DCIT CIR 3, MUMBAI V. SIL BUSINESS, MUMBAI

ITA 1962/MUM/2010

• Counselvise Citation: 196219914 RSA 2010
• Duration Of Justice: 1 year(s) 5 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-08-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 16-08-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 11-03-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: C G K NAIR
• Section: 147; 263; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH D : MUMBAI BEFORE SHRI D.K. AGARWAL, (JUDICIAL MEMBER) AND SHRI RAJENDRA SINGH,(ACCOUNTANT MEMBER) ITA NO.1962/MUM/2010 ASSESSMENT YEAR : 2001-02 DY. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-5, 9 TH FLOOR OLD CGO BLDG., ANNEXE M.K. ROAD MUMBAI. ..( APPELLANT ) VS. M/S. SIL BUSINESS ENTERPRISES LTD. KILLICK HOUSE, KILLICK ESTATE BAJI PALASKAR MARG CHANDIVALI MUMBAI-400 072. ..( RESPONDENT ) P.A. NO. (AACCS 9181 K) APPELLANT BY : SHRI C.G.K. NAIR RESPONDENT BY : NONE DATE OF HEARING : 16.8.2011 DATE OF PRONOUNCEMENT : 24 TH AUGUST, 2011 O R D E R PER RAJENDRA SINGH (AM). THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 2.12.2009 OF CIT(A) FOR THE ASSESSMENT YEAR 2001-02 . THE ONLY DISPUTE RAISED BY THE REVENUE IN THIS APPEAL IS REGARDING A DDITION OF RS.20.00 LACS TO THE TOTAL INCOME ON ACCOUNT OF SUBSIDY RECEIVED FRO M MAHARASHTRA ENERGY DEVELOPMENT AGENCY (MEDA). ITA NO.1962/M/10 A.Y:01-02 2 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE AS SESSEE IN THE ASSESSMENT YEAR 2001-02 HAD DECLARED RECEIPT OF CAPITAL SUBSID Y OF RS.20.00 LACS FROM MEDA. THE, AO HOWEVER, HAD RE-OPENED ASSESSMENT FOR THE ASSESSMENT YEAR 2000-01 TO CONSIDER THE TAXABILITY OF SAID SUM IN T HAT YEAR AND IN THE RE- ASSESSMENT, ASSESSED A SUM OF RS.20.00 LACS AS REVE NUE RECEIPT IN ASSESSMENT YEAR 2000-01 WHICH WAS CONFIRMED BY THE CIT(A). HOWEVER, THE TRIBUNAL IN THE ORDER DATED 2.11.2008 IN ITA NO.525 2/MUM/2006 NOTED THAT THE PROMOTERS WERE ENTITLED TO SUBSIDY SUBJECT TO T HE CONDITION THAT WIND POWER PLANT HAD SUCCESSFULLY OPERATED WITH A MINIMU M 12% OF PLANT LOAD FACTOR. THE TRIBUNAL ALSO NOTED THAT THE PROJECT H AD COMMENCED ON 9.4.2000, THEREFORE, ASSESSEE COULD BE ELIGIBLE FOR RECEIPT OF SUBSIDY ONLY AFTER 9.4.2000. THE TRIBUNAL ACCORDINGLY HELD THAT SUBSIDY COULD BE CONSIDERED ONLY IN ASSESSMENT YEAR 2001-02. THE TR IBUNAL HOWEVER DID NOT PASS ANY ORDER REGARDING NATURE OF RECEIPT I.E. REV ENUE OR CAPITAL. SUBSEQUENT TO ORDER OF TRIBUNAL, THE AO PASSED AN O RDER DATED 2.4.2009 IN WHICH A SUM OF RS.20.00 LACS WAS ADDED TO THE TOTAL INCOME FOR THE ASSESSMENT YEAR 2001-02. 2.1 THE ASSESSEE DISPUTED THE DECISION OF THE AO AN D SUBMITTED BEFORE THE CIT(A) THAT THE ORDER DATED 2.4.2009 WAS BAD IN LAW . THE CIT(A) NOTED THAT UNDER THE PROVISIONS OF SECTION 150, ASSESSMENT OR RE-ASSESSMENT OR RE- COMPUTATION OF INCOME CAN BE MADE AT ANY TIME TO GI VE EFFECT TO ANY FINDING OR DIRECTION CONTAINED IN AN ORDER PASSED BY THE AP PELLATE AUTHORITY OR COURT PROVIDED THAT AT THE TIME OF PASSING THE ORIGINAL O RDER TIME WAS AVAILABLE FOR RE-OPENING THE ASSESSMENT. IN THIS CASE THE AO HAD NOT TAKEN RECOURSE TO ITA NO.1962/M/10 A.Y:01-02 3 SECTION 150 AND STRAIGHTAWAY ADDED THE SUM OF RS .20.00 LACS TO THE TOTAL INCOME FOR ASSESSMENT YEAR 2001-02 WHICH WAS NOT IN ACCORDANCE WITH LAW. HE THEREFORE, DELETED THE ADDITION MADE BY AO AGGRIE VED BY WHICH THE REVENUE IS IN APPEAL. 2.2 AT THE TIME OF HEARING OF THE APPEAL, NO ONE AP PEARED ON BEHALF OF THE ASSESSEE TO REPRESENT THE CASE. WE ALSO NOTED THAT NOTICE OF HEARING SENT BY RPAD HAS BEEN RETURNED BY THE POSTAL AUTHORITIES. NOTICE HAD BEEN SENT AT THE ADDRESS GIVEN IN THE MEMORANDUM OF APPEAL AND N O CHANGE IN ADDRESS HAS BEEN INTIMATED BY THE ASSESSEE. WE, THEREFORE, PROCEED TO DECIDE THE APPEAL ON THE BASIS OF MATERIAL AVAILABLE ON RECORD AND AFTER HEARING THE LD. DEPARTMENTAL REPRESENTATIVE WHO PLACED RELIANCE ON THE ORDER OF AO. 3. WE HAVE PERUSED THE RECORDS AND CONSIDERED THE M ATTER CAREFULLY. THE DISPUTE IS REGARDING LEGAL VALIDITY OF ADDITION OF RS.20.00 LACS ON ACCOUNT OF SUBSIDY RECEIVED FROM MEDA IN ASSESSMENT YEAR 2001 -02. THE SAID SUBSIDY HAD EARLIER BEEN ASSESSED BY THE AO FOR THE ASSESSM ENT YEAR 2000-01 BUT THE TRIBUNAL VIDE ORDER DATED 2.11.2008 IN ITA NO.5 252/MUM/2006 HAD HELD THAT THE SUBSIDY COULD BE CONSIDERED IN ASSESSMENT YEAR 2001-02 ONLY. THE TRIBUNAL HAD NOT PASSED ANY ORDER AS TO NATURE OF S UBSIDY I.E. REVENUE OR CAPITAL. SUBSEQUENT TO THE ORDER OF THE TRIBUNAL, THE AO ADDED A SUM OF RS. 20.00 LACS TO THE TOTAL INCOME FOR THE ASSESSMENT YEAR 2001-02 IN THE ORDER DATED 2.4.2009. THE ISSUE IS THE LEGAL VALIDI TY OF THE SAID ORDER OF THE AO. THE ASSESSMENT FOR ANY ASSESSMENT YEAR CAN BE AMENDED UNDER SECTION ITA NO.1962/M/10 A.Y:01-02 4 154, MODIFIED UNDER SECTION 263 (BY CIT) OR RE-OPEN ED UNDER SECTION 147 R.W.S. 150. THEREFORE, IF ASSESSMENT ORDER FOR ANY ASSESSMENT YEAR IS TO BE AMENDED OR MODIFIED, ACTION HAS TO BE TAKEN UNDER S PECIFIC PROVISIONS OF LAW AS MENTIONED ABOVE. IN THIS CASE, THE AO STRAIGHTA WAY HAS ADDED RS.20.00 LACS TO THE INCOME OF THE ASSESSMENT YEAR 2001-02 W ITHOUT MENTIONING THE SECTION UNDER WHICH IT HAS BEEN DONE. THE ORDER PA SSED BY THE AO CANNOT BE CONSIDERED AS ORDER UNDER SECTION 154 AS THE ISSUE REGARDING NATURE OF SUBSIDY HAD NOT BEEN DECIDED BY THE TRIBUNAL AND WA S DEBATABLE. THE ONLY OTHER PROVISIONS UNDER WHICH AO COULD CALL ACTION W AS TO RE-OPEN ASSESSMENT UNDER SECTION 150 IN ORDER TO GIVE EFFECT TO THE FI NDING OF THE TRIBUNAL BUT THE AO DID NOT TAKE ANY ACTION TO RE-OPEN THE ASSESSMEN T UNDER SECTION 150. THE ADDITION MADE BY THE AO IN ASSESSMENT YEAR 2001-02 IS THEREFORE, NOT IN ACCORDANCE WITH LAW. WE, THEREFORE, SEE NO INFIRMI TY IN THE ORDER OF THE CIT(A) DELETING THE ADDITION MADE AND THE SAME IS T HEREFORE UPHELD. 4. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 24.8.2011. SD/- SD/- (D.K. AGARWAL) (RAJENDRA SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 24.8.2011. JV. ITA NO.1962/M/10 A.Y:01-02 5 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR BENCH TRUE COPY BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.