Appeal details
Counselvise Citation
[2011] 140 COUNSELVISE.COM (IT) 48099 (ITAT-KOLKATA)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
6 month(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
05-05-2011
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
C
Assessment Year
2005-2006
Appeal Filed On
04-11-2010
Judgement Text
, C , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOL KATA () , , , !' ) [BEFORE HONBLE SRI MAHAVIR SINGH, JM & HONBLE SHR I AKBER BASHA, AM] # # # # / I.T.A NOS. 2006 & 2007/KOL/2010 $% &' $% &' $% &' $% &'/ // / ASSESSMENT YEARS: 2005-06 & 2006-07 DEPUTY COMMISSIONER OF INCOME-TAX -VS- M/S. SUBLI ME AGRO LTD. CIRCLE-4, KOLKATA. (PAN-AAECS 1804 P) ()* /APPELLANT ) (+,)*/ RESPONDENT ) FOR THE APPELLANT: SHRI PIYUSH KOLHE FOR THE RESPONDENT: SHRI H. BHARDWAJ ! / ORDER PER AKBAR BASHA/ THESE APPEALS BY REVENUE ARE ARISING OUT OF THE ORD ERS OF CIT(A)-IV, KOLKATA IN APPEAL NOS. 58/CIT(A)-IV/07-08 AND 53/CIT(A)-IV/08-09 BOTH DATED 14.12.2009. SINCE FACTS ARE IDENTICAL AND GROUNDS ARE COMMON, WE DISPOSE OF BOT H THE APPEALS BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. THE COMMON ISSUE INVOLVED IN THESE APPEALS OF TH E REVENUE ARE AGAINST THE ORDER OF CIT(A) IN RESPECT OF DELETING THE ADDITION ON ACCO UNT OF CESS ON GREEN LEAF BY FOLLOWING THE ORDER OF HONBLE CALCUTTA HIGH COURT IN THE CASE OF AFT INDUSTRIES LTD. VS. CIT 270 ITR 167 INSPITE OF THE FACT THAT SLP IS PENDING BEFORE THE HONBLE SUPREME COURT AGAINST THE SAID DECISION OF HONBLE CALCUTTA HIGH COURT. 3. BOTH THESE APPEALS OF THE REVENUE ARE DELAYED BY 23 DAYS AND AFFIDAVITS SHOWING THE CAUSE OF THE DELAY HAS BEEN SWORN BY SRI PRIYABRATA PRAMANIK, DCIT, CIR-4, KOLKATA, WHICH ARE AVAILABLE IN FILE. AFTER HEARING BOTH THE SIDES, W E ARE OF THE VIEW THAT THERE IS REASONABLE CAUSE FOR FILING THE APPEALS DELAYED. HENCE, WE CONDONE THE DELAY AND ADMIT THE APPEALS FOR HEARING. 4. NOW COMING TO THE SOLE ISSUE OF THE REVENUE IS A GAINST THE ORDERS OF CIT(A) DELETING THE ADDITION MADE ON ACCOUNT OF CESS ON GREEN LEAF, WHI CH IS A COVERED ISSUE BY HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF AFT INDUST RIES LTD. VS. CIT (2004) 270 ITR 167. 5. WE FIND THAT THE ISSUE IS SQUARELY COVERED BY TH E DECISION OF JURISDICTIONAL HIGH COURT IN THE CASE OF AFT INDUSTRIES LTD. (SUPRA), WHEREIN HONBLE HIGH COURT HAS HELD AS UNDER: HAVING REGARD TO THE PROVISIONS CONTAINED IN RULE 8 WITH WHICH WE HAD OCCASION TO DEAL IN UNION OF INDIA V. WARREN TEA LTD. [2004) 266 ITR 226 (CAL ), A.P.O. NO.792 OF 1999, DISPOSED OF BY US ON JANUARY 15, 2004, IT APPEARS THAT IN RESPECT OF COMPUTATION OF INCOME OF TEA GROWN AND MANUFACTURED, A FICTION HAS BEEN CREATED UNDER WHIC H BOTH THE AGRICULTURAL COMPONENT AND THE 2 ITA 2006 & 2007/K/201 0 SUBLIME