ACIT, CHENNAI V. M/s. S&S Industries Enterprises Ltd., CHENNAI

ITA 2064/CHNY/2010

• Counselvise Citation: 206421714 RSA 2010
• Duration Of Justice: 11 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-11-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 28-11-2011
• Assessment Year: 2003-2004
• Appeal Filed On: 06-12-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR I V IJAYAKUMAR IRS
• Assessee Lawyers: R SU BRAMANIAN

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH C CHENNAI BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI ABRAHAM P.GEORGE, ACCOUNTANT MEMBER .. ITA NO. 2064/MDS./2010 ASSESSMENT YEAR:2003-04 THE ASSISTANT COMMISSIONER OF INCOME TAX , COMPANY CIRCLE VI(1), CHENNAI 600 034. VS. M/S.S&S INDUSTRIES ENTERPRISES LTD., 204,SIDCO AIEMA TOWERS, I MAIN ROAD, AMBATTUR INDUSTRIAL ESTATE, CHENNAI 600 058. PAN AAACS 5108 G (APPELLANT) (RESPONDENT) DEPARTMENT BY : DR.I.VIJAYAKUMAR,I.R.S.,C.I.T. DR ASSESSEE BY : SHRI R.SUBRAMANIAN, C.A. DATE OF HEARING : 28.11.11 DATE OF PRONOUNCEMENT : 29 .11.11 O R D E R PER HARI OM MARATHA , JUDICIAL MEMBER : THIS APPEAL OF THE REVENUE FOR ASSESSMENT YEAR 2003-04 IS DIRECTED AGAINST THE ORDER OF CIT(A) DA TED 06.09.2010. PAGE OF 4 ITA. 2064/MDS/10 2 2. THE ONLY ISSUE INVOLVED IN THIS APPEAL IS REGAR DING TREATMENT OF THE LICENSE FEE. AS PER ASSESSING OFFI CER, THIS INCOME IS TO BE TREATED AS INCOME FROM HOUSE PROPE RTY. ON THE OTHER HAND LD. CIT(A) HAS TREATED THIS INCOME A S INCOME FROM ASSESSEES BUSINESS. ASSESSEE HAS DERIVED THI S INCOME FROM LETTING OUT THE ENTIRE WORKING PLANT AND MACHI NERY ALONG WITH THE BUILDINGS IN WHICH MACHINERY IS INSTALLED. THE ASSESSEE COMPANY HAD BECOME A SICK COMPANY AND STAN DS REGISTERED WITH THE BIFR. THE CASE IS PENDING BEF ORE BIFR AND THE REHABILITATION PLAN IS YET TO BE APPROVED. THIS FACT HAS BEEN ACKNOWLEDGED BY THE ASSESSING OFFICER AND HAS BEEN INCORPORATED IN HIS ORDER. BEING A SICK COMPA NY AWAITING APPROVAL OF ITS REHABILITATION PLAN, THE ASSESSEE H AS BEEN FACING SEVERE FINANCIAL CRISIS AND HAS NOT BEEN ABL E TO OPERATE THE PLANT ON ITS OWN. THE ASSESSEE HAS LET OUT THE BUILDINGS ALONG WITH ENTIRE PRODUCTIVE ASSESTS. THE LICENCEE IS CARRYING ON THE SAME BUSINESS AS THEIR BEING CARRIED ON BY T HE ASSESSEE I.E. OF MANUFACTURE OF EDIBLE OILS. ASSES SEE WAS OPERATING THE PLANT ON ITS OWN UNTIL 2002, WHEN IT STARTED GIVING OUT ITS FACILITIES ON LICENCE BASIS. BUT THE ASSES SING OFFICER HAS CONCLUDED THAT THE ASSESSEE HAS PERMANENTLY CLOSED DOWN HIS BUSINESS AND HAS NO INTENTION TO RESTART THE BUSINE SS. AT THE TIME OF HEARING, IT WAS BROUGHT TO OUR NOTICE THAT IDENTICAL AND SIMILAR ISSUE IN ASSESSEE'S OWN CASE PERTAINING TO ASSESSMENT YEAR 2007-08 WAS BROUGHT BEFORE HONBLE ITAT, WHO H AS TREATED THIS IMPUGNED RECEIPT AS INCOME FROM BUSIN ESS. THE HONBLE TRIBUNAL HAS TAKEN CARE OF THE DECISIONS OF HONBLE SUPREME COURT IN THE CASE OF UNIVERSAL PLAST LTD., VS. C.I.T. IN 237 ITR 454 AND C.I.T. VS. PODAR CEMENT PVT. LTD. I N 226 ITR PAGE OF 4 ITA. 2064/MDS/10 3 625 ON WHICH THE REVENUE HAS RELIED IN ITS GROUNDS OF APPEAL. WHILE DECIDING THE APPEAL FOR ASSESSMENT YEAR 2007- 08 ON THE SAME ISSUE, THE FACTS REMAINING IDENTICAL, THE BENCH HAS COME TO THE ABOVE CONCLUSION AFTER CONSIDERING BOTH THE ABOVE DECISIONS OF HONBLE APEX COURT. WE HAVE GONE THRO UGH THE COPY OF THIS ORDER REFERRED IN ITAT NO.96/MDS/2011 FOR ASSESSMENT YEAR 2007-08 DATED 24 TH JUNE, 2011. ACCORDINGLY BY ADHERING TO THE DOCTRINE OF STAIRE DECISIS , WE HOLD THAT THE IMPUGNED RECEIPT HAS BEEN CORRECTLY TREATED BY LD. COMMISSIONER OF INCOME TAX(A) AS ASSESSEES BUSINES S INCOME, IN THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE. ACCORDINGLY, WE DISMISS THE APPEAL OF THE REVENUE. 3. IN THE RESULT, THE APPEAL OF REVENUE STANDS DI SMISSED. ORDER PRONOUNCED ON 29.11.2011. SD/- SD/- ( ABRAHAM P.GEORGE ) ( HARI OM MARATHA ) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI, DATED THE 29.11. 2011. K S SUNDARAM COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE PAGE OF 4 ITA. 2064/MDS/10 4 DATE INITIALS 1. DRAFT DICTATED ON 2. DRAFT PLACED BEFORE AUTHORITY 3. DRAFT PLACED BEFORE THE SECOND MEMBER 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 5. APPROVED DRAFT COMES TO P.S. 6. KEEP FOR PRONOUNCEMENT ON 7. FILE SENT TO THE BENCH CLERK 8. DATE ON WHICH FILE GOES TO THE 9. DATE OF DISPATCH OF ORDER