ACIT, Coimbatore V. Roots Industries India Ltd., Coimbatore

ITA 1673/CHNY/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 77388 (ITAT-CHENNAI)
• Duration Of Justice: 10 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-07-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 02-06-2014
• Assessment Year: 2010-2011
• Appeal Filed On: 30-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P B SEKARAN
• Assessee Lawyers: S SRIDHAR
• Keywords: Depreciation

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , B B ENCH, CHENNAI . , ' $ % , & ' BEFORE SHRI A.MOHAN ALANKAMONY ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ITA NO. ASSESS -MENT YEAR APPELLANT RESPONDENT 1672/MDS/2013 2010-11 ASSISTANT COMMISSIONER OF INCOME TAX, COMPANY CIRCLE-IV(2) 63, RACE COURSE ROAD, COIMBATORE-641 018. M/S. ROOTS MULTICLEAN LTD. RKG INDUSTRIAL ESTATE GANAPATHY, COIMBATORE-641 006. PAN:AABCR0315F 1673/MDS/2013 2010-11 ASSISTANT COMMISSIONER OF INCOME TAX, COMPANY CIRCLE-IV(2) 63, RACE COURSE ROAD, COIMBATORE-641 018. M/S. ROOTS INDUSTRIES INDIA LTD. RKG INDUSTRIAL ESTATE GANAPATHY, COIMBATORE-641 006. PAN:AABCR0314E / APPELLANT BY : MR. P.B.SEKARAN, CIT /RESPONDENT BY : MR. S.SRIDHAR, ADVOCATE / DATE OF HEARING : 2 ND JUNE, 2014 /DATE OF PRONOUNCEMENT : 17 TH JULY, 2014 / O R D E R PER CHALLA NAGENDRA PRASAD, JM: BOTH THESE APPEALS ARE FILED BY THE REVENUE AGAINS T ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS)- I, COIMBATORE DATED 31.05.2013 FOR THE ASSESSMENT Y EAR 2010-11. AS THE ISSUE INVOLVED IN BOTH THESE APPEAL S IS COMMON, THEY ARE CLUBBED TOGETHER AND DISPOSED OFF BY THIS COMMON ORDER. THE ONLY GRIEVANCE OF THE REVENUE IN BOTH THESE APPEALS IS THAT COMMISSIONER OF INCOME TAX 2 ITA NOS. 1672 & 1673/MDS/2013 (APPEALS) ERRED IN DELETING THE ADDITION MADE ON AC COUNT OF DISALLOWANCE UNDER SECTION 80IA OF THE ACT. 2. BRIEF FACTS ARE THAT ASSESSEE CLAIMED DEDUCTION UNDER SECTION 80IA OF THE ACT IN RESPECT OF INCOME GENERA TED FROM WINDMILL FOLLOWING THE DECISION OF THE JURISDICTION AL HIGH COURT IN THE CASE OF VELAYUDHASAMY SPINNING MILLS PVT.LTD . VS. ACIT (340 ITR 477). THE ASSESSEE CLAIMED DEDUCTION UNDER SECTION 80IA DURING THE ASSESSMENT YEAR 2010-11 AS INITIAL YEAR OF CLAIM FOR ITS WIND ENERGY GENERATORS SET UP IN EARLIER YEAR. HOWEVER, ASSESSING OFFICER DENIED DEDUCTION C LAIMED BY THE ASSESSEE STATING THAT AS PER SECTION 80IA OF THE ACT PROFITS AND GAINS OF ELIGIBLE BUSINESS HAS TO BE WO RKED OUT AS IF SUCH ELIGIBLE BUSINESS IS THE ONLY SOURCE OF INCOME OF T HE ASSESSEE RIGHT FROM THE COMMENCEMENT OF BUSINESS AN D IN SUBSEQUENT YEARS UP TO THE COMPUTATION IS MADE AND BUSINESS LOSSES, DEPRECIATION AND INVESTMENT ALLOWA NCE OF EARLIER YEARS SHOULD BE TAKEN INTO ACCOUNT IN DETER MINING THE QUANTUM OF DEDUCTION ADMISSIBLE UNDER SECTION 80IA OF THE ACT EVEN THOUGH THEY HAVE BEEN SET OFF AGAINST PROF ITS OF THE BUSINESS FROM OTHER SOURCES. ON APPEAL, COMMISSIONE R OF 3 ITA NOS. 1672 & 1673/MDS/2013 INCOME TAX (APPEALS) ALLOWED THE CLAIM OF THE ASSES SEE SINCE ASSESSEES CLAIM WAS IN TUNE WITH THE DECISIO N OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF VELAYUDHASWAMY SPINNING MILLS PVT.LTD.(SUPRA) 3. DEPARTMENTAL REPRESENTATIVE PLACES RELIANCE ON THE ASSESSMENT ORDER AS THE REVENUE FILED SLP BEFORE TH E HONBLE SUPREME COURT AGAINST THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF VELAYUDHAS WAMY SPINNING MILLS PVT.LTD. AND THE SLP IS PENDING FOR DECISION. 4. COUNSEL FOR THE ASSESSEE RELIED ON THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS). 5. HEARD BOTH SIDES. PERUSED ORDERS OF LOWER AUTHOR ITIES. THE REVENUE COULD NOT REBUT THE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APPEALS) THAT THE CLAIM OF THE ASSESSEE IS NOT IN ACCORDANCE WITH THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF VELAYUDHAS WAMY SPINNING MILLS PVT.LTD.(SUPRA). SINCE THE CLAIM O F THE ASSESSEE IS BASED ON THE ABOVE DECISION OF THE JURI SDICTIONAL 4 ITA NOS. 1672 & 1673/MDS/2013 HIGH COURT, RESPECTFULLY FOLLOWING THE SAID DECISIO N, WE SUSTAIN THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) AND REJECT THE GROUNDS OF APPEALS OF THE REVENUE. 6. IN THE RESULT, BOTH THE APPEALS OF THE REVENUE A RE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THURSDAY, THE 17 TH DAY OF JULY, 2014 AT CHENNAI. SD/- SD/- ( A.MOHAN ALANKAMONY ) ( CHALLA NAGENDR A PRASAD ) . ( # %& ) ACCOUNTANT MEMBER / ( JUDICIAL MEMBER/ %) ( % /CHENNAI, * /DATED, 17 TH JULY, 2014 SOMU )-. /. /COPY TO: 1. APPELLANT 2. /RESPONDENT 3. 0 () /CIT(A) 4. 0 /CIT 5. . ))4 /DR 6. 7 /GF .