Havells India Limited , Delhi V. PCIT Central Delhi-2, New Delhi

ITA 1070/DEL/2022

AI Insights

The case involves an appeal by M/s. Havells India Limited against the revisional order of the Principal Commissioner of Income Tax (Central), Delhi-2, which was dated 30.03.2022. The revisional order had deemed an earlier assessment order under Section 143(3) of the Income Tax Act, 1961, dated 31.12.2019, as erroneous and prejudicial to the interests of the revenue. The primary contention was regarding an alleged disallowance under the Shahenshah Scheme, which was argued to have no impact on the book profit computed under Section 115JB of the Act. The assessee argued that there was no resultant prejudice to the revenue as they had switched to Section 115BAA and did not avail any MAT credit, thus no tax benefit was derived from the provisions under dispute.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 121519 (ITAT-DELHI)
• Duration Of Justice: 11 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-05-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 10-05-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 17-05-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 263; 63; 2; 143(3); 115JB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “B” DELHI BEFORE SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER I.T.A. No.1070/DEL/2022 Assessment Year 2018-19 M/s. Havells India Limited 904, 9 th Floor, Surya Kiran Building K.G. Marg Connaught Place New Delhi Vs. PCIT Central Delhi-2 New Delhi TAN/PAN: AAACH0351E (Appellant) (Respondent) Appellant by: Shri Akshat Jain, CA Respondent by: Shri T. James Singson, CIT-DR Date of hearing: 11 05 2023 Date of pronouncement: 17 05 2023 O R D E R PER PRADIP KUMAR KEDIA, A.M.: T he ca pti oned a ppeal has been file d at t he i ns tance o f the assessee agai nst the revisi onal or de r of th e ld. Pri nc ipal Com miss ioner of Inc ome T ax ( C entr al ), D elh i-2 (‘P r.CIT ’ i n shor t) dated 30. 03. 2022 wherei n order pas sed b y the Assessi ng O fficer (A O) unde r Sect ion 143(3) of t he Inc ome T ax A ct, 19 61 (t he A ct) date d 31. 12. 2019 co ncernin g AY 2018 -19 w as he ld to be er roneou s i n so far as prejudicial t o the inte res t of the reve nue w ithi n the mea ni ng of Secti on 2 63 of the A ct. 2. When the ma tte r w as cal led f or he ar ing, th e l d. cou nsel submit ted that t he tw in condi t ion fo r appl icabilit y o f S ect ion 263 is not fu lf illed in the pres ent cas e. Ela bora tin g the s tance, the I.T.A. No.1070/Del/2022 2 assessee sub mi tte d that a d isa llow ance of Rs. 1, 15, 00, 000/- w as pro pos ed to be made unde r Sect io n 263 on account Shahens ha h Scheme w hich has the res ult of modi fyi ng t he ta xa ble income under th e normal provisions of the I nc ome T ax Ac t. Howeve r, event ua ll y there is no c hange in t he book pro fit c omp uted unde r Sect ion 115J B of t he Act b y suc h dis all ow ance. T he ass essee h as been char ged to taxat ion under th e alternati ve Scheme unde r Sect ion 115JB o f the A ct a s per the Scheme o f the Act. T he l d. counse l c onten ds that ulti ma te res ult o f such adj ust me nt w il l be lesse r credit unde r MAT to this exte nt of Rs. 39,79,920/ - w hich the assessee is en ti tle d to car ry forwa rd i n t he subs eque nt year for avail in g credi t i n accor dance w it h l aw. However, in t he ins tant case, the ass essee has sw itc he d to Section 115B AA of t he A ct w .e. f. A Y 2020-21 and as a result of exerci si ng the opt ion u nde r Sect ion 115BAA o f the Act, the asse ssee is no longer ent i tle d to avail t he ca rr y forw ar d c redit o f M A T in the s ubs equen t yea r. Conse que ntl y, in t otal it y, no prej udice has res ul ted t o t he R evenue w hen t he assess ment upt o A Y 2020- 21 is ta ken into acc ount in s o fa r as t hi s issue is conce rned. O n bei ng su ggestd by the Bench, the ld. c ounsel has file d an a ffi da vi t d at ed 11. 05. 20 23 of the assess ee - co mpan y t o the e ffec t t hat it has no t avai led an y tax be nef it fl ow i ng un der Sectio n 115JB applied i n the i ns tant assess ment ye ar and thus n o prej udice w hatsoever has cause d to the Reven ue. 3. T he ld. D R fo r th e Re ve nue, on t he other hand, states that the explanat ion o ffere d on behal f of t he as sesse e th ough pl aus i ble but is not ver if iabl e a t prese nt. T he ld. CIT -D R ref ers t o pa ra graph 5.3 of the rev is iona l ord er an d c la i ms tha t it is not co rrect to sa y that no p rejud ice h as been caused to t he Revenue b y cla iming a n uns us t ainable p rovisi on. T he l d. C IT -D R a ccor di ngl y I.T.A. No.1070/Del/2022 3 submit ted that no inter fe re nce w ith t he re vis ional orde r is cal le d for. 4. T he c onte nts of a ffidavi t file d b y the ass essee -c ompan y is re pro duc ed h ereunder: I.T.A. No.1070/Del/2022 4 5. I n t h e l ig ht o f t h e a s se rt i on s m a de o n b eh al f o f t he a ss e ss ee du l y s u pp or t e d b y t h e a ff id a v i t i n t h i s re g a r d t h a t n o re v e nu e b e n e fi t ha s b e e n d e r iv e d b y t h e a s se s s ee f r o m t h e a l l e g e d er r or i n t h e or de r a nd no e x t r a M A T c re d i t h a s b e e n a va i l e d i n t he l ate r ye a rs, w e fi n d me r it i n t he p l ea o f t he a ss e s se e t ha t n o pr e ju di ce h a s c a u se d to t he re v e n u e on a c c ou n t o f i s su e o f p r o v i si o n s t o w a r ds una sce r t a i ne d l ia bi l i ti e s ra ke d u p by th e P r . CIT i n t h e re v i s i o n al p r o c e e d in gs. 6. T h u s, w i t ho u t g o i ng i n t o t h e m e r i t s o f t he c o r rec t n e ss o f a ll e g e d er ro r o n a c c ou n t o f t he p r ov i si o n o r o t h e rwi se o n t he I.T.A. No.1070/Del/2022 5 t ou c h st o n e o f S e c t i on 2 6 3 o f t he A c t , w e se t asi d e t h e o rd e r o f t he P r. CI T a t t he th r e s ho l d o n t h e gr ou nd t ha t t he tw i n p r e r e qui si t e s fo r i nv o c a t i o n o f r e v i s i on a l p o w er s un d er S ec t i on 2 6 3 is no t a va i l ab le i n t he p re se nt c a se . 7. R e su l t a nt l y, t he r e v i si on al o r de r i s s e t a si de and q ua s he d. 8. I n t h e re s ul t , th e a p p e a l o f th e a s se ss e e i s a l lo w ed . Order pronounced in the open Court on 17/05/2023 Sd/- Sd/- [CHANDRA MOHAN GARG] [PRADIP KUMAR KEDIA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: /05/2023 prabhat