M/S. AIMS IMPEX P. LTD., MUMBAI V. ITO - 3(1)(1), MUMBAI

ITA 1245/MUM/2007

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 55501 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 8 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-10-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 08-09-2010
• Assessment Year: 2002-2003
• Appeal Filed On: 09-02-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: PARSHASARTHI NAIR
• Keywords: Reassessment proceedings

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, A BENCH, MUMBAI. BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER AND SHRI VIJAY PAL RAO, JUDICIAL MEMBER I.T.A NO.1245/ MUM/2007 ASSESSMENT YEAR: 2002-03 AIMS IMPEX P.LTD. .. APPELLANT DEHBANOO MANSION, NEXT TOKALATRI MANGAL KATRALAYA, NASIK PUNE HIGHWAYS, NASIK ROAD-422 101. PA NO. AAACA 3781 A VS INCOME TAX OFFICER 11(2)(4) .. RESPONDEN T AAYAKAR BHAVAN, M.K. ROAD, MUMBAI. APPEARANCES: VIJAY MEHTA, FOR THE APPELLANT PARSHASARTHI NAIR , FOR THE RESPONDENT DATE OF HEARING : 11.8.2011 DATE OF PRONOUNCEMENT : 12 -10-2011 O R D E R PER PRAMOD KUMAR: 1. THIS APPEAL, FILED BY THE ASSESSEE IS DIRECTED AGAINST CIT(A)S ORDER DATED 4.9.2006 . IN THE MATTER OF ASSESSMENT UNDER SECTION 14 3(3) OF THE INCOME TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2002-03. I.T.A NO.1245/ MUM/2007 ASSESSMENT YEAR: 2002-03 2 2. BY WAY OF LETTER DATED 5 TH JANUARY, 2011,THE ASSESSEE HAS SOUGHT TO RAISE THE FOLLOWING GROUNDS OF APPEAL: 1.ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT(A) - ERRED IN CONFIRMING THE ACTION OF THE AO IN DISALLOW ING THE CLAIM OF THE APPELLANT OF WRITE OFF OF ADVANCE LICENSES OF RS.25,5 6,268 PERTAINING TO AY 1996-97 ON THE GROUND THAT THE CONDITION PRESCRIBED U/S.36(2) IS NOT SATISFIED. - WAS NOT JUSTIFIED IN DISALLOWING THE CLAIM OF THE APP ELLANT THAT THE AMOUNT OF ADVANCE LICENSES OF RS.25,56,268 WAS OFFERED TO TAX ON ACCRUAL BASIS IN AY 1996-97, THUS FULFILLING THE CONDITIONS LAID DOWN U/S.3692) AND THE DISALLOWANCE OF THE CLAIM OF WRITE OFF OF THE LICENSE WHICH ARE ULTIMATELY NOT RECEIVED IS NOT JUSTIFIED. - WAS NOT JUSTIFIED IN CONFIRMING THE DISALLOWANCE WITHO UT APPRECIATING THAT THIS WOULD AMOUNT TO DOUBLE TAXATION OF THE SAME INCO ME, ONCE IN AY 1996-97 ON ACCRUAL BASIS AND AGAIN IN AY 2002-03 BY D ISALLOWING THE CLAIM OF THE APPELLANT OF WRITE OFF OF ADVANCE LICE NSE. - FAILED TO APPRECIATE THAT MERELY BECAUSE THE APPELLA NT CLAIMED THE DEDUCTION U/S.80 HHC, IT CANNOT BE SAID THAT THE AMOU NT WAS NOT OFFERED TO TAX AND CONDITION LAID DOWN IN SEC.36(2) IS NOT FU LFILLED. - WITHOUT PREJUDICE TO THE ABOVE, SHOULD HAVE ALLOWED THE CLAIM OF THE APPELLANT AS BUSINESS LOSS U/S.37(1) OF THE ACT. 3. LEARNED COUNSEL FOR THE ASSESSEE FAIRLY ADMITS THAT TH ESE GRIEVANCES WERE NOT RAISED BEFORE THE AUTHORITIES BELOW, BUT CONTENDS THAT THE ASSESSEES FAILURE TO DO SO DOES NOT AFFECT HIS LEGAL RIGHTS