ITO Wd 3(4), Kolkata, Kolkata V. M/s Cresmac Foundry (P) Ltd., Kolkata

ITA 1473/KOL/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 75109 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 5 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-03-2014
• Appeal Filed By: Department
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 11-10-2012
• Court: TRIBUNAL
• Department Lawyers: SANJAY BHATTACHARJEE
• Assessee Lawyers: P DAM KANUNJNA
• Section: 143(3)

Judgement Text

, B , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA () BEFORE , /AND , ! ) [BEFORE SHRI MAHAVIR SINGH, JM & SHRI SHAMIM YAHYA, AM] ' / I.T.A NO.1473/KOL/2012 #$ %&/ ASSESSMENT YEAR: 2008-09 INCOME-TAX OFFICER, WD-3(4), KOLKATA. VS. M/S. CR ESMAC FOUNDRY (P) LTD. (PAN: AABCC0933C) (() /APPELLANT ) (*+()/ RESPONDENT ) DATE OF HEARING: 28.03.2014 DATE OF PRONOUNCEMENT: 28.03.2014 FOR THE ASSESSEE: SHRI P. DAM KANUNJNA, JCIT, SR. D R FOR THE REVENUE : SHRI SANJAY BHATTACHARJEE / ORDER PER SHRI MAHAVIR SINGH, JM : THIS APPEAL BY REVENUE IS ARISING OUT OF ORDER OF C IT(A)-I, KOLKATA IN APPEAL NO.186/CIT(A)-1/WD-3(4)/10-11 DATED 03.07.2012. AS SESSMENT WAS FRAMED BY ITO, WARD- 3(4), KOLKATA U/S. 143(3) OF THE INCOME-TAX ACT, 19 61 (HEREINAFTER REFERRED TO AS THE ACT) FOR ASSESSMENT YEAR 2008-09 VIDE HIS ORDER DATED 30.11. 2010. 2. AT THE OUTSET, IT IS SEEN THAT APPEAL OF REVENUE IS TIME BARRED BY 5 DAYS AND REVENUE HAS FILED A CONDONATION PETITION. ON QUERY FROM THE BE NCH, LD. COUNSEL FOR THE ASSESSEE DOES NOT RAISE ANY OBJECTION FOR CONDONATION OF DELAY. DUE TO SMALLNESS OF DELAY I.E. ONLY 5 DAYS AND NO OBJECTION FROM ASSESSEE, WE CONDONE THE DELAY AND A DMIT THE APPEAL OF REVENUE. 3. THE ONLY ISSUE IN THIS APPEAL OF REVENUE IS AGAI NST THE ORDER OF CIT(A) IN ALLOWING THE APPEAL OF ASSESSEE ON THE ISSUE OF DISALLOWANCE MAD E BY AO ON ACCOUNT OF EXPORT TURNOVER AS REALISATION OF PATTERN COST. 4 . WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FA CTS AND CIRCUMSTANCES OF THE CASE. WE FIND THAT THE AO WITHOUT ANY OBSERVATION MADE DI SALLOWANCE OF OTHER INCOMES WHICH CONSIST OF REALISATION OF PATTERN COST AT RS.16,15, 130/- AND MADE DISALLOWANCE BY HOLDING THAT THESE ARE PART OF OTHER INCOMES ON WHICH NO DEDUCTI ON U/S. 10A OF THE ACT IS ELIGIBLE. AGGRIEVED, ASSESSEE PREFERRED APPEAL BEFORE CIT(A), WHO ALLOWED THE CLAIM OF ASSESSEE BY OBSERVING AS UNDER: 2 ITA NO. 1473/K/2012 M/S. CRESMAC FOUNDRY (P) LTD., AY 2008-09 RE: GROUND NO. 6: THE AOS OBSERVATION THAT THE REA LISATION OF PATTERN AMOUNTING TO RS.16,15,130/- WHICH HAD BEEN RECEIVED IN CONVERTIB LE FOREIGN EXCHANGE, WAS NOT ELIGIBLE FOR DEDUCTION U/S. 10A HAS ALREADY BEEN AC CEPTED BY THE APPELLANT. I AM INCLINED TO ACCEPT THE A/RS SUBMISSION THAT SINCE THE SALE PROCEEDS ARE TAKEN OUT OF THE EXPORT TURNOVER, IT IS ALSO NECESSARY TO EXCLUDE THE COST AND OTHER RELATED EXPENSES FROM THE TOTAL EXPENSES DEBITED TO THE PROFIT & LOSS ACCOUNT . WHEN A PARTICULAR INCOME IS CONSIDERED SEPARATELY THEN THE RELEVANT EXPENSES IN CURRED TO EARN THAT INCOME, WILL HAVE TO BE DEDUCTED FROM THAT INCOME TO FIND OUT THE ASS ESSABLE PROFIT. THE APPLLANT HAD SUBMITTED BEFORE THE AO THE DETAILS OF THE EXPENSES AGGREGATING TO RS.15,58,275/-. THE AO IS DIRECTED TO VERIFY THE CLAIM OF THE ASSESSEE AFTER VERIFICATION OF THE BOOKS OF ACCOUNTS AND RELEVANT RECORDS MAINTAINED BY THE ASS ESSEE IN THIS REGARD, WHILE COMPUTING THE PROFIT DEDUCTIBLE U/S. 10A AND TO RED UCE THESE EXPENSES SO DETERMINED AFTER VERIFICATION FROM THE SALE PROCEEDS OF PATTERN, I.E . RS.16,15,130 FOR DETERMINING THE ASSESSABLE INCOME FROM SALE OF PATTERNS. AS A RESU LT THE ASSESSABLE PROFIT FROM PATTERN WILL BE THE NET AMOUNT (RS.16,15,130 LESS THE EXPE NSES AS VERIFIED BY THE AO). THE AO IS DIRECTED TO INCLUDE THE NET AMOUNT INSTEAD OF RS.16 ,15,130 AS THE INCOME ASSESSABLE IN RELATION TO THE PATTERN. HENCE, GROUND NO. 6 IS PA RTLY ALLOWED. WE FIND THAT THE ASSESSEE HAS TAKEN OUT EXPORT TURN OVER FROM SALE PROCEEDS AND EVENTUALLY IT IS NECESSARY TO EXCLUDE THE COST OF OTHER RELATED EXPE NSES FROM THE TOTAL EXPENSES AS DEBITED TO P&L ACCOUNT. WE ARE IN AGREEMENT WITH THE FINDINGS OF CIT(A) AS NOTED ABOVE AND MOREOVER, HE HAS ONLY DIRECTED THE AO TO VERIFY THESE EXPENSE S AND REDUCE THESE EXPENSES FROM SALE PROCEEDS OF PATTERN FOR DETERMINING THE ASSESSABLE INCOME FROM SALE OF PATTERNS. WE FIND NO INFIRMITY IN THE FINDING OF CIT(A) AND THE SAME IS CONFIRMED. REVENUES APPEAL IS DISMISSED. 5. IN THE RESULT, APPEAL OF REVENUE IS DISMISSED. 6. ORDER IS PRONOUNCED IN THE OPEN COURT. SD/- SD/- , ! , (SHAMIM YAHYA ) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 28TH MARCH, 2014 -. #/0 1 JD.(SR.P.S.) 2 *3 4 3%5- COPY OF THE ORDER FORWARDED TO: 1 . () / APPELLANT ITO, WARD-3(4), KOLKATA. 2 *+() / RESPONDENT M/S. CRESMAC FOUNDRY (P) LTD., P-387, NEW ALIPORE, GROUND FLOOR, BLOCK-G, KOLKATA-53 3 . # ( )/ THE CIT(A), KOLKATA 4. 5. # / CIT KOLKATA 3:; *# / DR, KOLKATA BENCHES, KOLKATA +3 */ TRUE COPY, #