Sidmak Labotatories Ltd., V. The ACIT, Circle-1,

CO 84/AHD/2004

• Counselvise Citation: [2011] 122 COUNSELVISE.COM (IT) 6528 (ITAT-AHMEDABAD)
• Duration Of Justice: 7 year(s) 6 month(s) 19 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 14-10-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 05-10-2011
• Assessment Year: 1993-1994
• Appeal Filed On: 25-03-2004
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR JAYANT JHAVERI
• Assessee Lawyers: MK PATELAR
• Section: 6

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD .., !'# $ $ $ $ %% % &, ' ( # BEFORE SHRI G.D.AGARWAL, VICE-PRESIDENT (AZ) AND SHRI MUKUL KR.SHRAWAT, JUDICIAL MEMBER $./ I.T.A. NO.1441/AHD/2003 WITH CO NO.84/AHD/2004 ( * * * * / / / / ASSESSMENT YEAR : 1993-94) THE ACIT CIRCLE-1 VALSAD / VS. SIDMAK LABORATORIES (I) PVT.LTD. ABRAMA VALSAD '+ (, $./- $./ PAN/GIR NO. : - ( +. / // / APPELLANT ) .. ( /0+. / RESPONDENT ) REVENUE BY : DR.JAYANT JHAVERI SR. D.R. ASSESSEE BY : SHRI M.K. PATEL, A.R. % 1 2 &, / / / / DATE OF HEARING : 05/10/2011 34* 2 &, / DATE OF PRONOUNCEMENT : 14.10.11 (5 / O R D E R PER SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER : THIS APPEAL HAS BEEN SET ASIDE BY THE HONBLE GUJA RAT HIGH COURT VIDE AN ORDER DATED 04/04/2011 (TAX APPEAL NO.175 OF 2008) AS PER THE FOLLOWING OBSERVATION:- THOUGH NOT SERIOUSLY DISPUTING, OUR PRIMA FACIE RE ADING OF THE TRIBUNALS ORDER IS THAT IT LACKS REASONS, COUNSEL FOR THE ASSESSEE SUBMITTED THAT EVEN OTHERWISE THE ORDER PASSED BY T HE ASSESSING ITA NO.1441/AHD/2003(BY REVENUE) AND CO NO.84/AHD/2004 (BY ASSESSEE) ACIT VS. SIDMAK LABORATORIES (I) LTD. ASST.YEAR 1993-94 - 2 - OFFICER WAS NOT SUSTAINABLE. HE SUBMITTED THAT THE ASSESSING OFFICER WAS PASSING A AFRESH ORDER UPON REMAND BY T HE CIT(APPEALS). SUCH REMAND WAS ON LIMITED POINT AND ASSESSING OFFICER THEREFORE, COULD NOT HAVE REOPENED ENTIRE A SSESSMENT IN VIEW OF DECISION OF THIS COURT IN CASE OF SAHELI SYNTHETICS P.LTD. VS. COMMISSIONER OF INCOME-TAX REPORTED IN (2008) 302 ITR 126 (GUJ.). COUNSEL FURTHER SUBMITTED THAT TRIBUNAL DID NOT ENT ERTAIN CROSS OBJECTION OF THE ASSESSEE MERELY ON THE GROUND THAT REVENUES APPEAL WAS BEING DISMISSED. IN THE CROSS OBJECTION , ASSESSEE HAD RAISED GROUNDS BASED ON DECISION IN CASE OF SAHELI SYNTHETICS P.LTD. (SUPRA). WE ARE OF THE OPINION THAT BOTH THESE QUESTIONS SHO ULD BE RECONSIDERED BY THE