M/s. Damasha Stamping, Ahmedabad V. The Jt.CIT, Range-12, Ahmedabad

ITA 1261/AHD/2015

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 7885 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 4 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-09-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 11-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: K P SINGH
• Keywords: Principle of natural justice
• Section: 143(3); 80IB

Judgement Text

ITA NO. 1261/AHD/2015 DAMASHA STAMPING VS. JCIT ASSESSMENT YEAR: 2010-11 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD SMC BENCH, AHMEDABAD [CORAM: PRAMOD KUMAR AM AND MAHAVIR PRASAD JM] ITA NO. 1261/AHD/2015 ASSESSMENT YEAR: 2010-11 DAMASHA STAMPING ..................APPELLAN T C/O. ISHWARLAL & CO, OPP. VISHWA VIDHYALAYA SCHOOL, BABUPURA, ASARWA, AHMEDABAD [PAN : AADFD 3291 M] VS. JCIT, RANGE-12, ...........................RESPONDENT AHMEDABAD APPEARANCES BY: KP SINGH, FOR THE APPELLANT JAMES KURIAN, FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : 19.06.2018 DATE OF PRONOUNCING THE ORDER : 14.09.2018 O R D E R PER PRAMOD KUMAR, AM: 1. BY WAY OF THIS APPEAL, THE ASSESSEE-APPELLANT HA S CHALLENGED CORRECTNESS OF THE LEARNED CIT(A)S ORDER DATED 21.01.2015 IN THE MATT ER OF ASSESSMENT UNDER SECTION 143(3) OF THE INCOME-TAX ACT, 1961, FOR THE ASSESSM ENT YEAR 2010-11. 2. GRIEVANCES RAISED BY THE APPELLANT, AS SET OUT I N THE MEMORANDUM OF APPEAL, ARE AS FOLLOWS:- 1. THE ORDER PASSED U/S 250 ON 20/01/2015 FOR A.Y . 2010-11 BY CIT(A) -6, AHMEDABAD, CONFIRMING THE IMPUGNED DISALLOWANCES BY THE AO OF THE APPELLANT'S CLAIM OF PARTNER'S REMUNERATION IS WHOL LY ILLEGAL, UNLAWFUL AND AGAINST THE PRINCIPLES OF NATURAL JUSTICE. 2. (I) THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW, THE LEARNED CIT (A) ERRED IN CONFIRMING THE ALLOWANCE O F PARTNER'S REMUNERATION U/S. 40(B) OF RS. 36,00,000/- AS AGAIN ST APPELLANT'S CLAIM OF PARTNER'S REMUNERATION OF RS. 46,44,890/- COMPUTED AFTER DISALLOWING CLAIM OF RS. 9,73,424/- U/S 80 IB(3). (II) THE LEARNED CIT(A) HAS GRIEVOUSLY ERRED IN LAW AND ON FACTS IN CONFIRMING COMPUTATION OF THE BOOK PROFIT BY THE A. O. WITHOUT FOLLOWING THE MANNER LAID DOWN IN CHAPTER IV-D AS P RESCRIBED BY EXPLANATION 3 TO SEC. 40 (B). ITA NO. 1261/AHD/2015 DAMASHA STAMPING VS. JCIT ASSESSMENT YEAR: 2010-11 PAGE 2 OF 3 3. TO ADJUDICATE ON THIS APPEAL, IT IS SUFFICIENT T O TAKE NOTE OF THE FACT THAT THERE WAS NO DISCUSSION, ON THE ISSUE IN APPEAL BEFORE US, BY THE ASSESSING OFFICER AS THE ASSESSEE HAD, AFTER ACCEPTING DISALLOWANCE OF RS.9, 73,424/- UNDER SECTION 80IB, DID NOT SEEK ENHANCEMENT OF DEDUCTION UNDER SECTION 40(B). IN APPEAL BEFORE THE CIT(A), THE DISALLOWANCE WAS CONFIRMED ON THE BASIS OF FOLLOWIN G REASONING:- 3.3 IN THE ASSESSMENT ORDER THERE IS NO DISCUSSIO N ON THE ISSUE. AS SEEN FROM PARA 3 OF THE ASSESSMENT ORDER, APPELLANT HAD CONCE DED THAT IT WAS NOT ELIGIBLE FOR CLAIMING DEDUCTION U/S 80IB AND ACCORDINGLY THE DEDUCTION CLAIMED OF RS.9,73,424/- WAS DISALLOWED. APPELLANT HAD NOT MAD E ANY CLAIM FOR ENHANCED DEDUCTION U/S 40(B). THEREFORE I AM OF THE VIEW THA T THIS ISSUE IS NOT ARISING OUT OF THE ASSESSMENT ORDER. IN OTHER WORDS THE RELEVANT F ACTS RELATING TO THIS GROUND OF APPEAL ARE NOT