Goodricke Group Limited, Kolkata V. DCIT, CIR-4, KOLKATA, Kolkata

ITA 1372/KOL/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 5007 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 8 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2016
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 16-06-2014
• Court: TRIBUNAL
• Department Lawyers: P N RAJENDRAN
• Keywords: Business income; Revised return
• Section: 143(3); 263

Judgement Text

I.T.A. NO 1 372/KOL./2014 ASSESSMENT YEAR: 2009-2010 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA A BENCH, KOLKATA BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER I.T.A. NO. 1372/KOL/ 2014 ASSESSMENT YEAR: 2009-2010 GOODRICKE GROUP LIMITED,........................... .........................APPELLANT CAMELLIA HOUSE, 14, GURUSADAY ROAD, KOLKATA-700 019 [PAN: AABCG 1614 Q] -VS.- DEPUTY COMMISSIONER OF INCOME TAX,................. ...............RESPONDENT CIRCLE-4, KOLKATA, AAYAKAR BHAWAN, P-7, CHOWRINGHEE ROAD, KOLKATA-700 069 APPEARANCES BY: SHRI P.N. RAJENDRAN, FCA & SHRI TANMOY DUTTA, FOR T HE ASSESSEE SHRI G. MALLIKARJUNA, CIT, D.R., FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : JANUARY 21, 2016 DATE OF PRONOUNCING THE ORDER : MARCH 11, 2016 O R D E R PER SHRI P.M. JAGTAP :- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF LD. COMMISSIONER OF INCOME TAX, KOLKATA-II, KOLKATA DAT ED 20.03.2014 PASSED UNDER SECTION 263 OF THE INCOME TAX ACT, 1961. 2. THE ASSESSEE IN THE PRESENT CASE IS A COMPANY, W HICH IS ENGAGED IN THE BUSINESS OF GROWING, MANUFACTURING AND SELLING OF TEA. THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION WAS ORIGINA LLY FILED BY IT ON 30.09.2009 DECLARING TOTAL INCOME OF RS.11,07,27,31 3/-. THEREAFTER A REVISED RETURN WAS FILED BY THE ASSESSEE ON 17.12.2 009 DECLARING TOTAL INCOME OF RS.13,17,48,375/-. IN THE ASSESSMENT COMP LETED UNDER SECTION 143(3) VIDE AN ORDER DATED 26.12.2011, THE TOTAL IN COME OF THE ASSESSEE WAS DETERMINED BY THE ASSESSING OFFICER AT RS.18,79 ,66,750/- AFTER MAKING CERTAIN ADDITIONS. THE RECORD OF THE SAID AS SESSMENT CAME TO BE I.T.A. NO 1 372/KOL./2014 ASSESSMENT YEAR: 2009-2010 PAGE 2 OF 3 EXAMINED BY THE LD. CIT AND ON SUCH EXAMINATION, HE FOUND THAT THE ASSESSEE HAS ADDED RS.81,54,987/- AS EXPENDITURE ON AGRICULTURAL INCOME, RS.5,00,000/- AS WEALTH TAX, RS.19,39,000/- AS LOSS ON TRADE INVESTMENT WRITTEN OFF AND RS.60,572/- UNDER THE HEAD PROVISI ON FOR DIMINUTION IN VALUE OF INVESTMENT WHILE COMPUTING THE COMPOSITE INCOME BEFORE MAKING APPORTIONMENT UNDER RULE 8 OF THE INCOME TAX RULES. ACCORDING TO HIM, THE CORRESPONDING RECEIPTS UNDER THE RESPEC TIVE HEADS RELATING TO THE SAID EXPENDITURE, HOWEVER, WERE NOT DEDUCTED BY THE ASSESSEE WHILE COMPUTING THE COMPOSITE INCOME. ACCORDING TO HIM, T HE SAID RECEIPTS NOT BEING DIRECTLY DERIVED FROM THE BUSINESS OF CULTIVA TION AND MANUFACTURING OF TEA WERE NOT ELIGIBLE FOR INCLUSION IN THE COMPO SITE INCOME AND RULE 8, THEREFORE, WAS NOT APPLICABLE IN RESPECT OF