TRIBUNAL. FIRSTLY, INSOFAR AS REVENUES APPEAL IS CONCERNED, SAME WAS DISMISSED WITHOUT GIVING IND EPENDENT REASON, MERELY ADOPTING ARGUMENTS AND FINDINGS OF L EARNED CIT(APPEALS). FURTHER CONTENTION RAISED BY ASSESSE E IN CROSS OBJECTION AND IN PARTICULAR, HIS RELIANCE ON DECISI ON OF GUJARAT HIGH COURT IN CASE OF SAHELI SYNTHETICS P.LTD. (SUPRA) IS ALSO REQUIRED TO BE CONSIDERED BY THE TRIBUNAL. FOR THE ABOVE PURPOSE, JUDGEMENT DATED OF THE TRIBU NAL DATED 2.5.2008 IS SET ASIDE. PROCEEDINGS ARE REMANDED TO THE TRIBUNAL FOR FRESH CONSIDERATION AFTER HEARING BOTH SIDES. IT IS CLARIFIED THAT NOT ONLY REVENUES APPEAL BUT ASSESSEES CROSS OBJE CTION ALSO STANDS REVIVED. 2. FOLLOWING THE DIRECTIONS OF THE HONBLE COURT, T HE APPEAL OF THE REVENUE AND THE CROSS OBJECTION FILED BY THE ASSESS EE ARE FIXED FOR HEARING. BOTH OF THEM HAVE ARISEN FROM THE ORDER OF THE CIT(A)-I, SURAT DATED 09/01/2002. REVENUE HAS RAISED THE FOLLOWIN G GROUNDS: ITA NO.1441/AHD/2003(BY REVENUE) AND CO NO.84/AHD/2004 (BY ASSESSEE) ACIT VS. SIDMAK LABORATORIES (I) LTD. ASST.YEAR 1993-94 - 3 - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED CIT(A) ERRED IN ALLOWING CARRY FORWARD OF LOSS OF RS.12,88,292/- HOLDING THAT THE A.O. HAS BEEN IN ERROR IN INVOKING THE SECTION 79 OF THE ACT. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED CIT(APPEALS) OUGHT TO HAVE UPHELD ACTIO N OF THE ASSESSING OFFICER IN RESPECT OF NOT ALLOWING CARRY FORWARD OF LOSS OF RS.12,88,292/- AS PER SECTION 79 AS PER ASS ESSMENT ORDER. 3. IN THE CROSS OBJECTION, THE RESPONDENT-ASSESSEE HAS RAISED THE FOLLOWING GROUND: 1. IN LAW AND IN THE FACTS AS WELL AS CIRCUMSTANCE S OF THE RESPONDENTS CASE THE LEARNED CIT(A) HAS GROSSLY ER RED IN NOT ADJUDICATING UPON THE FOLLOWING GROUND RAISED D URING THE COURSE OF HEARING APPEAL : THE ORDER PASSED BY THE JCIT (ASSTT.) S.R.1, SURAT U/S.143(3) R.W.S. 250 IS BAD IN LAW INSOFAR AS IT I S WITHOUT JURISDICTION, IT DESERVES TO BE CANCELLED. WHEN HE OUGHT TO HAVE ADJUDICATED UPON THE SAME MOR E PARTICULARLY WHEN THE SAID ADDITIONAL GROUND IS NOT SPECIFICALLY REJECTED TO BE ADMITTED. 