Aurobindo Pharma Limited, Hyderabad V. DCIT, Circle-1(1), Hyderabad

ITA 1507/HYD/2013

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 1616 (ITAT-HYDERABAD)
• Duration Of Justice: 7 year(s) 3 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-02-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Next Hearing Date: 13-01-2021
• Assessment Year: 1999-2000
• Appeal Filed On: 14-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: Y V S T SAI
• Assessee Lawyers: C P RAMASWAMI
• Keywords: Retrospective amendment; Set aside
• Section: 80HHC; 37(1); 80IA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD (THROUGH VIDEO CONFERENCE) BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER ITA NO. A.Y. APPELLANT RESPONDENT 1507/HYD/13 1999-2000 AUROBINDO PHARMA LTD., HYDERABAD [PAN: AABCA7366H] DY.COMMISSIONER OF INCOME TAX, CIRCLE-1(1), HYDERABAD 1508/HYD/13 2001-02 RANITH PHARMA LTD., (NOW AMALGAMATED WITH AUROBINDO PHARMA LTD), HYDERABAD [PAN: AAACR9749L] 1509/HYD/13 2002-03 AUROBINDO PHARMA LTD., HYDERABAD [PAN: AABCA7366H] 1510/HYD/13 2004-05 FOR ASSESSEE : SHRI C.P.RAMA SWAMI, AR FOR REVENUE : SHRI Y.V.S.T.SAI, CIT-DR DATE OF HEARING : 13-01-2021 DATE OF PRONOUNCEMENT : 16-02-2021 O R D E R PER BENCH : THESE FOUR ASSESSEES APPEALS ARISE FROM CIT(A)S COMMON ORDER FOR AYS.1999-2000, 2001-02, 2002-03 & 2004- 05 PASSED IN CASE NOS.094 TO 096/CC-2, HYD/CIT(A)- 1,HYD/12-13 & DATED 30-08-2013 FOR AY.2002-03 PASSED ON THE VERY DATE, INVOLVING PROCEEDINGS U/S.143(3) OF THE ACT IN FORMER SET AND U/S.143(3) R.W.S.263 IN ORDER WISE; RESPECTIVELY. HEARD BOTH THE PARTIES AND CASE FILES PERUSED. ITA NOS.1507, 1508, 1509 & 1510/HYD/2013 :- 2 -: 2. THE ASSESSEES IDENTICAL GROUNDS IN ALL THESE FOUR APPEALS READ AS UNDER (EXTRACTED FROM AY.1999-2000): 1. THE ORDER OF THE LEARNED CIT(APPEALS), INSOFAR AS IT IS PREJUDICIAL TO THE INTEREST OF THE APPELLANT, IS AGAINST LAW, W EIGHT OF EVIDENCE AND PROBABILITIES OF THE CASE. 2. THE LEARNED CIT(APPEALS) ERRED IN UPHOLDING THE DECISION OF THE ASSESSING OFFICER OF RESTRICTING THE DEDUCTIONS UND ER CHAPTER VI-A DESPITE THE FACT THAT THE AGGREGATE OF DEDUCTIONS U NDER SECTION 80IA AND UNDER SECTION 80HHC WAS LESS THAN 100% OF THE P ROFITS OF THE BUSINESS OF THE ASSESSEE. SHE OUGHT TO HAVE ALLOWED THE APPEAL. 3. THE LEARNED CIT(APPEALS) FAILED TO APPRECIATE TH AT THE CLAIM OF THE APPELLANT IS COMPLETELY IN ACCORDANCE WITH BOARD CI RCULAR NO.772 DATED 23-12-1998 AND FURTHER SUPPORTED BY THE DECIS ION OF THE BOMBAY HIGH COURT REPORTED IN 332 ITR 42, BESIDES A NUMBER OF DECISIONS OF CO-ORDINATE BENCHES OF THE HON'BLE TRI BUNAL FOLLOWING THE DECISION OF THE BOMBAY HIGH COURT. CONSEQUENTLY SHE ERRED IN DISMISSING THE APPEAL. 