Deputy Commissioner of Income Tax, Circle -1(1)(1), Surat V. Enviro Control Associates (I) Pvt.Ltd., Surat

ITA 105/SRT/2018

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9252 (ITAT-SURAT)
• Duration Of Justice: 2 year(s) 7 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Appeal Filed On: 07-12-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SHRIRASESH SHAH
• Keywords: Retrospective amendment
• Section: 80IA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER ITA NO. 105/SRT/2018 (AY 2014-15) (H EARING IN VIRTUAL COURT) DY. COMMISSIONER OF INCOME- TAX, CIRCLE-1[1][1], ROOM NO.108, AAYKAR BHAVAN, MAJURAGATE,SURAT-395001 VS ENVIRO CONTROL ASSOCIATES (I) PVT. LTD., ENVIRO HOOUSE, OPP. BANK OF MAHARASHTRA GHOD DOD ROAD, SURAT PAN : AAACE 8700 C REVENUE / APPELLANT ASSESSEE /RESPONDENT ASSESSEE BY SHRIRASESH SHAH, C.A REVENUE BY SHRI SREENIVAS T. BIDARI, CIT DR DATE OF HEARING 03.08.2021 DATE OF PRONOUNCEMENT 03.08.2021 ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER : 1. THIS APPEAL BY REVENUE IS DIRECTED AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-1, SURAT DATED 21.12.2017FOR ASSESSMENT YEAR (AY) 2014-15. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL:- 1. WHETHER ON THE FACTS AND CIRCUMSTANCES AND CASE AND IN LAW, THE LD CIT(A) IS RIGHT IN DELETING THE ADDITION MADE BY THE ASSESSING OFFICER OF RS.12,01,82,331/- BY DISALLOWING CLAIM UNDER SECTION 80IA(4) OF THE INCOME TAX ACT AS THE ASSESSEE IS A CONTRACTOR NOT AN INDUSTRIAL UNDERTAKING OR ENTERPRISES ENGAGED IN INFRASTRUCTURE DEVELOPMENT? 2- WHETHER ON THE FACTS AND CIRCUMSTANCES AND CASE AND IN LAW, THE LD CIT(A) IS RIGHT IN DELETING THE DISALLOWANCE MADE BY THE ASSESSING OFFICER IN DELETING THE DISALLOWANCE ON ACCOUNT OF DEDUCTION CLAIMED U/S 80IA OF THE ACTS AS THE ASSESSEE ITA NO.105/SRT/2018 ENVIRO CONTROL ASSOCIATES ((I) PVT. LTD. (A.Y.2014-15) 2 WITHOUT APPRECIATING THE FACTS THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER CLEARLY OBSERVED THAT THE ASSESSEE IS A CONTRACTOR NOT AN INDUSTRIAL UNDERTAKING OR ENTERPRISES ENGAGED IN INFRASTRUCTURE DEVELOPMENT? 3-WHETHER ON THE FACTS AND CIRCUMSTANCES AND CASE AND IN LAW, THE LD CIT(A) IS RIGHT IN DELETING THE DISALLOWANCE MADE BY THE ASSESSING OFFICER IN DELETING THE DISALLOWANCE ON ACCOUNT OF DEDUCTION CLAIMED U/S 80IA OF THE ACT AS THE ASSESSEE WITHOUT APPRECIATING THE FACTS THAT EXPLANATION TO SECTION 80IA INTRODUCED BY FINANCE ACT 2009 WITH RETROSPECTIVE EFFECT FROM 01.04.2000 WHEREIN DECLARED THAT NOTHING CONTAINED IN THIS SECTION SHALL APPLY IN RELATION TO A BUSINESS REFERRED TO IN SUB SECTION (4) WHICH IS IN NATURE OF WORK CONTRACT AWARDED BY ANY PERSON AND EXECUTED BY UNDERTAKING OR ENTERPRISE REFERRED TO IN SUB SECTION (1)? 4- ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE ASSESSING OFFICER. 2. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS A COMPANY ENGAGED IN THE CONSULTANCY AND DEVELOPMENT OPERATION AND MAINTENANCE OF SEWAGE TREATMENT PLANTS. THE ASSESSEE WHILE FILING RETURN OF INCOME FOR ASSESSMENT YEAR 2014-15 DECLARED TOTAL INCOME OF RS.26.19 CRORES. IN THE COMPUTATION OF INCOME, THE ASSESSEE CLAIMED DEDUCTION UNDER SECTION 80IA OF RS.12,01,82,331/-.THE ASSESSING OFFICER DISALLOWED THE CLAIM OF DEDUCTION UNDER SECTION 80IA DESPITE NOTING THAT SIMILAR CLAIM WAS DISALLOWED IN EARLIER YEARS, HOWEVER ON APPEAL BEFORE THE TRIBUNAL SIMILAR DEDUCTION WAS ULTIMATELY ALLOWED. THE ASSESSING OFFICER FURTHER HELD THAT THE DECISION OF ITA NO.105/SRT/2018 ENVIRO CONTROL ASSOCIATES ((I) PVT. LTD. (A.Y.2014-15) 3 TRIBUNAL IS NOT ACCEPTED BY THE DEPARTMENT AND THEY ARE INTENDING TO FILE APPEAL BEFORE THE JURISDICTIONAL HIGH COURT AGAINST THE DECISION OF THE TRIBUNAL. ON APPEAL BEFORE LD. COMMISSIONER OF (APPEALS) THE ASSESSEE WAS ALLOWED DEDUCTION UNDER SECTION 80IA BY FOLLOWING DECISION OF TRIBUNAL FOR ASSESSMENT YEARS 2003-04 TO 2011-12. THUS, AGGRIEVED BY THE ORDER OF LD. CIT(A) THE REVENUE HAS FILED THIS APPEAL BEFORE THE TRIBUNAL. 3. WE HAVE HEARD THE SUBMISSION OF LD. DEPARTMENTAL REPRESENTATIVE REPRESENT FOR THE REVENUE (CIT-DR) AND LD. AUTHORIZED REPRESENTATIVE (AR) OF THE ASSESSEE. AT THE OUTSET OF HEARING LD. AR OF THE ASSESSEE SUBMITS THAT GROUNDS OF APPEAL RAISED BY REVENUE ARE SQUARELY COVERED BY THE DECISION OF TRIBUNAL IN ALL EARLIER YEARS. LD. AR FILED COPY OF THOSE DECISION OF TRIBUNAL. 4. ON THE OTHER HAND, LD. CIT-DR FOR THE REVENUE SUBMITS THAT HE IS RELIED ON THE ORDER OF ASSESSING OFFICER. 5. WE HAVE HEARD THE SUBMISSIONS OF THE LEARNED COMMISSIONER OF INCOME-TAX DEPARTMENTAL REPRESENTATIVE ( CIT-DR) FOR THE REVENUE AND THE LEARNED AUTHORISED REPRESENTATIVE (LD. AR) FOR THE ASSESSEE AND HAVE GONE THROUGH THE ORDER OF THE LOWER AUTHORITIES. THE LD. CIT-DR FOR THE REVENUE SUPPORTED THE ORDER OF THE ASSESSING OFFICER. 6. ON THE OTHER HAND THE LD. AR FOR THE ASSESSEE SUBMITS THAT THE GROUNDS OF THE APPEAL RAISED BY THE REVENUE IS COVERED BY THE DECISIONS OF THE TRIBUNAL IN ITA NO.105/SRT/2018 ENVIRO CONTROL ASSOCIATES ((I) PVT. LTD. (A.Y.2014-15) 4 EARLIER YEARS. THE LD. CIT(A) WHILE GRANTING RELIEF TO THE ASSESSEE FOLLOWED THE ORDERS OF EARLIER YEAR. THE LD. AR FOR THE ASSESSEE PRAYED FOR DISMISSAL OF THE APPEAL. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF BOTH THE PARTIES AND HAVE GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. WE HAVE ALSO GONE THROUGH THE ORDER OF TRIBUNAL FOR ASSESSMENT YEARS 2003-04 TO 2011-12. FURTHER, WE FIND THAT THE LD. CIT(A) WHILE GRANTING RELIEF TO THE ASSESSEE HAS FOLLOWED THE ORDER OF TRIBUNAL FOR VARIOUS ASSESSMENT YEARS AND PASSED THE FOLLOWING ORDERS:- 6.1.1 I HAVE CONSIDERED THE ASSESSMENT ORDER AS WELL AS THE SUBMISSION OF THE APPELLANT. THE GROUND NO. 1 AND 2: NOT FOLLOWING THE ORDERS OF HON'BLE ITAT AHMEDABAD IN CASE OF TH9E APPELLANT FOR EARLIER YEARS IN RESPECT OF DEDUCTION CLAIMED BY ASSESSEE U/S 80IA(4) OF THE IT ACT OF RS.12,01,82,331/- MENTIONED IN GROUND #2. THE AO HAS DEALT WITH THIS ISSUE AT PAGE 2 IN PARA 3 OF THE ASSESSMENT ORDER. THE AO DURING ASSESSMENT PROCEEDING FOUND THAT THE ASSESSEE HAD CLAIMED DEDUCTION OF RS.12,01,82,331/- AND MADE ADDITION STATING THAT THE DEPARTMENT HAS NOT ACCEPTED THE DECISION AND HAD MADE REFERENCE U/S 260 OF THE IT ACT. THE APPELLANT IN ITS SUBMISSION RELIED ON THE ORDER OF THE HON'BLE ITAT FOR ASSTT. YEAR 2003-04 TO ASSTT. YEAR 2011-12 IN ITS OWN CASE. 6.1.2 SIMILAR ISSUE AROSE IN APPELLANTS OWN CASE FOR AY 2002-03 TO 2011-12 AND THE ISSUE WAS DECIDED BY HON. ITAT, AHMADABAD AS UNDER : ASSESSMENT YEAR ITA NUMBER ITAT ORDER DATE 2003-04 & 2004-05 1681 & 1682/AHD/2006 AND 210 & 211/AHD/2006 20-03-2009 2005-06 TO 2007-08 & 2009-10 3454/AHD/08, 3698/AHD/08, 2369/AHD/11, 2589/AHD/09, 2817/AHD/09, 2794/AHD/.11, 783/AHD./10, 1021/AHD/10, 2795/AHD/11, & 2083/AHD/12 30-04-2013 2008-09 1259/AHD/2011 16-11-2016 ITA NO.105/SRT/2018 ENVIRO CONTROL ASSOCIATES ((I) PVT. LTD. (A.Y.2014-15) 5 2010-11 1888/AHD/2013 24-07-2017 2011-12 2679/AHD/2014 15-06-2017 6.1.3.THE ISSUE RAISED IN THE GROUNDS OF APPEAL UNDER CONSIDERATION IS SQUARELY COVERED IN FAVOUR OF THE APPELLANT BY THE DECISIONS OF HON'BLE ITAT, AHMEDABAD FOR THE VARIOUS ASSESSMENT YEARS (ASSTT. YEAR 2003-04 TOO ASSTT. YEAR 2011-12),. AS PER THE CHART ABOVE, IN ITS OWN CASE, AND THE SAME IS A BINDING PRECEDENT. HENCE, IN VIEW OF THE ABOVE, FACTS THE ADDITION MADE BY THE AO OF RS.12,01,82,331/- BY DISALLOWANCE U/S 80IA(4) OF THE ACT, IS DELETED AND THE GROUNDS OF APPEALS ARE ALLOWED . 8. CONSIDERING THE CONSISTENT DECISION OF TRIBUNAL FOR EARLIER YEARS AS REFERRED ABOVE, WE DO NOT FIND ANY MERIT IN THE GROUNDS OF APPEAL RAISED BY REVENUE. 9. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON 03/08/2021 AS PER RULE 34(5) OF THE INCOME TAX (APPELLATE TRIBUNAL) RULE, 1963 BY PLACING THE RESULT ON THE NOTICE BOARD. SD/- SD/- ( DR ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER SURAT, DATED: 03/08/2021 DKP P.S COPY TO: 1. APPELLANT-DCIT, CIR-1(1)(1),ROOM NO.108,AAYKAR BHAVAN, MAJURA GATE, SURAT-395001 2. RESPONDENT- ENVIRO CONTROL ASSOCIATES (I) PVT. ENVIRO HOUSE, OPP. BANK OF MAHARASHTRA GHOD DOD ROAD, SURAT 3. CIT(A)-SURAT 4. CIT 5. DR 6. GUARD FILE TRUE COPY/ BY ORDER ASSISTANT REGISTRAR, ITAT, SURAT