AGRO LTD. A.Y.05-06 & 06-07 BUSINESS COMPONENT OF THE INCOME WOULD BE ASSESSED TOGETHER FOR THE PURPOSE OF COMPUTING THE INCOME UNDER THE ACT AND ONLY AFTER THE COMPUTATION OF THE TOTAL INCOME, THE APPORTIONMENT IS TO BE MADE DETERMINING 60 PER CENT, AS AGRICULTURAL IN COME AND 40 PER CENT. AS EXIGIBLE TO TAX UNDER THE ACT. DURING THE PROCESS OF THE COMPUTATION, ALL DEDUCTIONS ALLOWABLE AT THE TIME OF COMPUTATION ARE TO BE ALLOWED AND THAT WAS RIGHTLY ALLOWED. INASMUCH AS IF THE INCOME FOR TEA GROWN WAS ASSESSED UNDER THE AGRICULTURAL INCOME-TA X, IN THAT EVENT, THE SAME CESS PAID OF GREEN LEAF WOULD HAVE BEEN ELIGIBLE FOR DEDUCTION AT THE TIME OF COMPUTATION OF THE AGRICULTURAL INCOME. BUT WHEN BY FICTION IN RESPECT OF TEA GROWN AND MAN UFACTURED, THE AGRICULTURAL COMPONENT OF THE INCOME OUT OF THE TEA GROWN IS ALSO COMPUTED UNDER THE INCOME-TAX ACT ALONG WITH THE INCOME OUT OF THE TEA MANUFACTURED FROM THE TEA GROWN. WHEN BY FICTION THE INCOME AS COMPUTED AS AN INCOME UNDER THE ACT, ALL DEDUCTIONS AS ARE AVAILAB LE BOTH FOR THE AGRICULTURAL COMPONENT AND FOR THE BUSINESS COMPONENT OF THE INCOME ARE TO BE ALLO WED AS A NATURAL COROLLARY TO THE FICTION SO CREATED. SUCH DEDUCTIONS, WHICH ARE ALLOWED IN ORD ER TO ARRIVE AT THE TOTAL INCOME EXIGIBLE TO TAX, ARE TO BE ALLOWED AND THE APPORTIONMENT OF THE TOTA L INCOME SO COMPUTED IS TO BE MADE. IF THE AGRICULTURAL PART OF THE DEDUCTIONS IS MADE APPLICA TION FOR DEDUCTION FROM THE 60 PER CENT OF THE TOTAL INCOME SO COMPUTED, IN THAT EVENT, THIS 60 PE R CENT WOULD BE AGAIN MADE ASSESSABLE UNDER THE AGRICULTURAL INCOME-TAX ACT WHICH IS NOT PERMIS SIBLE. IN THAT EVENT, THE PURPOSE OF CREATING FICTION WOULD STAND FRUSTRATED. IT WOULD THEN BE A CONCEPT COMPLETELY FOREIGN TO THE FICTION SO CREATED. THEREFORE, THE ENTIRE AMOUNT PAID AS CESS ON GREEN LEAF SEEMS TO BE ELIGIBLE FOR DEDUCTION WITH REGARD TO WHICH WE DO NOT FIND ANY CONFUSION. FOR THE AFORESAID REASONS, WE DO NOT FIND ANY SUBS TANTIAL QUESTION OF LAW INVOLVED IN THIS CASE. THE PETITION IS, THEREFORE, DISMISSED. RESPECTFULLY FOLLOWING THE HONBLE JURISDICTIONAL H IGH COURT DECISION, AS THE ISSUE IS EXACTLY SAME ON FACTS, WE UPHOLD THE ORDERS OF CIT(A). 6. IN THE RESULT, THE APPEALS OF THE REVENUE ARE DI SMISSED. 7. ORDER IS PRONOUNCED IN THE OPEN COURT. SD/- SD/- , , !' (MAHAVIR SINGH) (AKBER BASHA) JUDICIAL MEMBER ACCOUNTANT MEMBER ( -' -' -' -') )) ) DATED 5 TH MAY 2011 ./ $01 2 JD.(SR.P.S.) ! 3 +4 5!4&6- COPY OF THE ORDER FORWARDED TO: 1 . )* / APPELLANT DCIT, CIRCLE-4, KOLKATA. 2 +,)* / RESPONDENT M/S. SUBLIME AGRO LTD., LORDS, 201-2 03, 7/1, LORD SINHA ROAD, KOLKATA-71. 3 . $ ( )/ THE CIT(A), KOLKATA 4. 5. $ / CIT KOLKATA 4<= +$ / DR, KOLKATA BENCHES, KOLKATA ,4 +/ TRUE COPY, ! $>/ BY ORDER, 1 /ASSTT. REGISTRAR .
