ACIT, CHENNAI V. M/s. Raj Kumar Impex P. Ltd., CHENNAI

ITA 1581/CHNY/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58043 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-03-2012
• Appeal Filed By: Department
• Bench Allotted: C
• Next Hearing Date: 14-03-2012
• Assessment Year: 2002-2003
• Appeal Filed On: 22-09-2011
• Court: TRIBUNAL
• Department Lawyers: DR YOGESH KAMATH
• Section: 80HHC

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER I.T.A. NO. 1581/MDS/2011 (ASSESSMENT YEAR : 2002-03) THE ASSISTANT COMMISSIONER OF INCOME TAX, COMPANY CIRCLE V(3), CHENNAI - 600 034 . (APPELLANT) V. M/S RAJ KUMAR IMPEX P. LTD., B-603, KESHAV DUGAR APARTMENTS, NO.1, EAST AVENUE, KESHAV PERUMALPURAM, R.A.PURAM, CHENNAI - 600 028. PAN : AAACR3577J (RESPONDENT) I.T.A. NO. 1587/MDS/2011 (ASSESSMENT YEAR : 2002-03) M/S RAJ KUMAR IMPEX P. LTD., B-603, KESHAV DUGAR APARTMENTS, NO.1, EAST AVENUE, KESHAV PERUMALPURAM, R.A.PURAM, CHENNAI - 600 028. (APPELLANT) V. THE ASSISTANT COMMISSIONER OF INCOME TAX, COMPANY CIRCLE V(3), CHENNAI - 600 034 . (RESPONDENT) REVENUE BY : DR. YOGESH KAMATH ASSESSEE BY : NONE DATE OF HEARING : 14.03.2012 DATE OF PRONOUNCEMENT : 14.03.2012 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : THESE ARE CROSS APPEALS FILED BY THE REVENUE AND AS SESSEE RESPECTIVELY. REVENUE IN ITS APPEAL IS AGGRIEVED T HAT CIT(APPEALS) I.T.A. NO. 1581/MDS/11 I.T.A. NO. 1587/MDS/11 2 DIRECTED THE A.O. TO COMPUTE THE ELIGIBLE DEDUCTION UNDER SECTION 80HHC OF INCOME-TAX ACT, 1962 (IN SHORT 'THE ACT') WITHOUT FIRST DEDUCTING THE DEDUCTION AVAILABLE TO THE ASSESSEE U NDER SECTION 80- IB OF THE ACT. AS PER THE REVENUE, IN VIEW OF THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF GENERAL OP TICS (ASIA) LTD. V. DCIT (315 ITR 400), THE AMENDED PROVISIONS OF SECTI ON 80-IB APPLY AND DEDUCTION UNDER SECTION 80HHC OF THE ACT COULD BE CALCULATED ONLY ON PROFITS AVAILABLE AFTER ALLOWING DEDUCTION UNDER SECTION 80-IB OF THE ACT. AS AGAINST, ASSESSEE IN ITS APPEAL IS AGGRIEVED THAT CIT(APPEALS) HELD INCOME FROM DEPB SALES AND INTERE ST RECEIVED ON MARGIN MONEY DEPOSIT TO BE NOT ELIGIBLE FOR CALCULA TING DEDUCTION UNDER SECTION 80-IB OF THE ACT. 2. WHEN THESE APPEALS WERE CALLED UP, NOBODY APPEAR ED ON BEHALF OF ASSESSEE. INSOFAR AS APPEAL OF REVENUE I S CONCERNED, WE FIND THAT HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT V. MRF LTD. (TCA NO.1020 OF 2009 DATED 27.10.2009) HAD, AF TER CONSIDERING ITS DECISION IN THE CASE OF SCM CREATIONS V. ACIT ( 304 ITR 319) AS ALSO PLETHORA OF VARIOUS HIGH COURTS AND SUPREME CO URT DECISIONS, HELD THAT LAW LAID DOWN BY THE COURT IN THE CASE OF SCM CREATIONS (SUPRA) COULD BE TAKEN AS A VIEW ACCEPTED BY THE DE PARTMENT. THE SAME VIEW HAS BEEN TAKEN BY HONBLE JURISDICTIONAL HIGH COURT IN THE I.T.A. NO. 1581/MDS/11 I.T.A. NO. 1587/MDS/11 3 CASE OF DCIT V. CHOLA TEXTILES P. LTD. (304 ITR 256 ) WHERE THE ASSESSMENT YEAR INVOLVED WAS 2004-05. AS FAR AS TH E DECISION ON GENERAL OPTICS (ASIA) LTD. (SUPRA) RELIED ON BY THE REVENUE, THE SAID DECISION WAS RENDERED ON 22 ND DECEMBER, 2008 MUCH PRIOR TO DECISION OF JURISDICTIONAL HIGH COURT IN THE CASE O F MRF LTD. (SUPRA). THEREFORE, WE ARE OF THE OPINION THAT LD. CIT(APPEA LS) WAS CORRECT IN HOLDING THAT DEDUCTION UNDER SECTION 80-IB OF THE A CT WAS NOT TO BE REDUCED BEFORE CALCULATING THE ELIGIBLE DEDUCTION U NDER SECTION 80HHC OF THE ACT. 3. IN THE RESULT, WE DO NOT FIND ANY MERIT IN THE A PPEAL OF THE REVENUE. 4. INSOFAR AS APPEAL OF THE ASSESSEE IS CONCERNED, WE ARE OF THE OPINION THAT IN VIEW OF THE DECISION OF HONBLE APE X COURT IN THE CASE OF LIBERTY INDIA V. CIT (317 ITR 218) WHERE IT HAS BEEN HELD THAT RECEIPTS OF DEPB AND DUTY DRAWBACK COULD NOT BE CON SIDERED AS INCOME DERIVED FROM INDUSTRIAL UNDERTAKING, LD. CI T(APPEALS)S ORDER COULD NOT BE FAULTED WITH. LD. CIT(APPEALS) HAD HE LD THAT INCOME FROM DEPB SALES AND INTEREST RECEIPT ON MARGIN MONE Y DEPOSIT HAD TO BE EXCLUDED WHILE CALCULATING DEDUCTION UNDER SE CTION 80-IB OF THE ACT. REVENUE IS ALSO SUPPORTED BY THE DECISION OF HONBLE APEX I.T.A. NO. 1581/MDS/11 I.T.A. NO. 1587/MDS/11 4 COURT IN THE CASE OF CIT V. K. RAVINDRANATHAN NAIR (295 ITR 228). WE ARE, THEREFORE, OF THE OPINION THAT APPEAL OF TH E ASSESSEE IS ALSO DEVOID OF ANY MERITS. 5. IN THE RESULT, BOTH THE APPEALS FILED BY REVENUE AS WELL AS ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT AFTER CONCLUSION OF HEARING ON 14 TH MARCH, 2012. SD/- SD/- (VIKAS AWASTHY) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 14 TH MARCH, 2012. KRI. COPY TO: (1) ASSESSEE (2) ASSESSING OFFICER (3) CIT(A)-VI, CHENNAI (4) CIT-III, CHENNAI (5) D.R. (6) GUARD FILE