ACIT, Circle-1, Warangal V. M/s. Madrasi Chakkar Bidi Factory Pvt.Ltd, Warangal

ITA 1403/HYD/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 59151 (ITAT-HYDERABAD)
• Duration Of Justice: 5 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-01-2012
• Appeal Filed By: Department
• Bench Allotted: B
• Assessment Year: 2004-2005
• Appeal Filed On: 29-07-2011
• Court: TRIBUNAL
• Department Lawyers: K J RAO
• Assessee Lawyers: G MANIKYA PRASAD
• Section: 143(3); 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD B BENCH, HYDERABAD BEFORE CHANDRA POOJARI, ACCOUNTANT MEMBER & SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA NO.1403/HYD/2011 ASSESSMENT YEAR 2004-05 THE ACIT, CIRCLE 1, WARANGAL VS M/S MADRASI CHAK KAR BIDI FACTORY P LTD., WARANGAL (PAN AABCM4758R/M- 12) APPELLANT RESPONDENT APPELLANT BY : SHRI K.J. RAO RESPONDENT BY : SHRI G. MANIKYA PRASAD DATE OF HEARING : 15.11.2011 DATE OF PRONOUNCEMENT : 20.1.2012 ORDER PER ASHA VIJAYARAGHAVAN: THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A)-VI, HYDERABAD DATED 16.5.2011 AND PERTAINS TO THE ASSESSMENT YEAR 2004-05. 2. THE ONLY ISSUE RAISED BY THE REVENUE IS AS FOLL OWS: THE CIT(A) FAILED TO APPRECIATE THE FACT THAT THE EXCESS CLAIM OF GROUP GRATUITY WAS DISALLOWED AND ADDED AF TER DUE VERIFICATION WITH RESPECTIVE AUTHORITIES AND AL SO THE ORDER OF THE TRIBUNAL IN SETTING ASIDE THE ORDER OF THE CIT PASSED U/S 263 WAS NOT ACCEPTED BY THE DEPARTMENT A ND FURTHER APPEAL WAS FILED BEFORE THE ANDHRA PRADESH HIGH COURT. ITA NO.1403 OF 2011 MADRASI CHAKKAR BIDI FACTORY P LTD., HYD. 2 3. BRIEF FACTS OF THE CASE ARE THAT VIDE ORDER U /S 263 DATED 26.3.2009, THE CIT-VI, HYDERABAD HAD DIRECTED THE A SSESSING OFFICER TO BRING EXCESS CLAIM OF RS.68,03,938/- UND ER GROUP GRATUITY SCHEME TO TAX AND TO EXAMINE THE CLOSING S TOCK OF TOBACCO WITH REFERENCE TO ORIGINAL RECORDS. THE AS SESSING OFFICER ADDED THE SUM OF RS.68,03,938/- UNDER GROUP GRATUIT Y SCHEME TO THE INCOME OF THE ASSESSEE. NO ADDITION WAS MAD E WITH REGARD TO THE CLOSING STOCK OF TOBACCO. THE ASSESS EE HAD ALSO FILED AN APPEAL AGAINST THE ORDER U/S 263 AND THE T RIBUNAL, HYDERABAD VIDE ITS ORDER IN ITA NO.734/H/2009 DATED 16.7.2010 ALLOWED THE ASSESSEES APPEAL ON THE ISSUE OF EXCES S CLAIM OF GROUP GRATUITY. 4. THE CIT(A) HAS HELD THAT SINCE THE ONLY ISSUE IN THE APPEAL IS THE ADDITION UNDER GROUP GRATUITY SCHEME AND THE TRIBUNAL HAS SET ASIDE THE ORDER U/S 263 ITSELF ON THIS ISSU E, THE ASSESSMENT ORDER APPEALED AGAINST HAS NO BASIS TO S TAND ON. HE, THEREFORE DELETED THE ADDITION AND ALLOWED TH E APPEAL FILED BY THE ASSESSEE. 5. AGGRIEVED BY THE ORDER OF THE CIT(A), THE REVE NUE HAS COME UP ON APPEAL BEFORE US. 6. WE HEARD THE PARTIES. WE HAVE ALSO PERUSED TH E ORDER OF THE TRIBUNAL IN ITA NO.734/HYD/2009 DATED 16.7.2010 , WHEREIN THE ORDER U/S 263 ITSELF HAS BEEN SET ASIDE. HENCE WE FIND NO INFIRMITY IN THE ORDER OF THE CIT(A) HOLDING THAT THE ORDER PASSED U/S 143(3) R.W. SECTION 263 OF THE IT ACT HAS NO BA SIS TO STAND ON. ITA NO.1403 OF 2011 MADRASI CHAKKAR BIDI FACTORY P LTD., HYD. 3 7. IN THE RESULT THE APPEAL FILED BY THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED IN THE COURT ON : 20.1.2012 SD/- SD/- (CHANDRA POOJARI) ACCOUNTANT MEMBER (ASHA VIJAYARAGHAVAN) JUDICIAL MEMBER DATED THE 20 TH JANUARY, 2012 COPY FORWARDED TO: 1. THE ACIT, CIRCLE -1, HYDERABAD 2. M/S MADRASI CHAKKAR BIDI FACTORY P LTD., H.NO.14/ 586, NARSAMPET ROAD, WARANGAL 3. THE CIT(A)-VI, HYDERABAD 4. THE CIT, HYDERABAD 5. THE DR, ITAT, HYDERABAD NP/