4. LD.AR MR. M.K.PATEL HAS INFORMED US THAT VIDE A WRITTEN SUBMISSION DATED 30/12/2002, THE ASSESSEE HAS RAISE D AN ADDITIONAL GROUND; REPRODUCED BELOW:- SUB : APPEAL AGAINST ORDER U/S.143(3) R.W.S. 250 OF THE I.T. ACT, 1961 A.Y. 1993-94 SUBMISSIONS. ITA NO.1441/AHD/2003(BY REVENUE) AND CO NO.84/AHD/2004 (BY ASSESSEE) ACIT VS. SIDMAK LABORATORIES (I) LTD. ASST.YEAR 1993-94 - 4 - THE APPEAL IS AGAINST THE ORDER PASSED BY THE AO U/ S.143(3) R.W.S. 250 OF THE I.T. ACT, 1961 DETERMINING THE ASSESSEE S TOTAL INCOME AT RS.NIL. WHILE FILLING THE APPEAL INADVERTENTLY THE FOLLOWING GROUNDS WAS LEFT OUT TO BE TAKEN: THE ORDER PASSED BY THE JCI (ASSTT) S.R.1, SURAT U/S.143(3) R.W.S. 250 IS BAD IN LAW INSOFAR AS IT I S WITHOUT JURISDICTION. IT DESERVES TO BE CANCELLED . IT IS REQUESTED THAT THE ASSESSEE MAY BE PERMITTED TO RAISE THE AFORESAID GROUND. THE GROUNDS OF APPEAL WOULD, THEREFORE IN BRIEF, B E UNDER:- 1. THE ORDER PASSED BY THE ASSESSING OFFICER IS BAD I N LAW AND WITHOUT JURISDICTION AND IT DESERVES TO BE CANC ELLED. 2. THERE IS NO JUSTIFICATION IN INVOKING THE PROVISIO NS OF SECTION 79 AND NOT ALLOWING THE SET OFF OF THE CARR Y FORWARD LOSSES FOR THE ASSESSMENT YEARS 1988-89 AND 1989-90 TO THE EXTENT OF THE TOTAL INCOME ASSESSED. 5. IN THE LIGHT OF THE ABOVE, LD.AR HAS PLEADED THA T THE ISSUE RAISED VIDE ADDITIONAL GROUND WAS NOT DECIDED BY THE LD.CI T(A). HE HAS ALSO INFORMED THAT WHILE DECIDING THE APPEAL OF THE REVE NUE AND THE CROSS OBJECTION OF THE ASSESSEE RESPECTED ITAT A BENCH AHMEDABAD IN APPEAL TITLED AS ACIT VS. M/S.SIDMAK LABORATORIES ( I) PVT.LTD. (ITA NO.1441/AHD/2003 WITH CO NO.84/AHD/2004 A.Y. 1993 -94) ORDER DATED 20/05/2008 IT WAS WRONGLY HELD THAT THE CROSS OBJECTION FILED BY THE ASSESSEE WAS MERELY IN SUPPORT OF THE ORDER OF THE CIT(A). ON THAT BASIS, THE CROSS OBJECTION OF THE ASSESSEE WAS HELD AS INFRUCTUOUS. ITA NO.1441/AHD/2003(BY REVENUE) AND CO NO.84/AHD/2004 (BY ASSESSEE) ACIT VS. SIDMAK LABORATORIES (I) LTD. ASST.YEAR 1993-94 - 5 - LD.AR HAS STRONGLY PLEADED THAT SINCE THE TRIBUNAL HAS NOT DECIDED THIS GROUND AS WELL AS CIT(A) HAS ALSO NOT DECIDED THIS GROUND, THEREFORE THE MATTER BEING RESTORED BACK BY THE HONBLE HIGH COUR T, THE SAME DESERVES TO BE DECIDED AS PER THE DIRECTION. 6. FROM THE SIDE OF THE REVENUE, LD.DR DR.JAYANT JH AVERI HAS PLEADED THAT THE ADMITTED POSITION WAS THAT THE SAI D LEGAL GROUND CHALLENGING THE JURISDICTION OF THE ASSESSMENT ORDE R PASSED U/S.143(3) R.W.S. 250 WAS NOT CHALLENGED THROUGH PROPER GROUND S OF APPEAL BUT IT WAS CHALLENGED VIDE A WRITTEN SUBMISSION BEFORE LD. CIT(A), THEREFORE IT WAS WITHIN HIS JURISDICTION NOT TO ADMIT THE SAID A DDITIONAL GROUND. ACCORDING