THE SAI D RECEIPTS. HE ACCORDINGLY TREATED THE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3) ON THIS ISSUE TO BE ERRONEOUS AS WELL AS PREJUDICIAL TO THE INTEREST OF THE REVENUE AND SETTING ASIDE TH E SAME, THE ASSESSING OFFICER WAS DIRECTED BY HIM (1) TO EXAMINE AND NATU RE THE SOURCE OF RECEIPTS UNDER THE RELEVANT HEADS, (2) TO EXAMINE I MMEDIATE SOURCE OF SUCH RECEIPTS, WHETHER THEY ARE DIRECTLY DERIVED FR OM CORE ACTIVITIES OF CULTIVATION AND MANUFACTURING OF TEA OR NOT AND (3) TO EXAMINE THE APPLICABILITY OF RULE 8D IN RESPECT OF THE AFORESAI D RECEIPTS. AGGRIEVED BY THE ORDER OF THE LD. CIT UNDER SECTION 263, THE ASS ESSEE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. 3. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. AS POINTED O UT BY THE LD. COUNSEL FOR THE ASSESSEE FROM THE COMPUTATION OF TOTAL INCO ME OF THE ASSESSEE FILED ALONG WITH THE RETURN OF INCOME (COPY PLACED AT PAGE NO. 45 & 46 OF THE PAPER BOOK), THE ASSESSEE AFTER HAVING ADDED TH E AMOUNT OF EXPENDITURE ON AGRICULTURAL INCOME, WEALTH TAX, LOS S ON TRADE INVESTMENT WRITTEN OFF AND PROVISION FOR DIMINUTION IN VALUE O F INVESTMENT, HAD DEDUCTED THE CORRESPONDING INCOME IN THE FORM OF SU NDRY RECEIPTS INCLUDING AGRICULTURAL INCOME AMOUNTING TO RS.1,70, 72,888/- AND PROVISION FOR DIMINUTION IN VALUE OF INVESTMENT OFF ERED FOR TAXATION IN I.T.A. NO 1 372/KOL./2014 ASSESSMENT YEAR: 2009-2010 PAGE 3 OF 3 EARLIER YEARS AMOUNTING TO RS.20,00,000/- WHILE COM PUTING THE COMPOSITE BUSINESS INCOME ELIGIBLE FOR 40% DEDUCTION AS PER R ULE 8 OF THE INCOME TAX RULES AND THIS POSITION CLEARLY EVIDENT FROM TH E RELEVANT COMPUTATION OF INCOME HAS NOT BEEN DISPUTED EVEN BY THE LD. D.R . IT IS THUS CLEAR THAT THE COMPOSITE INCOME WAS COMPUTED BY THE ASSESSEE I N ACCORDANCE WITH RULE 8 OF THE INCOME TAX RULES AFTER DULY DEDUCTING THE CORRESPONDING RECEIPTS RELATING TO THE OTHER EXPENDITURE SUCH AS AGRICULTURE, WEALTH TAX, LOSS ON TRADE INVESTMENT WRITTEN OFF, PROVISION FOR DIMINUTION IN VALUE OF INVESTMENT, ETC., WHICH WERE NOT ELIGIBLE TO BE PAR T OF COMPOSITE INCOME AND THERE WAS NO ERROR IN THE ORDER OF THE ASSESSIN G OFFICER ACCEPTING THE SAME WHILE COMPLETING THE ASSESSMENT UNDER SECTION 143(3) CALLING FOR REVISION UNDER SECTION 263 BY THE LD. CIT. WE, THER EFORE, SET ASIDE THE IMPUGNED ORDER PASSED BY THE LD. CIT UNDER SECTION 263 ON THIS ISSUE AND RESTORE THAT OF THE ASSESSING OFFICER PASSED UNDER SECTION 143(3). 4. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON MARCH 11, 201 6. SD/- SD/- (S.S. VISWANETHRA RAVI) (P.M. JAGTAP) JUDICIAL MEMBER ACCOUNTANT MEMBER KOLKATA, THE 11 TH DAY OF MARCH, 2016 COPIES TO : (1) GOODRICKE GROUP LIMITED, CAMELLIA HOUSE, 14, GURUSADAY ROAD, KOLKATA-700 019 (2) DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-4, KOLKATA, AAYAKAR BHAWAN, P-7, CHOWRINGHEE ROAD, KOLKATA-700 069 (3) COMMISSIONER OF INCOME TAX, KOLKATA-II, KO LKATA (4) THE DEPARTMENTAL REPRESENTATIVE (5) GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.