COMMISSIONER OF INCOME TAX, FARIDABAD V. M/S LAKHANI INDIA LTD., PLOT NO. 131, SECTOR-24, FARIDABAD

ITA/211/2014

AI Insights

The case involves the Commissioner of Income Tax, Faridabad as the appellant, challenging the orders of the CIT(A) and ITAT which had deleted a disallowance made by the Assessing Officer regarding the under valuation of stock by M/s Lakhani India Limited. The primary legal question was whether the ITAT was correct in law in deleting the disallowance, particularly in relation to the inclusion of entry tax in the closing stock as per Section 145A of the Income Tax Act, 1961. The court found that the previous judgments in similar cases provided a clear precedent, which the appellant failed to distinguish or challenge effectively.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 702381 (HC-CHANDIGARH)
• Appeal Type: Others
• Pronouncement Date: 07-10-2014
• Assessment Year: misc
• Other Referred Cases: Lakhani Rubber Udyog Ltd. v. CIT (A), Faridabad, Commissioner of Income Tax, Faridabad v. M/s Lakhani Rubber Udyog(P) Ltd.
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Assessee Lawyers: TEJINDER JOSHI
• Keywords: Condone delay; Income Tax; Legal Precedent; Under valuation of stock
• Section: 145A

Judgement Text

"Income Tax Appeal No.211 of 2014 (O&M) -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Income Tax Appeal No.211 of 2014 (O&M) Date of Order: 07.10.2014 Commissioner of Income Tax, Faridabad ..Appellant Versus M/s Lakhani India Limited, Faridabad ..Respondent CORAM: HON'BLE MR. JUSTICE RAJIVE BHALLA HON'BLE MR. JUSTICE AMIT RAWAL Present: Mr. Tejinder K. Joshi, Advocate, for the appellant. RAJIVE BHALLA, J (Oral) C.M.No.14672-CII of 2014 Prayer in this application is to condone delay of 766 days in re-filing the appeal. We have heard counsel for the appellant and as sufficient cause has been shown, allow the application and condone the delay of 766 days in re-filing the appeal. C.M.No.14673-CII of 2014 Allowed as prayed for. Income Tax Appeal No.211 of 2014 The revenue is before us challenging orders dated 24.03.2011(Annexure A-II) and 10.08.2011(Annexure A-III),passed by the CIT(A) and the Income Tax Appellate Tribunal, Delhi Bench 'D', New Delhi, respectively. Counsel for the revenue submits that the ITAT as well as CIT(A) have erred in deleting disallowance of Rs.29,69,625/- made NARESH KUMAR 2014.10.14 15:50 I attest to the accuracy and authenticity of this document Chandigarh Income Tax Appeal No.211 of 2014 (O&M) -2- by the Assessing Officer on account of under valuation of stock and, therefore, the following question of law arises for adjudication:- “Whether, on the fact and in the circumstances of the case, Hon'ble ITAT was right in law in deleting the disallowance of Rs.29,69,625/- made by the Assessing Officer on account of under valuation of stock even when the entry tax levied was includible in the closing stock of the assessee as per the provisions of Section 145A of the Income Tax Act, 1961?” We have heard counsel for the appellant, perused the impugned orders as well as the substantial question of law. A perusal of the order passed by the ITAT reveals that while deleting disallowance made by the Assessing Officer, the CIT (A) placed reliance upon an order passed by the Tribunal in Income Tax Appeal No.3208/Del/2007 titled Lakhani Rubber Udyog Ltd. v. CIT (A), Faridabad. Admittedly, the order has been affirmed by this Court by dismissal of ITA No.312 of 2010 titled Commissioner of Income Tax, Faridabad v. M/s Lakhani Rubber Udyog(P) Ltd., on 08.02.2011. Counsel for the revenue is unable to distinguish these judgments or refer to any statutory provisions or raise any argument that would enable us to hold to the contrary. The question of law, framed in the present appeal, having been answered against the revenue, as question no. IV in ITA No.312 of 2010 titled Commissioner of Income Tax, Faridabad v. M/s Lakhani Rubber NARESH KUMAR 2014.10.14 15:50 I attest to the accuracy and authenticity of this document Chandigarh Income Tax Appeal No.211 of 2014 (O&M) -3- Udyog(P) Ltd., the present appeal must also meet the same fate. Consequently, the substantial question of law is answered against the revenue in terms of order dated 08.02.2011, passed in ITA No.312 of 2010 titled Commissioner of Income Tax, Faridabad v. M/s Lakhani Rubber Udyog(P) Ltd., and the appeal is dismissed. (RAJIVE BHALLA) JUDGE October 07, 2014 (AMIT RAWAL) nt JUDGE NARESH KUMAR 2014.10.14 15:50 I attest to the accuracy and authenticity of this document Chandigarh "