Sh. Vipin Gupta, Solan V. DCIT, Parwanoo

ITA 135/CHANDI/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 6597 (ITAT-CHANDIGARH)
• Duration Of Justice: 10 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-11-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 16-01-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: CHANDER KANTASR
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES, SMC, CHANDIGARH BEFORE MS. DIVA SINGH, JUDICIAL MEMBER ITA NO.135/CHD/2017 ASSESSMENT YEAR : 2012-13 SHRI VIPIN GUPTA, VS. THE DCIT, PROP. M/S JAYANTI POLYMERS IND. CIRCLE, DIC INDUSTRIAL AREA, PLOT NO. 30, PARWANOO. BADDI, DISTT. SOLAN, (HP). PAN NO. ABXPG0206E (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MANOJ KUMAR RESPONDENT BY : SMT. CHANDER KANTA,SR.DR DATE OF HEARING : 10.10.2017 DATE OF PRONOUNCEMENT : 28.11.2017 ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE ASSAILIN G THE CORRECTNESS OF THE ORDER OF THE CIT(A) FARIDABAD DATED 13.10.2016 PERTAINING TO 2012-13 ASSESSMENT YEAR ON THE FOLLOWING GROUNDS : 1. THE ID. CIT(A) IS WRONG IN CONFIRMING THE ADDITION OF RS. 25,95,965/- BY RESTRICTING THE DEDUCTION U/S 80IC TO THE EXTENT OF 25% AS AGAI NST 100% OF DEDUCTION DENYING THE BENEFIT OF SUBSTANTIAL EXPANSION U/S 80IC, WITHOUT APPRECIATING THE COVERED MATTER IN THE CASE OF ACIT CIRCLE 3(1). CHANDIGARH VS M/S IND O FARMA EQUIPMENT LTD. ITA NO. 661/CHD/2014 DATED 19.06.2015 ADJUDICATED B Y HON'BLE JURISDICTIONAL CHANDIGARH BENCH WHEREIN IT WAS HELD THAT THE EXIST ING UNDERTAKING FOR THE PURPOSE OF SUBSTANTIAL EXPANSION U/S 80IC WOULD MEAN THE UN DERTAKING WHICH WAS EXISTING ON THE DATE OF INTRODUCTION OF SECTION 80IC I.E. 01.04 .2004. 2. WITHOUT PREJUDICE TO GROUND NO. 1, THE ID. CIT(A) I S FURTHER WRONG IN TREATING THE RELEVANT YEAR AS 10 TH A.Y. OF DEDUCTION U/S 80IC INSTEAD OF 6 TH A.Y. OF DEDUCTION U/S 80IC, AS THE PERIOD OF EARLIER DEDUCTION U/S 80 IB CLAIMED BY THE ASSESSEE IN THE STATE OF HIMACHAL PRADESH IS NOT TO BE INCLUDED WHI LE CALCULATING THE OVERALL LIMIT OF 10 YEARS OF DEDUCTION U/S 80IC(6). 2. THE LD. AR SUBMITTED THAT IN THE FACTS OF THE PRESENT CASE, THE ORDER OF THE ITAT FOLLOWED BY THE CIT(A) IS INCORRECT ON FACTS. THE LD. AR WAS REQUIRED TO CLARIFY WHETHER ANY MISCELLANEOUS APPLICATIO N HAS BEEN FILED AGAINST THE SAID ORDER. THE LD. AR SUBMITTED THAT A M ISCELLANEOUS APPLICATION HAD BEEN FILED. ON READING FROM THE ORDER-SHEE T DATED 23.05.2017, IT WAS NOTICED THAT THE SAID CLAIM HAD BEEN MA DE EARLIER ALSO AND HE WAS REQUIRED TO SHOW WHETHER ORDER OF THE ITAT IN 2010-11 ASSESSMENT YEAR FOLLOWED BY THE CIT(A) IN THE PRESENT PR OCEEDINGS HAS BEEN UPSET IN THE MISCELLANEOUS APPLICATION FILED. THE LD. AR IN REPLY ITA 135/CHD/2017 A.Y. 2012-13 PAGE 2 OF 3 SUBMITTED THAT THE SAID ORDER HAS BEEN CHALLENGED BEFORE THE HON'BLE HIGH COURT. THE LD. AR WAS REQUIRED TO ADDRESS HOW THE ISSUE IS