Tanfac Industries Ltd., CHENNAI V. DCIT, CHENNAI

CO 22/CHNY/2002

• Counselvise Citation: [2010] 122 COUNSELVISE.COM (IT) 5080 (ITAT-CHENNAI)
• Duration Of Justice: 8 year(s) 4 month(s) 9 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 05-08-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 05-08-2010
• Assessment Year: 1998-1999
• Appeal Filed On: 27-03-2002
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: P B SEKARAN
• Assessee Lawyers: SAROJ KUMAR
• Keywords: Business income
• Section: 80HHC

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH B CHENNAI (BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, JUDICIAL MEMBER) ..... CO NO. 22/MDS/2002 I.T.A. NO. 1255 / MDS/2001 ASSESSMENT YEAR : 1998-99 TANFAC INDUSTRIES LTD FLAT NO. 1-L, PRINCE ARCADE, FIRST FLOOR, 22-A CATHEDRAL ROAD CHENNAI 600 086. (APPELLANT) V. THE DY C.I.T, COMPANY CIRCLE III(1) CHENNAI (RESPONDENT) APPELLANT BY : SHRI SAROJ KUMAR RESPONDENT BY : SHRI P.B. SEKARAN O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : THIS IS A CROSS OBJECTION FILED BY ASSESSEE IN APP EAL OF THE REVENUE NUMBERED I.T.A. 1255/MDS/2001 FOR ASSESSMEN T YEAR 1998-99. CO. NO.22/MDS/2002 2 2. APPEAL OF THE REVENUE HAD RAISED TWO ISSUES THER EIN. FIRST WAS RELATING TO ADDITION MADE BY ASSESSING OFFICER TOWA RDS THE ELEMENT FOR EXCISE DUTY IN THE CLOSING STOCK. 3. PARAS 1 TO 4 OF THE CROSS OBJECTIONS ARE IN SUPP ORT OF THE ORDER OF THIS TRIBUNAL WHEREIN THIS TRIBUNAL HAD DISMISSE D REVENUES APPEAL ON THIS ISSUE. THEREFORE, THIS GRIEVANCE OF THE ASSESSEE HAS BECOME INFRUCTUOUS. 4. SECOND ISSUE RAISED BY REVENUE IN ITS APPEAL WAS ON THE DIRECTION OF THE LD. CIT(A) TO COMPUTE DEDUCTION U/ S 80HHC OF THE INCOME-TAX ACT, 1961 [IN SHORT, THE ACT] AFTER CON SIDERING THE INTEREST ON ICDS, INTEREST ON SBI BOND, INTEREST ON COMMERCI AL PAPERS AND INTEREST ON MRPL DEBENTURES AS PART OF THE BUSINESS INCOME. TRIBUNAL HELD THAT THESE TYPES OF INCOME COULD NOT BE CONSIDERED AS DERIVED FROM THE BUSINESS OF THE ASSESSEE AND HELD THAT THESE WERE ONLY INCOME FROM OTHER SOURCES. TRIBUNAL, THEREFOR E, REVERSED THE ORDER OF THE LD. CIT(A) AND RESTORED THE ORDER OF T HE ASSESSING OFFICER. CO. NO.22/MDS/2002 3 5. PARA 5 ONWARDS OF THE CROSS OBJECTIONS SUPPORTS THE ORDER OF THE LD. CIT(A) WHEREBY HE DIRECTED INTEREST ON ICDS , INTEREST ON SBI BOND, INTEREST ON COMMERCIAL PAPERS AND INTEREST ON MRPL DEBENTURES TO BE CONSIDERED AS PART OF THE BUSINESS INCOME OF THE ASSESSEE FOR COMPUTING DEDUCTION U/S 80HHC OF THE A CT. ASSESSEE ALSO SUBMITS THAT THE DECISIONS OF THE HON'BLE APEX COURT IN THE CASE OF TUTICORIN ALKALI CHEMICALS & FERTILISERS LTD 227 ITR 172 AND THAT OF THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SOUTH INDIA SHIPPING CORPN. LTD VS. CIT 240 ITR 24 AND CIT VS. PONDICHERRY DISTILLERIES 241 ITR 802 RELIED ON BY THE RESPONDEN T HAD NO APPLICATION IN ASSESSEES CASE. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE ORDERS. WE FIND THAT THE ISSUE RELATED TO CLAIM FOR DEDUCTI ON U/S 80HHC ON THE VARIOUS ITEMS OF INCOME MENTIONED AT PARA FIVE ABOVE AND THIS WAS DECIDED IN FAVOUR OF THE REVENUE BY THIS TRIBUN AL AFTER CONSIDERING THE DECISION IN THE CASE OF PANDIAN CHE MICALS LIMITED VS. CIT 262 ITR 278 WHICH IS A DECISION LATER TO TH E DECISIONS IN TUTICORIN ALKALI CHEMICALS & FERTILIZERS LTD [SUPRA ], SOUTH INDIA SHIPPING CORPN. LTD VS. CIT [SUPRA] AND CIT VS. PON DICHERRY DISTILLERIES [SUPRA]. THEREFORE, WE FIND NO REASON TO ENTERTAIN THE CO. NO.22/MDS/2002 4 GRIEVANCES RAISED BY THE ASSESSEE IN PARAS 5 ONWARD S OF ITS CROSS OBJECTION. 7. IN THE RESULT, CROSS OBJECTIONS OF THE ASSESSEE ARE DISMISSED. THE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 05.08 .2010. SD/- SD/- (GEORGE MATHAN) (ABRAHAM P. GEORGE ) JUDICIAL MEMBER ACCOUNTANT MEMBE R CHENNAI, DATED THE 5 TH AUGUST, 2010. VL COPY TO: (1) APPELLANT (2) RESPONDENT (3) CIT(A), CHENNAI-34 (4) CIT, CHENNAI-34 (5) D.R. (6) GUARD FILE