Sulzon Windfarm Services Ltd.,(Now known as Sulzon Infrastructure Services Ltd.,), Pune V. Addl. CIT, Range-6, Pune, Pune

ITA 1379/PUN/2009

• Counselvise Citation: 137924514 RSA 2009
• Duration Of Justice: 1 year(s) 5 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-05-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 04-12-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T CHACKO MANI
• Assessee Lawyers: SANJAY N KAP ADIA
• Keywords: Opportunity of being heard; Deemed to accrue or arise in india
• Section: 115JB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER AND SHRI G.S. PANNU, ACCOUNTANT MEMBER I.T.A. NO. 1379/PN/2009 (ASSTT. YEAR: 2006-07) SUZLON WINDFARM SERVICES LTD., (NOW KNOWN AS SUZLON INFRASTUCTURE SERVICES LTD.,) 5 TH FLOOR, GODREJ MILLENIUM BUILDING 9 KOREGAON PARK, PUNE-411 001 PAN AADC 0451 M .. APPELLANT VS. ASSTT. CIT RANGE 6, PUNE .. RE SPONDENT APPELLANT BY: SHRI SANJAY N. KAP ADIA RESPONDENT BY: SHRI T. CHACKO MANI ORDER PER G.S. PANNU, AM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-III PUNE DATED 10-9-2009 FOR A.Y. 2006-07 ON THE FOLLOWING GROUND: THAT ON FACTS AND CIRCUMSTANCES OF THE CASE, THE L EARNED CIT(A) HAS ERRED IN SUSTAINING THE ACTION OF THE A.O IN NOT CONSIDER ING THE AMOUNT OF MAT CREDIT WHILE MAKING ADJUSTMENT TO BOOK PROFIT AS PR ESCRIBED IN EXPLANATION 1 TO SECOND PROVISO TO SECTION 115JB OF THE ACT WHERE BY THE BOOK PROFIT OF THE APPELLANT COMPANY STAND INCREASED ERRONEOUSLY BY RS . 61,00,000/- 2. AT THE VERY OUTSET, LEARNED COUNSEL POINTED OUT THAT THE APPELLANT WOULD BE SATISFIED IF THE ISSUE RAISED IS REMANDED BACK TO THE FILE OF THE ASSESSING OFFICER FOR FRESH CONSIDERATION. ACCORDIN G TO THE LEARNED COUNSEL THE LOWER AUTHORITIES HAVE NOT APPRECIATED IN PROPER PERSPECTIVE THE PROPOSITION OF THE ASSESSEE THAT TH E AMOUNT OF MAT CREDIT ENTITLEMENT IS REQUIRED TO BE ADJUSTED FOR T HE PURPOSE OF COMPUTING BOOK PROFIT U/S 115JB OF THE ACT. WITH RE GARD TO THE TREATMENT GIVEN BY THE ASSESSEE TO MAT CREDIT ENTIT LEMENT, A COPY OF ITA NO. 1379/PN/2009 SUZLON WIND FARM SERVICES A.Y. 2006- 07 2 THE AUDITED BALANCE SHEET AND PROFIT AND LOSS ACCOU NT AS ALSO THE CALCULATION OF BOOK PROFIT U/S 115JB WAS PLACED ON RECORD. 3. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL REPR ESENTATIVE, APPEARING FOR THE REVENUE, HAS NO SERIOUS OBJECTION TO THE PLEA OF THE ASSESSEE FOR REMANDING THE MATTER TO THE FILE OF TH E A.O. FOR FRESH ADJUDICATION. 4. THE ONLY DISPUTE IN THIS APPEAL RELATES TO THE M ANNER OF COMPUTATION OF BOOK PROFITS CHARGEABLE TO TAX IN TE RMS OF SECTION 115JB OF THE ACT. WHILE COMPUTING THE BOOK PROFITS ON THE BASIS OF THE PROFIT & LOSS ACCOUNT PREPARED BY THE ASSESSEE IN TERMS OF T HE COMPANIES ACT, 1956 (1 OF 1956), THE ASSESSEE MADE AN ADJUSTMENT O N ACCOUNT OF RS 61 LAKHS REPRESENTING MAT CREDIT ENTITLEMENT, WHICH IS THE SUBJECT- MATTER OF DISPUTE BEFORE US.. THE ASSESSING OFFICER DENIED THE SAID ADJUSTMENT, WHICH HAS SINCE BEEN UPHELD BY THE COMM ISSIONER OF INCOME-TAX (APPEALS) FOR THE REASON THAT THE SAME I S NOT SPECIFICALLY PERMISSIBLE IN TERMS OF THE EXPLANATION 1 BELOW THE SUB-SECTION (2) OF SECTION 115JB OF THE ACT. THE MAT CREDIT IS AVAILAB LE TO THE ASSESSEE IN TERMS OF SUB-SECTION (1A) OF SECTION 115JAA OF T HE ACT. THE CREDIT PRESCRIBED IN SECTION 115JAA OF THE ACT IS AVAILABL E IN RESPECT OF TAXES PAID BY AN ASSESSEE UNDER SECTION 115JB(1) OF THE A CT ON DEEMED INCOME. SUB-SECTION (2A) OF SECTION 115JAA PRESCRIB ES THE AMOUNT OF SUCH CREDIT AVAILABLE TO AN ASSESSEE IN THE YEAR IN WHICH TAXES ARE PAID UNDER SECTION 115JB OF THE ACT. IN THE PRESENT CASE , IT IS CLEAR FROM THE ORDERS OF THE AUTHORITIES BELOW THAT THE CLAIM OF T HE ADJUSTMENT OF MAT CREDIT HAS BEEN ADJUDICATED BY THE LOWER AUTHORITIE S WITHOUT REFERENCE TO THE NATURE OF SUCH CREDIT AS CONTAINED IN SECTIO N 115JAA OF THE ACT. UNDER THESE CIRCUMSTANCES, WE ARE INCLINED TO UPHOL D THE LIMITED ITA NO. 1379/PN/2009 SUZLON WIND FARM SERVICES A.Y. 2006- 07 3 PRAYER OF THE ASSESSEE THAT THE MATTER BE REMANDED BACK TO THE FILE OF THE ASSESSING OFFICER, WHO SHALL ADJUDICATE THE ISS UE AFRESH WITH REFERENCE TO THE RELEVANT PROVISIONS CONTAINED IN S ECTION 115JB AND ALSO SECTION 115JAA OF THE ACT AND ALSO HAVING REGA RD TO THE TREATMENT ACCORDED BY THE ASSESSEE TO THE IMPUGNED SUMS IN ITS AUDITED FINAL ACCOUNT. THE ASSESSING OFFICER SHALL ALLOW THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD AND THEREAFTE R PASS AN ORDER AFRESH IN ACCORDANCE WITH LAW. 5. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLO WED FOR STATISTICAL PURPOSES. DECISION PRONOUNCED IN THE OPEN COURT ON THIS 13 TH DAY OF MAY 2011. SD/- SD/- (SHAILENDRA KUMAR YADAV) JUDICIAL MEMBER (G.S. PANNU) ACCOUNTANT MEMBER PUNE: DATED: 13 TH MAY, 2011 B COPY OF THE ORDER IS FORWARDED TO : 1. ASSESSEE 2. DEPARTMENT 3. THE CIT(A)-III PUNE 4. THE CIT -III PUNE 5. THE D.R, A BENCH, PUNE 6. GUARD FILE TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT, PUNE BENCHES, PUNE