STATED TO BE ASSAILED IN MISCELLANEOUS APPLICATION BEFORE THE ITAT AND ALSO AT THE SAME TIME IS SUBJECT MATTER OF APPEAL BEFORE THE HO N'BLE HIGH COURT. THE LD. AR WAS NOT ABLE TO PLACE ANY FACTS OR ADV ANCE ANY SUBMISSIONS THEREON. IN THESE PECULIAR FACTS AND CIRCUMST ANCES, IT IS DEEMED APPROPRIATE TO DISMISS THE REQUEST FOR TIME AS TH E ORDER INN THE CASE OF THE ASSESSEE ON IDENTICAL FACTS AND PROVISIONS IS A LREADY AVAILABLE ON RECORD IN THE IMMEDIATELY PROCEEDING ASSESSME NT YEAR WHICH HAS BEEN RELIED UPON BY THE REVENUE AND HAS NOT BEEN UPSET AS ON DATE BY ANY FORUM. IN THE CIRCUMSTANCES THE REQUES T FOR THE TIME WITHOUT DEMONSTRATING THE CLAIM OF FILING OF M.A. AGAINST THE ORDER DESPITE MORE THAN SUFFICIENT TIME IS FOUND TO BE WITHOUT ANY BASIS. AS AND WHEN SAID ORDER IS UPSET, THE APPROPRIATE LEGAL REME DIES AVAILABLE TO THE ASSESSEE CAN BE BROUGHT TO THE NOTICE OF THE B ENCH OR THE TAX DEPARTMENT AS DEEMED APPROPRIATE. 3. THE RECORD SHOWS THAT THE ASSESSEE IS STATED TO B E DERIVING INCOME FROM MANUFACTURING OF SPECIFIC PACKING MATERIAL. THE A SSESSEE WAS FOUND TO HAVE CLAIMED 100% DEDUCTION U/S 80IB ON TH E BASIS OF COMMENCEMENT OF OPERATIONS/ACTIVITY OF HIS BUSINESS W.E.F. 10 .01.2003 I.E. FROM THE ASSESSMENT YEAR 2003-04 AS THE INITIAL ASSES SMENT YEAR. THE SAID FIVE YEARS PERIOD COMPLETED IN 2007-08 ASSESSME NT YEAR. THE YEAR UNDER CONSIDERATION BEING 2012-13 WHEREIN IT IS NOTE D THAT ON SIMILAR FACTS AND CIRCUMSTANCES, THE CO-ORDINATE BENCH DISM ISSED THE CLAIM OF THE ASSESSEE IN 2011-12 ASSESSMENT YEAR WHICH FA CT HAS BEEN TAKEN COGNIZANCE OF IN PARA 5 OF THE IMPUGNED ORDER A ND THE ISSUE CHALLENGED IN GROUND NO. 2 HAS BEEN TAKEN NOTE OF IN PARA 6. IN THE LIGHT OF THE SUBMISSIONS WHERE THE EARLIER ORDER OF THE IT AT TILL DATE HAS NOT BEEN UPSET BY ANY HIGHER FORUM IN APPEAL OR THE IT AT IN A MISCELLANEOUS APPLICATION, THE IMPUGNED ORDER IS UPHELD. THE FOLLOWING FINDINGS OF THE CIT(A) IN THE FACTS AS THEY STAND SHO W NO INFIRMITY : 5.1 I HAVE CAREFULLY CONSIDERED THE SUBMISSION OF AR OF THE APPELLANT AND PURSUED THE ORDER PASSED BY THE AO AND FOUND THAT T HE SAID ISSUE UNDER CONSIDERATION IN THIS APPEAL HAS ALREADY BEEN ADJUD ICATED UPON BY THE JURISDICTIONAL TRIBUNAL IN THE CASE OF M/S HYCRON E LECTRONICS VS ITO IN ITA NO. 798/CHD/2012 AND OTHER RELATED CASES. THE HON'BLE I TAT WHILE CONSIDERING THE ISSUE, AT-HAND IN THE CASE OF M/S HYCRON ELECTRONICS VS (T O AND OTHERS HAS HELD THE MATTER IN THE FAVOUR OF THE DEPARTMENT. THE OPERATIVE PART OF THE JUDGMENT IS AS UNDER: ITA 135/CHD/2017 A.Y. 2012-13 PAGE 3 OF 3 48. THE CAREFUL READING OF THE FORM IN A SERIAL ORD ER WOULD CLEARLY SHOW THAT THE ASSESSEE IS REQUIRED TO INFORM THE LOCATION OF THE INDUSTRY AND COLUMN (C) SPECIFICALLY ASK THE ASSESSEE TO STATE WHETHER BUSI NESS IS A NEW BUSINESS? COLUMN (D) CLEARLY ASK THE ASSESSEE WHETHER EXISTIN G BUSINESS