4. FOR THE ABOVE GROUNDS AND SUCH OTHER GROUNDS THA T MAY BE URGED AT THE TIME OF HEARING, THE APPELLANT PRAYS THAT TH E APPEAL BE ALLOWED. 3. WE NOTICE AT THE OUTSET WITH THE ABLE ASSISTANCE OF BOT H THE PARTIES THAT THE SOLE SUBSTANTIVE ISSUE THAT ARISES FOR OUR APT ADJUDICATION IS THAT OF CORRECTNESS OF BOTH THE LOWER AUTHORITIES ACTION TREATING THE ASSESSEES CLAIMS OF SE CTION 80- IA AND SECTION 80HHC DEDUCTION(S) AS AN INSTANCE OF DO UBLE DEDUCTION AS NOT ALLOWABLE. THE CIT(A)S DETAILED DIS CUSSION TO THIS EFFECT READS AS UNDER: 02.0 THE APPELLANT COMPANY IS A WIDELY HELD PUBLIC LIMITED COMPANY ENGAGED IN THE BUSINESS OF MANUFACTURE AND SALE OF BULK DRUGS AND PHARMACEUTICAL FORMULATIONS. IN THIS CASE , SCRUTINY ASSESSMENT U/S.143(3) WAS COMPLETED FOR ASST.YEARS 2002-03 & 2004-05 AND SCRUTINY ASSESSMENT U/S.143(3) R.W.S.14 7 FOR ASST.YEAR 1999-2000 ON 22-3-2005, 29-12-2006 AND 28-2-2005 RE SPECTIVELY. AGAINST THESE ORDERS, THE APPELLANT HAS FRIED AN AP PEAL BEFORE CIT(A) AND THE APPEALS FOR ASST. YEARS 2002-03 AND 2004-05 WERE SETTLED IN FAVOUR OF THE APPELLANT AND THE APPEAL FOR ASST.YEA R 1999-2000 WAS PARTLY ALLOWED IN FAVOUR OF THE APPELLANT BY THE CI T(A). AGAINST THESE ITA NOS.1507, 1508, 1509 & 1510/HYD/2013 :- 3 -: APPELLATE ORDERS, THE DEPARTMENT HAS FILED AN APPEA L BEFORE THE TRIBUNAL FOR ASST. YEARS 2002-03 AND 2004-05 AND TH E APPELLANT HAS FILED AN APPEAL BEFORE THE TRIBUNAL FOR ASST.YEAR 1 999-2000. ONE OF THE ISSUES INVOLVED IN THE ORDER IS DEDUCTIONS U/S. 80IA AND 80HHC. THE TRIBUNAL IN ITS ORDER ITA NO.1265/HYD/2005 DT.3 0-6-2010 HAS RESTORED THE MATTER TO THE FILE OF THE ASSESSING OF FICER FOR ASCERTAINING THE FACT WHETHER HE HAD WORKED OUT THE DEDUCTION U/ S.80HHC OF THE ACT IN LINE WITH THE WORKING SHOWN IN THE ORDER AND AS PER THE RULING OF THE SPECIAL BENCH OF DELHI TRIBUNAL DECISION IN THE CASE OF HINDUSTAN MINT AND AGRO PRODUCTS PRIVATE LIMITED(SU PRA). SUBSEQUENTLY, THE ASSESSING OFFICER HAS PASSED THE CONSEQUENTIAL ORDERS FOR ASST.YEARS 1999-2000, 2002-03 AND 2004-0 5. 03.0 AGGRIEVED. WITH THE ABOVE CONSEQUENTIAL ORDERS , THE ASSESSEE PREFERRED APPEALS WITH THE FOLLOWING COMMON EFFECTI VE GROUNDS. I) THE ORDER OF THE LEARNED DCIT, CIRCLE-1(1) IS SO FOR AS IT IS AGAINST THE INTEREST OF THE APPELLANT, IS AGAINST LAW, WEIG HT OF EVIDENCE AND PROBABILITIES OF THE CASE. II) THE LEARNED DCIT GROSSLY ERRED IN CALCULATING A ND ALLOWING THE AMOUNTS OF DEDUCTIONS U/S.80IA AND 80HHC IGNORING T HE DIRECTIONS OF THE HON'BLE ITAT. III) FOR THE ABOVE GROUNDS AND SUCH OTHER GROUNDS T HAT MAY BE URGED AT THE TIME OF HEARING. 04.0 IN RESPONSE TO THE NOTICE OF HEARING ISSUED BY THIS OFFICE, SHRI C.P.RAMASWAMY, ADVOCATE. APPEARED AND THE CASE WAS DISCUSSED WITH HIM. 05.0 THE ASSESSING OFFICER IN THE CONSEQUENTIAL ORD ER DT.2-3-2011 FOR ASST.YEAR 2004-05, HAS STATED THAT THE ISSUE INVOLV ED IS WHETHER THE DEDUCTION ALLOWED U/S.80IB HAS TO BE REDUCED WHILE COMPUTING THE DEDUCTION U/S.80HHC OF THE ACT IN VIEW OF PROVISION S OF SUB SECTION (9) OF SEC.80IA OF THE ACT AND THE HON'BLE ITAT REL YING ON THEIR OWN ORDER IN THE ASSESSEE'S OWN CASE IN ITA NO.1265/HYD /05 FOR AY 1999-2000 DT.30-6-10 DIRECTED THE AO TO FOLLOW THE METHOD OF COMPUTATION SHOWN IN THEIR ORDER WHICH IN TURN WAS BASED ON THE DECISION OF DELHI ITAT SPECIAL BENCH IN THE CASE OF ACIT VS HINDUSTAN MINT & AGRO PRODUCTS PVT.LTD (SB)(DELHI) 315 ITR (AT) 1. 05.1 AFTER DISCUSSING THE DECISIONS OF VARIOUS JUDI CIAL AUTHORITIES AND THE SUBMISSIONS OF THE APPELLANT, THE ASSESSING OFF ICER CONCLUDED THAT THE DEDUCTION ALLOWED UJS.80IA IS TO BE REDUCE D FROM THE ELIGIBLE PROFITS AND ON THE BALANCE PROFIT ALONE, THE DEDUCT ION U/S.80HHC HAS TO BE ALLOWED AND FOLLOWED THE SAME PRINCIPLE FOR A SST.YEARS 1999- 2000 AND 2002-03 ALSO. ITA NOS.1507, 1508, 1509 & 1510/HYD/2013 :- 4 -: 06.0 IN THE STATEMENT OF FACTS FILED ALONGWITH FORM NO.35, IT HAS BEEN SUBMITTED THAT FOR ASST.YEAR 1999-2000, THE APPELLA NT COMPANY WAS HAVING SIX INDUSTRIAL UNDERTAKINGS AND THE APPELLAN T IS ENTITLED FOR 80IA DEDUCTION FOR UNIT-II AND UNIT-IV INDUSTRIAL U NDERTAKINGS AT. BOLLARAM AND PASHAMYLARAM AND FOR ASST.YEAR 2002-03 , THE APPELLANT COMPANY WAS HAVING ELEVEN INDUSTRIAL UNDE RTAKINGS AND THE APPELLANT IS ENTITLED FOR 80IA DEDUCTION FOR UN IT-II AND UNIT-IV INDUSTRIAL UNDERTAKINGS AT BOLLARAM AND PASHAMYLARA M. IN THE SAME MANNER, FOR ASST.YEAR 2004-05, THE APPELLANT COMPAN Y WAS HAVINQ ELEVEN INDUSTRIAL UNDERTAKINGS AND THE APPELLANT IS ENTITLED FOR 80IA DEDUCTION FOR UNIT-VII, IX AND UNIT-XI INDUSTRIAL U NDERTAKINGS AT GADDAPOTHARAM, GUNDLA MACHANUR AND PYDIBHIMAVARAM. IT WAS ALSO CONTENDED THAT THE APPELLANT COMPANY IS ALSO E NTITLED FOR DEDUCTION U/S.80HHC ON EXPORT PROFITS. 