M/s Ahuja Radios, New Delhi V. ACIT, New Delhi

CO 182/DEL/2010

• Counselvise Citation: [2010] 122 COUNSELVISE.COM (IT) 5284 (ITAT-DELHI)
• Duration Of Justice: 3 month(s) 20 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 29-10-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 25-10-2010
• Assessment Year: 2003-2004
• Appeal Filed On: 09-07-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHOK PANDEY
• Section: 80HHC; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A : NEW DELHI BEFORE SHRI G.E.VEERABHADRAPPA, VICE PRESIDENT AND SHRI I.P.BANSAL, JUDICIAL MEMBER ITA NOS.1739/DEL/2010, 1740/DEL/2010 & 1741/DEL/201 0 ASSESSMENT YEARS : 2001 - 02, 2002 - 03 & 2003 - 04 AS STT.COMMISSIONER OF INCOME TAX, CIRCLE-30(1), NEW DELHI. VS. M/S AHUJA RADIOS, 3778, DARYA GANJ, NEW DELHI. PAN NO.AAAFA4564D. (APPELLANT) (RESPONDENT) CROSS OBJECTION NOS.180/DEL/2010, 181/DEL/2010 & 182/DEL/2010 ASSESSMENT YEARS : 2001 - 02, 2002 - 03 & 2003 - 04 M/S AHUJA RADIOS, 3778, DARYA GANJ, NEW DELHI. PAN NO.AAAFA4564D. VS. ASSTT.COMMISSIONER OF INCOME TAX, CIRCLE-30(1), NEW DELHI. (APPELLANT) (RESPONDENT) REVENUE BY : SHRI ASHOK PANDEY, CIT - DR. ASSESSEE BY : SHR I R.K.MEHRA, CA WITH SHRI MANISH KUMAR, ADVOCATE. ORDER PER I.P.BANSAL : THESE APPEALS ARE FILED BY THE DEPARTMENT AND CROS S-OBJECTIONS BY THE ASSESSEE. THEY ARE DIRECTED AGAINST THREE S EPARATE ORDERS OF CIT(A) DATED 11.2.2010 AND 12.2.2010 IN RESPECT OF ASSESSMENT YEARS 2001-02, 2002-03 & 2003-04 RESPECTIVELY. 2. GROUNDS OF APPEALS AS WELL AS CROSS-OBJECTIONS A RE IDENTICAL IN RESPECT OF EACH OF THE APPEAL AND THEY ARE AS FOLLO WS:- GROUND RAISED BY THE REVENUE :- IN THE FACTS AND THE CIRCUMSTANCES OF THE CASE, TH E LD.CIT(A) HAS ERRED IN DELETING TO AO TO COMPUTE TH E ITA-1739/D/2010 & OTHERS 2 DEDUCTION U/S 80HHC IN CONFORMITY WITH THE DECISION OF SPECIAL BENCH OF HONBLE ITAT IN THE CASE OF TOPMAN EXPORT VS. INCOME TAX OFFICER (2009-10) 33 SOT 337 (MUM)SB DATED 11.8.2009. GROUNDS RAISED BY THE ASSESSEE :- 1. THE LD.CIT(A) ERRED IN DIRECTING THE AO TO CALC ULATE THE DEDUCTION U/S 80HHC WITH RESPECT TO DEPB AS PER THE DECISION OF THE ITAT, MUMBAI (SPECIAL BENCH) IN THE CASE OF TOPMAN EXPORT V/S ITO, 33 SOT 337 AS THE DECISION O F TOPMAN EXPORT HAS BEEN REVERSED BY THE HONBLE MUMB AI HIGH COURT. 2. THE LD.CIT(A) FAILED TO APPRECIATE THAT THE METH OD OF ACCOUNTING FOLLOWED BY THE ASSESSEE FOR ACCOUNTING THE DEPB ON UTILIZATION/SALE BASIS CONSISTENTLY OVER TH E PREVIOUS YEARS AND WHICH IS IN CONFORMITY OF ACCOUN TING STANDARD 9 BE ALLOWED. 