M/s Axpert Enterprise, Parwanoo V. DCIT, Circle , Parwanoo

ITA 1044/CHANDI/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5132 (ITAT-CHANDIGARH)
• Duration Of Justice: 8 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-03-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 22-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KIRAN DESH
• Assessee Lawyers: PUNEET GUPTA
• Keywords: Opportunity of being heard
• Section: 10B; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES, SMC, CHANDIGARH BEFORE MS. DIVA SINGH, JUDICIAL MEMBER ITA NO. 1044/CHD/2017 ASSESSMENT Y EAR: 2013-14 M/S AXPERT ENTERPRISE, VS. THE DCIT, PLOT 40, SECTOR-1, CIRCLE, PARWANOO (HP). PARWANOO (HP). PAN NO. AAKFA5182B (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PUNEET GUPTA RESPONDENT BY : SHRI KIRAN DESHPANDE, SR.DR DATE OF HEARING : 04.01.2018 DATE OF PRONOUNCEMENT : 12.03.2018 ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE ASSA ILING THE CORRECTNESS OF THE ORDER DATED 26.04.2017 OF LD. CIT(APPE ALS) SHIMLA PERTAINING TO 2012-13 ASSESSMENT YEAR ON THE FOLLOWING GROUND : THE ID. CIT(A) IS WRONG IN DISALLOWING THE BENEFIT OF SUBSTANTIAL EXPANSION U/S 80IC AND CONFIRMING THE DEDUCTION U/S 80IC ONLY TO THE EXTEN T OF 25% AS AGAINST 100% BY HOLDING THAT BENEFIT OF SUBSTANTIAL EXPANSION IS ALLOWABLE ONLY TO THE UNDERTAKING WHICH WERE EXISTING AS ON 07.01.2003. 2. IT WAS COMMON STAND OF THE PARTIES BEFORE THE BENCH THAT THE ISSUE INVOLVED IN THE PRESENT APPEAL IS COVERED IN FAVOUR OF THE ASSESSEE BY VIRTUE OF THE ORDER DATED 28.11.2017 OF THE HONBLE HIGH COURT IN THE CASE OF M/S STOVE CRAFT INDIA VERSUS CIT-V AND OTHERS IN ITA 20 TO 24/20 15. ACCORDINGLY, IT WAS A COMMON PRAYER OF THE PARTIES THAT THE ISSUE MAY BE REMANDED TO THE AO WITH A DIRECTION TO GRANT NECESSARY RELIEF IN TERMS OF THE DIRECTION OF THE HONBLE HIGH COURT CONSIDERING THE PECULIAR FACTS AND CIRCU MSTANCES OF THE PRESENT CASE ALSO. 3. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE M ATERIAL ON RECORD. IT IS SEEN THAT THE ASSESSEE IN THE FACTS OF THE PRESEN T CASE DERIVES INCOME FROM THE BUSINESS OF MANUFACTURING OF ELECTRONICS WEIGHING SC ALES. THE MANUFACTURING ACTIVITY IS CARRIED OUT AT PLOT NO. 40 SECTOR 2 GABRIEL ROAD, PARWANOO (HP). ADMITTEDLY 80IC DEDUCTION @ 100% OF ELIGIBLE PROFITS FOR FIVE YEARS FROM 2005-06 TO 2009-10 HAD BEEN CLAIMED AND ALLOWED TO THE AS SESSEE. ITA 1044/CHD/2017 A.Y. 2013-14 PAGE 2 OF 2 THE PRESENT YEAR BEING THE 9 TH YEAR, THE ASSESSEE HAD CLAIMED DEDUCTION @ 100% ON THE GROUND THAT SUBSTANTIAL EXPANSION HAD BEEN CARRIED OUT IN THE FINANCIAL YEAR 2010-11 WHICH HAS BEEN RESTRICTED TO 25% B Y THE AO. IT IS SEEN THAT THE JURISDICTIONAL HIGH COURT IN THE AFORESAID DECISIO N CONSIDERED THE FACTS OF THE SPECIFIC CASE BEFORE IT IN PARA 51 AND CONSIDERING THE SAME CAME TO THE FOLLOWING CONCLUSION:- 55. THUS, IN VIEW OF THE ABOVE DISCUSSION, THESE APPEAL S ARE ALLOWED AND ORDERS PASSED BY THE ASSESSMENT OFFICER AS WELL AS THE APP ELLATE AUTHORITY AND THE TRIBUNAL IN THE CASE OF EACH ONE OF THE ASSESSEES, ARE QUASHED AND SET ASIDE, HOLDING AS UNDER: (A) SUCH OF THOSE UNDERTAKINGS OR ENTERPRISES WHICH WER E ESTABLISHED, BECAME OPERATIONAL AND FUNCTIONAL PRIOR TO 07/01/2003 AND HAVE UNDERTAKEN SUBSTANTIAL EXPANSION BETWEEN 07/01/2003 UPTO 01/04/2012, SHOUL D BE ENTITLED TO BENEFIT OF SECTION 80-IC OF THE ACT, FOR THE PERIOD FOR WHICH THEY WERE NOT ENTITLED TO THE BENEFIT OF DEDUCTION UNDER SECTION 80-IB. (B) SUCH OF THOSE UNITS WHICH HAVE COMMENCED PRODUCTION AFTER 07/01/2003 AND CARRIED OUT SUBSTANTIAL EXPANSION PRIOR TO 01/04/20 12, WOULD ALSO BE ENTITLED TO BENEFIT OF DEDUCTION AT DIFFERENT RATES OF PERCENTA GE STIPULATED UNDER SECTION 80-IC. (C) SUBSTANTIAL EXPANSION CANNOT BE CONFINED TO ONE EXP ANSION. AS LONG AS REQUIREMENT OF SECTION 80-IC (8) (IX) IS MET, THERE CAN BE NUMBER OF MULTIPLE SUBSTANTIAL EXPANSIONS. (D) CORRESPONDINGLY, THERE CAN BE MORE THAN ONE INITIAL ASSESSMENT YEARS. (E) WITHIN THE WINDOW PERIOD OF 07/01/2013 UPTO 01/04/2 012, AN UNDERTAKING OR AN ENTERPRISE CAN BE ENTITLED TO DEDUCTION @100% FOR A PERIOD OF MORE THAN FIVE YEARS. (F) ALL THIS, OF COURSE, IS SUBJECT TO A CAP OF TEN YEARS. [SECTION 80-IC(6)]. (G) UNITS CLAIMING DEDUCTION UNDER SECTION 80-IC SHALL NOT BE ENTITLED TO DEDUCTION UNDER ANY OTHER SECTION, CONTAINED IN CHA PTER VI-A OR SECTION 10A OR 10B OF THE ACT [SECTION 80-IB(5)] 3.1 ACCORDINGLY, IN VIEW OF THE ABOVE STATED LEGAL POSITION, THE ISSUE IS RESTORED BACK TO THE AO WITH THE DIRECTION TO GRANT NECESSARY RELIEF IN ACCORDANCE WITH LAW. NEEDLESS TO SAY THAT A REASONA BLE OPPORTUNITY OF BEING HEARD SHALL BE GRANTED TO THE ASSESSEE BEFORE THE PA SSING OF THE ORDER. 4. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PUR POSES. ORDER PRONOUNCED IN THE OPEN COURT ON 12 TH MARCH 2018. SD/- (DIVA SINGH) JUDICIAL MEMBER POONAM/AMIT/POONAM COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR ASSTT. REGISTRAR ITAT,CHANDIGARH.