Sanctuary Television Private Limited , Hyderabad V. Asst. Commissioner of Income Tax, Circle-14(1), Hyderabad

ITA 1429/Hyd/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 3931 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-10-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 17-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P MURALI MOHANA RAO
• Keywords: Depreciation
• Section: 143(3); 142(1); 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A : HYDERABAD (THROUGH VIDEO CONFERENCE) BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER ITA NO. A.Y. APPELLANT RESPONDENT 557/HYD/2018 2012-13 M/S.SANCTUARY TELEVISION PVT. LIMITED, HYDERABAD [PAN: AANCS3528D] DCIT, CIRCLE-3(1), HYDERABAD 1429/HYD/2019 ACIT, CIRCLE-14(1), HYDERABAD FOR ASSESSEE : SHRI P.MURALI MOHANA RAO, AR FOR REVENUE : SHRI BALAKRISHNA, CIT-DR SHRI SUNKU SRINIVAS, SR.DR DATE OF HEARING : 06-09-2021 DATE OF PRONOUNCEMENT : 08-10-2021 O R D E R PER S.S.GODARA, J.M. : THESE ASSESSEES APPEALS FOR AY.2012-13 ARISE AGAIN ST THE PR.CIT-3 & CIT(A)-6, HYDERABADS ORDER(S) DATED 1 8-11- 2016 & 13-03-2019 IN APPEAL NOS.10 / PR.CIT-3 / 263 / 16-17 & 10098 / 2017-18 / A3 / CIT(A)-6, INVOLVING PROCEE DINGS U/S.143(3) (IN FORMER APPEAL) AND U/S.143(3) R.W.S. 263 (IN LATTER APPEAL) OF THE INCOME TAX ACT, 1961 [IN SHORT, TH E ACT]; RESPECTIVELY. HEARD BOTH THE PARTIES. CASE FILES PERUSED. 2. IT TRANSPIRES AT THE OUTSET THAT THIS ASSESSEES INSTANT APPEAL SUFFERS FROM 85 DAYS DELAY STATED TO BE ATTRIBUTAB LE TO ITA NOS. 557/HYD/2018 & 1429/HYD/2019 :- 2 -: THE REASON(S) BEYOND ITS CONTROL AS PER CONDONATION PETITION/AFFIDAVIT. NO REBUTTAL HAS COME FROM THE DEPARTM ENTAL SIDE. THE IMPUGNED DELAY IS CONDONED THEREFORE. 3. WE ADVERT TO THE ASSESSEES FORMER APPEAL ITA NO.557/HYD/2018 CHALLENGING CORRECTNESS OF THE PCITS ACTION ASSUMING SECTION 263 REVISION JURISDICTION THEREBY TER MING THE CORRESPONDING REGULAR ASSESSMENT DT.16-03-2015 AS AN ERRONEOUS AND PREJUDICIAL ONE TO THE INTEREST OF THE REV ENUE. THERE IS NO DISPUTE THAT THE CITS DETAILED DISCUSSION HOLDS IN SECTION 263 ORDER IN PARAS 7 TO 11 INTER ALIA HOLD THAT THE ASSESSEE HAD DERIVED INTEREST INCOME OF RS.44,84,828/ - ON THE FIXED DEPOSITS MADE WITH THE KARUR VYSYA BANK, HYDERA BAD FOLLOWED BY ITS CLAIM OF ADMINISTRATIVE EXPENDITURE, FINANCIAL COSTS AND DEPRECIATION ETC. TO THE TUNE OF RS.1,87,311/-, RS.2,853/- AND RS.44,46,552/-; RESPECTIVELY TOTALLING TO RS.46,36,716/-. THE PCIT HOLDS THAT THE SAID THREE HEAD S OF EXPENSES ARE IN THE NATURE OF PRE-OPERATIVE EXPENDITUR E WHICH COULD NOT BE SET-OFF AGAINST THE ASSESSEES FOREGOING INTEREST INCOME. AND THAT THE ASSESSING OFFICERS ACTION ALLOWIN G THE ASSESSEES CLAIM IN A VERY CASUAL AND MECHANICAL MA NNER DESERVES TO BE REVISED FOR WANT OF PROPER ENQUIRY REN DERING THE IMPUGNED ASSESSMENT AS BOTH ERRONEOUS AS WELL AS PREJ UDICIAL TO INTEREST OF THE REVENUE. 4. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO RIVAL PLEADINGS AND FIND NO REASON TO SUSTAIN THE IMPUGNED REVISION ACTION. THIS IS FOR THE REASON THAT THE ASSESSEES ADM INISTRATIVE EXPENSES ARE IN THE NATURE OF COMPULSORILY OFFICE EX PENDITURE WHICH HAVE BEEN HELD ELIGIBLE FOR INTRA-HEAD SET-OFF AGAINST ITA NOS. 557/HYD/2018 & 1429/HYD/2019 :- 3 -: INCOME FROM OTHER SOURCES THAN U/S.57(III) BY THE ASSE SSING OFFICER. THE FACTUAL POSITION IS HARDLY DIFFERENT QUA ITS LATTER TWO HEADS OF FINANCIAL COSTS; INCLUDING THAT DIRECTLY PAID TO THE BANK OF RS.2,8,53/- (SUPRA) PERTAINS TO THE VERY ACCOU NT ONLY AS WELL AS THE FACT THAT THE IMPUGNED DEPRECIATION/AMORTIZATION HAS BEEN A CONTINUING RELIEF GRANTED VERY WELL FROM THE PRECEDING ASSESSMENT YEARS, WHOSE FACTS AND FIGURES ARE NOWHERE IN DISPUTE. COUPLED WITH THIS, THE ASSESSEE HAS ALSO FILED ON REC ORD THE NECESSARY CORRESPONDENCE/SHOW CAUSE NOTICE ISSUE D BY THE ASSESSING OFFICER IN SECTION 143(2) & 142(1) NOTI CES DT.13- 05-2014 AND 24-02-2015 FOLLOWED BY ITS DETAILED REPLY ON 02- 12-2015. WE THEREFORE HOLD THAT THE PCIT HAS ERRED IN LAW AND ON FACTS IN ASSUMING SECTION 263 REVISION JURISDICTION . WE QUOTE HON'BLE APEX COURTS LANDMARK DECISION IN MALAB AR INDUSTRIAL CO. VS. CIT [243 ITR 83] (SC) WHEREIN IT W AS HELD THAT AN ASSESSMENT HAS TO BE BOTH ERRONEOUS AS WELL AS C AUSING PREJUDICE TO THE INTEREST OF THE REVENUE; SIMULTANE OUSLY, BEFORE IT IS SOUGHT TO BE SUBJECTED TO EXERCISE OF REVISIO N JURISDICTION U/S.263 OF THE ACT . THEIR LORDSHIPS FURTHER MAKE IT CLEAR THAT IT IS NOT EACH AND EVERY ASSESSMENT WHICH ATTRACTS SECTION 263 REVISION BUT ONLY WHEREIN THE ASSESSING OFFICER HAS N OT TAKEN ONE OF THE TWO POSSIBLE VIEWS; AS THE CASE MAY BE. WE DRAW STRONG SUPPORT THEREFROM AND REVERSE THE LEARNED PCITS ACTION EXERCISING SECTION 263 REVISION JURISDICTION. THE IM PUGNED SECTION 143(3) REGULAR ASSESSMENT DT.16-03-2015 STANDS REVIVED AS THE NECESSARY COROLLARY THEREFORE. THE ASSESSEES INSTANT SECTION 263 APPEAL ITA NO.557/HYD/2018 IS ACCEPTED. ITA NOS. 557/HYD/2018 & 1429/HYD/2019 :- 4 -: 5. SAME ORDER TO FOLLOW IN ASSESSEES CONSEQUENTIAL LATTER APPEAL ITA NO.1429/HYD/2019 AS THE IMPUGNED ASSESSME NT FRAMED IN FURTHERANCE TO THE PCITS FOREGOING SECTION 263 REVISION DIRECTIONS HAS NO LEGS TO STAND. NO OTHER GROUND HAS BEEN PRESSED BEFORE US. 6. THESE ASSESSEES TWO APPEALS ARE ALLOWED IN ABOV E TERMS. A COPY OF THIS COMMON ORDER BE PLACED IN THE RESPECTI VE CASE FILES. ORDER PRONOUNCED IN THE OPEN COURT ON 8 TH OCTOBER, 2021 SD/- SD/- (LAXMI PRASAD SAHU) (S.S.G ODARA) ACCOUNTANT MEMBER JUDICIAL MEM BER HYDERABAD, DATED: 08-10-2021 TNMM ITA NOS. 557/HYD/2018 & 1429/HYD/2019 :- 5 -: COPY TO : 1.M/S.SANCTUARY TELEVISION PVT. LIMITED, C/O. P.MUR ALI & CO., CHARTERED ACCOUNTANTS, 6-3-655/2/3, 1 ST FLOOR, SOMAJIGUDA, HYDERABAD. 2.THE DCIT, CIRCLE-3(1), HYDERABAD. 3.THE ACIT, CIRCLE-14(1), HYDERABAD. 4.THE CIT(APPEALS)-6, HYDERABAD. 5.THE PR.CIT-3, HYDERABAD. 6.THE PR.CIT-6, HYDERABAD. 7.D.R. ITAT, HYDERABAD. 8.GUARD FILE.