M/s Orison Pharma International, Sirmour V. DCIT, Circle , Shimla

ITA 1150/CHANDI/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5349 (ITAT-CHANDIGARH)
• Duration Of Justice: 5 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 17-07-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGHSR
• Section: 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES, SMC, CHANDIGARH BEFORE MS. DIVA SINGH, JUDICIAL MEMBER ITA NO 1150/CHD/2017 ASSESSMENT YEAR : 2013-14 M/S ORISON PHARMA INTERNATIONAL VS. THE DCIT, VILLAGE-KHARI, KALA AMB, CIRCLE, DISTT. SIRMOUR (HP). SHIMLA. PAN NO. AABFO6301K (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ATUL GOYAL RESPONDENT BY : SHRI MANJIT SINGH,SR.DR DATE OF HEARING : 14.12.2017 DATE OF PRONOUNCEMENT : 04.01.2018 ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE ASSAILIN G THE CORRECTNESS OF THE ORDER DATED 24/05/2017 OF CIT-A SH IMLA PERTAINING TO 201314 ASSESSMENT YEAR ON THE FOLLOWING GROUNDS : 1. THAT THE ORDER OF THE LD. ASSESSING OFFICER UPHELD BY THE WORTHY CIT(A) IS BEING CHALLENGED ON THE GROUND OF IT BEIN G ILLEGAL, ARBITRARY & HAVING BEEN PASSED IN HASTE WITHOUT CONSIDERING THE JUDICIAL PR ONOUNCEMENTS RELIED UPON BY THE APPELLANT DURING THE COURSE OF THE APPELLANT PROCEE DINGS. 2. THAT THE ORDER OF LD. ASSESSING OFFICER UPHELD BY T HE WORTHY CIT(A) ERRED IN FACTS & IN LAW IN NOT CONSIDERING THE AY 2 013-14 AS 2 ND ASSESSMENT YEAR FOR CLAIMING DEDUCTION U/S 80IC OF THE INCOME TAX ACT, 1961 ON THE BASIS OF SUBSTANTIAL EXPANSION CARRIED OUT IN AY 2012-13 & THEREFORE THE SAID ORDER DESERVES TO BE SET ASIDE. 2. AT THE TIME OF HEARING IT WAS A COMMON STAND OF THE PARTIES BEFORE THE BENCH THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY V IRTUE OF THE ORDER DATED 28.11.2017 OF THE HONBLE HIGH COURT DA TED 28/11/2017 IN THE CASE OF M/S STOVE CRAFT INDIA VERSUS CIT-V AND OTHERS IN ITA 20 TO 24/2015. ACCORDINGLY, IT WAS A PRAYE R THAT THE ISSUE MAY BE REMANDED TO THE AO WITH A DIRECTION TO GRANT NE CESSARY RELIEF IN TERMS OF THE DIRECTION OF THE HONBLE HIGH COURT CONSIDER ING THE PECULIAR FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. 3. I HAVE HEARD THE SUBMISSIONS AND PERUSED THE MATERIA L AVAILABLE ON RECORD. THE RELEVANT FACTS OF THE CASE ARE THAT THE ASSESSEE IN THE FACTS OF THE PRESENT CASE WAS ENGAGED IN THE BUSINESS O F MANUFACTURING ITA-1150-2017 A.Y. 2013-14 PAGE 2 OF 3 OF ALLOPATHIC & AYURVEDIC PHARMACEUTICAL PRODUCTS; I.E. I) TA BLETS, II) CAPSULES III) LIQUID SYRUPS IV) DRY SYRUP V) OINTMENT ETC. AT VILLAGE KHARI, SADHUARA ROAD, KALA AMB, DISTT. SIRMOUR. ON THE SAID ACTIVIT Y 80IC DEDUCTION HAD BEEN CLAIMED AND ALLOWED @ 100% OF THE ELIGIBLE PROFITS FOR THE INITIAL 5 YEARS. THEREAFTER, THE ASSESSEE CLAIMED SUB STANTIAL EXPANSION. THE SAID CLAIM FOR GRANT