DCIT, Madurai V. Sree Karpagambal Mills Ltd., Rajapalayam

ITA 1439/CHNY/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 96531 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2015
• Appeal Filed By: Department
• Bench Allotted: A
• Next Hearing Date: 14-12-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 12-06-2015
• Court: TRIBUNAL
• Department Lawyers: P RADHAKRISHNAN
• Section: 80HHC

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI , . ! , ' !# $ [ BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI G. PAVAN KUMAR, JUDICIAL MEMBER ] ./ I.T.A.NO.1439/MDS/2015 / ASSESSMENT YEAR : 2004-05 THE DY. COMMISSIONER OF INCOME-TAX CORPORATE CIRCLE 2 MADURAI VS. M/S SREE KARPAGAMBAL MILLS LTD CHOLAPURAM VILLAGE CHOLAPURAM SOUTH RAJAPALAYAM 626 139 [PAN AADCS 9038 A] ( %& / APPELLANT) ( '(%& /RESPONDENT) / APPELLANT BY : SHRI P RADHAKRISHNAN, JCIT /RESPONDENT BY : NONE / DATE OF HEARING : 14 - 1 2 - 2015 / DATE OF PRONOUNCEMENT : 18 - 1 2 - 2015 ) / O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-1, MAD URAI, DATED 24.3.2015 FOR ASSESSMENT YEAR 2004-05. 2. AT THE OUTSET, IT WAS NOTICED THAT NONE ATTENDED ON BEHALF OF THE ASSESSEE AT THE TIME OF HEARING. WE, THEREFOR E, HEARD THE LD. DEPARTMENTAL REPRESENTATIVE AND AFTER TAKING INTO C ONSIDERATION THE ITA NO. 1439/15 :- 2 -: WRITTEN SUBMISSION FILED BY THE ASSESSEE DATED 1.8 .2015, PROCEEDED TO DISPOSE OF THE APPEAL ON MERIT. 3. THE ONLY GRIEVANCE OF THE REVENUE IN THIS APPEAL IS THAT THE CIT(A) ERRED IN HOLDING THAT DEDUCTION ALLOWED U/S 80IA AMOUNTING TO ` 1,68,72,323/- SHOULD NOT BE REDUCED FROM THE PROFI TS AND GAINS OF BUSINESS FOR THE CALCULATION OF DEDUCTION U/S 80HH C ON THE GROUND THAT SEC. 80HHC DOES NOT PROVIDE FOR REDUCING THE A MOUNT OF DEDUCTION ALLOWED U/S 80IA OF THE ACT. 4. THE FACTS OF THE CASE ARE THAT THE ASSESSING OFFICE R PASSED AN ORDER DATED 21.7.2010 GIVING EFFECT TO THE ORDER OF THE CIT(A). IN THE SAID ORDER, THE A WORKED OUT THE AMOUNT ALLOWAB LE U/S 80IA AT ` 1,68,72,323/- AND REWORKED THE DEDUCTION ALLOWABLE U/S 80HHC AT ` 15,29,805/-. IN THE SAID REWORKING, THE ASSESSING OFFICER DEDUCTED THE AMOUNT ALLOWED U/S 80IA FROM THE INCOME UNDER THE HEAD BUSINESS FOR ARRIVING AT THE ELIGIBLE DEDUCTION U/S 80HHC. ON APPEAL, THE CIT(A), FOLLOWING THE JUDGMENT OF THE MADRAS HIGH C OURT IN THE CASE OF SCM CREATIONS VS CIT, 304 ITR 319, AND ALSO DY. CIT VS CHOLA TEXTILES P LTD, 281 CTR 123, HELD THAT DEDUCTION U/S 80IA I S NOT TO BE DEDUCTED FROM PROFITS AND GAINS OF BUSINESS BEFORE COMPUTING RELIEF U/S 80HHC AND THEREBY HE ALLOWED THE CLAIM OF THE ASSESSEE WITH A ITA NO. 1439/15 :- 3 -: DIRECTION TO THE ASSESSING OFFICER TO RECOMPUTE THE DEDUCTION U/S 80HHC OF THE ACT. 5. WE HAVE HEARD THE LD. DR AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT SIMILAR ISSUE CAME UP FOR CON SIDERATION BEFORE THE SUPREME COURT IN THE CASE OF ACIT VS M/S MICRO LABS LTD IN CIVIL APPEAL NO. 7427 OF 2012 AND OTHERS BY WAY OF SLP, J UDGMENT DATED 10.12.2015. AS THERE WERE DIVERGENT VIEWS BETWEEN THE JUDGES, NOW THE ISSUE IS PENDING FOR FINAL DECISION. IN VIEW O F THIS, WE ARE OF THE OPINION THAT THE ISSUE NEEDS TO BE REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER TO DECIDE THIS ISSUE AFTER THE FI NAL OUTCOME OF JUDGMENT OF SUPREME COURT IN THE CASE OF M/S MICRO LABS LTD. (SUPRA). ACCORDINGLY, WE REMIT THE ISSUE BACK TO THE FILE OF THE ASSESSING OFFICER TO DISPOSE OF THE SAME AFTER THE FINAL DECISION OF THE SUPREME COURT IN THE CASE OF M/S MICRO LABS LTD. (SUPRA). 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLOW ED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH DECEMBER, 2015, AT CHENNAI. SD/- SD/- ( . ! ) (G. PAVAN KUMAR) ' / JUDICIAL MEMBER ( ) (CHANDRA POOJARI) / ACCOUNTANT MEMBER !' / CHENNAI #$ / DATED: 18 TH DECEMBER, 2015 RD ITA NO. 1439/15 :- 4 -: $%&& '(&)( / COPY TO: & 1 . / APPELLANT 3. & *&+, / CIT(A) 5. (-.& / / DR 2. / RESPONDENT 4. & * / CIT 6. .0&1 / GF