ACIT, Coimbatore V. Pioneer Woven Sacks Pvt. Ltd., Udamalpet

ITA 1687/CHNY/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86236 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-01-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 19-01-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 13-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P RADHAKRISHNAN
• Assessee Lawyers: G BASKAR
• Keywords: Depreciation

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI .. , ! ' # , $ %& BEFORE SHRI B.R. BASKARAN, ACCOUNTANT MEMBER AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER ! ./ ITA NO. 1687/MDS/2014 $ ' (' / ASSESSMENT YEAR : 2010-11 THE ASSISTANT COMMISSIONER OF INCOME TAX, SALARY CIRCLE I, COIMBATORE. V. M/S PIONEER WOVEN SACKS PVT. LTD., S.F. NO.34, SAKTHI CO-OPERATIVE INDUSTRIAL ESTATE, UDUMALPET 642 128. PAN : AABCP 8788 J (#*/ APPELLANT) (,-#*/ RESPONDENT) #* . / / APPELLANT BY : SHRI P. RADHAKRISHNAN, JCIT ,-#* . / / RESPONDENT BY : SHRI G. BASKAR, ADVOCATE 0 . 1 / DATE OF HEARING : 19.01.2015 23( . 1 / DATE OF PRONOUNCEMENT : 19.01.2015 / O R D E R PER B.R. BASKARAN, ACCOUNTANT MEMBER: THE APPEAL FILED BY THE REVENUE IS DIRECTED AGAI NST THE ORDER DATED 27.03.2014, PASSED BY LD. COMMISSIONER OF INCOME TAX (APPEALS)-II, COIMBATORE, RELATING TO ASSESSMEN T YEAR 2010-11. THE REVENUE IS AGGRIEVED BY THE DECISION OF LD. CIT (APPEALS) IN 2 I.T.A. NO. 1687/MDS/2014 ALLOWING DEDUCTION UNDER SECTION 80-IA OF INCOME-TA X ACT, 1961 (IN SHORT 'THE ACT') CLAIMED BY THE ASSESSEE. 2. THE ASSESSEE HAD CLAIMED DEDUCTION UNDER SECTION 80-IA OF THE ACT IN RESPECT OF INCOME GENERATED FROM WINDMIL LS. THE ASSESSING OFFICER, BY FOLLOWING THE PROVISIONS OF S ECTION 80-IA(5) OF THE ACT, TOOK THE VIEW THAT THE PROFITS AND GAINS O F WINDMILLS BUSINESS SHOULD BE COMPUTED AS IF IT WERE THE ONLY SOURCE OF INCOME OF THE ASSESSEE RIGHT FROM COMMENCEMENT OF B USINESS. ACCORDINGLY, THE A.O. HELD THAT THE BUSINESS LOSSES , DEPRECIATION AND INVESTMENT ALLOWANCES OF EARLIER YEARS SHOULD B E TAKEN INTO ACCOUNT IN DETERMINING THE QUANTUM OF DEDUCTION ADM ISSIBLE UNDER SECTION 80-IA, EVEN THOUGH THERE MAY HAVE BEEN SET OFF AGAINST THE PROFITS OF TAXPAYER FROM OTHER SOURCES. THOUGH THE ASSESSEE PLACED RELIANCE ON THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF VELAYUDHASWAMY SPINNING MILLS (P) LTD. V. A CIT (234 CTR 368) TO CONTEND THAT RESTRICTIONS PLACED UNDER SECT ION 80-IA(5) SHOULD BE APPLICABLE AFTER INITIAL YEAR OF CLAIMING OF DEDUCTION, YET, THE ASSESSING OFFICER DID NOT ACCEPT THE SAME ON TH E REASON THAT THE DEPARTMENT HAS PREFERRED SLP BEFORE THE HON'BLE SUPREME COURT AGAINST THE DECISION RENDERED BY THE HON'BLE MADRAS HIGH COURT. ACCORDINGLY, HE DISALLOWED THE CLAIM RAISED BY THE ASSESSEE UNDER SECTION 80-IA(5) OF THE ACT. 3 I.T.A. NO. 1687/MDS/2014 3. IN THE APPELLATE PROCEEDING, THE LD. CIT(APPEALS ) ALLOWED THE CLAIM OF THE ASSESSEE BY FOLLOWING THE DECISION OF HON'BLE MADRAS HIGH COURT IN THE CASE OF VELAYUDHASWAMY SPI NNING MILLS REFERRED SUPRA. 4. AGGRIEVED, THE REVENUE HAS FILED THIS APPEAL BEF ORE US. 5. WE HAVE HEARD THE PARTIES AND PERUSED THE RECORD S. SINCE THE LD. CIT(APPEALS) HAS FOLLOWED THE BINDING DECIS ION OF HON'BLE MADRAS HIGH COURT IN ALLOWING THE CLAIM OF DEDUCTIO N UNDER SECTION 80-IA TO THE ASSESSEE, WE DO NOT FIND ANY REASON TO INTERFERE WITH HIS ORDER ON THIS ISSUE 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED ON 19 TH DAY OF JANUARY, 2015 AT CHENNAI. SD/- SD/- ( ' # ) ( .. ) (VIKAS AWASTHY) (B.R. BASKARAN) $ /JUDICIAL MEMBER /ACCOUNTANT MEMBER /CHENNAI, C! /DATED, THE 19 TH JANUARY, 2015. KRI. 4 I.T.A. NO. 1687/MDS/2014 D . ,$1E' F'(1 /COPY TO: 1. #* /APPELLANT 2. ,-#* /RESPONDENT 3. 0 G1 () /CIT(A)-II, COIMBATORE 4. 0 G1 /CIT-III, COIMBATORE 5. ' HI ,$1$ /DR 6. IJ' K /GF.