HAS UNDERTAKEN SUBSTANTIAL EXPANSION, THEREFORE, THERE ARE TWO CAT EGORIES OF BUSINESS AND SUBSTANTIAL EXPANSION IS POSSIBLE ONLY IN CASE OF E XISTING BUSINESS. IN OUR OPINION, THE LD. OT(A) HAS CORRECTLY ADJUDICATED TH IS ISSUE. '49. IN VIEW OF THE ABOVE DETAILED DISCUSSION WE HO LD THAT THE ASSESSEE BEFORE US I.E. M/S HYCRON ELECTRONICS IN ITA NO. 798/CHD/2 012 IS ENTITLED TO ONLY 25% OF DEDUCTION DURING THE PRESENT YEAR BECAUSE TH E ASSESSEE HAS ALREADY AVAILED THE PERIOD OF FULL DEDUCTION @ 100% IN THE EARLIER FIVE YEARS I.E. FROM ASSESSMENT YEARS 2004-05 TO 2008-09. IN THIS BACKGR OUND, WE FIND NOTHING WRONG WITH THE ORDER OF LD. C IT(A) AND WE UPHOLD T HE SAME. ACCORDINGLY, ASSESSEE'S APPEAL IS DISMISSED. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISSED. ' 5.1.2 THE APPELLANT'S OWN CASE FOR A.Y. 2010-11 WAS PART OF THE ABOVE MENTIONED CASE. IT MEANS THE APPELLANT'S CASE FOR A.Y. 2010-11 HAS ALREADY BEEN DISMISSED BY THE JURISDICTIONAL ITAT ON THIS ISSUE. HENCE, THE ABOVE FINDINGS OF TH E HON'BLE ITAT COVER ALL THE SUBMISSIONS MADE BY THE APPELLANT IN THE PRESENT CASE ALSO. RES PECTFULLY, FOLLOWING THE SAME, THE ORDER OF THE ASSESSING OFFICER IS UPHELD AND THE APPEAL O F THE APPELLANT ON THIS GROUND IS DISMISSED. 6. GROUND NO. 2: THIS GROUND DEALS WITH THE FACT TH E AO HAS TREATED THE RELEVANT YEAR AS 10 TH YEAR OF DEDUCTION U/S 80IC INSTEAD OF 6 TH AS CLAIMED BY THE APPELLANT DESPITE THE FACT THAT THE APPELLANT HAD NEVER CLAIMED ANY DEDUCTION U/S 8 0IC EARLIER TO A.Y. 2007-08 BECAUSE THE APPELLANT HAD CLAIMED DEDUCTION U/S 80IB AND NOT 80 IC. 6.2 I HAVE CONSIDERED THE SUBMISSIONS OF THE APP ELLANT AND THE ORDER OF THE AO AND FOUND THAT THE BONE OF CONTENTION BETWEEN THE APPELLANT A ND THE AO WAS ON ACCOUNT OF INTERPRETATION OF PROVISIONS OF TWO SECTIONS I.E. 8 0IC AND 801B OF THE ACT. HENCE FOR CLARITY RELEVANT PROVISIONS OF BOTH THE SECTIONS AR E REPRODUCED AS BELOW:- ' 2 ND PROVISO TO SUB-SECTION (4) OF 80-UP:- PROVIDED ALS O THAT NO DEDUCTION UNDER THIS SUB-SECTION SHALL BE ALLOWED FOR THE ASSESSMENT YEA R BEGINNING ON THE 1ST DAY OF APRIL, 2004 OR ANY SUBSEQUENT YEAR TO ANY UNDERTAKING OR E NTERPRISE REFERRED TO IN SUB-SECTION (2) OF SECTION 80-IC: 80-IC(6) NOTWITHSTANDING ANYTHING CONTAINED IN THI S ACT, NO DEDUCTION SHALL BE ALLOWED TO ANY UNDERTAKING OR ENTERPRISE UNDER THIS SECTION, WHERE THE TOTAL PERIOD OF DEDUCTION INCLUSIVE OF THE PERIOD OF DEDUCTION UNDE R THIS SECTION, OR UNDER THE SECOND PROVISO TO SUB-SECTION (4) OF SECTION 80-IB OR UNDE R SECTION 10C AS THE CASE MAY BE, EXCEEDS TEN ASSESSMENT YEARS.' 4. BEING SATISFIED BY THE REASONING AND FINDING THEREON, THE APPEAL OF THE ASSESSEE IS DISMISSED. THE ORDER WAS PRONOUNCED IN THE OPEN COURT OF THE TIME OF HEARING ITSELF. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 28.11. 2017. 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.