DCIT, CHENNAI V. Sundaram Auto Components Ltd., CHENNAI

ITA 1576/CHNY/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8162 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 05-10-2016
• Assessment Year: 2004-2005
• Appeal Filed On: 30-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A V SREEKANTH IRS
• Assessee Lawyers: R VIJAYARAGHAVAN

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : CHENNAI . . . , ! . '#'$ , % !& ' [BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER ] ./ I.T.A. NO. 1576/MDS/2016 / ASSESSMENT YEAR : 2004-2005. THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE 6(2) CHENNAI 600 034. VS. M/S. SUNDRAM AUTO COMPONENTS LTD, NO.29, JAYALAKSHMI ESTATES, HADDOWS ROAD, CHENNAI 600 006. [PAN AAACS 7027G ] ( () / APPELLANT) ( *+() /RESPONDENT) / APPELLANT BY : SHRI. A.V. SREEKANTH, IRS, JCIT. /RESPONDENT BY : SHRI. R. VIJAYARAGHAVAN, ADVOCATE / DATE OF HEARING : 05-10-2016 ! / DATE OF PRONOUNCEMENT : 21-10-2016 / O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST AN ORDER DATED 10.02.2016 OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-15, CHENNAI. ITA NO.1576/2016 :- 2 -: 2. REVENUE HAS FILED THIS APPEAL WITH A DELAY OF TEN D AYS. PETITION FOR CONDONATION HAS BEEN FILED. FAIR REAS ONS HAVE BEEN SHOWN. DELAY IS CONDONED. APPEAL IS ADMITTED. 3. GRIEVANCE RAISED BY THE REVENUE IS ON THE DIRECTIO N OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) TO EXCLUDE EXCISE DUTY, SALES TAX AND SCRAP SALES FROM TOTAL TURNOVER WHIL E CALCULATING DEDUCTION CLAIMED BY THE ASSESSEE U/S.80HHC OF THE INCOME TAX ACT, 1961 (HEREIN REFERRED AS THE ACT). 4. LD. ASSESSING OFFICER HAD ADDED EXCISE DUTY OF C10,76,34,763/-, SALES TAX C2,96,94,516/- AND SCRA P SALES C24,48,474/- IN THE TOTAL TURNOVER OF THE ASSESSEE WHILE COMPUTING DEDUCTION U/S.80HHC OF THE ACT. 5. WHEN ASSESSEE MOVED IN APPEAL BEFORE LD. COMMISSION ER OF INCOME TAX (APPEALS), THE LD. COMMISSIONER OF INCOM E TAX (APPEALS) RELYING ON THE JUDGMENTS OF APEX COURT IN THE CASE OF CIT VS. LASKHMI MACHINE WORKS 290 ITR 667 AND CIT VS. PUNJAB STAIN LESS STEEL INDUSTRIES 364 ITR 144 DIRECTED THE LD. ASSESSING OFFICER TO EXCLUDE THESE AMOUNTS FROM THE TOTAL TURNOVER WHILE COMPUTI NG THE DEDUCTION U/S.80HHC OF THE ACT. ITA NO.1576/2016 :- 3 -: 6. NOW BEFORE US, LD. DEPARTMENTAL REPRESENTATIVE SUB MITTED THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HAD R ELIED ON A DECISION OF CO-ORDINATE BENCH IN THE CASE OF M/S. S UNDARAM CLAYTON LTD FOR GIVING RELIEF TO THE ASSESSEE. AS PER LD. DEPARTMENTAL REPRESENTATIVE THE DECISION HAD NOT REACHED FINALI TY. 7. PER CONTRA, THE LD. AUTHORISED REPRESENTATIVE STRO NGLY SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 8. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND PERUSE D THE ORDERS OF THE AUTHORITIES BELOW. IN SO FAR AS EXCI SE DUTY AND SALES TAX ARE CONCERN, THE HONBLE APEX COURT IN THE CASE OF LASKHMI MACHINE WORKS (SUPRA) CLEARLY HELD THAT EXCISE DUTY AND SALES TAX WERE TO BE EXCLUDED FROM TOTAL TURNOVER WHEN WORKING OUT THE DEDUCTION AVAILABLE TO THE ASSESSEE U/S.80HHC OF THE ACT. IN SO FOR AS SCRAP SALES THEIR LORDSHIP IN THE CASE OF PUNJAB STAINLESS STEEL INDUSTRIES (SUPRA) HELD THAT WHERE AN ASSESSEE WAS NOT DEALING IN SCRA P BUT SCRAP WAS ONLY WHAT WAS LEFT FROM THE PROCESS OF MANUFACT URING, THEN PROCEEDS OF SALE OF SUCH SCRAP SHOULD NOT BE CONSID ERED AS PART OF THE TURNOVER. WE ARE OF THE OPINION THAT LD. COMMISSIO NER OF INCOME TAX (APPEALS) HAD RIGHTLY FOLLOWED THE JUDGMENT OF APEX COURT IN THE CASES ITA NO.1576/2016 :- 4 -: OF LASKHMI MACHINE WORKS (SUPRA) AND PUNJAB STAINLESS STEEL INDUSTRIES(SUPRA) FOR GIVING RELIEF TO THE ASSESSEE. WE DO NOT FIND ANY REASON TO INTERFERE. 9. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISS ED. . ORDER PRONOUNCED ON FRIDAY, THE 21ST DAY OF OC TOBER, 2016, AT CHENNAI. SD/- SD/- ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER ( ! . '#'$ ) (ABRAHAM P. GEORGE) % / ACCOUNTANT MEMBER #$ / CHENNAI %& / DATED:21ST OCTOBER, 2016 KV &' ()*) / COPY TO: 1 . / APPELLANT 3. +,' / CIT(A) 5. )-. / / DR 2. / RESPONDENT 4. + / CIT 6. .01 / GF