M/s. Eastman Spinning Mills Private Limited, Tiruppur V. DCIT, Tiruppur

ITA 183/CHNY/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 64229 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-08-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 02-08-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 30-01-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR S MOHARANA
• Assessee Lawyers: N VIJAYAKUMAR
• Section: 115JB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH CHENNAI BEFORE DR. O. K. NARAYANAN, VICE PRESIDENT AND SHRI V. DURGA RAO, JUDICIAL MEMBER .. ITA NOS. 183/MDS/2012 ASSESSMENT YEAR : 2007-08 M/S. EASTMAN SPINNING MILLS PRIVATE LTD., NO. 16-17, KUMAR NAGAR SOUTH, 2 ND STREET, TIRUPUR-641 603. (PAN : AAACE4595R) V. THE DEPUTY COMMISSIONER OF INCOME TAX, COMPANY CIRCLE, TIRUPUR. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI N. VIJAYAKUMAR, CA RESPONDENT BY : DR. S. MOHARANA DATE OF HEARING : 02.0 8.2012 DATE OF PRONOUNCEMENT : 30.08.201 2 O R D E R PER V. DURGA RAO, JUDICIAL MEMBER THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF THE CIT(APPEALS)-II, COIMBATORE DATED 25-10-2011 FOR TH E ASSESSMENT YEAR 2007-08. 2. THE FACTS IN BRIEF ARE THAT THE ASSESSEE IS A TE XTILE MANUFACTURING COMPANY. IT IS HAVING A WINDMILL UND ERTAKING AS AN INDEPENDENT DIVISION. THE ASSESSEE FILED RETURN OF INCOME FOR THE ITA NO. 183/MDS/2012 2 YEAR UNDER CONSIDERATION DECLARING A TOTAL INCOME O F ` 1,48,51,100/- UNDER THE REGULAR COMPUTATION AND ` 2,07,44,158/- UNDER THE BOOK PROFIT U/S 115JB OF THE INCOME TAX ACT, 1961 ('THE A CT' FOR SHORT). THE RETURN WAS PROCESSED U/S 143(1) OF THE ACT. SU BSEQUENTLY AFTER ISSUING NOTICE U/S 143(2), THE ASSESSING OFFICER CO MPLETED THE ASSESSMENT BY DISALLOWING 80IA DEDUCTION OF ` 28,99,916/- CLAIMED BY THE ASSESSEE IN RESPECT OF WIND MILL. DURING TH E COURSE OF THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER OBSER VED THAT THE POWER GENERATED BY THE WINDMILL HAS TO BE EITHER CO NSUMED BY THE ASSESSEE OR SOLD TO THE TAMILNADU ELECTRICITY BOARD (TNEB FOR SHORT), THE STATUTORY AUTHORITY EXISTING BY VIRTUE OF TAMIL NADU ELECTRICITY ACT AT THE PRICE DETERMINED BY IT. THE SAME CANNOT BE SOLD TO ANY THIRD PARTY AS PER THE AGREEMENT REACHED BETWEEN THE ASSE SSEE AND TNEB WHILE INSTALLING THE WINDMILL. IN SUCH A SITUATION THE PRICE DETERMINED BY TNEB IN RESPECT OF THE POWER PURCHASED BY IT FROM THE WINDMILL IS TO BE ADOPTED, I.E. AT ` 2.70 PER UNIT OF POWER GENERATED AND SUPPLIED TO TNEB. 3. PROVISO TO SUB-SECTION (8) MAKES IT CLEAR THAT IF IN THE OPINION OF THE ASSESSING OFFICER THE COMPUTATION OF PROFIT AND GAINS OF THE ELIGIBLE