M/s. Beach Mineral Company (P) Limited, CHENNAI V. ACIT, CHENNAI

ITA 1904/CHNY/2012

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 4974 (ITAT-CHENNAI)
• Duration Of Justice: 7 year(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-11-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 14-08-2019
• Assessment Year: 2008-2009
• Appeal Filed On: 26-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A R V SREENIVA SAN J
• Assessee Lawyers: S SRIDHAR
• Keywords: Opportunity of being heard; Earning of tax free income; Reasonable cause; Corroborative evidences; Condonation of delay; Rule 8D
• Section: 80HHC; 14A; 115JB; 10B; 201

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI , , BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER & S HRI S.JAYARAMAN , ACCOUNTANT MEMBER I.T.A.NO S . 2113 & 2114/CHNY/2012 / ASSESSMENT YEARS : 2008-09 & 2008-09 THE ASSISTANT COMMISSIONER OF INCOME TAX, COMPANY CIRCLE 1(3), CHENNAI 600 034. VS. M/S.BEACH MINERAL CO. PVT LTD ., BMC HOUSE,32/2,HALLS ROAD, CHENNAI 600 008. [PAN AADCB 3450 D ] ( / APPELLANT) ( /RESPONDENT) I.T.A.NOS.1904/CHNY/2012 & 2002 & 2003 /CHNY/2014 / ASSESSMENT YEARS : 2008-09 & 2009-10 & 2009-10 M/S.BEACH MINERAL CO. PVT LTD ., BMC HOUSE,32/2,HALLS ROAD, CHENNAI 600 008. VS. THE ASSISTANT COMMISSIONER OF INCOME TAX, COMPANY CIRCLE 1(3), CHENNAI 600 034. [PAN AADCB 3450 D] ( / APPELLANT) ( /RESPONDENT) ASSESSEE BY : MR.S.SRIDHAR,ADVOCATE REVENUE BY : MR.AR.V.SREENIVASAN,JCIT,DR / DATE OF HEARING : 04 - 11 - 201 9 / DATE OF PRONOUNCEMENT : 07 - 11 - 201 9 / O R D E R PER GEORGE MATHAN, JUDICIAL MEMBER I.T.A.NO.2113/CHNY/2012 IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-IX, ITA NOS.2113,2114 & 1904/CHNY/12 ITA NOS.2002 & 2003/CHNY/2014 :- 2 -: CHENNAI IN ITA NO.50/11-12 DATED 08.08.2012 FOR ASS ESSMENT YEAR 2008-09, AND I.T.A.NO.2114/CHNY/2012 IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE COMMISSIONER OF I NCOME- TAX(APPEALS)-III, CHENNAI IN ITA NO.56/11-12/A-III DATED 21.08.2012 FOR ASSESSMENT YEAR 2008-09 AGAINST THE PARTIAL CAN CELLATION OF PENALTY LEVIED U/S.271(1)(C) OF THE INCOME TAX ACT, 1961 (I N SHORT THE ACT). I.T.A.NO.1904 /CHNY/2012 IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS)-II I, CHENNAI IN ITA NO.56/11-12/A-III DATED 21.08.2012 FOR ASSESSMENT Y EAR 2008-09 AGAINST THE CONFIRMATION OF PENALTY LEVIED U/S.271( 1)(C) OF THE ACT. I.T.A.NO.2003/CHNY/2014 IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS) (A /C )-II, CHENNAI IN ITA NO.341/13-14 DATED 28.03.2014 FOR ASSESSMENT YEAR 2009-10 AGAINST THE CONFIRMATION OF ACTION OF THE ASSESSING OFFICER IN DENYING THE EXEMPTION CLAIMED BY THE ASSESSEE U/S.10B OF TH E ACT AND IN RESPECT OF DISALLOWANCE U/S.14A OF THE ACT. I.T.A.NO.2002 /CHNY/2012 IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF T HE COMMISSIONER OF INCOME-TAX(APPEALS)( A/C)-II, CHENN AI IN ITA NO.342/13-14 DATED 28.03.2014 FOR ASSESSMENT YEAR 2 009-10 AGAINST THE CONFIRMATION OF PENALTY LEVIED U/S.271(1)(C) OF THE ACT. ITA NOS.2113,2114 & 1904/CHNY/12 ITA NOS.2002 & 2003/CHNY/2014 :- 3 -: 2. MR.S.SRIDHAR REPRESENTED ON BEHALF OF THE ASSESSEE AND MR.AR.V.SREENIVASAN REPRESENTED ON BEHALF OF THE REVENUE. 3. SINCE THE ISSUES RAISED IN ALL THESE APPEALS OF ASSESSEE AS WELL AS REVENUE ARE INTERCONNECTED, THESE APPEALS A RE HEARD TOGETHER AND DISPOSE OF BY THIS COMMON ORDER. 4. AT THE TIME OF HEARING, IT WAS SUBMITTED BY LD. AR THAT FOR THE ASSESSMENT YEARS 2008-09 & 2009-10, THE MAIN ISSUE IS RELATED TO DENIAL OF EXEMPTION U/S.10B OF THE ACT ON ACCOUNT O F BELATED FILING OF THE RETURN OF INCOME FOR THE RELEVANT ASSESSMENT YE ARS. IT WAS SUBMITTED THAT FOR ASSESSMENT YEAR 2008-09, THE RET URN HAD BEEN FILED BELATEDLY ON 07.01.2009, ON WHICH DATE THE RETURN W AS FILED WITH THE DELAY OF 4 MONTHS. IT WAS SUBMITTED THAT FOR ASSES SMENT YEAR 2009- 10, THE RETURN HAD BEEN FILED BELATEDLY ON 20.11.20 09, ON WHICH DATE THE RETURN WAS FILED WITH THE DELAY OF 50 DAYS. IT WAS A SUBMISSION THAT THE DENIAL OF EXEMPTION U/S.10B OF THE ACT HAD BEEN MADE ON ACCOUNT OF THE 4 TH PROVISO TO SECTION 10B OF THE ACT, WHICH REQUIRED THAT THE ASSESSEE SHOULD FILE ITS RETURN OF INCOME WITHIN THE TIME PRESCRIBED U/S.139(1) OF THE ACT. THE ASSESSEE HAS SUBMITTED THAT HE HAD FILED AN APPLICATION U/S.119(2)(B) OF THE ACT B EFORE CENTRAL BOARD OF DIRECT TAXED(CBDT) SEEKING TO CONDONE THE DELAY IN FILING OF RETURNS BELATEDLY AND ALLOW DEDUCTION U/S.10B OF THE ACT. I T WAS SUBMITTED ITA NOS.2113,2114 & 1904/CHNY/12 ITA NOS.2002 & 2003/CHNY/2014 :- 4 -: THAT THE APPLICATION HAS BEEN REJECTED BY THE CBDT VIDE ORDER DATED 09.10.2015 AND THE SAME HAS BEEN CHALLENGED BEFORE THE HONBLE JURISDICTIONAL HIGH COURT IN WRIT PETITION NO.38208 /2015 & 39209/2015 FOR ASSESSMENT YEAR 2008-09 & 2009-10. THE LEARNED COUNSEL SUBMITTED THAT THE WRIT PETITION WAS PENDING DISPOS AL ON ACCOUNT THE NON-FILING OF THE COUNTER-AFFIDAVIT BY THE REVENUE, WHICH WAS FILED ON 25.10.2019 AND THE WP WAS POSTED FOR HEARING ON 19. 11.2019. IT WAS A PRAYER THAT THE APPEALS MAY BE ADJOURNED TO AWAIT THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE W.PS. 5. THE APPEALS PERTAINING TO THE YEARS 2012 TO 2014 , ARE VERY OLD MATTERS AND THERE HAS BEEN SPECIFIC DIRECTION F OR THE DISPOSAL OF OLD MATTERS. THIS BEING SO, THE ADJOURNMENT SOUGHT BY T HE ASSESSEE IS REJECTED AND THE APPEALS DISPOSED OF ON MERITS. 6. IT WAS SUBMITTED BY LD.DR THAT PROVISO TO SECTIO N 10B OF THE ACT, WHICH REQUIRED THE FILING OF THE RETURN OF INC OME WITHIN THE TIME PRESCRIBED U/S.139(1) OF THE ACT, WAS NOT PROCEDURA L, BUT WAS MANDATORY AND ON ACCOUNT OF VIOLATION OF THE SPECIF IC PROVISO, THE DENIAL OF DEDUCTION U/S.10B OF THE ACT HAD BEEN RIG HTLY MADE. IT WAS SUBMITTED THAT THIS ISSUE WAS RELATED TO GROUND NOS .2.1. TO 2.21 IN THE APPEAL OF REVENUE FOR ASSESSMENT YEAR 2008-09 IN IT A NO.2113/CHNY/2012. IN REGARD TO GROUNDS NOS.3.1 TO 3.5 OF REVENUES ITA NOS.2113,2114 & 1904/CHNY/12 ITA NOS.2002 & 2003/CHNY/2014 :- 5 -: APPEAL FOR ASSESSMENT YEAR 2008-09, IT WAS SUBMITTE D THAT THE ISSUE WAS AGAINST THE ACTION OF THE LD.CIT(A) IN DIRECTIN G THE ASSESSING OFFICER TO ALTER THE NOMENCLATURE OF THE ADDITION F ROM SUPPRESSION IN EXPORT TURNOVER TO INCREASE IN VALUE OF CLOSING STO CK. IN REGARD TO GROUNDS NOS.4.1 TO 4.2 OF REVENUES APPEAL FOR ASSE SSMENT YEAR 2008- 09, IT WAS SUBMITTED THAT THE ISSUE WAS AGAINST THE ACTION OF THE LD.CIT(A) IN DIRECTING THE ASSESSING OFFICER TO EXC LUDE FREIGHT, INSURANCE ETC. FROM EXPORT TURNOVER AS WELL AS TOTA L TURNOVER WHILE COMPUTING DEDUCTION U/S.10B OF THE ACT. THE LD.DR V EHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER. IT W AS SUBMITTED THAT THE ORDER OF LD.CIT(A) WAS LIABLE TO BE REVERSED. 7. IN REPLY, LD.AR SUBMITTED THAT THE ISSUE OF DED UCTION U/S.10B OF THE ACT BEING PENDING BEFORE THE HONBLE JURISDI CTIONAL HIGH COURT, THE ISSUE MAY BE RESTORED TO THE FILE OF ASSESSING OFFICER FOR RE-ADJUDICATION AFTER THE RECEIPT OF THE ORDER OF H ONBLE JURISDICTIONAL HIGH COURT IN RESPECT TO W.PS FILED BY THE ASSESSEE . 7.1 IN RESPECT OF SUPPRESSION OF TURNOVER, IT WAS S UBMITTED BY LD.AR THAT HE HAD NO OBJECTION, IF THE ISSUE MAY BE RESTORED TO THE FILE OF ASSESSING OFFICER FOR VERIFICATION AS TO WHETHER THE SAID ALLEGED TURNOVER HAD BEEN DISCLOSED IN THE SUBSEQUENT YEAR. IT WAS ALSO A SUBMISSION THAT IN THE EVENT, ASSESSEE IS GRANTED T HE BENEFIT OF ITA NOS.2113,2114 & 1904/CHNY/12 ITA NOS.2002 & 2003/CHNY/2014 :- 6 -: EXEMPTION U/S.10B OF THE ACT, THE ADDITION PER SE M IGHT NOT SURVIVE AS THE ADDITION ITSELF WOULD BECOME EXEMPT INCOME. 7.2 IN RESPECT OF GROUND NOS. 4.1 TO 4.2 OF REVENU ES APPEAL, IT WAS SUBMITTED BY LD.AR THAT THE ISSUE WAS SQUARE LY COVERED BY THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE O F C.I.T VS. HCL TECHNOLOGIES LTD., REPORTED IN 404 ITR 719(SC) WHER EIN THE SUPREME COURT HAS HELD THAT IF A TERM IS DEFINED U/S.2 OF T HE ACT, THEN DEFINITION WOULD BE APPLICABLE TO ALL PROVISIONS WHEREIN SAME TERM APPEARS; AND THE TERM TOTAL TURNOVER HAS BEEN DEFINED IN EXPLA NATION TO SECTIONS 80HHC AND 80HHE OF THE ACT, WHEREIN IT HAS BEEN CLE ARLY STATED THAT FOR PURPOSES OF THIS SECTION ONLY, AND NOT FOR PU RPOSE OF SECTION 10A OF THE ACT. IT WAS FURTHER SUBMITTED THAT THE SPECI AL BENCH OF CHENNAI TRIBUNAL IN THE CASE OF ITO VS. SAK SOFT LTD., REPO RTED IN [2009] 30 SOT 55 (CHENNAI)(SB) HELD THAT EXPENSES ARE TO B E EXCLUDED, BOTH FROM EXPORT TURNOVER AND FROM TOTAL TURNOVER, FOR P URPOSES OF COMPUTATION OF DEDUCTION U/S.10B(4) OF THE ACT. IT WAS SUBMITTED THAT LD.CIT(A) HAS FOLLOWED THE DECISION OF THE SPECIAL BENCH OF CHENNAI TRIBUNAL IN THE CASE OF SAK SOFT LTD., CONSEQUENTLY NO INTERFERENCE WAS LIABLE TO BE MADE. ITA NOS.2113,2114 & 1904/CHNY/12 ITA NOS.2002 & 2003/CHNY/2014 :- 7 -: 8. IT WAS SUBMITTED BY THE LD.AR THAT IN THE APPEA L OF ASSESSEE IN ITA NO.2003/CHNY/2014 FOR ASSESSMENT YEAR 2009-1 0, THE ISSUE WAS AGAINST THE ACTION OF LD.CIT(A) IN DENYING THE BENEFIT OF DEDUCTION CLAIMED U/S.10B OF THE ACT ON ACCOUNT OF DELAY IN F ILING OF THE RETURN BY APPLYING THE PROVISO TO SECTION 10B OF THE ACT. IT WAS SUBMITTED THAT THE ISSUE OF SECTION 14A OF THE ACT READ WITH RULE 8D WAS ALSO THERE IN THE ASSESSEES APPEAL, AS ALSO THE ISSUE OF THE SUP PRESSION OF EXPORT TURNOVER. IT WAS SUBMITTED THAT AS THE ISSUE OF DE DUCTION U/S.10B OF THE ACT WAS PENDING BEFORE THE HONBLE JURISDICTION AL HIGH COURT IN W.PS, THE ISSUE MAY BE RESTORED TO THE FILE OF ASSE SSING OFFICER FOR RE-ADJUDICATION AFTER THE DECISION OF HONBLE JURIS DICTIONAL HIGH COURT IN W.PS FILED BY THE ASSESSEE. IN RESPECT OF DISALLOWA NCE U/S.14A OF THE ACT, IT WAS SUBMITTED THAT THE ASSESSEE HAS NOT EAR NED ANY EXEMPT INCOME AND CONSEQUENTLY, NO DISALLOWANCE U/S.14A WA S CALLED FOR IN VIEW OF THE DECISION OF THE HONBLE DELHI HIGH COUR T IN THE CASE OF JOINT INVESTMENT PVT. LTD., VS CIT REPORTED IN 372 ITR 69 4, (DELHI). IN RESPECT OF THE ISSUE OF SUPPRESSION IN THE EXPORT T URNOVER, IT WAS SUBMITTED THAT THE ISSUE MAY BE RESTORED TO THE FIL E OF ASSESSING OFFICER FOR VERIFICATION. IT WAS A SUBMISSION THAT IF THE ASSESSEE IS HELD TO BE ENTITLED TO DEDUCTION U/S.10B OF THE ACT, THE N THE ADDITION ON ACCOUNT OF SUPPRESSION OF TURNOVER WOULD NOT LEAD T O ANY TAXABLE INCOME. ITA NOS.2113,2114 & 1904/CHNY/12 ITA NOS.2002 & 2003/CHNY/2014 :- 8 -: 9. IN REPLY, THE LD.DR SUBMITTED THAT HE HAD NO OB JECTIONS, IF THE ISSUES ARE RESTORED TO THE FILE OF ASSESSING OF FICER TO AWAIT THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT R EGARDING ALLOWABILITY OF ASSESSEES CLAIM U/S.10B OF THE ACT. IT WAS A SU BMISSION THAT IN RESPECT OF DISALLOWANCE U/S.14A OF THE ACT, THE ISS UE MAY BE RESTORED TO THE FILE OF ASSESSING OFFICER FOR VERIFICATION A S TO WHETHER THE ASSESSEE HAS EARNED ANY EXEMPT INCOME. IT WAS SUBMI TTED THAT IT IS RECORDED BY LD.CIT(A) AT PARA 10.1 OF HIS ORDER THA T THE ASSESSEE HAS NOT EARNED ANY DIVIDEND INCOME. 10. IN RESPECT OF REVENUES APPEAL IN ITA NO.2114/ CHNY/2012, THE ISSUE WAS AGAINST THE ACTION OF LD.CIT(A) IN DE LETING THE LEVY OF PENALTY U/S.271(1)(C) OF THE ACT. IT WAS SUBMITTED BY LD.DR THAT LD.CIT(A) HAD DELETED THE LEVY OF PENALTY IN RESPEC T OF ADDITIONS TOWARDS STAFF WELFARE EXPENSES CAPITALIZED AND SUPP RESSED EXPORT TURNOVER. IT WAS SUBMITTED THAT THIS WAS A CLEAR CA SE OF CONCEALMENT AND THE PENALTY WAS LIABLE TO BE CONFIRMED. IT WAS A PRAYER THAT THE ORDER OF THE LD. CIT(A) TO BE REVERSED. THE SAME WA S OPPOSED BY THE LD.AR. 10.1. IT WAS SUBMITTED BY LD.AR THAT LD.CIT(A) HAD CONSIDERED THE FACTS AND COME TO A CONCLUSION THAT FACTUALLY THERE WAS NO ITA NOS.2113,2114 & 1904/CHNY/12 ITA NOS.2002 & 2003/CHNY/2014 :- 9 -: CONCEALMENT OF INCOME. IT WAS A PRAYER THAT THE OR DER OF THE LD.CIT(A) WAS LIABLE TO BE UPHELD ON THE SAID ISSUES. 11. IT WAS SUBMITTED BY THE LD.AR IN RESPECT OF THE APPEAL OF ASSESSEE IN ITA NO.1904/CHNY/2012 FOR ASSESSMENT YE AR 2008-09, THAT THE PENALTY HAD BEEN LEVIED BY THE ASSESSING OFFICE R ON ACCOUNT OF DISALLOWANCE OF THE ASSESSEES CLAIM OF DEDUCTION U /S.10B OF THE ACT, WHICH HAD RESULTED IN ASSESSEES INCOME BEING LIABL E TO TAX UNDER THE PROVISO TO SECTION 115JB OF THE ACT. IT WAS SUBMITT ED THAT IF THE ISSUE U/S.10B OF THE ACT WAS RESTORED TO THE FILE OF ASSE SSING OFFICER FOR RE- ADJUDICATION, THEN THE PENALTY WOULD NO MORE SURVIV E. 11.1 IN REPLY, THE LD.DR VEHEMENTLY SUPPORTED THE O RDER OF THE ASSESSING OFFICER AND THE LD.CIT(A). 12. IT WAS SUBMITTED BY THE LD.AR THAT THE APPEAL OF ASSESSEE IN ITA NO.2002/CHNY/2014 FOR ASSESSMENT YEAR 2009-10, THE ISSUE WAS AGAINST THE ACTION OF THE LD.CIT(A) IN CONFIRMING T HE PENALTY LEVIED U/S.271(1)(C) OF THE ACT ON ACCOUNT OF DENIAL OF DE DUCTION U/S.10B OF THE ACT. IT WAS SUBMITTED THAT THIS PENALTY WOULD N OT SURVIVE, IF THE ASSESSEE IS GRANTED BENEFIT U/S.10B OF THE ACT. IT WAS A PRAYER THAT THE PENALTY HAS BEEN LEVIED AND CONFIRMED ON ACCOUNT OF DENIAL OF DEBATABLE ISSUE REGARDING THE ALLOWANCE OF DEDUCTIO N U/S.10B OF THE ACT. IT WAS A PRAYER THAT THE PENALTY WAS LIABLE T O BE CANCELLED. ITA NOS.2113,2114 & 1904/CHNY/12 ITA NOS.2002 & 2003/CHNY/2014 :- 10 -: 12.1 IN REPLY, THE LD.DR VEHEMENTLY SUPPORTED THE O RDERS OF THE AUTHORITIES BELOW. 13. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSE D THE MATERIAL AVAILABLE ON RECORD. ADMITTEDLY, THE MAIN CRUX OF THE ISSUE IN ALL APPEALS IS RELATED TO DENIAL OF DEDUCTION U/S.1 0B OF THE ACT. THE FACT REMAINS THAT THE ASSESSEE COMPANY IS ENGAGED IN THE MANUFACTURING, PROCESSING AND EXPORTING OF PULVERIZED GARNET, AN ESSENTIAL RAW MATERIAL IN THE MANUFACTURE OF ABRASIVES, PAINTS ET C. IT HAS ITS MANUFACTURING UNIT AT RADHAPURAM TALUK, TIRUNELVELI DISTRICT, WHICH IS AN 100% EOU AS RECOGNIZED BY THE DEVELOPMENT COMMIS SIONER, MEPZ,CHENNAI-45. IT HAD BEEN GRANTED DEDUCTION U/S. 10B OF THE ACT ON THE PROFITS FROM THE EXPORT OF BUSINESS AND THE SAME WAS GRANTED TO THE ASSESSEE TILL THE ASSESSMENT YEAR 2007-08. T HE FACTS REMAIN THAT THERE WAS A SURVEY ON THE PREMISES OF THE ASSE SSEE ON 23.03.2010. FOR THE ASSESSMENT YEARS 2008-09 AND 20 09-10, THERE WAS A DELAY IN FILING OF THE RETURN ON ACCOUNT OF T HE ACCOUNTANT OF THE COMPANY TURNING AGAINST THE COMPANY AND THEREBY CAU SING LOSS OF DATA, WHICH HAD TO BE SORTED OUT BY SENDING THE MAI N SERVER OF THE ASSESSEE TO SOFTWARE ENGINEERS FOR RETRIEVAL OF THE ORIGINAL DATA. THOUGH THE REASONS HAD BEEN MENTIONED FOR THE DELAY , AND THOUGH SUCH REASONS DO AT THE OUTSET, SEEM TO BE REASONABL E, NO EVIDENCE WITH SUPPORTING EVIDENCE HAS BEEN PLACED BEFORE THE TRIBUNAL. IN ANY ITA NOS.2113,2114 & 1904/CHNY/12 ITA NOS.2002 & 2003/CHNY/2014 :- 11 -: CASE, THE MATTER OF THE REASONABLE CAUSE IN RESPECT OF THE DELAY IN FILING OF THE RETURNS IS BEFORE THE HONBLE JURISDI CTIONAL HIGH COURT IN THE APPROPRIATE W.P NOS.39208 & 39209/2015 FOR ASSE SSMENT YEARS 2008-09 & 2009-10 RESPECTIVELY. THE ISSUE IS SUB JUDICE BEFORE THE HONBLE JURISDICTIONAL HIGH COURT AND IT IS NOT APP ROPRIATE FOR THIS TRIBUNAL TO DECIDE ON THE SAID ISSUE. HOWEVER, CONS IDERING THE FACT THAT, THESE ARE OLD APPEALS, AND THEY NEED TO DISPO SE OFF THE ISSUES IN THE QUANTUM APPEALS BEING APPEAL IN ITA NO.2113/CHN Y/2012 BY THE REVENUE FOR ASSESSMENT YEAR 2008-09 AND ITA NO.2003 /CHNY/2014 BY THE ASSESSEE FOR ASSESSMENT YEAR 2009-10 ARE RESTOR E TO THE FILE OF ASSESSING OFFICER FOR DENOVO RE-ADJUDICATION AFTER GRANTING THE ASSESSEE ADEQUATE OPPORTUNITY OF BEING HEARD AND AF TER RECEIPT OF THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT I N WRIT PETITION IN RESPECT OF CONDONATION OF DELAY IN FILING THE RETUR N REFERRED TO SUPRA FOR ASSESSMENT YEARS 2008-09 AND 2009-10. 13.1 IN RESPECT OF THE ISSUE OF EXCLUSION OF FREIG HT, INSURANCE FROM THE EXPORT TURNOVER AS WELL AS TOTAL TURNOVER WHILE COMPUTING DEDUCTION U/S.10B OF THE ACT, AS THE LD.CIT(A) HAS FOLLOWED THE JUDICIAL DISCIPLINE AND HAS FOLLOWED THE DECISION OF THE SPE CIAL BENCH OF CHENNAI TRIBUNAL IN THE CASE OF ITO VS. SAK SOFT LT D., REFERRED TO SUPRA, WE FIND NO REASON TO INTERFERE IN THE ORDER OF THE LD. CIT(A) ON ITA NOS.2113,2114 & 1904/CHNY/12 ITA NOS.2002 & 2003/CHNY/2014 :- 12 -: THIS ISSUE AND CONSEQUENTLY GROUNDS NOS.4.1. TO 4.2 IN ITA NO.2113/CHNY/2012 OF THE REVENUES APPEAL STAND DIS MISSED. 13.2. IN RESPECT OF GROUND NOS.3.1. TO 3.5 OF THE REVENUES APPEAL IN ITA NO.2113/CHNY/2012,THE ISSUE WAS AGAINST THE ACTION OF THE LD.CIT(A) IN DIRECTING THE ASSESSING OFFICER TO ALT ER THE NOMENCLATURE OF THE ADDITION FROM SUPPRESSION IN EXPORT TURNOVER TO INCREASE IN VALUE OF CLOSING STOCK. AS THE ISSUE OF DEDUCTION U/S.10B IT SELF IS PENDING BEFORE THE HONBLE JURISDICTIONAL HIGH COURT AND AS THE SAID ISSUE HAS BEEN RESTORED TO THE FILE OF ASSESSING OFFICER FOR RE-ADJUDICATION AFTER THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COU RT IN W.PS FILED BY THE ASSESSEE REFERRED TO SUPRA, THIS ISSUE IS ALSO RESTORED TO THE FILE OF ASSESSING OFFICER FOR RE-ADJUDICATION AFTER CONSIDE RING THE DIRECTIONS ISSUED BY THE HONBLE JURISDICTIONAL HIGH COURT IN THE W.P.S FILED BY THE ASSESSEE. THE ASSESSING OFFICER SHALL ALSO VERIFY AS TO WHETHER THE ALLEGED SUPPRESSED TURNOVER HAS BEEN INCLUDED IN TH E TURNOVER OF THE SUBSEQUENT ASSESSMENT YEARS. 13.3. IN RESPECT OF THE ASSESSEES APPEAL FOR THE ASSESSMENT YEAR 2009-10, IN ITA NO.2003/CHNY/2014, THE ISSUE OF DED UCTION U/S.10B OF THE ACT IS RESTORED TO THE FILE OF ASSESSING OFFICE R ON SIMILAR LINES AS IN RESPECT OF THE APPEAL OF REVENUE IN ITA NO.2113/CHN Y/2012 FOR ASSESSMENT YEAR 2008-09. ITA NOS.2113,2114 & 1904/CHNY/12 ITA NOS.2002 & 2003/CHNY/2014 :- 13 -: 13.4 IN RESPECT OF DISALLOWANCE U/S.14A OF THE ACT, THE ASSESSING OFFICER IS TO VERIFY AS TO WHETHER THE ASSESSEE HAS EARNED ANY EXEMPT INCOME FROM THE SAID INVESTMENTS. IF NO EXEMPT INCO ME IS EARNED, THEN IN VIEW OF THE DECISION OF THE HONBLE DELHI H IGH COURT IN THE CASE OF JOINT INVESTMENT PVT. LTD., VS. C.I.T REFERRED T O SUPRA, NO DISALLOWANCE IS CALLED FOR. 13.5 IN RESPECT OF ISSUE OF SUPPRESSION IN EXPORT TURNOVER, ON SIMILAR DIRECTIONS AS GIVEN IN RESPECT OF GROUND NO S.3.1. TO 3.4 OF THE REVENUES APPEAL IN ITA NO.2113/CHNY/2012, THIS IS SUE IS RESTORED TO THE FILE OF ASSESSING OFFICER FOR RE-ADJUDICATION. 13.6 IN RESPECT OF ISSUE OF COMPUTATION OF BOOK PR OFIT U/S.115JB OF THE ACT, THE SAME IS RESTORED TO THE FILE OF ASS ESSING OFFICER FOR RE-ADJUDICATION AFTER DECIDING ON THE ISSUE OF DEDU CTION U/S.10B OF THE ACT. 13.7 IN RESPECT OF THE PENALTY LEVIED U/S.271(1)(C ) OF THE ACT IN REVENUES APPEAL IN ITA NO.2114/CHNY/2012 FOR ASSES SMENT YEAR 2008-09 AND THE ASSESSEES APPEAL IN ITA NO.1904/CH NY/2012 FOR ASSESSMENT YEAR 2008-09 AND ITA NO.2002/CHNY/2014 F OR ASSESSMENT YEAR 2009-10, AS THE ISSUE OF DEDUCTION U/S/10B OF THE ACT AND VARIOUS OTHER DEDUCTIONS AND ADDITIONS HAVE BEEN RESTORED T O THE FILE OF ASSESSING OFFICER FOR RE-ADJUDICATION DENOVO, THE V ERY FOUNDATION OF ITA NOS.2113,2114 & 1904/CHNY/12 ITA NOS.2002 & 2003/CHNY/2014 :- 14 -: LEVY OF PENALTY U/S.271(1)(C) OF THE ACT WOULD NO M ORE SURVIVE, CONSEQUENTLY PENALTY IMPOSED U/S.271(1)(C) OF THE A CT STANDS DELETED AS THE SAME HAS BECOME INFRUCTUOUS. 14. TO SUM UP, THE APPEAL OF REVENUE IN ITA NO.2113/CHNY/2012 STANDS PARTLY ALLOWED FOR STATIST ICAL PURPOSES, ASSESSEES APPEAL IN ITA NO.2003/CHNY/2014 STANDS P ARTLY ALLOWED FOR STATISTICAL PURPOSES, REVENUES APPEAL IN ITA NO.21 14/CHNY/2012 STANDS DISMISSED AS INFRUCTUOUS AND THE APPEAL OF A SSESSEE IN ITA NO.2002/CHNY/2014 & ITA NO.1904/CHNY/2012 STANDS AL LOWED. ORDER PRONOUNCED ON 07 TH NOVEMBER, 2019, AT CHENNAI. SD/- SD/- ( ) (S. JAYARAMAN) # /ACCOUNTANT MEMBER ( ) (GEORGE MATHAN) $ # / JUDICIAL MEMBER / CHENNAI ! / DATED: 07 TH NOVEMBER, 2019. K S SUNDARAM $%& )& / COPY TO: 1 . , / APPELLANT 3. - () / CIT(A) 5. & $2 / DR 2. $3, / RESPONDENT 4. - / CIT 6. / GF