ACIT, New Delhi V. M/s. A Malik International Trading Co., Delhi

ITA 1124/DEL/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 74142 (ITAT-DELHI)
• Duration Of Justice: 11 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2014
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 06-01-2014
• Assessment Year: 2002-2003
• Appeal Filed On: 27-02-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: B SRINIVAS KUMAR
• Keywords: Depreciation
• Section: 143(3); 80HHC

Judgement Text

ITA NO.1124 & 1125/DEL/2013 ASSTT.YEAR: 2002-03 & 2003-04 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH `A NEW DELHI BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI CHANDRAMOHAN GARG, JUDICIAL MEMBER I.T.A.NO.1124/DEL/2013 ASSESSMENT YEAR : 2002-03 I.T.A.NO.1125/DEL/2013 ASSESSMENT YEAR : 2003-04 ASSTT. COMMISSIONER OF INCOME TAX, VS M/S A.MALI K INTERNATIONAL TRADING CIRCLE 29(1), NEW DELHI. CO., 68/2, 1 ST FLOOR, GANDHI GALI, FATEHPURI, DELHI-110006 (PAN: AAEFA8069M) (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI B. SRINIVAS KUMAR, SR.DR RESPONDENT BY : SHRI ANIL SHARMA O R D E R PER CHANDRA MOHAN GARG, JUDICIAL MEMBER THESE APPEALS HAVE BEEN PREFERRED BY THE REVENUE AG AINST THE ORDER OF COMMISSIONER OF INCOME TAX(A)XXV, NEW DELHI BOT H DATED 20.12.2012 FOR AY 2002-03 AND 2003-04 IN APPEAL NO. 115/2011-12 AND 122/2011-12 RESPECTIVELY. 2. THE REVENUE HAS RAISED SIMILAR SOLE GROUND OF AP PEAL IN BOTH THESE APPEALS WHICH READS AS UNDER:- 1. THE LD. CIT(A) HAS ERRED IN LAW AS WELL AS FAC T IN DIRECTING THE ASSESSING OFFICER TO EXAMINE THE C ASE AND RECOMPUTED THE DEDUCTION U/S 80-HHC AFTER GIVIN G ITA NO.1124 & 1125/DEL/2013 ASSTT.YEAR: 2002-03 & 2003-04 2 FULL OPPORTUNITY TO THE ASSESSEE WHICH AMOUNTS TO S ETTING ASIDE THE MATTER WHICH IS NOT PERMISSIBLE IN LAW. 3. BRIEFLY STATED THE FACTS GIVING RISE TO THESE AP PEALS ARE THAT THE ORIGINAL ASSESSMENTS WERE COMPLETED U/S 143(3) OF THE ACT, 1 961 (FOR SHORT THE ACT) VIDE ORDER DATED 10.05.2007 AFTER MAKING DISALLOWAN CE OF DEDUCTION U/S 80HHC OF THE ACT AMOUNTING TO RS. 39,89,187 AND RS. 20,10,594/- RESPECTIVELY IN BOTH THE YEARS. IN AY 2003-04, THE ASSESSING OFFICER ALSO MADE DISALLOWANCE OF RS.18,017 ON ACCOUNT OF PERSON AL EXPENSES (TELEPHONE + VEHICLE MAINTENANCE) AND ANOTHER DISAL LOWANCE OF RS.20,099 ON ACCOUNT OF VEHICLE DEPRECIATION AND CAR INSURANC E EXPENSES. BEING AGGRIEVED BY THE ABOVE ASSESSMENT ORDER, THE ASSESS EE PREFERRED APPEALS BEFORE THE COMMISSIONER OF INCOME TAX(A) WHICH WERE ALLOWED BY THE IMPUGNED ORDERS. THE COMMISSIONER OF INCOME TAX(A) HELD THAT THE ASSESSEE IS ELIGIBLE FOR DEDUCTION U/S 80HHC OF THE ACT IN VIEW OF THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF TOPMAN EXPORTS VS CIT 18 TAXMAN 120 (SC) AND COMMISSIONER OF INCOME TAX(A) DIRECTED THE ASSESSING OFFICER TO EXAMINE THE CASE AND RECOM PUTED THE DEDUCTION U/S 80HHC OF THE ACT ON THE ISSUE OF DEPB AFTER PROVIDI NG DUE OPPORTUNITY OF HEARING TO THE ASSESSEE. NOW, THE AGGRIEVED REVENU E IS BEFORE THIS TRIBUNAL WITH THE SOLE GROUND AS MENTIONED HEREINABOVE IN BO TH THE APPEALS. ITA NO.1124 & 1125/DEL/2013 ASSTT.YEAR: 2002-03 & 2003-04 3 4. WE HAVE HEARD RIVAL ARGUMENTS OF BOTH THE PARTIE S AND CAREFULLY PERUSED THE RECORD PLACED BEFORE US. WE HAVE ALSO PERUSED ASSESSMENT ORDERS AS WELL AS IMPUGNED ORDERS IN THE LIGHT OF S UBMISSIONS AND CONTENTIONS OF BOTH THE PARTIES. LD. DR SUBMITTED THAT THE COMMISSIONER OF INCOME TAX(A) IS NOT EMPOWERED TO SET ASIDE THE ISS UE TO THE FILE OF THE ASSESSING OFFICER AS PER