BUSINESS IN THE MANNER SPECIFIED IN SUB-SE CTION PRESENTS EXCEPTIONAL DIFFICULTIES, THE ASSESSING OFFICER MAY COMPUTE SUCH ITA NO. 183/MDS/2012 3 PROFITS AND GAINS ON SUCH REASONABLE BASIS AS HE MA Y DEEM FIT. THE CONTENTION OF THE ASSESSEE THAT IT SHOULD BE PERMIT TED TO ADOPT THE SAME PRICE AT WHICH IT PURCHASES POWER FROM TNEB, IF ACCEPTED, IT WOULD TANTAMOUNT TO ALLOWING THE ASSESSEE TO INFLAT E ITS PROFIT ELIGIBLE FOR DEDUCTION. ON THE CONTRARY, IF MARKET VALUE WE RE TO BE ADOPTED, THERE IS NO OPEN MARKET FOR PURCHASE AND SALE OF PO WER OTHER THAN WITH TNEB. IT IS A RESTRICTED MARKET AND AT THE SAM E TIME THE TNEB IS A STATUTORY AUTHORITY. IT HAS FIXED THE PRICE F OR PURCHASE OF POWER. IT IS THE PRICE FIXED BY A STATUTORY AUTHORITY. WH ETHER THE PRICE AT WHICH IT PURCHASES OR SELLS POWER TO THE ASSESSEE I S TO BE ADOPTED, PRESENTS A REAL DIFFICULTY IN ADOPTING THE OPEN MAR KET VALUE. THE ASSESSING OFFICER WAS THEREFORE OF THE VIEW THAT TH E ASSESSEE SHOULD NOT BE PERMITTED TO INFLATE ITS PROFIT AND BY VIRTU E OF PROVISO TO SUB- SECTION (8) HE WAS CONSTRAINED TO ADOPT THE PURCHAS E PRICE OF POWER BY TNEB FROM THE ASSESSEE AS THE MARKET VALUE FOR TH E VALUE OF POWER CONSUMED BY THE ASSESSEE IN RESPECT OF THE PO WER GENERATED BY THE WINDMILL INSTALLED BY IT. HENCE THE ASSESSE ES CLAIM U/S 80IA OF ` 28,99,916/- WAS DISALLOWED. 4. THE ASSESSEE CARRIED THE MATTER BEFORE THE LEARN ED CIT(APPEALS). IT WAS SUBMITTED BEFORE THE LEARNED CIT(APPEALS) THAT THE SALE PRICE ADOPTED BY TNEB FOR SUPPLY OF POWER T O THE SPINNING ITA NO. 183/MDS/2012 4 MILL @ ` 3.50 HAS TO BE TAKEN INTO CONSIDERATION FOR THE PU RPOSE OF DEDUCTION U/S 80IA OF THE ACT. THE LEARNED CIT(APPE ALS) BY CONSIDERING THE SUBMISSIONS OF THE ASSESSEE HAS OBS ERVED AS UNDER: 5.3. ISSUE (C) : REGARDING THE ASSESSEES CLAIM THAT THE MARKET VALUE SHOULD BE THE PRICE AT WHICH THE TNEB CHARGES ITS CUSTOMERS, I AM UNABLE TO AGREE WITH THE ARGUMENTS FOR THE FOLLOWING REASONS : A) IN THE CASE OF M/S. THIAGARAJAR MILLS LTD., THE HIGH COURT OF MADRAS HAS UNAMBIGUOUSLY HELD THAT CAPTIVE CONSUMPTION OF POWER GENERATED WOULD ENABL E THE RESPONDENT/ASSESSEE TO DERIVE PROFIT AND GAINS BY WORKING OUT THE COST OF CONSUMPTION OF THE POWER. IN OTHER WORDS, THE PROFIT HAS TO BE WORKED WITH REFERENCE TO THE COST AND NOT NECESSARILY TO ANY MARKET PRICE AS HELD BY THE ITAT, CHENNAI IN THE CASE OF M/S. SRI VELAYUDHASWAMY SPINNING MILLS (P) LTD. THE REFERENCE TO SAVINGS IN THE ORDER IS IN THE CONTEXT WHETHER NOTIONAL SAVINGS IN COST EFFECTED B Y UTILIZING SELF GENERATED POWER WOULD BE ELIGIBLE FO R CLAIM U/S 80IA(1). THE OBSERVATION CANNOT BE INTERPRETED AS REFERRING TO RE-COMPUTATION OF THE BENEFIT ADOPTING MARKET PRICE. B) THE ENTIRE TRANSACTION IS GOVERNED BY POWER PURCHASE AGREEMENT BETWEEN THE ASSESSEE AND TAMIL NADU ELECTRICITY BOARD. NO EXTRANEOUS FACTORS WILL AFFECT THE TERMS OF CONTRACT AS PER WHICH THE TARIFF FOR T HE POWER ITA NO. 183/MDS/2012 5 CONSUMED BY THE ASSESSEE WILL BE CHARGED AT SAME RA TE IT WAS PURCHASED BY THE TAMIL NADU ELECTRICITY BOARD F ROM THE ASSESSEE. (C) SUB SECTION 8 OF SECTION 80IA SPEAKS OF MARKET VALUE ONLY WHEN THE GOODS OF THE INDUSTRIAL UNDERTAKING ARE TRANSFERRED TO ANY OTHER BUSINESS CARRIED ON BY THE ASSESSEE, OR WHERE ANY GOODS HELD FOR THE PURPOSES OF ANY OTHER BUSINESS CARRIED ON BY THE ASSESSEE ARE TRANSFERRED TO THE BUSINESS OF THE IND USTRIAL UNDERTAKING. IN THE INSTANT CASE THERE IS NO SUCH TRANSFER WITHIN THE BUSINESS OF THE ASSESSEE. RATHER THE POWER GENERATED BY THE ASSESSEE IS SOLD TO THE THIRD PARTY AND SIMILARLY THE POWER GENERATED B Y THE THIRD PARTY IS BOUGHT BY THE ASSESSEE. AS THIS IS A SALE AND BUY BACK TRANSACTION, 80IA(8) HAS NO APPLICABILITY TO THIS CASE. (D) THE TARIFF OF THE THIRD PARTY TO THESE TRANSACTIONS IS FIXED BY THE GOVT. OF TAMIL NADU AN D NOT BY MARKET FORCES. TO PUT IT DIFFERENTLY, SALE OF E LECTRICITY IS GOVERNED BY STATUTORY LAW. IN THE ABSENCE OF OPEN MARKET, THE QUESTION OF APPLICABILITY OF THE EXPLANATION TO SUB SECTION 8 TO SEC. 80IA DOES NOT ARISE. (E) THE ACTION OF THE ASSESSING OFFICER IN RE- COMPUTING THE SALE PRICE OF THE SELF GENERATED POWE R AND CONSUMED IN-HOUSE CANNOT BE ATTRIBUTED TO THE INV OKING OF THE PROVISIONS OF SUB SECTION 8 TO SECTION 80IA BUT TO EXERCISING HIS INHERENT POWERS TO CORRECT A MISTAKE . ITA NO. 183/MDS/2012 6 (F) IN THE CASE OF JINDAL STEEL & POWER LTD., THE DELHI TRIBUNAL HAS NOT CONSIDERED THE ISSUES DEALT IN PARA TO (F) ABOVE. EVEN ASSUMING THAT MARKET RATES AR E TO BE APPLIED, THE DELHI TRIBUNAL HAS OVERLOOKED THE F ACT THAT THERE AREU9 TWO DIFFERENT MARKETS OPERATING IN THESE TRANSACTIONS AFFECTING THE STATUS OF THE CONTRACTIN G PARTIES. FIRST IS THE BUYERS MARKET , IN WHICH THE TAMIL NADU ELECTRICITY BOARD IS THE PURCHASER AND THE SECO ND IS THE SELLERS MARKET, WHERE THE STATUS OF THE TAMIL NADU ELECTRICITY BOARD IS REVERSED. THERE IS NO PROVISI ON EITHER IN THE IT ACT OR GENERAL LAW TO SUPPORT A CLAIM THA T THE PRICE IN THE BUYERS MARKET BE EXTENDED TO SELLERS MARKET OR VICE VERSA. THE LEARNED CIT(APPEALS) ACCORDINGLY DISMISSED THE APPEAL FILED BY THE ASSESSEE. 