OF DEDUCTION @ 100% WA S NOT ACCEPTED AS THE PRESENT YEAR BEING THE 7 TH YEAR, DEDUCTION WAS RESTRICTED TO 25% BY THE AO WHICH ORDER WAS UPHELD BY THE CIT(A). IT IS SEEN THAT THE JURISDICTIONAL HIGH COURT IN THE AFORESAID D ECISION CONSIDERED THE FACTS OF THE SPECIFIC CASE IN PARA 5 1 AND CONSIDERING THE SAME CAME TO THE FOLLOWING CONCLUSION:- 55. THUS, IN VIEW OF THE ABOVE DISCUSSION, THESE APPEAL S ARE ALLOWED AND ORDERS PASSED BY THE ASSESSMENT OFFICER AS WELL AS THE APPELLATE AUTHORITY AND THE TRIBUNAL IN THE CASE OF EACH ONE OF THE ASS ESSEES, ARE QUASHED AND SET ASIDE, HOLDING AS UNDER: (A) SUCH OF THOSE UNDERTAKINGS OR ENTERPRISES WHICH WER E ESTABLISHED, BECAME OPERATIONAL AND FUNCTIONAL PRIOR TO 07/01/2003 AND HAVE UNDERTAKEN SUBSTANTIAL EXPANSION BETWEEN 07/01/2003 UPTO 01/04 /2012, SHOULD BE ENTITLED TO BENEFIT OF SECTION 80-IC OF THE ACT, FO R THE PERIOD FOR WHICH THEY WERE NOT ENTITLED TO THE BENEFIT OF DEDUCTION UNDER SECTION 80-IB. (B) SUCH OF THOSE UNITS WHICH HAVE COMMENCED PRODUCTION AFTER 07/01/2003 AND CARRIED OUT SUBSTANTIAL EXPANSION PRIOR TO 01/04/20 12, WOULD ALSO BE ENTITLED TO BENEFIT OF DEDUCTION AT DIFFERENT RATES OF PERCENTAGE STIPULATED UNDER SECTION 80-IC. (C) SUBSTANTIAL EXPANSION CANNOT BE CONFINED TO ONE EXP ANSION. AS LONG AS REQUIREMENT OF SECTION 80-IC (8) (IX) IS MET, THERE CAN BE NUMBER OF MULTIPLE SUBSTANTIAL EXPANSIONS. (D) CORRESPONDINGLY, THERE CAN BE MORE THAN ONE INITIAL ASSESSMENT YEARS. (E) WITHIN THE WINDOW PERIOD OF 07/01/2013 UPTO 01/04/2 012, AN UNDERTAKING OR AN ENTERPRISE CAN BE ENTITLED TO DED UCTION @100% FOR A PERIOD OF MORE THAN FIVE YEARS. (F) ALL THIS, OF COURSE, IS SUBJECT TO A CAP OF TEN YEARS. [SECTION 80-IC(6)]. (G) UNITS CLAIMING DEDUCTION UNDER SECTION 80-IC SHALL NOT BE ENTITLED TO DEDUCTION UNDER ANY OTHER SECTION, CONT AINED IN CHAPTER VI-A OR SECTION 10A OR 10B OF THE ACT [SECTION 80-IB(5)]. 4. IT IS NOTED THAT IN THE FACTS OF THE SAID CASE, THE FACT OF EXPANSION HAVING BEEN CARRIED OUT WAS ACCEPTED BY THE REVENUE. IN THE FACTS OF THE PRESENT CASE, THE ISSUES NEED TO BE EXAMINED AND S INCE THE NECESSARY DETAILS HAVE NOT BEEN ADDRESSED AND BROUGH T ON RECORD BY THE PARTIES IN THE LIGHT OF THE DECISION OF THE HON'BLE HIG H COURT, ACCORDINGLY IN TERMS OF THE PRAYER OF THE PARTIES, I DE EM IT APPROPRIATE TO SET ASIDE THE ISSUE BACK TO THE FILE OF ASSESSING O FFICER WITH A DIRECTION TO ITA-1150-2017 A.Y. 2013-14 PAGE 3 OF 3 GRANT NECESSARY RELIEF BY WAY OF PASSING A SPEAKING ORDE R IN ACCORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REASONABLE OPPORT UNITY OF BEING HEARD. 6. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 04.01.2018. SD/- (DIVA SINGH) JUDICIAL MEMBER POONAM COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR ASSTT. REGISTRAR ITAT CHANDIGARH