3. SO AS IT CAN BE SEEN FROM THE GROUNDS OF APPEALS AND THE CROSS- OBJECTIONS, THE ISSUE RAISED IS ONE I.E. THE TREATM ENT TO DEPB FOR THE COMPUTATION OF DEDUCTION U/S 80HHC. ON THE BASIS O F DECISION OF SPECIAL BENCH IN THE CASE OF TOPMAN EXPORTS 33 SO T 337, LEARNED CIT(A) HAS DECIDED THIS ISSUE IN FAVOUR OF THE ASSE SSEE FOR WHICH THE REVENUE HAS RAISED GRIEVANCE AS PER GROUNDS OF APPE AL DESCRIBED AS ABOVE AND CROSS-OBJECTIONS ARE SUPPORTING THE ORDER OF COMMISSIONER. 4. DURING THE COURSE OF HEARING, IT WAS POINTED OUT BY THE LEARNED DR THAT THE DECISION IN THE CASE OF TOPMAN EXPORTS (SUPRA) HAS BEEN REVERSED BY THE HON'BLE BOMBAY HIGH COURT IN THE CA SE OF KALPATARU COLOURS & CHEMICALS 233 CTR 313 AND HENCE, THE OR DER OF CIT(A) IS NOT AS PER LAW AS THE SPECIAL BENCH DECISION HAS BE EN OVERRULED BY THE AFOREMENTIONED DECISION OF BOMBAY HIGH COURT. THE ASSESSEE ALSO IN THE WRITTEN SUBMISSION HAS REFERRED TO THE ORDER OF HON'BLE BOMBAY HIGH COURT. IT WAS THE CONTENTION OF REVENUE THAT THE MATTER SHOULD BE RESTORED BACK TO THE FILE OF THE AO WITH A DIREC TION TO RECOMPUTE DEDUCTION U/S 80HHC IN VIEW OF THE DECISION OF THE HON'BLE BOMBAY ITA-1739/D/2010 & OTHERS 3 HIGH COURT IN THE CASE OF KALPATARU COLOURS & CHEMI CALS (SUPRA). HOWEVER, IT WAS THE CONTENTION OF THE ASSESSEE THAT IN VIEW OF CONSISTENCY OF THE TREATMENT GIVEN BY THE ASSESSEE IN ITS ACCOUNTS FOR DEPB AND IN VIEW OF THE ACCOUNTING STANDARD-9, THE COMPUTATION OF DEDUCTION SHOULD BE MADE. 5. WE HAVE HEARD BOTH THE PARTIES ON THIS ISSUE. W E FIND SUBSTANCE IN THE ARGUMENTS OF THE LEARNED DR THAT THE DEDUCTI ON U/S 80HHC IS REQUIRED TO BE RECOMPUTED IN THE LIGHT OF THE DECIS ION OF HON'BLE BOMBAY HIGH COURT IN THE CASE OF KALPATARU COLOURS & CHEMICALS (SUPRA), SINCE THE DECISION ON WHICH THE LEARNED CI T(A) HAS PLACED RELIANCE I.E. IN THE CASE OF TOPMAN EXPORTS (SUPRA) HAS BEEN REVERSED. WE, THEREFORE, DIRECT THE AO TO RECOMPUTE DEDUCTION U/S 80HHC FOR ALL THESE YEARS KEEPING IN VIEW THE DECISION OF HON'BLE BOMBAY HIGH COURT IN THE CASE OF KALPATARU COLOURS & CHEMICALS (SUPRA ). THE AO IS ALSO DIRECTED TO GIVE REASONABLE OPPORTUNITY TO THE ASSE SSEE BEFORE ARRIVING AT THE FINAL AMOUNT OF DEDUCTION U/S 80HHC. WE DIR ECT ACCORDINGLY. FOR STATISTICAL PURPOSES, THE APPEALS AS WELL AS CR OSS-OBJECTIONS BOTH ARE ALLOWED IN THE MANNER AFORESAID. DECISION PRONOUNCED IN THE OPEN COURT ON 29 TH OCTOBER, 2010. SD/- SD/- (G.E.VEERABHADRAPPA) (I.P.BANSAL) VICE PRESIDENT JUDICIAL MEMBER DATED : 29.10.2010. VK. COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR ITA-1739/D/2010 & OTHERS 4