5. ON BEING AGGRIEVED, THE ASSESSEE CARRIED THE MAT TER BEFORE THE TRIBUNAL. AT THE TIME OF HEARING THE LEARNED COUNS EL FOR THE ASSESSEE HAS FILED A PAPER BOOK AND SUBMITTED THAT THE ISSUE INVOLVED IN THIS APPEAL IS COVERED BY THE FOLLOWING DECISIONS : 1. CIT V. THIAGARAJAR MILLS LTD. IN TAX CASE (APPEAL) NOS. 68 TO 70 OF 2010 2. SRI VELAYUDHASWAMY SPINNING MILLS (P) LTD. V. DCIT IN ITA NO. 850/MDS/2011 3. ARUN TEXTILES PVT. LTD. V. DCIT IN ITA NO 569/MDS/2011 ITA NO. 183/MDS/2012 7 4. VIKING TEXTILES (P) LTD. V. DCIT IN ITA NO. 1570/MDS/2011 5. EVEREADY SPINNING MILLS PVT. LTD. V. ACIT IN ITA NO. 1571/MDS/2011 6. EXCEL COTSPIN (INDIA) (P) LTD. V. DCIT IN ITA NO. 1790/MDS/2011 7. PRABHU SPINNING MILLS PVT. LTD. & ANR. V. DCIT IN ITA NO. 1847/MDS/2011 DATED 20-01-2012. 6. ON THE OTHER HAND, THE LEARNED DR STRONGLY SUPPO RTED THE ORDERS PASSED BY THE AUTHORITIES BELOW. HOWEVER, HE FAIRLY ACCEPTED THAT THE ISSUE HAS BEEN CONSIDERED IN FAVOUR OF THE ASSESSEE BY THE VARIOUS DECISIONS AS RELIED ON BY THE LEARNED COUNS EL FOR THE ASSESSEE. IN ONE OF THE CASES CITED BY THE LEARNED COUNSEL FOR THE ASSESSEE IN ITA NO. 850/MDS/2011, THE TRIBUNAL CONS IDERED THE ISSUE ELABORATELY AND ALLOWED THE APPEAL OF THE ASSESSEE. THE RELEVANT PORTION OF THE ORDER OF THE TRIBUNAL IS EXTRACTED A S UNDER : 8. THE ASSESSING AUTHORITY HAS ADOPTED THE PRICE OF POWER AT ` . 2.70 PER UNIT IN THE LIGHT OF THE PROVISIONS OF LAW STATED IN SECTION 80IA(8). SUB-SECTION (8) OF SECTION 80IA PROVIDES THAT WHERE ANY GOODS ARE TRANSFERRED TO ANY OTHER BUSINESS CARRIED ON BY THE ASSESSEE OR ANY GOODS ARE TRANSFERRED TO THE ELIGIB LE BUSINESS, IN EITHER CASE THE CONSIDERATION FOR THE TRANSFER RECORDED IN THE BOOKS OF ACCOUNTS IF NOT CORRESPONDS TO THE MARKET VALUE OF SUCH GOODS, THE ASSESSING AUTHORITY SHALL COMPUTE THE ELIGIBLE PROF IT ON ITA NO. 183/MDS/2012 8 THE BASIS OF THE MARKET VALUE OF SUCH GOODS. IT ME ANS THAT SUB-SECTION(8) OF SECTION 80IA DOES NOT ALLOW AN ASSESSEE TO INFLATE THE PROFIT OF ITS ELIGIBLE UNIT BY OVER INVOICING THE GOODS TRANSFERRED OR UNDER-INVOICING OF GOODS BOUGHT IN. IT IS A SAFEGUARD AGAINST MISUSE OF THE EXISTING PROVISION. THE ASSESSING OFFICER TOOK THE MARKET VALUE OF THE POWER GENERATED BY THE ASSESSEE AT ` .2.70 PER UNIT AND NOT ` . 3.50 PER UNIT AS CLAIMED BY THE ASSESSEE AND THEREBY THE ASSESSEE HAS OVERSTATED TH E PRICE OF THE GOODS SOLD BY IT SO AS TO BOOST THE PR OFIT OF ITS ELIGIBLE UNIT, WHICH IN THIS CASE IS WINDMILL U NIT. 9. THE RULE APPLICABLE IN DETERMINING THE MARKET VALUE IN A SIMILAR CONTEXT HAS BEEN DISCUSSED BY TH E HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME-TAX, MADURAI VS. THIAGARAJAR MILLS LTD., KAPPALUR, MADURAI. WHILE DELIVERING TH E JUDGMENT IN TAX CASE(APPEAL) NOS.68 TO 70 OF 2010 DATED 7-6-2010 THEIR LORDSHIPS HAVE HELD AS UNDER:- 9. THEREFORE, THERE