PROVISIONS OF THE ACT. TH E DR FURTHER CONTENDED THAT ALTHOUGH THE POWERS OF THE COMMISSIONER OF INC OME TAX(A) ARE COTERMINOUS WITH THE ASSESSING OFFICER BUT THE COMM ISSIONER OF INCOME TAX(A) CANNOT SET ASIDE THE ISSUE TO THE FILE OF AS SESSING OFFICER FOR FRESH ADJUDICATION. ON THE OTHER HAND, LD. ASSESSEES RE PRESENTATIVE SUBMITTED THAT THE CLAIM OF THE ASSESSEE FOR DEDUCTION U/S 80HHC O F THE ACT IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION O F HONBLE SUPREME COURT IN THE CASE OF TOPMAN EXPORTS VS COMMISSIONER OF IN COME TAX(SUPRA). THE AR FURTHER CONTENDED THAT THE COMMISSIONER OF INCOM E TAX(A) RIGHTLY DIRECTED THE ASSESSING OFFICER TO EXAMINE THE CLAIM OF THE ASSESSEE AND TO RECOMPUTE THE DEDUCTION U/S 80HHC OF THE ACT ON THE ISSUE OF DEPB. THE AR SUPPORTED THE IMPUGNED ORDER AND SUBMITTED THAT THE COMMISSIONER OF INCOME TAX(A) HAS NOT GRANTED ANY RELIEF FOR THE AS SESSEE AND THE MATTER HAS BEEN SET ASIDE TO THE FILE OF ASSESSING OFFICER FOR VERIFICATION AND EXAMINATION OF THE CLAIM OF ASSESSEE. ITA NO.1124 & 1125/DEL/2013 ASSTT.YEAR: 2002-03 & 2003-04 4 5. AT THE OUTSET, WE OBSERVE THAT THE COMMISSIONER OF INCOME TAX(A) ENJOYS COTERMINOUS POWERS WITH THE ASSESSING OFFIC ER BUT THE COMMISSIONER OF INCOME TAX(A) IS NOT LEGALLY EMPOWE RED TO SET ASIDE OR RESTORE THE ISSUE TO THE FILE OF ASSESSING OFFICER. ACCORDINGLY, WE HOLD THAT THE DIRECTION OF COMMISSIONER OF INCOME TAX(A) TO A SSESSING OFFICER WERE NOT BASED AS PER LETTER AND SPIRIT OF THE PROVISION S OF THE ACT. THEREFORE, WE ALSO HOLD THAT THE COMMISSIONER OF INCOME TAX(A) GR OSSLY ERRED IN SETTING ASIDE AND RESTORING THE ISSUE TO THE FILE OF ASSESS ING OFFICER ABOUT THE CLAIM OF THE ASSESSEE FOR DEDUCTION U/S 80HHC OF THE ACT. THEREFORE, IMPUGNED ORDER UP TO THIS EXTENT IS NOT SUSTAINABLE AND WE S ET ASIDE THE SAME ONLY UP TO THIS EXTENT. AT THE SAME TIME, WE ALSO OBSERVE THA T THE ASSESSEES CLAIM AND ELIGIBILITY FOR DEDUCTION U/S 80HHC OF THE ACT WAS NOT EXAMINED AT THE END OF ASSESSING OFFICER AS PER RATIO LAID DOWN BY THE HONBLE APEX COURT IN THE CASE OF TOPMAN EXPORT VS COMMISSIONER OF INCOME TAX (SUPRA). HENCE, WE ARE OF THE CONSIDERED OPINION THAT THE CLAIM OF THE ASSESSEE DESERVES TO BE EXAMINED AND VERIFIED AT THE END OF ASSESSING OFFIC ER IN THE LIGHT OF DECISION OF HONBLE APEX COURT IN THE CASE OF TOPMAN EXPORT VS COMMISSIONER OF INCOME TAX(SUPRA). THUS, WE HOLD THAT THE ASSESSIN G OFFICER DID NOT EXAMINE AND VERIFY THE CLAIM OF THE ASSESSEE FOR DE DUCTION U/S 80HHC OF THE ACT AS PER PROVISIONS OF THE ACT AS WELL AS RATIO O F THE DECISION OF HONBLE ITA NO.1124 & 1125/DEL/2013 ASSTT.YEAR: 2002-03 & 2003-04 5 APEX COURT IN THE CASE OF TOPMAN EXPORT VS COMMISSI ONER OF INCOME TAX(SUPRA). WE, THEREFORE, RESTORE THE ISSUE TO TH E FILE OF ASSESSING OFFICER WITH A DIRECTION THAT THE ASSESSING OFFICER SHALL E XAMINE AND VERIFY THE CLAIM OF THE ASSESSEE FOR DEDUCTION U/S 80HHC OF TH E ACT AND RECOMPUTE THE DEDUCTION U/S 80HHC OF THE ACT ON THE ISSUE OF DEPB AFTER AFFORDING DUE OPPORTUNITY OF HEARING TO THE ASSESSEE. ACCORDINGL Y, APPEAL OF THE REVENUE IS DEEMED TO BE ALLOWED FOR STATISTICAL PURPOSES IN TH E MANNER AS INDICATED ABOVE. 6. IN THE RESULT, APPEALS OF THE REVENUE ARE DISPOS ED OF AND DEEMED TO BE TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 31.01.2014. SD/- SD/- (G.D. AGRAWAL) (CHANDRAMOHAN GARG) VICE PRESIDENT JUDICIAL MEMBER DT. 31ST JANUARY 2014 GS COPY FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. C.I.T.(A) 4. C.I.T. 5. DR BY ORDER ASSTT.REGISTRAR