TO RAISE THE ABOVE LE GAL PLEAS BEFORE THE TRIBUNAL. RELIANCE IS PLACED ON HONBLE SUPREME COURT JUDGMENT IN THE CASE OF NTPC VS. CIT, (229 ITR 383 )AND JUTE CORPORATION OF INDIA VS CIT,( 187 ITR 668) AS ALSO HONBLE BOMBAY HIGH COURT (FB) DECISION IN THE CASE OF AHMEDA BAD ELECTRICITY CO. LTD. V CIT(199 ITR 351). LEARNED COUNSEL FURTHER SUBMITS TH AT THE ADDITIONAL GROUND OF APPEAL, ON MERITS, IS COVERED IN FAVOUR OF THE ASSESSEE BY HONBLE BOMBAY HIGH COURTS JUDGMENT IN THE CASE OF CIT VS. JET AIRWAYS IN D LTD (195 TAXMAN 1170, WHEREIN, THEIR LORDSHIPS HAVE HELD THAT WHERE ASSESSING O FFICER DOES NOT MAKE ADDITION IN RESPECT OF THE INCOME IN RESPECT OF WHICH REASSESSMENT PROCEEDINGS ARE RESORTED TO, HE IS DEEMED OF POWERS TO MAKE ADDITION I N RESPECT OF ANY OTHER INCOME AS WELL. I.T.A NO.1245/ MUM/2007 ASSESSMENT YEAR: 2002-03 3 4. LEARNED DEPARTMENTAL REPRESENTATIVE OPPOSES THE ADM ISSION OF THIS ADDITIONAL GROUND OF APPEAL AND SUBMITS THAT EVEN IF ADDITIONAL GROUND IS ADMITTED, THE MATTER SHOULD BE SENT BACK TO THE CIT(A) FOR FRESH CONSIDERATION. WITHOUT PREJUDICE TO THIS STAND, HE FURTHER MAKES SUBMISSIONS ON MERITS, WHICH, FOR THE REASONS, WE WILL SET OUT, ARE NOT NECESSARY TO DEAL WITH . 5. HAVING REGARD TO THE RIVAL SUBMISSIONS AND THE MATER IAL ON RECORD, WE DEEM IT FIT AND PROPER TO ADMIT THE ADDITIONAL GROUND ON ME RITS. HOWEVER, WE ARE OF THE CONSIDERED VIEW THAT SINCE THIS ASPECT OF THE MATTER HA S NOT BEEN EXAMINED BY THE AUTHORITIES BELOW, IT WOULD BE APPROPRIATE TO LET TH E CIT(A) EXAMINE THE MATTER AFRESH IN THE LIGHT OF WHATEVER SUB MISSIONS THE ASSESSEE MA Y LIKE TO MAKE AGAINST LEGALITY OF REASSESSMENT PROCEEDINGS AND AS TO HOW THE AD DITION MADE DURING THE COURSE OF REASSESSMENT PROCEEDINGS, EVEN THOUGH IN RESPECT OF DEDUCTION U/S. 80 HHC, ARE NOT COVERED BY THE SCOPE OF REASONS FOR WHIC H REASSESSMENT WAS RESORTED TO. ALL THESE ASPECTS WILL REMAIN OPEN TO ADJUDICATIO N BY THE CIT(A). WHILE DOING SO, THE CIT(A) WILL GIVE A DUE AND FAIR OPPORTUNITY OF HEARING TO THE ASSESSEE AND DECIDE THE MATTER BY WAY OF A SPEAKING ORDER. TO THIS EXTEN T, CHALLENGING TO VALIDITY OF IMPUGNED ASSESSMENT STANDS REMITTED TO THE FILE OF THE CI T(A). 6. AS WE HAVE REMITTED THE LEGAL ISSUE ABOUT VALIDITY OF IMPUGNED ASSESSMENT ORDER, ON THE ABOVE LEGAL GROUND TO THE CIT(A), WE SEE NO NEED TO DEAL WITH MERITS OF THE CASE AT THIS STAGE. 7. IN THE RESULT, APPEAL IS ALLOWED FOR STATISTICAL PUR POSES IN THE TERMS INDICATED ABOVE. PRONOUNCED IN THE OPEN COURT ON 12 TH OCTOBER, 2011 SD/- (VIJAY PAL RAO) JUDICIAL MEMBER SD/- (PRAMOD KUMAR) ACCOUNTANT MEMBER MUMBAI, DATED 12 TH OCTOBER, 2011 PARIDA I.T.A NO.1245/ MUM/2007 ASSESSMENT YEAR: 2002-03 4 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS),XXVII, MUMBAI 4. COMMISSIONER OF INCOME TAX, CITY-III , MUMBAI 5. DEPARTMENTAL REPRESENTATIVE, BENCH A MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI