DCIT, Circle-2(1), Hyd, Hyderabad V. Khaitan Electricals Ltd., Hyd, Hyderabad

ITA 15/HYD/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 6674 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-04-2016
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 05-04-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 06-01-2016
• Court: TRIBUNAL
• Department Lawyers: B RAMANJANEYULU
• Section: 143(3); 80G; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH ES B , HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER I.T.A. NO. 1 5 /H YD /201 6 ASSESSMENT YEAR: 20 1 0 - 11 DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE - 2(1), HYDERABAD VS M/S. KHAITAN ELECTRICALS LTD., HYDERABAD [PAN: AA ACK5587B ] (APPELLANT) (RESPONDENT) FOR REVENUE : SHRI B. RAMANJANEYULU , D R FOR ASSESSEE : SHRI K.C. DEVDAS, AR DATE OF HEARING : 0 5 - 0 4 - 201 6 DATE OF PRONOUNCEMENT : 13 - 0 4 - 201 6 O R D E R PER B. RAMAKOTAIAH, A.M. : TH I S IS REVENUES APPEAL AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX ( APPEALS ) - 2 , HYDERABAD DATED 26 - 1 0 - 201 5 . THE REVENUE IS AGGRIEVED ON THE ORDER PASSED BY THE CIT(A) A GAINST THE ORDER , REJECTING ASSESSEES CLAIM U/S. 154 OF THE INCOME TAX ACT [ACT]. 2. ASSESSEE - COMPANYS ASSESSMENT WAS ORIGINALLY COMPLETED U/S. 143(3) OF THE ACT ON 08 - 03 - 2013. IN THAT ORDER, ASSESSING OFFICER (AO) HAS DISALLOWED AN AMOUNT OF RS. 19, 39,836/ - AND I.T.A. NO. 15 / HYD / 20 1 6 M/S. KHAITAN ELECTRICALS LTD., : - 2 - : ADDED TO THE INCOME RETURNED BY ASSESSEE. THEREAFTER, AO NOTICED THAT CERTAIN CARRIED FORWARD LOSSES WERE NOT CORRECTLY CARRIED FORWARD AND ADJUSTED. THEREFORE, HE HAS PROPOSED PROCEEDINGS U/S. 154 OF THE ACT. ASSESSEE IN TURN ASKED FOR ALL OWING THE CLAIM OF DEDUCTION U/S. 35(1) WHICH WAS MADE BEFORE THE AO IN THE COURSE OF SCRUTINY PROCEEDINGS VIDE LETTER DT. 08 - 12 - 2012 AND 22 - 02 - 2013 WHICH WAS NOT CONSIDERED. AO IN THE ORDER U/S. 154 ONLY CORRECTED THE AM OUNT OF BROUGHT FORWARD LOSS ES AND REJECTED THE CLAIM OF DEDUCTION U/S. 35(1)(II). ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A). LD. CIT(A) AFTER NOTICING OF THE FACTS AND ALSO THE FACT THAT SIMILAR CLAIM WAS ALLOWED IN ASSESSEES OWN CASE IN AY. 2011 - 12 BY THE ITAT B BENC H IN THE ORDER NO. 1850/HYD/2014 DT. 12 - 08 - 2015, ALLOWED ASSESSEES CLAIM. REVENUE IS AGGRIEVED AND RAISED THE FOLLOWING GROUNDS: 1. THE CIT(A) OUGHT NOT HAVE ADMITTED THE APPEAL OF THE ASSESSEE AGAINST THE ORDER U/S. 154 OF THE ACT BECAUSE THE ISSUE WA S ALREADY DEALT WITH IN THE ORIGINAL SCRUTINY ASSESSMENT. 2. THE CIT(A) OUGHT NOT HAVE ALLOWED THE APPEAL AGAINST THE ORDER U/S. 154 OF THE ACT AS THE AO RIGHTLY HELD THAT THERE IS NO MISTAKE APPARENT FROM THE RECORD WHICH CAN BE RECTIFIED U/S. 154 OF THE ACT. 3. THE CIT(A) OUGHT NOT HAVE ALLOWED THE APPEAL BY RELYING ON THE JURISDICTIONAL TRIBUNALS DECISION IN THE CASE OF KHAITAN ELECTRONICS LIMITED BY HOLDING THAT THE FACTS ARE SQUARELY APPLICABLE, WHICH ARE IN FACT DISTINGUISHABLE. 4. WITHOUT PREJUDI CE TO THE ABOVE, WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) IS JUSTIFIED IN SETTING ASIDE THE ISSUE OF ALLOWABILITY OF REVISED CLAIM OF DEDUCTION U/S. 35(1)(II) OF THE ACT., TO THE FILE OF THE AO FOR EXAMINATION INSTEAD OF DECIDING THE ISSUE HIMSELF IN ACCORDANCE WITH THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF M/S. GOETZ INDIA LTD., I.T.A. NO. 15 / HYD / 20 1 6 M/S. KHAITAN ELECTRICALS LTD., : - 3 - : 3. AFTER HEARING THE RIVAL PARTIES, WE ARE OF THE OPINION THAT THERE IS NO MERIT IN REVENUES CONTENTIONS. AS SEEN FROM THE GROUND NO.1, REVENU E CONTENDS THAT THE ISSUE IS ALREADY DEALT WITH IN ORIGINAL SCRUTINY ASSESSMENT , THE FACT OF WHICH IS NOT CORRECT. IN FACT, AO HAS NOT CONSIDERED THE ISSUE AT ALL IN THE ORIGINAL ASSESSMENT ORDER. THEREFORE, GROUND NO. 1 IS INFRUCTUOUS. 3.1. AS FAR AS GROUND NOS. 2 & 3 ARE CONCERNED, THESE ARE ALSO TO BE REJECTED AS LD. CIT(A) IS CORRECT IN ALLOWING ASSESSEES CONTENTIONS , WHICH THE AO DID NOT CONSIDER IN THE ORIGINAL ASSESSMENT AS WELL AS IN THE PROCEEDINGS U/S. 154 , WHEN ALL THE FACTS ARE AVAIL ABLE O N RECORD. FURTHER, LD. CIT(A) FOLLOWED THE CO - ORDINATE BENCH DECISION. THEREFORE, IT CANNOT BE CONSIDERED AS CIT(A) HAS ERRED IN ALLOWING ASSESSEES CONTENTIONS . 3.2. AS FAR AS GROUND NO. 4 IS CONCERNED, HERE ALSO WE DO NOT SEE ANY REASON TO IN TERFERE WITH THE FINDING OF THE CIT(A) AS HE HAS DIRECTED THE ISSUE TO THE FILE OF AO TO EXAMINE AND ALLOW THIS AS UNDER: 8. FROM THE ABOVE IT IS CLEAR THAT THE FACTS AND CIRCUMSTANCES FOR THE YEAR UNDER APPEAL ARE SAME AND HENCE, THE RATIO LAID DOWN BY THE HON'BLE ITAT FOR AY. 2011 - 12, IS SQUARELY APPLICABLE. AS A RESULT, THE AO IS DIRECTED TO EXAMINE THE CLAIM MADE U/S. 35(1)(II) INSTEAD OF SEC.80G, AFTER VERIFYING THE EVIDENCES BROUGHT ON RECORD BY ASSESSEE. IF FOUND IN ORDER, NECESSARY DEDUCTION MAY BE GIVEN. THUS, THE GROUNDS RAISED IN THIS REGARD ARE ALLOWED FOR STATISTICAL PURPOSES. IT IS FOR THE AO TO RE - WORK OUT THE COMPUTATION , AS THE CLAIM U/S. 80G WAS ORIGINALLY MADE IN THE COMPUTATION AND THE AO STARTED THE COMPUTATION IN THE ASSESSMENT O RDER FROM THE INCOME RETURNED. THEREF ORE, THE ELIGIBLE AMOUNT TO BE ALLOWED CAN ONLY BE I.T.A. NO. 15 / HYD / 20 1 6 M/S. KHAITAN ELECTRICALS LTD., : - 4 - : QUANTIFIED BY THE AO AFTER E XAMINING THE AMOUNTS INVOLVED AND THE CLAI M ALREADY ALLOWED UNDER A DIFFERENT SECTION OF THE ACT . AO HAS TO VERIFY THE RECORD AND THE CLAI M . THE RELIANCE ON THE DECISION OF GOETZE INDIA IS ALSO NOT CORRECT AS LD. CIT(A) HAS POWER TO ENTERTAIN A CLAIM WHICH AO DID NOT ACCEPT, EVEN THOUGH MADE DURING ASSESSMENT PROCEEDINGS.. WE DO NOT SEE ANY REASON TO FIND FAULT WITH THE DIRECTION OF THE CIT (A). IN VIEW OF THIS, WE FIND NO MERIT IN REVENUES CONTENTIONS. 4. IN THE RESULT, REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH APRIL, 2016 SD/ - SD/ - (P. MADHAVI DEVI) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDERABAD, DATED 13 TH APRIL , 2016 TNMM COPY TO : 1. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE - 2( 1 ), 8 TH FLOOR, B BLOCK, IT TOWERS, AC GUARDS, H YDERABAD. 2 . M/S. KHAITAN ELECTRICALS LTD., A - 13, COOP INDUSTRIAL ESTATES, BALANAGAR, HYDERABAD. 3 . CIT(APPEALS) - 2 , HYDERABAD. 4. PR. CIT - 2 , HYDERABAD. 5 . D.R. ITAT, HYDERABAD. 6 . GUARD FILE.