IS NO DIFFICULTY IN HOLD ING THAT CAPTIVE CONSUMPTION OF THE POWER GENERATED BY THE ASSESSEE FROM ITS OWN POWER PLANT WOULD ENABLE THE RESPONDENT/ASSESSEE TO DERIVE PROFIT AND GAINS BY WORKING OUT THE COST OF SUCH CONSUMPTION OF POWER INASMUCH AS THE ASSESSEE IS ABLE TO SAVE TO THAT EXTENT WHICH WOULD CERTAINLY BE COVERED BY SECTION 80IA(1). WHEN SUCH WILL BE THE OUTCOME OUT OF OWN CONSUMPTION OF THE POWER GENERATED AND GAINED BY THE ASSESSEE BY SETTING UP ITS OWN POWER PLANT, WE DO NOT FIND ANY LACK OF MERI IN THE CLAIM OF THE RESPONDENT/ASSESSEE ITA NO. 183/MDS/2012 9 WHEN IT CLAIMED BY RELYING UPON SECTION 80IA(1) OF THE INCOME-TAX ACT BY WAY OF DEDUCTION OF THE VALUE OF SUCH UNITS OF POWER CONSUMED BY ITS OWN PLANT BY WAY OF PROFIT AND GAINS FOR THE RELEVANT ASSESSMENT YEARS. 10. A CAREFUL READING OF THE ABOVE PARAGRAPH BRINGS HOME THE POINT THAT THE HONBLE HIGH COURT HAS LOOK ED INTO THE POINT OF SAVINGS MADE BY THE ASSESSEE BY U SING ITS OWN POWER AND THE VALUATION OF THAT SAVINGS MAD E ON THE BASIS OF THE PRICE OTHERWISE THE ASSESSEE SHOUL D HAVE PAID. THE RATIO IS VERY CLEAR. THE VALUE OF THE POWER GENERATED AND CONSUMED BY THE ASSESSEE WILL B E THAT VALUE THAT SHOULD HAVE BEEN PAID BY THE ASSESS EE IF THE POWER WAS BOUGHT FROM OPEN MARKET. WHEN THE ABOVE CASE IS APPLIED TO THE PRESENT CASE, THE CASE OF THE ASSESSEE HAS TO BE ACCEPTED THAT THE MARKET VAL UE SHOULD BE TREATED AS ` .3.50 PER UNIT OF ELECTRICITY. 11. EXACTLY THIS ISSUE WAS CONSIDERED BY THE DELHI BENCH-I OF THE TRIBUNAL IN THE CASE OF ADDITIONAL COMMISSIONER OF INCOME-TAX VS. JINDAL STEEL & POWER LTD., 16 SOT 509. IN THAT CASE ALSO ONE OF THE ISS UES RAISED WAS VALUATION OF THE POWER GENERATED BY THE ELIGIBLE UNIT. IN THAT CASE THE POWER GENERATED BY THE ASSESSEE WAS USED BY IT FOR OWN CONSUMPTION AS WELL AS FOR SALE TO THE STATE ELECTRICITY BOARD. THE TRIBU NAL HELD THAT THE RATE AT WHICH THE STATE ELECTRICITY BOARD SUPPLIES POWER TO ITS CONSUMERS IS TO BE CONSIDERED TO BE TH E MARKET VALUE FOR TRANSFER OF POWER BY THE ASSESSEE S ELECTRICITY GENERATING UNDERTAKING FOR CAPTIVE ITA NO. 183/MDS/2012 10 CONSUMPTION FOR THE PURPOSES OF SECTION 80IA(8) AND NOT THE PRICE AT WHICH POWER IS SUPPLIED BY THE ASSESSE E TO THE BOARD. 12. FURTHER, AS FAR AS CAPTIVE CONSUMPTION OF POWER IS CONCERNED, THE ASSESSEE IS NEITHER SELLING NOR B UYING ELECTRICITY. THE QUANTUM OF POWER CONTRIBUTED BY T HE ASSESSEE TO THE TAMIL NADU ELECTRICITY BOARD CAN BE AVAILED AS SUCH BY THE ASSESSEE FOR WHICH NO ADDITI ONAL PAYMENT IS TO BE MADE. IF THE ASSESSEE HAS RECEIVE D ` . 2.70 PER UNIT, THE ASSESSEE HAS TO PAY ONLY ` . 2.70 PER UNIT. IT IS A KIND OF COMMODITY BANKING, OR IN ECO NOMIC TERM, BARTER EXCHANGE OF SAME GOOD. THEREFORE, DEFACTO SPEAKING, THERE IS NO SALE AND PURCHASE. I N SUCH CIRCUMSTANCES THERE IS NO MARKET PRICE AT ALL. 13. MARKET PRICE COMES INTO PLAY ONLY WHEN THE ASSESSEE IS BUYING POWER FROM THE TAMIL NADU ELECTRICITY BOARD JUST LIKE ANY OTHER CONSUMER. TA MIL NADU ELECTRICITY BOARD IS THE SUPPLIER AND THE ASSESSEE IS THE CONSUMER AND THERE IS NO QUESTION O F COMMODITY BANKING OR BARTER EXCHANGE. TAMIL NADU ELECTRICITY BOARD SELLS POWER TO THE ASSESSEE IN TH E USUAL COURSE OF ITS BUSINESS AND THE ASSESSEE BUYS THE POWER LIKE ANY OTHER CONSUMER IN THE MARKET. I T IS IN THAT CONTEXT THAT THE QUESTION OF MARKET PRICE ARISES. IN SUCH A SCENARIO WHAT IS THE PRICE COLLE CTED BY THE TAMIL NADU ELECTRICITY BOARD? THE PRICE IS ` .3.50 PER UNIT. THEREFORE IT IS OBVIOUS THAT THE MARKET PRICE OF THE POWER GENERATED BY THE ASSESSEE ITA NO. 183/MDS/2012 11 IS ` .3.50 PER UNIT. THE EXPRESSION USED IN SECTION 80IA(8) IS MARKET VALUE. MARKET VALUE MEANS THE VALUE DETERMINED BY MARKET FORCES. IN THE CAPTIVE CONSUMPTION OF POWER GENERATED BY THE ASSESSEE COMPANY NO MARKET FORCE IS OPERATING. MARKET FORCE S COME INTO PICTURE ONLY WHEN THE ASSESSEE BUYS POWER FROM TAMIL NADU ELECTRICITY BOARD LIKE ANY OTHER CONSUMER. THE VALUE PAID FOR SUCH CONSUMPTION IS THE MARKET VALUE. IN THE PRESENT CA SE THAT IS ` . 3.50 PER UNIT. 14. THEREFORE WE ACCEPT THE CONTENTION OF THE ASSESSEE AND SET ASIDE THE ORDERS OF THE LOWER AUTHORITIES ON THIS ISSUE. THE ASSESSING AUTHORITY IS DIRECTED TO RECOMPUTE THE PROFIT AND GAINS OF THE ELIGIBLE UNIT FOR THE PURPOSE OF SECTION 80IA ON TH E BASIS OF THE UNIT PRICE OF ELECTRICITY GENERATED BY THE ASSESSEE COMPANY AT ` . 3.50 PER UNIT. 15. IN RESULT, THIS APPEAL FILED BY THE ASSESSEE IS ALLOWED. 7. WE FIND THAT THE ISSUE INVOLVED IN THIS APPEAL I S SQUARELY COVERED BY THE DECISION OF THE TRIBUNAL IN THE CASE OF SRI VELAYUDHASWAMY SPINNING MILLS (P) LTD. V. DCIT IN I TA NO. 850/MDS/2011 DATED 13-07-2011. THE REMAINING CASE LAWS CITED BY THE ASSESSEE, SUPRA, ALSO CONSIDERED THE VERY SAME ISSUE AND ITA NO. 183/MDS/2012 12 DECIDED IN FAVOUR OF THE ASSESSEE. IN VIEW OF THE ABOVE, RESPECTFULLY FOLLOWING THE DECISION OF THE TRIBUNAL IN THE CASE OF SRI VELAYUDHASWAMY SPINNING MILLS (P) LTD., THIS GROUND OF APPEAL RAISED BY THE ASSESSEE IS ALLOWED. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON THURSDAY, THE 30 TH DAY OF AUGUST, 2012 AT CHENNAI. SD/- SD/- (DR. O. K. NARAYANAN) ( V.DURGA RAO ) VICE PRESIDENT JUDICIAL MEMBER CHENNAI, DATED THE 30 TH AUGUST, 2012. H. COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE