M/s Suresh Productions Private Limited, Hyderabad V. Commisioner of Income Tax, Hyderabad

ITA 1083/HYD/2013

• Counselvise Citation: 108322514 RSA 2013
• Duration Of Justice: 10 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-05-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 19-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P SOMASEKHAR REDDY
• Assessee Lawyers: C P RAMASWAMY
• Keywords: Revision of order; Revised return
• Section: 143(3); 115JB; 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A : HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA.NO. 1083/HYD/2013 ASSESSMENT YEAR 2010-2011 M/S. SURESH PRODUCTIONS P. LTD., HYDERABAD. PAN AADCS-0841-F VS. CIT-1 HYDERABAD. (APPELLANT) (RESPONDENT) FOR ASSESSEE : MR. C.P. RAMASWAMY FOR REVENUE : MR. P. SOMASEKHAR REDDY DATE OF HEARING : 21.05.2014 DATE OF PRONOUNCEMENT : 28.05.2014 ORDER PER B. RAMAKOTAIAH, A.M. THIS APPEAL BY ASSESSEE IS AGAINST THE ORDER OF T HE COMMISSIONER OF INCOME TAX PASSED UNDER SECTION 263 OF THE I.T. ACT, 1961. ASSESSEE HAS RAISED 12 GROUNDS MAIN LY CONTESTING THAT THE ORDER OF THE CIT IS NOT CORRECT AS THE ORDER OF THE A.O. WAS NEITHER ERRONEOUS NOR PREJUDICIAL T O THE INTERESTS OF REVENUE. 2. BRIEFLY STATED, IN THIS CASE SCRUTINY ASSESSMEN T UNDER SECTION 143(3) WAS COMPLETED ON 28.03.2013 DETERMINING THE TAXABLE INCOME UNDER NORMAL PROVISI ONS AT RS.5,89,91,920/- AND BOOK PROFIT FOR THE PURPOSE OF 115JB AT RS.6,01,66,457/-. WHILE COMPLETING THE ASSESSMENT, THE A.O. HAS CONSIDERED THE RETURN OF INCOME FILED BY THE AS SESSEE ON 14.10.2010 ADMITTING TAXABLE INCOME AT RS.5,89,91,9 16/- AND 2 ITA.NO.1083/HYD/2013 M/S. SURESH PRODUCTIONS P. LTD. HYDERABAD FAILED TO CONSIDER THE REVISED RETURN OF INCOME FIL ED BY THE ASSESSEE COMPANY ON 09.03.2012 ADMITTING TAXABLE IN COME AT RS.5,36,95,470/-. THE REVISED RETURN OF INCOME WAS FILED BY THE ASSESSEE FOR CLAIMING ENHANCED DEDUCTION U/S.80 IA AT RS.39,54,138/- AS AGAINST THE CLAIM U/S.80IA AT RS.26,16,668/- MADE IN ORIGINAL RETURN FILED BY THE ASSESSEE COMPANY. SINCE THE CORRECTNESS OF THE CLAIM FOR DED UCTION U/S.80IA IN THE REVISED RETURN OF INCOME FILED BY T HE ASSESSEE COMPANY WAS NOT EXAMINED BY THE A.O. AT THE TIME OF ASSESSMENT MADE U/S.143(3), THE ORDER PASSED ON 28. 03.2013 U/S.143(3) WAS CONSIDERED AS ERRONEOUS AS WELL AS P REJUDICIAL TO THE INTEREST OF REVENUE BY CIT AND A SHOW CAUSE NOTICE UNDER SECTION 263 OF THE I.T. ACT WAS ISSUED TO THE ASSESSEE COMPANY ON 13.05.2013. LD. CIT AFTER GIVING OPPORTU NITY TO THE ASSESSEE SET ASIDE THE ASSESSMENT ORDER BY STATING AS UNDER : 4. THE CONTENTION MADE BY THE ASSESSEE ARE CONSIDERED. THE NON-CONSIDERATION OF THE REVISED RE TURN FILED BY THE ASSESSEE AT THE TIME OF ASSESSMENT MADE U/S. 143(3) IS A MISTAKE AND THE ASSESSEE IS HAVING EVERY RIGHT TO GET THE MISTAKE RECTIFIED WITHIN THE PROVISIONS OF INCO ME TAX ACT. IN THE EVENT OF RECTIFYING THE MISTAKE, THE ASSESSM ENT WILL NATURALLY BE ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF REVENUE BY ALLOWING THE ENHANCED CLAIM OF 80IA DEDUCTION. 5. AS SUCH, THE ASSESSMENT PASSED ON 28.03.2013 FOR THE A.Y. 2008-09 U/S.143(3) OF THE I.T. ACT, IS CONSIDE RED AS ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF REVEN UE AND UNDER THE POWERS VESTED WITH THE UNDERSIGNED U/S.26 3 OF THE I.T. ACT, THE ASSESSMENT IS SET ASIDE TO THE FI LE OF THE A.O., WITH A DIRECTION TO RE-DO THE SAME AFTER CONS IDERING THE CLAIMS MADE IN THE REVISED RETURN OF INCOME FILED O N 09.03.2012 BY THE ASSESSEE. (EMPHASIS SUPPLIED) 3 ITA.NO.1083/HYD/2013 M/S. SURESH PRODUCTIONS P. LTD. HYDERABAD 3. IT WAS THE CONTENTION OF THE LD. COUNSEL THAT T HE ORDER PASSED BY THE A.O. WHICH WAS SUBJECT MATTER O F REVISION BY CIT WAS NOT ERRONEOUS, AS ADMITTED BY THE CIT IN THE ORDER AND ONLY IN THE EVENT THE ORDER WAS RECTIFIED, THEN THE ASSESSMENT MAY BECOME ERRONEOUS AND PREJUDICIAL. BU T SO FAR THE ORDER UNDER SECTION 143(3) HAS NOT BEEN RECTIFI ED AS APPREHENDED BY THE CIT. THEREFORE, THE ORDER UNDER SECTION 143(3) PER SE IS NOT CORRECT. 4. LEARNED D.R. HOWEVER, DEFENDED THE ORDER OF THE CIT. 5. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND PERUSED THE ORDERS ON RECORD. THE LD. CIT, IN OUR O PINION, HAS WRONGLY CONSIDERED THE ASSESSMENT ORDER AS ERRONEOU S AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. EVEN T HOUGH, ASSESSEE HAD FILED REVISED RETURN MAKING HIGHER CLA IM, THE A.O. HAS NOT CONSIDERED IT AND HAS PASSED THE ORDER ALLO WING THE ORIGINAL CLAIM ONLY. THE APPREHENSION OF THE CIT TH AT NON- CONSIDERATION OF REVISED RETURN AT THE TIME OF ASSE SSMENT IS A MISTAKE CANNOT BE ACCEPTED AS THE SO-CALLED MISTAK E HAS NOT BEEN RECTIFIED, SO FAR. EVEN OTHERWISE, IF A.O. REC TIFIES THE SAME THEN THAT ORDER MAY BECOME ERRONEOUS AND PREJUDICIA L TO THE INTERESTS OF REVENUE. BUT THE ASSESSMENT ORDER PASS ED BY THE A.O. PER SE IS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTER ESTS OF REVENUE. IN VIEW OF THIS, THE ORDER OF CIT SETTI NG ASIDE THE ASSESSMENT CANNOT BE UPHELD. MOREOVER, WE ARE ALSO NOT ABLE TO UNDERSTAND WHY THE ORDER WAS SET ASIDE. AS PER T HE DIRECTIONS OF CIT, AO HAS TO RE-DO ASSESSMENT AFTE R CONSIDERING THE CLAIMS MADE IN THE REVISED RETURN O F INCOME BY THE ASSESSEE WHICH MEANS, THE ORDER OF CIT MAY LEAD TO A 4 ITA.NO.1083/HYD/2013 M/S. SURESH PRODUCTIONS P. LTD. HYDERABAD SITUATION WHERE IT CAN BE A PREJUDICIAL ORDER TO TH E INTERESTS OF REVENUE, BUT NOT THE ORIGINAL ASSESSMENT ORDER WHIC H WAS REVISED. THEREFORE, CONSIDERING IT EITHER WAY, WE C ANNOT CONSIDER THE ORDER OF THE A.O. AS ERRONEOUS AND PRE JUDICIAL TO THE INTERESTS OF REVENUE. WE, THEREFORE, SET ASIDE THE ORDER OF THE CIT AS TWIN CONDITIONS FOR INVOKING JURISDICTIO N U/S 263 HAVE NOT BEEN COMPLIED WITH AND RESTORE THE ORDER O F AO. ASSESSEES GROUNDS ARE ALLOWED. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN THE OPEN COURT ON 28.05.2014. SD/- SD/- (SAKTIJIT DEY) (B.RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED 28 TH MAY, 2014. VBP/- COPY TO : 1. M/. SURESH PRODUCTIONS P. LTD. D.NO.8-2-293/82/ J-111/6, RAMANAIDU STUDIOS, JUBILEE HILLS, HYDERABAD 500 033. 2. CIT-1, HYDERABAD. 3. ADDL. CIT, RANGE-13, HYDERABAD. 5. D.R. ITAT, A BENCH, HYDERABAD.