ACIT 2(1)(1), MUMBAI V. BHARAT PETROLEUM CORPORATION LTD, MUMBAI

ITA 17/MUM/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 2412 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: I
• Assessment Year: 2010-2011
• Appeal Filed On: 02-01-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K KARDA M
• Assessee Lawyers: J D MISTRY
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH I, MUMBAI BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI AMARJIT SINGH , JUDICIAL MEMBER ITA NO. 17 /MUM/201 5 : (A.Y : 20 1 0 - 11 ) ACIT - 2(1)(1), MUMBAI (APPELLANT) VS. M/S. BHARAT PETROLEUM CORPORATION LTD., BHARAT BHAVAN, 4&6 CURRIMBHOY ROAD, BALLARD ESTATE, MUMBAI 400 001 (RESPONDENT) PAN : AAACA4495N ASSESSEE BY : SHRI J.D. MISTRY REVENUE BY : SHRI A.K. KARDAM DATE OF HEARING : 1 8 /0 7 /2016 DATE OF PRONOUNCEMENT : 22 /0 7 /2016 O R D E R PER G.S. PANNU , AM : THE CAPTIONED APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF CIT(A) - 4 , MUMBAI DATED 1 0 . 1 0 .201 4 , PERTAINING TO THE ASSESSMENT YEAR 20 1 0 - 11 , WHICH IN TURN HAS ARISEN FROM THE ORDER PASSED BY THE ASSESSING OFFICER DATED 30 .0 1 .201 4 UNDER SECTION 143 ( 3 ) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). 2. IN THIS APPEAL, REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 2 M/S. BHARAT PETROLEUM CORPORATION ITA NO. 17/MUM/2015 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN HOLDING THAT THE ASSESSEE COMPANY IS ELIGIBLE FOR DEDUCTION U/S 80IB OF THE IT ACT, IN RESPECT OF ITS LPG BOTTLING PLANTS BY RELYING ON THE DECISION IN THE CASE OF HINDUS TAN PETROLEUM CORPORATION LTD. IN ITA NO. 2131 OF 2012 ORDER DATED 07.03.2013 IGNORING THE FACT THAT DEPARTMENT HAS NOT ACCEPTED THE SAID DECISION AND FILING OF SLP AGAINST THE SAID DECISION HAS BEEN AUTHORIZED. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN HOLDING THAT BOTTLING OF GAS INTO GAS CYLINDERS IS A PRODUCTION ACTIVITY FOR THE PURPOSE OF CLAIMING DEDUCTION U/S 80IB, IGNORING THE FACT THAT NO NEW PRODUCT COMES INTO EXISTENCE IN THIS PROCESS. 3. IN BRIE F, THE RELEVANT FACTS ARE THAT THE RESPONDENT - ASSESSEE IS A PUBLIC SECTOR UNDERTAKING UNDER THE ADMINISTRATIVE CONTROL OF MINISTRY OF PETROLEUM AND NATURAL GAS, ENGAGED IN THE BUSINESS OF REFINING OF CRUDE OIL AND MARKETING OF PETROLEUM PRODUCTS. FOR THE ASSESSMENT YEAR 2010 - 11, IT FILED A RETURN OF INCOME DECLARING INCOME OF RS.3144,97,27,771/ - WHICH WAS SUBJECT TO A SCRUTINY ASSESSMENT WHEREBY THE TOTAL INCOME WAS ASSESSED AT RS.3204,06,28,290/ - . ONE OF THE AREAS OF DIFFERENCE BETWEEN THE ASSESSEE AND T HE REVENUE RELATED TO THE CLAIM OF DEDUCTION U/S 80IB OF THE ACT AMOUNTING TO RS.28,27,888/ - WITH RESPECT TO THE PROFIT S OF LPG BOTTLING PLANT. PERTINENTLY, THE ASSESSING OFFICER DENIED THE CLAIM ON THE GROUND THAT THE ACTIVITY OF FILLING GAS INTO CYLINDERS DID NOT CONSTITUTE MANUFACTURING AND THAT THE LPG BOTTLING PLANTS WERE A PART OF REFINING ACTIVITY. 4. BEFORE THE CI T(A), ASSESSEE POINTED OUT THAT THE HON'BLE BOMBAY HIGH COURT IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 1992 - 93 (ITA NO. 612 OF 2001) AND ASSESSMENT YEAR 1993 - 94 (ITA NO. 613 OF 2001) DATED 3 M/S. BHARAT PETROLEUM CORPORATION ITA NO. 17/MUM/2015 3.5.2013 HAS ALLOWED THE CLAIM OF DEDUCTION U/S 80IB OF THE ACT H OLDING THAT BOTTLING OF LPG IS MANUFACTURE OR PRODUCTION. ASSESSEE ALSO POINTED OUT THAT IN SUBSEQUENT ASSESSMENT YEARS OF 1994 - 95, 1995 - 96, 1996 - 97, 1997 - 98, 1998 - 99 AND 1999 - 2000 THE TRIBUNAL HAS ALSO ALLOWED ASSESSEES CLAIM FOR DEDUCTION U/S 80IB OF T HE ACT. FOLLOWING THE AFORESAID PRECEDENTS, CIT(A) HAS ALLOWED THE CLAIM OF ASSESSEE. 5. BEFORE US, IT WAS A COMMON POINT BETWEEN THE PARTIES THAT THE JUDGMENT OF THE HON'BLE BOMBAY HIGH COURT IN ASSESSEES OWN CASE FOR ASSESSMENT YEARS 1992 - 93 & 1993 - 94 DATED 3.5.2013 ( SUPRA ) FULLY COVERS THE CONTROVERSY AND THE SAME CONTINUES TO HOLD THE FIELD. AS A CONSEQUENCE, WE FIND NO REASON TO INTERFERE WITH THE DECISION OF CIT(A), WHICH IS HEREBY AFFIRMED. THUS, ON THIS ASPECT, APPEAL OF THE REVENUE FAILS. 6. RESULTANTLY, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 2 2 N D JULY, 2016. SD/ - SD/ - ( AMARJIT SINGH ) JUDICIAL MEMBER ( G.S. PANNU ) ACCOUNTANT MEMBER MUMBAI, DATE : 2 2 N D JULY, 2016 *SSL* COPY TO : 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 4 M/S. BHARAT PETROLEUM CORPORATION ITA NO. 17/MUM/2015 4) THE CIT CONCERNED 5) THE D.R, I BENCH, MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T, MUMBAI