M/s E.G. Pharmaceuticals, Solan V. DCIT, Circle, Parwanoo

ITA 1385/CHANDI/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5182 (ITAT-CHANDIGARH)
• Duration Of Justice: 5 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-02-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 20-09-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCHES A, CHANDIGARH BEFORE MS. DIVA SINGH, JUDICIAL MEMBER AND DR.B.R.R.KUMAR, ACCOUNTANT MEMBER ITA NO. 1385/CHD /2017 ASSESSMENT YEAR: 2014-15 M/S E.G. PHARMACEUTICALS, VS THE DCIT, VILLAGE - MANDHALA, CIRCLE, TEHSIL-KASAULI, PARWANOO. DISTT. SOLAN (H.P.). PAN : AACFE1835H (A PPELLANT) (RESPONDENT) APPELLANT BY : SHRI MANOJ KUMAR RESPONDENT BY : SMT. CHANDER KANTA, SR.DR DATE OF HEARING : 16.01.2018 DATE OF PRONOUNCEMENT : 28.02.2018 ORDER PER DIVA SINGH, JM THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE ASSA ILING THE CORRECTNESS OF THE ORDER DATED 17/07/2017 OF CIT(A) SH IMLA HP PERTAINING TO 2014 10 ASSESSMENT YEAR ON THE FOLLOWING GROUND : THE LD. CIT(A) IS WRONG IN DISALLOWING THE BENEFIT OF SUBSTANTIAL EXPANSION U/S 80IC(2) BY HOLDING THAT BENEFIT OF SUBSTANTIAL EXPA NSION IS ALLOWABLE ONLY TO THE UNDERTAKING WHICH WERE EXISTING AS ON 07.01.2003. 2. THE LD. AR INVITING ATTENTION TO THE IMPUGNED ORDER SU BMITTED THAT THE POINT AT ISSUE IS FULLY COVERED IN FAVOUR OF THE ASSESS EE BY VIRTUE OF THE DECISION OF THE JURISDICTIONAL HIGH COURT DATED 28/11/2017 IN THE CASE OF M/S STOVE CRAFT INDIA VERSUS CIT-V AND OTHERS IN IT A 20 TO 24/2015. INVITING ATTENTION TO THE ASSESSMENT ORDER DATED 20/12/2017 IN 2015-16 ASSESSMENT YEAR PASSED UNDER SECTION 143 (3) IN THE CAS E OF THE ASSESSEE. REFERRING TO THE COPY OF SAID ORDER FILED, IT WAS SUBMITTED T HAT FOLLOWING THE DECISION OF THE JURISDICTIONAL HIGH COURT, THE ASSESSING OFFICER CONSIDERING THE FACTS OF THE CASE, ALLOWED THE CLAIM OF THE A SSESSEE @ 100% UNDER SECTION 80IC. ACCORDINGLY, IT WAS HIS SUBMISSIO N THAT ON FACTS AND LAW, THE ISSUE WAS FULLY COVERED IN FAVOUR OF THE ASSESSEE. 3. THE LD. DR CONSIDERING THE ASSESSMENT ORDER PASSED BY THE AO IN THE SCRUTINY PROCEEDINGS DID NOT POSE ANY OBJECTION. ITA 1385/CHD/2017. A.Y. 2014-15 PAGE 2 OF 2 4. WE HAVE HEARD THE SUBMISSIONS AND PERUSED THE MATER IAL AVAILABLE ON RECORD. IT IS SEEN THAT THE ASSESSEE IN THE YEAR UN DER CONSIDERATION WAS DERIVING INCOME FROM MANUFACTURING OF TABLETS, CAPSULES, SYRUP S ETC. FROM BADI- PINJORE HIGHWAY, TEHSIL KASAULI, DISTRICT SOLAN (HP). AFTER HAVING CLAIMED 100% DEDUCTION IN THE INITIAL 5 YEARS, THE ASSESSEE THEREAFTER CLAIMED TO HAVE CARRIED OUT SUBSTANTIAL EXPANSION AND THE Y CLAIMED 100% DEDUCTION OF ELIGIBLE PROFITS. THE CLAIM WAS REJECTED BY THE ASSESSING OFFICER AND THE DEDUCTION WAS RESTRICTED TO 25% OF THE ELIG IBLE PROFITS UNDER SECTION 80IC. IN THE LIGHT OF THE DECISION OF THE JUR ISDICTIONAL HIGH COURT WHICH HAS BEEN TAKEN INTO CONSIDERATION BY THE AS SESSING OFFICER HIMSELF IN THE IMMEDIATELY SUBSEQUENT ASSESSMENT YEAR I.E. 201516 WHEREIN THE AO CONSIDERING THE CLAIM OF SUBSTANTIAL EXPANSIO N IN 2015-15 WHICH HAPPENED TO BE THE 8 TH YEAR, HAS GRANTED 100% DEDUCTION FOLLOWING THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE ORDER P ASSED U/S 143 (3) DATED 20/12/2017. WE FIND THAT THE CLAIM OF THE ASSESSE E IS ALLOWABLE IN LAW AND FACTS. IN THE PECULIAR FACTS AND CIRCUMSTANCES OF THE PRESENT CASE THE IMPUGNED ORDER NEEDS IS SET ASIDE WITH THE DIRE CTION TO THE ASSESSING OFFICER TO GRANT NECESSARY RELIEF ON FACTS AS ALR EADY CONSIDERED IN 2015-16 ASSESSMENT YEAR AND ALLOW THE CLAIM OF THE ASS ESSEE @ OF 100% DEDUCTION UNDER SECTION 80IC. THE SAID ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ITSELF. 4. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH FEB., 2018. SD/- SD/- ( DR.B.R.KUMAR) (DIVA SINGH) ACCOUNTANT MEMBER 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.