TO LD.DR, NON-ADMISSION OF AN ADDITIONAL GROUND WHICH WAS NOT RAISED IN PROPER MANNER WAS WITHIN HIS DISCRETI ON, HENCE, NOTHING WRONG HAS HAPPENED IF THE SAID GROUND WAS NOT DECID ED. HOWEVER, LD.DR HAS CONTESTED THAT AS FAR AS THE APPEAL OF THE REVE NUE IS CONCERNED, LD.CIT(A) HAS NOT GIVEN HIS OWN REASONING AND MEREL Y EXPRESSED HIS AGREEMENT WITH THE SUBMISSION OF THE ASSESSEE. LD. DR HAS THEREFORE PLEADED THAT ON MERITS LD.CIT(A) SHOULD HAVE GIVEN HIS OWN FINDINGS AND THEREFORE THE SAID DECISION OF LD.CIT(A) WAS BAD IN LAW. 7. HAVING HEARD THE SUBMISSIONS OF BOTH THE SIDES, WE ARE OF THE CONSIDERED VIEW THAT THE HONBLE JURISDICTIONAL HIG H COURT HAS EXPRESSED HIS CONCERN OVER THE MANNER IN WHICH THE LOWER AUTH ORITIES HAVE PASSED A NON-SPEAKING ORDER WITHOUT GIVING A FINDING ON THE MERITS. OUR FIRST OBSERVATION IS THAT THIS IS THE MAIN REASON FOR RESTORING THE ISSUE OF THE REVENUE BACK, SO THAT THE QUESTION OF APPLICATION O F THE PROVISIONS OF ITA NO.1441/AHD/2003(BY REVENUE) AND CO NO.84/AHD/2004 (BY ASSESSEE) ACIT VS. SIDMAK LABORATORIES (I) LTD. ASST.YEAR 1993-94 - 6 - SECTION 79 OF THE ACT SHOULD NOW BE DECIDED ON MERI TS AS PER LAW. OUR SECOND OBSERVATION IS THAT THE JURISDICTION OF THE IMPUGNED ASSESSMENT ORDER PASSED U/S.143(3) R.W.S.250 DATED 30/11/1999 WAS CHALLENGED THROUGH ADDITIONAL GROUND BUT IT WAS NOT ADJUDICATE D UPON BY LD.CIT(A). BECAUSE OF THESE TWO REASONS WE DEEM IT PROPER TO R ESTORE THE SAID ISSUES BACK TO THE STAGE OF THE FIRST APPEAL TO BE DECIDE D IN ACCORDANCE TO LAW. IN THE RESULT, APPEAL OF THE REVENUE AS WELL AS THE CROSS OBJECTION OF THE ASSESSEE, BOTH ARE RESTORED BACK TO LD.CIT(A) FOR P ROPER ADJUDICATION, HENCE ALLOWED FOR STATISTICAL PURPOSES ONLY. 8. IN THE RESULT, APPEAL OF THE REVENUE AS WELL AS CROSS OBJECTION FILED BY THE ASSESSEE BOTH ARE ALLOWED BUT FOR STAT ISTICAL PURPOSES. SD/- SD/- ( G.D. AGARWAL ) ( MUKUL KR. SHRAWAT ) VICE PRESIDENT (AZ) JUDICIAL ME MBER AHMEDABAD; DATED 14/ 10 /2011 6.. , . ../ T.C. NAIR, SR. PS (5 2 /&7 (7*& (5 2 /&7 (7*& (5 2 /&7 (7*& (5 2 /&7 (7*&/ COPY OF THE ORDER FORWARDED TO : 1. +. / THE APPELLANT 2. /0+. / THE RESPONDENT. 3. $$ & %8 / CONCERNED CIT 4. %8() / THE CIT(A)- 5. 7;< /& , , / DR, ITAT, AHMEDABAD 6. < =1 / GUARD FILE. (5 % (5 % (5 % (5 % / BY ORDER, 07& /& //TRUE COPY// ! !! !/ // / $ $ $ $ ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD