D.C.I.T Cir - 11,kolkata, Kolkata V. M/s Epcos India Pvt Ltd, North 24 Parganas

ITA 1161/KOL/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4625 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 1 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-06-2016
• Appeal Filed By: Department
• Bench Allotted: C
• Next Hearing Date: 20-06-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 09-05-2013
• Court: TRIBUNAL
• Department Lawyers: ARINDAM BHATTACHARYA
• Assessee Lawyers: KARISHMA JAISWAL ACA
• Keywords: Depreciation; Revised return; Unabsorbed depreciation; Reassessment proceedings
• Section: 143(3); 142(1); 148

Judgement Text

I.T.A. NO. 1161/KOL./2013 ASSESSMENT YEAR: 2006-2007 & C.O. NO. 77/KOL/2013 (IN I.T.A. NO. 1161/KOL./2013) ASSESSMENT YEAR: 2006-2007 PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA C BENCH, KOLKATA BEFORE SHRI M. BALAGANESH, ACCOUNTANT MEMBER AND SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER I.T.A. NO. 1161/KOL/ 2013 ASSESSMENT YEAR: 2006-2007 DEPUTY COMMISSIONER OF INCOME TAX,................. ...........APPELLANT CIRCLE-11, KOLKATA, P-7, CHOWRINGHEE SQUARE, KOLKATA-700 069 -VS.- M/S. EPCOS INDIA PVT. LIMITED,..................... ...................RESPONDENT KULIA, KANCHARAPARA ROAD, KALYANI-741 251 [PAN : AAACI 6950 Q] & C.O. NO. 77/KOL/2013 (IN I.T.A. NO. 1161/KOL/ 2013) ASSESSMENT YEAR: 2006-2007 M/S. EPCOS INDIA PVT. LIMITED,..................... ...................CROSS OBJECTOR KULIA, KANCHARAPARA ROAD, KALYANI-741 251 [PAN : AAACI 6950 Q] -VS.- DEPUTY COMMISSIONER OF INCOME TAX,................. ...............RESPONDENT CIRCLE-11, KOLKATA, P-7, CHOWRINGHEE SQUARE, KOLKATA-700 069 APPEARANCES BY: SHRI ARINDAM BHATTACHARYA, JCIT, SR. D.R., FOR THE DEPARTMENT MS. KARISHMA JAISWAL, ACA, FOR THE ASSESSEE DATE OF CONCLUDING THE HEARING : JUNE 20, 2016 DATE OF PRONOUNCING THE ORDER : JUNE 22, 2016 O R D E R PER SHRI S.S. VISWANETHRA RAVI :- WE FIRST TAKE UP THE APPEAL BEING ITA NO. 1161/KOL/2013 FILED BY THE REVENUE. THIS APPEAL IS PREFERRED BY THE REVENU E AGAINST THE ORDER OF I.T.A. NO. 1161/KOL./2013 ASSESSMENT YEAR: 2006-2007 & C.O. NO. 77/KOL/2013 (IN I.T.A. NO. 1161/KOL./2013) ASSESSMENT YEAR: 2006-2007 PAGE 2 OF 5 LD. COMMISSIONER OF INCOME TAX (APPEALS)-XII, KOLKA TA DATED 15.01.2013 FOR THE ASSESSMENT YEAR 2006-07. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A COMPANY AND IS ENGAGED, INTER ALIA, IN THE BUSINESS OF MANUFACTURI NG AND SELLING OF SOFT FERRITE COMPONENTS. THE ASSESSEE FILED ITS REVISED RETURN OF INCOME FOR THE ASSESSMENT YEAR 2006-07 ON 3RD OCTOBER, 2007 DE CLARING A TOTAL TAXABLE INCOME AT NIL. IN THE AFORESAID RETURN, THE UNABSORBED BUSINESS LOSS AND UNABSORBED DEPRECIATION ALLOWANCE WERE CLA IMED TO BE CARRIED FORWARD. THE RETURN OF INCOME WAS PROCESSED U/S 143 ( 1) OF THE INCOME- TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE' ACT' ). DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS THE COPY OF THE TAX AUDI T REPORT WAS FILED EVIDENCING THE UNABSORBED BUSINESS LOSS AND UNABSOR BED DEPRECIATION ALLOWANCE TO BE CARRIED FORWARD. THE ASSESSMENT WAS COMPLETED U/S 143(3) OF THE ACT VIDE ORDER DATED DECEMBER 24, 200 9. IN THE SAID ORDER, THE CARRY FORWARD OF THE UNABSORBED DEPRECIATION AL LOWANCE AS CLAIMED BY THE ASSESSEE IN THE RETURN OF INCOME WAS NOT DIS TURBED. SUBSEQUENTLY THE A.O. INITIATED REASSESSMENT PROCEEDINGS VIDE NO TICE UNDER SECTION 148 OF THE ACT DATED 30.03.2011 FOR THE ASSESSMENT YEAR UNDER CONSIDERATION. THE ASSESSING OFFICER HAS ALSO ISSUED NOTICE UNDER SECTION 142(1) OF THE ACT DATED 28.11.2011 AND FURTHER A LETTER ON EVEN D ATE WITH DETAILED REASONS JUSTIFYING THE REOPENING OF THE ASSESSMENT FOR THE CAPTIONED ASSESSMENT YEAR. THE ASSESSING OFFICER DISALLOWED T HE UNABSORBED DEPRECIATION ALLOWANCE UPTO AY 1998-99 TO BE CARRIE D FORWARD. 3. THE ASSESSEE IS AGGRIEVED BY THE INITIATION OF R EASSESSMENT PROCEEDINGS AS WELL AS THE FINDINGS OF THE ASSESSIN G OFFICER IN THE AFORESAID REASSESSMENT ORDER AND HENCE, IT HAD PREF ERRED AN APPEAL BEFORE THE LD. CIT(APPEALS) AGAINST THE ACTION OF T HE ASSESSING OFFICER. I.T.A. NO. 1161/KOL./2013 ASSESSMENT YEAR: 2006-2007 & C.O. NO. 77/KOL/2013 (IN I.T.A. NO. 1161/KOL./2013) ASSESSMENT YEAR: 2006-2007 PAGE 3 OF 5 4. THE ASSESSEE CONTENDED BEFORE THE LD. CIT(APPEAL S) THAT DURING THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2006- 07 CLAIMED, INTER ALIA UNABSORBED DEPRECIATION ALLOWANCES UPTO THE ASSESSM ENT YEAR 1998-99 TO BE CARRIED FORWARD AND TO BE SET OFF IN THE FUTURE YEARS. THE TAX AUDIT REPORT FILED BY THE ASSESSEE BEFORE THE ASSESSING O FFICER FOR THE CAPTIONED ASSESSMENT YEAR ALSO DISCLOSED A DETAILED LIST OF T HE UNABSORBED DEPRECIATION ALLOWANCES TO BE CARRIED FORWARD AND T O BE SET OFF IN THE FUTURE YEARS. 5. THE LD. CIT(APPEALS) CONSIDERING ABOVE GRANTED R ELIEF TO THE ASSESSEE BY OBSERVING IN HIS IMPUGNED ORDER AS UNDE R:- APPEAL IS AGAINST THE DISALLOWANCE OF CARRY FORWAR D OF UNABSORBED DEPRECIATION OF RS.3,66,28,773/-. THE AO IN HIS ASSESSMENT ORDER HAS CLEARLY MENTIONED THAT UNABSOR BED DEPRECIATION FOR AY 1998-99 WAS TO BE CLAIMED/ SET OFF UPTO AY 2006-07 ONLY IT COULD NOT BE CARRIED FORWAR D AND SET OFF BEYOND THAT. DURING THE APPELLATE PROCEEDIN G THE AR HAS SUBMITTED A COPY OF THE ORDER OF THE JURISDICTI ONAL HONBLE KOLKATA TRIBUNAL IN THE CASE OF BENGAL TEA & FABRICS LTD. VS.- DCIT, CIRCLE-4, KOLKATA (ITA NO. 467/KOL/2012 DT. 26.07.2012) WHEREIN THE TRIBUNAL H AS CATEGORICALLY GIVEN ITS FINDING THAT THE ASSESSEE C OMPANY WOULD BE ENTITLED TO SET OFF UNABSORBED DEPRECIATIO N FOR THE AYS 1997-98, 1988-99 AGAINST THE INCOME OF AY 2 008- 09 (I.E. BEYOND THE AYS 2004-05/2005-06. THE HON'B LE KOLKATA TRIBUNAL HAS ALSO DISCUSSED, ANALYZED AND ACCEPTED THE PRINCIPLES OF THE DECISIONS OF HON'BLE KARNATAKA HIGH COURT IN THE CASE OF KARNATAKA COOPERATIVE MILK PRODUCERS FEDERATIONS LTD. VS. DCI T 53 DTR 81 (KARNATAKA) ON THE SAME ISSUE. I HAVE CONSID ERED THE FINDING OF THE A.O, IN THE ASSESSMENT ORDER DT. 16-12- 2011 AND THE WRITTEN SUBMISSION AND CASE LAWS FILED BY THE A.R. DURING THE APPELLATE PROCEEDING. I FIND THAT T HIS CASE IS SQUARELY COVERED BY THE KOLKATA TRIBUNAL'S DECIS ION IN THE CASE OF BENGAL TEA & FABRICS LTD. (SUPRA). THUS RESPECTFULLY FOLLOWING THE RATIO DECIDED BY THE JURISDICTIONAL APPELLATE TRIBUNAL, ASSESSEES APPEA L ON GROUND NO. 3 & 4 ARE ALLOWED. I.T.A. NO. 1161/KOL./2013 ASSESSMENT YEAR: 2006-2007 & C.O. NO. 77/KOL/2013 (IN I.T.A. NO. 1161/KOL./2013) ASSESSMENT YEAR: 2006-2007 PAGE 4 OF 5 BEING AGGRIEVED WITH THE ORDER OF LD. CIT(APPEALS), THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 6. AT THE TIME OF HEARING BEFORE US, THE LD. D.R. R ELIED ON THE ORDER OF ASSESSING OFFICER. ON THE OTHER HAND, LD. COUNSEL F OR THE ASSESSEE HAS RELIED ON THE ORDER OF LD. CIT(APPEALS). HE ALSO RE LIED ON THE DECISION DATED 11.05.2016 OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2004-05 IN ITA NO. 815/KOL/2013. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND ALSO PER USED THE RELEVANT MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE ISSU E UNDER CONSIDERATION IS SQUARELY COVERED BY THE DECISION DATED 11.05.201 6 OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2004-05 IN ITA NO. 815/KOL/2013, WHEREIN IT WAS HELD AS UNDER:- WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND ARE O F THE VIEW THAT IN THE LIGHT OF THE DECISION OF THE HONB LE GUJARAT HIGH COURT IN THE CASE OF GENERAL MOTORS INDIA PVT. LIMITED (354 ITR 244) (SUPRA), WHICH HAS THE EFFECT OF OVER RULING THE DECISION OF THE SPECIAL BENCH IN THE CASE OF TIMES GUARANTEE [40 SOT 14 (MUM.)(SB) (SUPRA) AND ALSO ON THE BASIS OF OTHER DECISIONS REFERRED BY THE ASSESSEE BEFORE CIT(A), T HE ORDER OF THE CIT(A) DOES NOT CALL FOR ANY INTERFERENCE. ACCO RDINGLY, THE APPEAL BY THE REVENUE IS DISMISSED. 8. AS THE ISSUE INVOLVED IN THE YEAR UNDER CONSIDER ATION AS WELL AS ALL THE MATERIAL FACTS RELEVANT THERETO IS SIMILAR TO A .Y. 2004-05, WE RESPECTFULLY FOLLOW THE DECISION OF THIS TRIBUNAL R ENDERED FOR THE SAID YEAR AND UPHOLD THE IMPUGNED ORDER OF THE LD. CIT(A PPEALS) DELETING THE DISALLOWANCE MADE BY THE ASSESSING OFFICER ON ACCOU NT OF CARRY FORWARD OF UNABSORBED DEPRECIATION. 9. THE CROSS OBJECTION OF THE ASSESSEE BEING C.O. N O. 77/KOL/2013 IS IN ON THE ASSUMPTION OF JURISDICTION AND VALIDITY O F REASSESSMENT PROCEEDINGS. AS WE HAVE ALREADY DECIDED THE ISSUE I N THE APPEAL FILED BY THE REVENUE ON MERITS IN FAVOUR OF THE ASSESSEE, WE DO NOT CONSIDER IT I.T.A. NO. 1161/KOL./2013 ASSESSMENT YEAR: 2006-2007 & C.O. NO. 77/KOL/2013 (IN I.T.A. NO. 1161/KOL./2013) ASSESSMENT YEAR: 2006-2007 PAGE 5 OF 5 NECESSARY TO ADDRESS THE GROUNDS RAISED IN THE C.O. HENCE, THE CROSS OBJECTION FILED BY THE ASSESSEE IS DISMISSED AS INF RUCTUOUS. 10. IN THE RESULT, THE APPEAL OF THE REVENUE AS WEL L AS THE CROSS OBJECTION OF THE ASSESESE BOTH ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON JUNE 22, 2016 . SD/- SD/- (M. BALAGANESH) (S.S. VISWANETHRA RAVI) ACCOUNTANT MEMBER JUDICIAL MEMBER KOLKATA, THE 22 ND DAY OF JUNE, 2016 COPIES TO : (1) DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-11, KOLKATA, P-7, CHOWRINGHEE SQUARE, KOLKATA-700 069 (2) M/S. EPCOS INDIA PVT. LIMITED, KULIA, KANCHARAPARA ROAD, KALYANI-741 251 (3) COMMISSIONER OF INCOME-TAX (APPEALS)-XII, KOLK ATA (4) COMMISSIONER OF INCOME TAX, KOLKATA (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.