EMANATING FROM THE RECORD. HENCE GRO UND NO. 1 AND 2 CANNOT BE ENTERTAINED. FOR THE SAME REASON THE ADDITIONAL GRO UND OF APPEAL IS NOT ADMITTED. THESE GROUNDS ARE DISMISSED IN LIMINE. EVEN ON MERITS APPELLANT IS NOT ENTITLED TO ANY ENH ANCEMENT OF DEDUCTION U/S 40(B). BY APPELLANT'S OWN ADMISSION IN WRITTEN SUBMISSION, THE ENTRIES MADE IN THE BOOKS OF ACCOUNTS WERE ONLY TO THE EXTENT OF RS.36 LACS (AND NOT RS.46,44,890/-). NO SUCH ENHANCED REMUNERATION WAS PAID OR PAYABLE TO THE PARTNERS OF THE APPELLANT FIRM. THEREFORE EVEN ON M ERITS THESE GROUNDS OF APPEALS ARE TO BE DISMISSED. 4. AGGRIEVED, ASSESSEE IS IN FURTHER APPEAL BEFORE US. 5. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE AP PLICABLE LEGAL POSITION. 6. WE HAVE NOTED THAT ONE OF THE CONTENTIONS RAISED BY THE ASSESSEE BEFORE THE CIT(A), BY WAY OF AN ADDITIONAL GROUND OF APPEAL, W AS AS FOLLOWS:- WITHOUT PREJUDICE TO THE ORIGINAL GROUND OF APPEAL NO. 2, THE APPELLANT HAS TAKEN FOLLOWING ADDITIONAL GROUND OF APPEAL: (1) IF PARTNER'S REMUNERATION OF RS.46,44,890 HAS N OT BEEN ALLOWED ON THE GROUND THAT THE APPELLANT FIRM HAD CLAIMED PARTNER' S REMUNERATION ONLY OF RS.36,00,000 AS PER RETURN OF INCOME, THE CLAIM OF RS. 10,44,890 SHALL BE CONSIDERED AS AN ADDITIONAL CLAIM ALLOWABLE AS PER THE PROVISIONS OF THE ACT. (CIT V/S PRUTHVY BROKERS AND SHAREHOLDERS P. LTD. 3 49 ITR 336 (BOM)) 7. WE HAVE ALSO NOTED THAT THE ASSESSING OFFICER HA D NO OCCASION TO CONSIDER OR EXAMINE THE MATTER ON MERITS. IT WAS ONLY ON ACCOU NT OF DEVELOPMENTS DURING THE ASSESSMENT PROCEEDINGS, I.E. DISALLOWANCE UNDER SEC TION 80IB HAVING BEEN ACCEPTED BY THE ASSESSEE, THAT THE QUESTION OF ADDITIONAL CLAIM UNDER SECTION 40(B) BECAME RELEVANT. LEARNED CIT(A) HAS DEALT WITH THE MERITS IN A VERY CASUAL WAY WITHOUT ADDRESSING HIMSELF TO THE ARGUMENTS OF THE ASSESSEE IN SUFFICI ENT DETAILS. IN THESE CIRCUMSTANCES, IN OUR CONSIDERED VIEW, THE RIGHT COURSE OF ACTION FOR US WILL BE REMIT THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR ADJUDICATION ON MERITS , BY WAY OF A SPEAKING ORDER, IN ACCORDANCE WITH THE LAW AND AFTER GIVING YET ANOTHE R OPPORTUNITY OF HEARING TO THE ASSESSEE. ITA NO. 1261/AHD/2015 DAMASHA STAMPING VS. JCIT ASSESSMENT YEAR: 2010-11 PAGE 3 OF 3 8. IN VIEW OF THE ABOVE DISCUSSIONS, THE MATTER IS REMITTED TO THE FILE OF THE CIT(A) FOR FRESH ADJUDICATION IN THE LIGHT OF ABOVE OBSERV ATIONS. ORDERED, ACCORDINGLY. 9. IN THE RESULT, APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT TODAY ON THE 14 TH SEPTEMBER, 2018 SD/- SD/- MAHAVIR PRASAD PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) AHMEDABAD, THE 14 TH DAY OF SEPTEMBER, 2018 **BT COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD 1. DATE OF DICTATION: ..........AS PER 4 PAGES MAN USCRIPTS OF HONBLE AM..WHICH ARE ATTACHED...14.9.1 8. 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: .. 14.9.18 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR . P.S./P.S.: ...14.9.18 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: 14.9.18. 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK : . 14.9.18 . 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK : . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER : . 8. DATE OF DESPATCH OF THE ORDER: ......