. The Court noted that a similar matter had been dismissed previously for lack of substantial legal questions. Consequently, no substantial questions of law were found to arise for consideration. In conclusion, the High Court dismissed the appeal, finding no grounds for interference in the Tribunal's order, deeming the appeal meritless.
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