DCIT Range- I, V. Iqbal PAramount Metal Industries,

ITA 1845/DEL/2008

• Counselvise Citation: [2009] 114 COUNSELVISE.COM (IT) 9688 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 3 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-09-2009
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 02-09-2009
• Assessment Year: 2003-2004
• Appeal Filed On: 12-05-2008
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MONA MOHANTI
• Keywords: Question of law
• Section: 80HHC; 80IB

Judgement Text

ITA NOS.1845&1603/DEL/2008 A.Y. 2003-04/2004-05 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH C NEW DELHI BEFORE SHRI R.P. TOLANI, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER I.T.A. NO. 1845 & 1603/DEL/2008 A.Y. 2003-04 & 2004-05 DY. CIT, VS. M/S IQBAL PARAMOUNT METAL INDUST RIES RANGE-1, TAVELA STREET, MORADABAD AAYAKAR BHAVAN, (PAN : AAAFI 9107N) MORADABAD [APPELLANT] (RESPONDENT) APPELLANT BY : SMT. MONA MOHANTI, DR RESPONDENT BY : NONE ORDER PER SHAMIM YAHYA, AM THESE APPEALS BY THE REVENUE ARE DIRECTED AGAINST THE ORDERS OF THE CIT(A) FOR THE CONCERNED ASSESSMENT YEARS. THE ISSUE INVOLVED THEREIN ARE COMMON. THEREFORE, THE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPO SED OF BY THIS CONSOLIDATED ORDER. 2. THE COMMON ISSUE RAISED IS THAT THE LD. CIT(A) H AS ERRED IN ISSUING DIRECTIONS WHICH AMOUNTED TO DOUBLE DEDUCTION ON ACCOUNT OF SE CTION 80IB AND 80HHC ON THE SAME INCOME DERIVED BY THE ASSESSEE. 3. IN THIS CASE THE ASSESSING OFFICER HAS DEDUCTED THE DEDUCTION UNDER SECTION 80IB FROM ELIGIBLE DEDUCTION UNDER SECTION 80HHC FOLLOWI NG THE PROVISION OF SECTION 80IA(9). 4. UPON ASSESSES APPEAL IN THIS REGARD THE LD. CIT (A) REFERRED TO ITAT, DELHI BENCH DECISION THAT BOTH SECTIONS 80IB AND 80HHC ARE INDE PENDENT AND PROVISO OF SECTION 80IB ITA NOS.1845&1603/DEL/2008 A.Y. 2003-04/2004-05 2 AND 80IA(9) DO NOT IMPOSE ANY RESTRICTION OF ALLOW ANCE OF ONE DEDUCTION AFTER ANOTHER. IN THIS REGARD, THE LD. CIT(A) DIRECTED THAT DEDUC TION UNDER SECTION 80HHC AND 80IB ARE DEDUCTIBLE ON THE GROSS INCOME. BUT THE TOTAL DED UCTION IN ANY WAY CANNOT EXCEED THE PROFIT FROM BUSINESS. 5. AGAINST THIS ORDER THE REVENUE IS IN APPEAL BE FORE US. 6. WE HAVE HEARD THE LD. DR AND PERUSED THE RECORD S. NONE APPEARED ON BEHALF OF THE ASSESSEE. WE FIND THAT THE ISSUE IS COVERED I N FAVOUR OF REVENUE BY DECISION OF SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF ACIT V S. M/S ROGINI GARMENTS. IT TRANSPIRES THAT DELHI SPECIAL BENCH C OF THE ITAT IN THE CASE OF ACIT VS. HINDUSTAN M INT & AGRO PRODUCTS (P.) LTD. (2009) 119 ITD 107 (DELHI)(SB) H AS DEALT WITH THE ISSUE AND CONFIRMED THE DECISION OF ROGINI GARMENTS CASE. IN THIS CASE, IT IS ALSO NOTED THAT THE SPECIAL BENCH HAS OBSERVED ON P.144 AS UNDER:- THE LATER DECISION OF MADRAS HIGH COURT IN THE CAS E OF GENERAL OPTICS (ASIA) LTD. V. DY. CIT(A) DECIDED ON 27.12.2008 HAS MADE OUR TASK EASI ER. IN THE SAID CASE, SIMILAR QUESTION WAS RAISED AND THE TRIBUNAL, AFTER FOLLOWI NG THE DECISION OF SPECIAL BENCH IN THE CASE OF ROGINI GARMENTS (SUPRA) HAD ALLOWED DEDUCTI ON UNDER SECTION 80HHC AFTER DEDUCTING RELIEF ALLOWED UNDER SECTION 80-IA(9). T HEIR LORDSHIPS IN THE JUDGMENT NOTED PROVISION OF SUB-SECTION (9A) AS ALSO CIRCULAR OF C BDT NO.772 AND ULTIMATELY OBSERVED AS UNDER:- 8. THE DECISION IN ACIT V. M/S ROGINI GARMENTS OF THE SPECIAL BENCH, WHICH WAS FOLLOWED BY THE TRIBUNAL, RELATES TO THE PERIOD SUB SEQUENT TO THE DATE WHEN THE AMENDMENT CAME INTO EFFECT. THEREFORE, THE TRIBUNA L ERRED IN APPLYING IT TO THE ASSESSMENT YEAR 1998-99 WHEN THE AMENDMENT HAD NOT YET COME INTO EFFECT. ITA NOS.1845&1603/DEL/2008 A.Y. 2003-04/2004-05 3 9. IN THESE CIRCUMSTANCES, THE SUBSTANTIAL QUESTION OF LAW IS ANSWERED IN FAVOUR OF THE ASSESSEE, BUT RESTRICTING IT ONLY TO THE ASSESSMENT YEAR 1998-99. THIS CLARIFICATION IS NECESSARY SINCE THE IMPUGNED ORDER WAS PASSED FOR BOTH ASSESSMENT YEARS 1998-99 AND 1999-2000. TAX CASE (APPEAL) IS DISPOSED OF ACCORDINGLY. NO C OSTS. CONSEQUENTLY, CONNECT M.P.S ARE CLOSED. IT IS CLEAR FROM ABOVE THAT APPLICATION OF RESTRICT IONS AS UPHELD BY THE SPECIAL BENCH IN THE CASE OF ROGINI GARMENTS (SUPRA ) WAS HELD TO BE APPLICABLE FROM ASSESSMENT YEAR 1999-2000 ONWARD. 7. RESPECTFULLY FOLLOWING THE PRECEDENCE ABOVE, WE SE ASIDE THE ORDER OF THE CIT(A) AND RESTORE THE ISSUE TO THE FILE OF ASSESSING OFFI CER. 8. IN THE RESULT, BOTH THE APPEALS FILED BY THE R EVENUE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 4 TH SEPTEMBER, 2009. SD/- SD/- [R.P. TOLANI] [SHAMIM YAHYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 4 TH SEPTEMBER, 2009 SRB COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, DEPUTY REGISTRAR, ITAT, DELHI BENCHES