06.1 IT HAS ALSO BEEN SUBMITTED THAT PRIOR TO THE I NTRODUCTION OF SEC.80IA, THE ASSESSEES WERE ENTITLED FOR DEDUCTION FROM THE PROFITS OF THE INDUSTRIAL UNDERTAKING U/S.8OI I.E., UP TO ASST .YEAR 1998-99 AND IN THAT SECTION THERE WAS NO PROVISION SIMILAR TO T HE PROVISION OF SUB- SECTION (9) OF 80IA. AND IN THE ABSENCE OF SUCH PRO VISION, THE, ASSESSES WERE CLAIMING HIGHER DEDUCTION ON UNDER VA RIOUS PROVISIONS OF CHAPTER-VIA, WHEREBY THE DEDUCTION AMOUNT WAS MO RE THAN THE PROFITS OF THE INDUSTRIAL UNDERTAKING BECAUSE THE A SSESSES WERE HAVING OTHER INCOME INCLUDED IN THE GROSS TOTAL INC OME. THOUGH, THERE IS A PROVISION IN SEC.80A(2) AS PER WHICH THE AGGRE GATE AMOUNT OF DEDUCTION UNDER CHAPTER-VIA SHOULD NOT EXCEED THE G ROSS TOTAL INCOME OF THE ASSESSEE, YET, THE ASSESSEES WERE CLA IMING THE DEDUCTION IN RESPECT OF THE INDUSTRIAL UNDERTAKING UNDER VARIOUS SECTIONS OF CHAPTER-VIA IN EXCESS OF THE PROFITS OF THE INDUSTRIAL UNDERTAKING AS LONG AS THE GROSS TOTAL INCOME WAS T HERE. 06.2 IT HAS BEEN FURTHER STATED THAT THE PURPOSE FO R WHICH SEC.8OIA(9) HAS BEEN 'TRADUCED IS EXPLAINED IN THE MEMORANDUM E XPLAINING THE PROVISION OF FINANCE BILL, 1998 AS - UNDER THE. PRO VISIONS OF CHAPTER VIA OF THE INCOME TAX ACT, VARIOUS DEDUCTIONS FROM THE PROFITS AND GAINS ARE ALLOWED TO SPECIFIED ASSESSEES SUBJECT TO FULFILLING CERTAIN REQUIREMENTS SPECIFIED UNDER THE INCOME TAX ACT ARE RESTRICTED TO THE GROSS TOTAL INCOME IN RESPECT OF THE ASSESSEE AS A WHOLE. HOWEVER, IN CERTAIN CASES, IT WAS NOTICED THAT CERTAIN ASSESSEE S CLAIMED MORE THAN 100% DEDUCTION ON SUCH PROFITS AND GAINS OF TH E SAME UNDERTAKING WHEN THEY WERE ENTITLED TO DEDUCTIONS U NDER MORE THAN ONE SECTION OF CHAPTER VIA. WITH A VIEW TO PROVIDIN G SUITABLE STATUTORY SAFEGUARD IN THE INCOME TAX ACT TO PREVEN T TAXPAYER FROM TAKING UNDUE ADVANTAGE OF EXISTING PROVISION OF THE ACT BY CLAIMING REPEATED DEDUCTIONS IN RESPECT OF THE SAME AMOUNT O F ELIGIBLE INCOME, EVEN IN CASES WHERE IT EXCEEDS SUCH ELIGIBLE PROFIT S OF AN UNDERTAKING OR HOTEL, IT IS PROPOSED TO PROVIDE INBUILT RESTRIC TIONS IN SECTION 80HHD AND 80IA SO THAT SUCH UNINTENDED BENEFITS ARE NOT P ASSED ON THE ITA NOS.1507, 1508, 1509 & 1510/HYD/2013 :- 5 -: ASSESSEE. THIS AMENDMENT IS SOUGHT TO BE INTRODUCED RETROSPECTIVELY W.E.F.1-4-1990. 06.3 IT HAS BEEN POINTED OUT THAT FROM THE ABOVE SA ID EXPLANATORY NOTES TO THE FINANCE BILL, THE LEGISLATIVE INTENT I S CLEAR AS ONLY TO RESTRICT THE DEDUCTION ALLOWABLE UNDER CHAPTER VIA AS' NOT TO EXCEED THE 100% PROFITS OF INDUSTRIAL UNDERTAKING, THIS PR OVISION HAS BEEN INTRODUCED. THEREFORE, THIS SECTION DOES NOT ENABLE THE ASSESSING OFFICER TO REDUCE THE QUANTUM OF DEDUCTION ALLOWABL E U/S.80IA AND ONLY ON THE BALANCE, 80HHCSHOUID BE ALLOWED. THE QU ANTIFICATION OF DEDUCTIONS IS GOVERNED INDEPENDENTLY UNDER BOTH THE SECTIONS WITH REFERENCE TO THE ENTIRE PROFITS OF THE INDUSTRIAL U NDERTAKING WITHOUT ANY DEDUCTION THERE FROM. ONCE THE ASSESSEE IS ENTI TLED TO BOTH THE DEDUCTIONS, THESE TOO PUT TOGETHER SHOULD NOT EXCEE D THE TOTAL PROFITS OF THE INDUSTRIAL UNDERTAKING AS PER THE PROVISIONS OF. SEC.80IA(9). THE FIRST LIMB OF THE PROVISION HAS TO BE READ IN C ONJUNCTION WITH THE SECOND LIMB OF THE PROVISION OF SEC.80IA(9). IT HAS BEEN FURTHER SUBMITTED THAT IT HAS BEEN HELD BY THE HON'BLE HIGH COURT IN THE CASE OF SHREE AZAD TRANSPORT CO.P.LTD VS. CTO-123-STC-13 (CAL) THAT THE PROVISIONS OF THE ACT AS ALSO OF THE RULES MUST BE READ CONJOINTLY SO AS TO GIVE FULL AND EFFECTIVE MEANING TO THE PROVISION S OF THE ACT. THE SUPREME COURT IN THE CASE OF BALRAM KUMAWAT VS UNIO N OF INDIA(2003) HELD THAT THE COURTS SHOULD. ADOPT A BO LDER CONSTRUCTION TO GIVE EFFECT TO THE PARLIAMENTARY INTENTION, REJECTI NG A CONSTRUCTION WHICH WILL DEFEAT THE INTENTION OF THE LEGISLATURE EVEN THOUGH THERE MAY BE SOME INEXACTITUDE IN THE LANGUAGE USED. THER EFORE, IF THE PRINCIPLE OF HARMONIOUS CONSTRUCTION OF STATUES ARE APPLIED TO THIS SECTION, IT WOULD ONLY MEAN THAT THE DEDUCTION WOUL D BE ALLOWED U/S.80HHC WITHOUT DEDUCTING THE QUANTUM OF DEDUCTIO N ALLOWED U/S.80IA, SUBJECT TO THE OVERALL CEILING THAT IT SH OULD NOT EXCEED THE TOTAL PROFITS OF THE INDUSTRIAL UNDERTAKING WHICH E XACTLY IS THE LEGISLATIVE INTENTION OF THE PARLIAMENT. 06.4 THE APPELLANT RELIED ON THE FOLLOWING JUDICIAL PRONOUNCEMENTS IN SUPPORT OF ITS CLAIM. I) ASSOCIATED CAPSULES PRIVATE LTD VS CIT II) GITANJALI CHEMICALS (P) LTD. VS ITO - 2006 TAX PUB(DT) 1706 (MUM- TRIB) III) RELIABLE DYECHEM (P) LTD. VS ADDL.CIT - 2012 T AX PUB(DT)0565 (RKT-TRIB) IV) SYSTEMATIC EXPORTS VS ACIT - 2011 TAX PUB(DT) 1 922 (MUM-TRIB) 06.5 IN THE COURSE OF APPELLATE PROCEEDINGS, THE AR OF THE APPELLANT RELIED ON THE DECISION OF HON'BLE ITAT, VISAKHAPATN AM BENCH, VISAKHAPATNAM IN ITA NOS.190 TO 192/VIZAG/2010 DT.1 -7-2011 IN WHICH HON'BLE ITAT RELIED ON THE DECISION OF HON'BL E BOMBAY HIGH ITA NOS.1507, 1508, 1509 & 1510/HYD/2013 :- 6 -: COURT IN THE CASE OF ASSOCIATED CAPSULES (P) LTD.(2 011) 237 CTR (BOM) 408, (2011) (50 OTR 65), WHEREIN THE HON'BLE COURT HAS EXPLAINED THE MANNER OF AI/OWING DEDUCTIONS U/S.80I B AND 80HHC VIS-A-VIS 80IA(9) OF THE ACT BY GIVING AN ILLUSTRAT ION. IN THE CASE OF ASSOCIATED CAPSULES (P) LTD., THE HON'BLE HIGH COUR T HELD I THAT SEC.80IA(9) AFFECTS ALLOWABILITY OF DEDUCTION AND N OT COMPUTATION OF DEDUCTION. PLACING RELIANCE ON THIS DECISION, THE HON'BLE ITAT , VISAKHAPATNAM HELD THAT THE METHOD FOLLOWED BY THE ASSESSING OFFI CER WAS NOT IN ACCORDANCE WITH THE ILLUSTRATION GIVEN BY THE HON'B LE BOMBAY HIGH COURT. ACCORDINGLY, THE HON'BLE ITAT SET ASIDE THE ORDERS OF CIT(A) AND DIRECTED THE ASSESSING OFFICER TO ALLOW THE IMP UGNED DEDUCTIONS IN THE MANNER EXPLAINED IN THE CASE OF ASSOCIATED C APSULES (P) LTD.(SUPRA). 07.0 I HAVE GONE THROUGH THE FACTS OF THE CASE. IT MAY BE NOTED THAT THE HON'BLE ITAT, HYDERABAD SET 'ASIDE THE ORDER OF THE ASSESSING OFFICER WITH A CLEAR DIRECTION TO FOLLOW THE DECISI ON OF SPECIAL BENCH IN THE CASE OF HINDUSTAN MINT AND AGRO PRODUCTS PRIVAT E LIMITED (SUPRA) AND THE ASSESSING OFFICER FOLLOWED THE DIRECTION AN D PASSED THE CONSEQUENTIAL ORDER ACCORDINGLY. THE OBJECT OF AMEN DING SECTION 80IA BY FINANCE ACT,1998 AS IS EVIDENT FROM THE MEMORAND UM EXPLAINING THE PROVISIONS IN THE FINANCE BILL, 1998 (231 ITR ( ST) 252) IS TO AVOID MISUSE OF THE DEDUCTIONS UNDER CHAPTER-VIA WHERE CO MBINED DEDUCTIONS UNDER VARIOUS SECTIONS CLAIMED EXCEEDED 100% DEDUCTION ON THE PROFITS AND GAINS OF THE UNDERTAKING. WITH A VIEW TO PREVENT THE TAXPAYER TAKING UNDUE ADVANTAGE OF EXISTING PRO VISIONS OF THE ACT, SECTION 80IA WAS AMENDED BY FINANCE ACT, 1998 SO THAT THE DEDUCTIONS ALLOWED U/S.80IA AND VARIOUS SECTIONS UN DER HEADING 'C' OF CHAPTER-VIA ARE RESTRICTED TO THE PROFITS OF THE BUSINESS OF THE UNDERTAKING. THIS VIEW IS ALSO SUPPORTED BY CBDT CI RCULAR NO.772 DT.23-12-1998, WHEREIN IT IS STATED THAT SECTION 80 IA(9) HAS BEEN INTRODUCED WITH A VIEW TO PREVENT THE TAXPAYERS FRO M CLAIMING REPEATED DEDUCTIONS IN RESPECT OF THE SAME AMOUNT O F ELIGIBLE INCOME AND THAT TOO IN EXCESS OF THE ELIGIBLE PROFITS. 07.1 IN THE CASE OF HINDUSTAN MINT & AGRO PRODUCTS PVT.LTD., THE HON'BLE ITAT DELHI SPECIAL BENCH HELD THAT TO THE E XTENT OF THE AMOUNT OF PROFITS OF BUSINESS ON WHICH 80IA DEDUCTI ON IS ALLOWED, NO OTHER DEDUCTION SHALL BE ALLOWED UNDER ANY OTHER PR OVISIONS UNDER PART-C OF CHAPTER-VIA OF THE ACT AND THIS DECISION OF SPECIAL BENCH HAS BEEN AFFIRMED BY THE HON'BLE DELHI HIGH COURT I N THE CASE OF M/S.GREAT EASTERN EXPORTS VS CIT (2011) 37(1) DTCL (DELHI HIGH COURT). SIMILAR VIEW HAS ALSO BEEN TAKEN BY THE HON 'BLE KERALA HIGH COURT IN THE CASE OF M/S.OLAM EXPORTS (INDIA) LTD. VS CIT (2009) 184 TAXMAN 373. THE CONTENTION OF THE APPELLANT THAT TH E HON'BLE ITAT, VISAKHAPATNAM BENCH IN THE CASE OF SOUTHERN ROCKS & MINERALS PVT. ITA NOS.1507, 1508, 1509 & 1510/HYD/2013 :- 7 -: LTD., ONGOLE VS DCIT (SUPRA) HAS DIRECTED THE ASSES SING OFFICER TO FOLLOW THE DECISION OF BOMBAY HIGH COURT IN THE CAS E OF ASSOCIATED CAPSULES (P) LTD AND THE SAME SHOULD BE FOLLOWED IN THE APPELLANT'S CASE CANNOT BE ACCEPTED IN VIEW OF THE FACT THAT TH E JURISDICTIONAL TRIBUNAL IN THE APPELLANT'S OWN CASE HAS DIRECTED T HE ASSESSING OFFICER TO FOLLOW THE DECISION OF THE DELHI SPECIAL BENCH IN THE CASE OF HINDUSTAN MINT & AGRO PRODUCTS PVT. LTD. WHICH HAS BEEN AFFIRMED BY THE DELHI HIGH COURT. SINCE THERE IS NO DECISION ON THE ISSUE BY THE JURISDICTIONAL ANDHRA PRADESH HIGH COURT, FOLLOWING THE DECISION OF THE TWO HIGH COURTS NAMELY, DELHI HIGH COURT AND KE RALA HIGH COURT WHICH HAVE SUPPORTED THE VIEW TAKEN BY THE HON'BLE ITAT, HYDERABAD, IT IS HELD THAT THE CONSEQUENTIAL ORDER PASSED BY THE ASSESSING OFFICER AS PER THE DIRECTION OF THE HON'B LE ITAT, HYDERABAD IS IN ORDER AND ACCORDINGLY, THE ACTION OF THE ASSE SSING OFFICER IS UPHELD. 4. LEARNED CIT-DR VEHEMENTLY CONTENDED AT THE OUTSET TH AT BOTH THE LOWER AUTHORITIES ACTION UNDER CHALLENGE DENYI NG THE ASSESSEE THE ALLEGED DOUBLE DEDUCTION(S) U/S.80HHC AN D SEC.80I IS VERY MUCH IN TUNE WITH THE TRIBUNALS FIRST ROUND REMAND ORDER RESTORING THE ISSUE BACK TO THE ASSESSING OFFICER TO BE DECIDED AS PER SPECIAL BENCH (SUPRA) AND THEREF ORE, EVEN IF IT IS HELD THAT THE LEGAL POSITION HAS CHANGED, THE S AME DESERVES TO BE UPHELD. WE NOTICE IN THIS FACTUAL BACKD ROP THAT THE ASSESSEES INSTANT FOUR APPEALS ARE PENDING SINCE THE YEAR 2013. THE LEAD APPEAL ITA NO.1507/HYD/2013 HAS SE EN THIRTY SIX ADJOURNMENTS IN ALL. CASE FILE(S) NOTINGS THEREIN SUFFICIENTLY INDICATE THAT THE TRIBUNAL HAD PROCEEDED TO AWAIT THE HON'B LE APEX COURTS DECISION IN ACIT VS. MICRO LABS LTD. [38 0 ITR 1] (SC). HON'BLE DIVISION BENCH OF THE APEX COURT HAD F ORMED A DIVERGENT OPINION QUA THE ISSUE OF DOUBLE DEDUCTION WHICH FINALLY CULMINATED IN A REFERENCE MADE TO A LARGER B ENCH. LEARNED CO-ORDINATE BENCH EARLIER DIRECTIONS IN THE CA SE RECORDS DT.02-06-2016, 18-09-2017 AND 01-10-2019 MAD E IT CLEAR THAT POSTPONEMENT OF HEARING IN THE INSTANT BATCH OF FOUR ITA NOS.1507, 1508, 1509 & 1510/HYD/2013 :- 8 -: APPEALS WAS WARRANTED TO CLARIFY THE FINAL STATUS OF H ON'BLE APEX COURTS TRIAL ORDER ONLY. 5. LEARNED COUNSEL IN THIS FACTUAL BACKDROP HAS FILED A COPY OF THE STATUS REPORT PERTAINING TO THE HON'BLE APEX COURT FINAL DECISION ON THE ISSUE AS IT IS EVIDENT FROM THE OFFICIA L SITE. LEARNED CIT-DR FAILS TO DISPUTE THAT THE REVENUES SPEC IAL LEAVE PETITION (C) NO.031153/12 REGISTERED ON 08-10- 2012; CONVERTED TO CIVIL APPEAL NO.7427/2012, STANDS DISMISS ED ON 17-09-2018. MEANING THEREBY THAT THE CORRESPONDING HON' BLE HIGH COURTS ORDER DECIDING THE ISSUE IN ASSESSEES FAVOUR AND AGAINST THE DEPARTMENT HAS ATTAINED FINALITY THAT THE TWIN CLAIMS OF SECTION 80HHC AND SECTION 80-IA RAISED AT TH E FORMERS BEHEST QUA PROFITS OF THE ELIGIBLE BUSINESS UNDERTAKING DO NOT AMOUNT TO DOUBLE DEDUCTION. 6. WE NEXT ADVERT TO THE REVENUES OBJECTIONS THAT ONCE THIS TRIBUNALS REMAND DIRECTIONS HAD MADE IT CLEAR THAT THE ISSUE HAD TO BE DECIDED IN VIEW OF THE SPECIAL BENCHS DECI SION (SUPRA), WE OUGHT NOT TO TAKE NOTE OF ALL OTHER INTERVENI NG LEGAL DEVELOPMENTS AT ALL. WE FIND NO FORCE IN THE FOREGOIN G TECHNICAL ARGUMENT. THE CLINCHING FACT THAT REMAINS IS THAT ON THE ONE HAND IS TRIBUNALS REMAND ORDER DIRECTING THE ASSESSIN G OFFICER TO FOLLOW ITS YET ANOTHER SPECIAL BENCH (SUPRA) WHICH I TSELF STANDS OVERRULED IN (2011) 332 ITR 42 (BOM) ASSOCIATE D CAPSULES (P) LTD. VS. DCIT AND ON THE OTHER HAND IS THE JUDICIAL VERDICT DIRECTLY ON THE ISSUE COMING FROM THE HON'BLE HIGHEST COURT OF LAND. WE THUS QUOTE ARTICLE-141 OF THE CONSTITUTION OF INDIA AND HOLD THAT JUDICIAL DISCIPLIN E REQUIRES THAT ALL JUDICIAL FORUMS MUST MAKE WAY FOR THE HON'BLE APEX ITA NOS.1507, 1508, 1509 & 1510/HYD/2013 :- 9 -: COURTS DECISION ON THE RELEVANT ISSUE. IT MUST THEREFOR E BE PRESUMED THAT THE ISSUE NOW STANDS SETTLED UPTO HON'BLE SUPREME COURT IN ASSESSEES FAVOUR WITH RETROSPECTIVE EFFECT IN OTHER WORDS. WE THUS ACCEPT THE ASSESSEES SOLE SUBSTANTI VE GRIEVANCE IN PRINCIPLE AND LEAVE IT OPEN FOR THE ASS ESSING OFFICER TO FINALISE CONSEQUENTIAL COMPUTATION AS PER L AW. IT IS MADE CLEAR THAT ALTHOUGH THE ASSESSEE HAS FILED ITS CA LCULATION SHEET(S) REGARDING SECTION 80-IA AND SECTION 80HHC DEDUCTION(S) PERTAINING TO THE ALLEGED ELIGIBLE UNDERTA KINGS, THIS LATTER COMPONENT IS RESTORED BACK TO THE ASSESSING O FFICER TO ARRIVE AT HIS FINAL CONCLUSION AS PER LAW AFTER FAC TUAL VERIFICATION OF THE NECESSARY RECORDS. 7. THESE ASSESSEES FOUR APPEALS ARE TREATED AS ALLOW ED FOR STATISTICAL PURPOSES IN ABOVE TERMS. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH FEBRUARY, 2021 SD/- SD/- (LAXMI PRASAD SAHU) (S.S.G ODARA) ACCOUNTANT MEMBER JUDICIAL MEM BER HYDERABAD, DATED: 16-02-2021 TNMM ITA NOS.1507, 1508, 1509 & 1510/HYD/2013 :- 10 -: COPY TO : 1.AUROBINDO PHARMA LTD., C/O. DR.C.P.RAMASWAMI, ADVOCATE, FLAT NOS.102 & 303, GITANJALI APTS, PLOT NO.108, SRINAGAR COLONY, HYDERABAD. 2.RANITH PHARMA LTD., C/O. DR.C.P.RAMASWAMI, ADVOCA TE, FLAT NOS.102 & 303, GITANJALI APTS, PLOT NO.108, SR INAGAR COLONY, HYDERABAD. 3.THE DY.COMMISSIONER OF INCOME TAX, CIRCLE-1(1), HYDERABAD. 4.CIT(APPEALS)-1, HYDERABAD. 5.CIT(CENTRAL)-HYDERABAD. 6.D.R. ITAT, HYDERABAD. 7.GUARD FILE.