APR Packing Ltd., Secunderabad V. DCIT, Hyderabad

ITA 1698/HYD/2008

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 3319 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 5 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2010
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 28-04-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 27-11-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: A PATRA
• Assessee Lawyers: SURESH ANANTHARAMAN
• Keywords: Capital receipt
• Section: 115JB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A , HYDERABAD BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI CHANDRA POOJARI ACCOUNTANT MEMBER ITA NO.1698/HYD/2008 A.Y. 2005-06 M/S APR PACKAGING LTD. (SINCE AMALGAMATED WITH BALLAPUR INDUSTRIES LTD.), SECUNDERABAD (PAN AACCA 7699 C) VS. ACIT, CIRCLE 1(1), HYDERABAD (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SURESH ANANTHARAMAN RESPONDENT BY : A. PATRA, CIT, DR O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER: THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTED AG AINST THE ORDER PASSED BY THE CIT (A)-II DATED 10.9.2008 AND PE RTAINS TO THE ASSESSMENT YEAR 2005-06. 2. THE FIRST GROUND RAISED BY THE ASSESSEE IS : THAT THE CIT(A) ERRED IN NOT ADJUDICATING THE ISSUE IN RESPECT OF THE ASSESSEE COMPANYS CLAIM FOR REDUCTION OF SALES TAX INCENTIVE OF RS.5,82,02,444/- FROM NET PROFIT U/S 115JB ON THE G ROUND THAT SUCH INCENTIVE WAS ALLOWED BY THE GOVT. OF MAHARASHTRA F OR DEVELOPMENT OF BACKWARD AREA IN MAHARASHTRA WHICH IS IN THE NATURE OF CAPITAL RECEIPT NOT CHARGEABLE TO TAX. 3. AFTER HEARING BOTH THE PARTIES, WE SET ASIDE THI S ISSUE TO THE FILE OF CIT(A) FOR FRESH ADJUDICATION, SINCE THERE IS A SPECIFIC GROUND RAISED BY THE ASSESSEE ON THIS IMPUGNED ISSUE BEFORE THE C IT(A) WHICH WAS NOT ADJUDICATED BY HIM. 4. THE NEXT GROUNDS RAISED BY THE ASSESSEE IN ITS APPE AL ARE : 2 2 2.1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CA SE, THE LEARNED CIT(A) WAS WRONG IN DISALLOWING PAYMENT OF RS.51,67 ,950/- OUT OF RS.1,31,10,370/- BEING DISCOUNT AND SERVICE CHARGES ALLOWED ON SALES. 2.2. WITHOUT PREJUDICE TO GROUND NOS.2.1. ABOVE AN D HAVING REGARD TO THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) WAS WRONG IN NOT CONSIDERING THE FACT THAT THE PAYMENTS OF SERVICE C HARGES SHOWN AS DISCOUNT ON SALES WERE LAID OUT FOR THE PURPOSES OF THE BUSINESS. 5. AFTER HEARING BOTH THE PARTIES, WE ARE OF THE OPINION THAT SIMILAR ISSUE CAME FOR CONSIDERATION BEFORE THIS TRIBUNA L FOR THE ASSESSMENT YEARS 2004-05 IN ASSESSEES OWN CASE IN ITA NO.245/H/2008 VIDE ITS ORDER DATED 30.4.2009 WHEREIN IT WAS HELD AS FOLLOWS: 8. WE HAVE CONSIDERED RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. WHEN THE ASSESSING OFFICER COLLECTED INFORMATION DIRECTLY, HE OUGHT TO HAVE GIVEN AN OPPORTUNITY TO THE ASSESSEE AFTER GIVING COPIES OF THE INFORMATION COLLECTED. THE PRINCIPLES OF NATURAL J USTICE REQUIRE THAT THE ASSESSEE SHALL BE PUT ON NOTICE ABOUT THE INFORMATION COLLECTED BY THE ASSESSING OFFICER. IN THIS CASE, ADMITTEDLY NO SUCH OPPORTUNITY WAS GIVEN TO THE ASSESSEE IN RESPE CT OF THE INFORMATION COLLECTED FROM ITC BHADRACHALAM AND COC HIN CEMENTS LTD.. THEREFORE, IN OUR OPINION, THE MATTE R NEEDS TO BE RE CONSIDERED BY THE ASSESSING OFFICER AFTER GIVING COPIES OF THE INFORMATION TO THE ASSESSEE. ACCORDINGLY, WE SET A SIDE THE ORDERS OF THE LOWER AUTHORITIES ON THIS ISSUE AND R EMIT THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER. THE ASS ESSING OFFICER SHALL GIVE THE ENTIRE COPIES OF THE DETAILS/INFORMA TION SAID TO HAVE BEEN COLLECTED FROM ITC BHADRACHALAM AND COCHI N CEMENTS LTD. THE ASSESSING OFFICER SHALL ALSO GIVE INFORMA TION, IF ANY, RELIED UPON BY HIM WHILE RECONSIDERING THE ISSUE. THE ASSESSING OFFICER SHALL ALSO GIVE A REASONABLE OPPORTUNITY TO THE ASSESSEE AND THEREAFTER DECIDE THE ISSUE IN ACCORDANCE WITH LAW. 6. ACCORDINGLY, WE SET ASIDE THE IMPUGNED ISSUE TO TH E FILE OF CIT(A) ON SIMILAR DIRECTION FOR FRESH CONSIDERATION. 7. THE NEXT GROUND RAISED BY THE ASSESSEE IN ITS APPE AL IS AS FOLLOWS: 3 3 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CA SE, THE CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS.5,63,283/- T O THE NET PROFIT AS PER PROFIT AND LOSS ACCOUNT U/S 115JB OF THE ACT IN RES PECT OF TAX DUTY AND CESS RS.2,27,397/- PAID AND OR ADJUSTED DURING THE ASSESSMENT YEAR 2006- 07. 8. THE AUTHORIZED REPRESENTATIVE SUBMITTED THAT TH IS ISSUE MAY BE SET ASIDE TO CONSIDER THE AVAILABLE EVIDENCE FOR THE PAYMENT MADE SUBSEQUENTLY BY THE ASSESSEE. THE DEPARTMENTAL REPRESENTA TIVE EXPRESSED NO OBJECTION IN SETTING ASIDE THIS ISSUE TO THE FILE OF ASSESSING OFFICER FOR FRESH CONSIDERATION. 9. AFTER HEARING BOTH THE PARTIES, WE SET ASIDE THI S ISSUE TO THE FILE OF CIT(A) TO CONSIDER THE AVAILABLE EVIDENCE WITH THE ASSESSEE FOR MAKING PAYMENT AFTER END OF THE YEAR AND TO DECIDE T HE ISSUE IN ACCORDANCE WITH LAW. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE PARTLY ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT 30. 4.2010 SD/- SD/- N.R.S. GANESAN CHANDRA POOJARI JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 30 TH APRIL, 2010 COPY FORWARDED TO: 1. M/S APR PACKAGING LTD., (SINCE AMALGAMATED WITH BALL APUR INDUSTRIES LTD.) C-16, VIKRAMPURI, BESIDES BATA LANE, SECUNDERABAD, HYDERABAD-500009. 2. ACIT, CIRCLE 1(1), HYDERABAD 3. CIT(A)-II HYDERABAD. 4. CIT, HYDERABAD 5. THE D.R., ITAT, HYDERABAD. NP