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TMI Blog2017 (1) TMI 397X X X X Extracts X X X X X X X X Extracts X X X X ..... MBER AND SH. PAWAN SINGH, JUDICIAL MEMBER For The Assessee : Sh. Dharmesh Shah - Advocate For The Revenue : Dr. P. Daniel- Advocate (Standing Counsel) Order under section 254(1) of Income Tax Act PER PAWAN SINGH JUDICIAL MEMBER : 1. This appeal under section 253 of the Income Tax Act ( Act ) is directed by assessee against the order of Commissioner of income tax (Appeals) 40, Mumbai dated 22/03/2013 for assessment year 1993-04. The assessee has raised has raised following grounds of appeal: (i) Ld CIT(A) erred in confirming the order of AO. (ii) Ld. CIT(A) erred in not appreciating that no income from attached asset can be assessed in the hands of appellant. (iii) Ld.CIT(A) erred in making the addition on account of dividend income of ₹ 11,06,948/- (iv) Ld CIT(A) erred in treating STCG offered at ₹ 344742/-as income from shares trading business. (v) Ld CIT(A) erred in not granting deduction on account of interest expenses. (vi) Ld CIT(A) erred in charging interest under section 233A,234B and 234C of the Act. (vii) Ld CIT(A) erred in charging interest under section 220(2) of the Act. 2. The briefs facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... res of Mazda Industries and Leasing Ltd. In the year 1992 search was conducted at the premises of assessee as well as at the premises of Mazda Industries and Leasing Ltd. After the search the assets of assessee as well as Mazda Industries and Leasing ltd including their Bank Accounts were attached and were vested in the hands of Custodian appointed by Special Court relating to the trial of offence relating to transactions in Securities Act 1992(TORT). Due to the attachment of Bank accounts of Mazda Industries and Leasing Ltd could not paid dividend to its shareholder. Mazda industries and Leasing Ltd filed an application before the Special Court for seeking permission for allowing it to open and operate their Bank accounts for payment of interest and dividend for the financial year ended on 30 June 1992. The Court vide order dated 31st May 1993 allowed Mazda industries and Leasing Ltd open and operate bank account for payment of dividend, (true copy of which is placed on record). The dividend from the said company was received by the assessee during the Assessment Year 1994- 95. The dividend was duly accounted and offered for tax in the return of income for Assessment Year 1994-95. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the Assessment Year 1994- 95 and the same was duly accounted and offered to tax during the said year. The assessee further contended that the dividend warrant itself issued on 27th of August 1993. The contention of assessee was not accepted by AO. The AO concluded that as per s.8 of the Act dividend is taxable in the year in which it is declared.Thus, any dividend declared during the financial year 1992-93 is taxable in AY 1993- 94 irrespective of whether assessee actually received it or not.The ld.CIT(A)while considering this ground of appeal concluded that assessee was following Mercantile System of Accounting and dividend income should have been offered for taxation irrespective of date of receipt and rejected the submission of assessee. We have notice that the lower authorities have failed to bring on record any evidence as to when the dividend was declared by Mazda Industries and leasing ltd, when it was communicated or when the income was credited to the assessee. The copy of communication received from Mazda industries and Leasing was not confronted with the assessee. The assessee throughout the proceedings contending that dividend income was received in the subsequent y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - 54, should be a matter of no consequences to the Department; and one should have thought that the Department would not fritter away its energies in fighting matters of this kind. But, obviously, judging from the references that comes up is very now and then, the Department appears to be delight in raisng points of character which do not affect the taxability of the assessee or tax that the Department is likely to collect from him whether in one year or in the other. Further the Hon ble Apex Court in CIT Vs Excel industries Ltd (supra) while dealing with the dispute of year of taxing held as under; The real question concerning us is the year in which assessee is required to pay tax. There is no dispute that in the subsequent accounting year, the assessee did make imports and did derive benefits under the advance licence and the duty entitlement passbook and paid tax thereon. Therefore, it is not as if the revenue has been deprived of any tax. We are told that rate of tax remained the same in the present assessment year as well as in the subsequent assessment year. Therefore, the dispute raised by the revenue is entirely academic or at the best may have a minor tax effec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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