ITO, Bangalore V. M/s Insilica Semiconductors India Pvt. Ltd., Bangalore

ITA 1086/BANG/2015

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 1543 (ITAT-BANGALORE)
• Duration Of Justice: 4 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2004-2005
• Appeal Filed On: 17-07-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PROF S SAMPATH DIRECTOR OF COM
• Keywords: Depreciation; Rectification of order
• Section: 154; 15

Judgement Text

ITA.1086 & CO.205/BANG/2015 PAGE - 1 IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH 'C', BANGALORE BEFORE SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER AND SHRI. ABRAHAM P. GEORGE, ACCOUNTANT MEMBER I.T.A NO.1086/BANG/2015 (ASSESSMENT YEAR : 2004-05) INCOME-TAX OFFICER, WARD 3(1)(4), BANGALORE ..APPELLANT V. M/S. INSILICA SEMICONDUCTORS INDIA PVT. LTD, C/O. M/S. RESOLVE BUSINESS SERVICES P. LTD, NO.231 236, RAHEJA ARCADE, 7 TH BLOCK, KORAMANGALA, BANGALORE 560 095 ..RESPONDENT PAN : AABCC9522F CROSS OBJECTION NO.205/BANG/2015 (IN I.T.A NO.1086/BANG/2015) (ASSESSMENT YEAR : 2004-05) (BY THE ASSESSEE) ASSESSEE BY : PROF. S. SAMPATH, DIRECTOR OF ASSESSE E COMPANY REVENUE BY : SHRI. SUNIL KUMAR AGARWALA, JCIT HEARD ON : 30.11.2015 PRONOUNCED ON : 04.12.2015 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : THIS APPEAL AND CROSS OBJECTION ARE FILED AGAINST AN ORDER DT.26.05.2015 OF CIT (OSD)-(A), BANGALORE, FOR THE A. Y. 2004-05. ITA.1086 & CO.205/BANG/2015 PAGE - 2 02. GRIEVANCE RAISED BY REVENUE IN ITS APPEAL IS TH AT CIT (A) DIRECTED THE AO TO RECOMPUTE DEDUCTION ALLOWABLE TO THE ASSE SSEE U/S.10A OF THE INCOME-TAX ACT, 1961 (THE ACT IN SHORT), WITHOUT SETTING OFF BROUGHT FORWARD LOSSES PERTAINING TO UNITS WHICH WERE NOT E LIGIBLE FOR CLAIMING SUCH DEDUCTION. AS AGAINST THIS, ASSESSEE IN ITS CROSS OBJECTION STATES THAT THE ISSUE REGARDING SET OFF OF LOSS OF OTHER UNITS AGAI NST THE PROFITS OF AN UNIT WHICH WAS ELIGIBLE FOR DEDUCTION U/S.10A OF THE ACT , WAS A DEBATABLE ONE AND THE AO WAS NOT JUSTIFIED IN INVOKING SECTION 15 4 OF THE ACT WHILE PASSING THE IMPUGNED ORDER. 03. APPEAL AND THE CROSS OBJECTION ARISE OUT OF AN ORDER DT.24.12.2008, U/S.154 OF THE ACT, OF THE ASSESSING OFFICER. IN T HE SAID ORDER, AO WAS OF THE OPINION THAT DEDUCTION U/S.10A COULD BE ALLOWED ONLY AFTER SET OFF OF BROUGHT FORWARD LOSS AND DEPRECIATION. RELIANCE WA S PLACED BY THE AO FOR TAKING THIS VIEW ON THE JUDGMENT OF HONBLE JURISDI CTIONAL HIGH COURT IN THE CASE OF CIT V. HIMTASINGKI SEIDE LTD [(2006) 28 6 ITR 255]. AS PER THE AO ASSESSEE HAD CLAIMED SUCH DEDUCTION WITHOUT SETT ING OFF OF SUCH BROUGHT FORWARD BUSINESS LOSS AND DEPRECIATION. 04. ASSESSEE HAD MOVED IN APPEAL BEFORE THE CIT (A) AGAINST THE ABOVE RECTIFICATION ORDER. CIT (A) RELYING ON THE JUDGME NT OF HONBLE ITA.1086 & CO.205/BANG/2015 PAGE - 3 JURISDICTIONAL HIGH COURT IN THE CASE OF CIT V. YOK OGAWA INDIA LTD [341 ITR 385], HELD THAT SECTION 10A DEDUCTION WAS TO BE COMPUTED ON A STAND ALONE BASIS WITHOUT SETTING OFF OF LOSS AND DEPRECI ATION. 05. HEARD THE RIVAL COUNSELS. WE ARE OF THE OPINIO N THAT CIT (A) HAD FOLLOWED THE JUDGMENT OF HONBLE JURISDICTIONAL HIG H COURT IN THE CASE OF YOKOGAWA INDIA LTD (SUPRA). QUESTION WHETHER SECTI ON 10A DEDUCTION COULD BE ALLOWED WITH OR WITHOUT SETTING OFF OF BRO UGHT FORWARD LOSS OF UNITS WHICH HAD NOT CLAIMED SUCH DEDUCTION IS IN OU R OPINION, A DEBATABLE ONE. THIS IS APPARENT FROM THE JUDGMENTS OF HONBL E JURISDICTIONAL HIGH COURTS IN THE CASE OF HIMTASINGKI SEIDE LTD (SUPRA) AND YOKOGAWA INDIA LTD (SUPRA). THIS BEING THE CASE, IN OUR OPINION, WE CANNOT SAY THAT THERE WAS A MISTAKE APPARENT ON RECORD IN THE ORIGINAL OR DER. WHAT WAS SOUGHT TO BE RECTIFIED BY THE AO WAS NOT ONE WHICH WAS A MIST AKE APPARENT FROM RECORD. RECTIFICATORY POWERS U/S.154 OF THE ACT, C ANNOT BE INVOKED ON DEBATABLE ISSUES, THAT TOO ON POINTS OF LAW. IT IS ONLY MISTAKES WHICH ARE APPARENT, AND GLARING ON RECORD WHICH ARE AMENABLE FOR RECTIFICATION. ITA.1086 & CO.205/BANG/2015 PAGE - 4 06. IN THE RESULT, CROSS OBJECTION FILED BY THE ASS ESSEE IS ALLOWED. APPEAL OF THE REVENUE HAVING BECOME INFRUCTUOUS IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 4TH DAY OF DE CEMBER, 2015. SD/- SD/- (SMT. ASHA VIJAYARAGHAVAN) (ABRAHAM P GEORGE) JUDICIAL MEMBER ACCOUNTA NT MEMBER MCN* COPY TO: 1. THE ASSESSEE 2. THE ASSESSING OFFICER 3. THE COMMISSIONER OF INCOME-TAX 4. COMMISSIONER OF INCOME-TAX(A) 5. DR 6. GF, ITAT, BANGALORE BY ORDER ASSISTANT REGISTRAR