The ACIT, Circle-4, Ahmedabad V. Hazira Port Pvt.Ltd., Ahmedabad

ITA 2121/AHD/2011

• Counselvise Citation: 212120514 RSA 2011
• Duration Of Justice: 4 year(s) 2 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-11-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 25-08-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 26-08-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K PANDEY
• Assessee Lawyers: P M MEHTA
• Keywords: Depreciation; Unabsorbed depreciation
• Section: 143(3); 115JB

Judgement Text

I.T.A. NO.: 2121/AHD/2011 ASSESSMENT YEAR: 2008-09 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH, AHMEDABAD. [CORAM: PRAMOD KUMAR AM AND S. S. GODARA JM] I.T.A. NO. 2121/AHD/2011 ASSESSMENT YEAR: 2008-09 ASSTT. CIT, CIRCLE-4, AHMEDABAD.................. ...APPELLANT VS. HAZIRA PORT PVT. LTD. 101-103, ABHIJEET-II, MITHAKALI CIRCLE, AHMEDABAD. . .RESPONDENT PAN AAACH9142D APPEARANCES BY: A.K. PANDEY....... FOR THE APPELLANT P. M. MEHTA....... F OR THE RESPONDENT DATE OF CONCLUDING THE HEARING: 25 TH AUGUST, 2015 DATE OF PRONOUNCING THE ORDER: 16 TH NOV, 2015 O R D E R PER PRAMOD KUMAR, AM: BY WAY OF THIS APPEAL, THE ASSESSING OFFICER HAS C HALLENGED CORRECTNESS OF THE LD. CIT(A)S ORDER DATED 15 TH JUNE, 2011, IN THE MATTER OF ASSESSMENT UNDER SECTION 143(3) OF THE INCOME-TAX A CT, 1961 (THE ACT, HEREINAFTER) FOR ASSESSMENT YEAR 2008-09, ON THE FO LLOWING GROUNDS :- 1. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DIRECTING TO ALLOW UNABSORBED DEPRECIATION AND BUSINESS LOSS TOGETHER FOR ALL YEARS WHILE ARRIVING AT THE AMOUNT TO BE SET OFF UNDER THE PROV ISIONS OF SECTION 115JB(2)(II) WITHOUT APPRECIATING FACT THAT ACCORDI NG TO THE PROVISIONS OF SECTION 71 TO 73 THE LOSS BROUGHT FORWARD OR UNABSO RBED DEPRECIATION WAS TO BE CONSIDERED ON YEAR TO YEAR BASIS AND NOT AS AN AGGREGATE FIGURE FOR ALL YEARS. I.T.A. NO.: 2121/AHD/2011 ASSESSMENT YEAR: 2008-09 PAGE 2 OF 3 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE AO 3. IT IS THEREFORE, PRAYED THAT THE ORDER OF THE LD . CIT(A) MAY BE SET ASIDE AND THAT OF THE AO MAY BE RESTORED TO THE ABOVE EXT ENT. 2. LD. REPRESENTATIVES FAIRLY AGREE THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY A CO-ORDINATE BENCHS DECISION IN THE CASE OF AMLINE TEXTILES LTD. VS. ITO (27 SOT 152), EVEN THOUGH LD. DR RELIED UPON THE STAND OF THE ASSESSING OFFICER. 3. WE FIND THAT IN GRANTING THE IMPUGNED RELIEF, LD . CIT(A) HAS IN A VERY DETAILED ANALYSIS MERELY FOLLOWED THE VIEWS EXPRESS ED BY THE CO-ORDINATE BENCH, AS EVIDENT FROM THE FOLLOWING OBSERVATIONS : - 2.2 I HAVE CAREFULLY CONSIDERED THE ASSESSMENT OR DER, FINDING OF THE AO AND THE SUBMISSIONS OF THE APPELLANT. THE DISPUT E ARISING HERE IS WITH REGARDS TO THE METHOD OF CALCULATION OF UNABSO RBED DEPRECIATION AND BROUGHT FORWARD LOSSES AS PER BOOKS OF ACCOUNTS . FROM THE ORDER, IT IS NOTICED THAT THE AO HAS ADOPTED YEAR TO YEAR BASIS WHEREAS THE APPELLANT HAS ADOPTED GLOBAL METHOD AND HAS REDUCED AGGREGATE AMOUNT OF UNABSORBED DEPRECIATION AND BROUGHT FORWA RD LOSSES OF EARLIER YEARS. IT IS SEEN FROM THE LANGUAGE OF CLAU SE (III) OF EXPLANATION (1) TO SECTION 115JB THAT THE AMOUNT OF LOSS BROUGH T FORWARD OR UNABSORBED DEPRECIATION WHICHEVER LESS AS PER BOOKS OF ACCOUNTS HAS TO BE REDUCED. THE USE OF THE WORD AMOUNT IN SINGUL AR CLEARLY SHOWS THE INTENTION OF LEGISLATURE TO REDUCE ONLY SINGLE AND ONE CONSOLIDATED FIGURE OF BROUGHT FORWARD LOSS OR DEPRECIATION OF E ARLIER YEARS AND NOT YEAR TO YEAR BASIS. THIS PARTICULAR INTERPRETATION FURTHER FINDS SUPPORT FROM THE DECISION OF HONBLE MUMBAI TRIBUNAL IN CAS E OF AMLINE TEXTILE PVT. LTD. REFERRED SUPRA WHEREIN THE HONBLE ITAT H AS CONSIDERED THE ISSUE AT LENGTH AND AFTER CONSIDERING THE SAME FORM ALL PERSPECTIVES INCLUDING PROVISIONS OF SECTION 71 TO 73 OF THE ACT AND THEREAFTER IT HAS BEEN HELD THAT LOWER OF THE SOLITARY FIGURES OF TH E UNABSORBED DEPRECIATION OF LOSSES BROUGHT FORWARD FOR ALL THE EARLIER YEARS TAKEN TOGETHER IS TO BE REDUCED FOR THE PURPOSE OF COMPUT ING BOOK PROFIT UNDER SECTION 115JB. IT IS FURTHER OBSERVED THAT T HERE IS NO REFERENCE IN THE SECTION TO CONSIDER THE BROUGHT FORWARD LOSS AND UNABSORBED DEPRECIATION ON YEAR TO YEAR BASIS. IF THE LEGISLAT URE WOULD HAVE DESIRED SUCH INTERPRETATION, IT WOULD HAVE BEEN SO STATED I N UNEQUIVOCAL TERMS IN THE PROVISION ITSELF. AND IN THE ABSENCE OF ANY SUCH SPECIFIC PROVISION IT WAS NOT POSSIBLE TO INFER SUCH INTENDMENT. IT IS ALSO SEEN THAT THE INTERPRETATION IS ALSO SUPPORTED BY THE ORDER OF MY LD. FELLOW CIT(A) VI, I.T.A. NO.: 2121/AHD/2011 ASSESSMENT YEAR: 2008-09 PAGE 3 OF 3 AHMEDABAD IN THE CASE OF THE ARVIND MILLS LTD. UNDE R SUCH CIRCUMSTANCES I AM OF THE CONSIDERED OPINION THAT T HE VIEW ADOPTED BY HONBLE MUMBAI TRIBUNAL IS QUITE REASONABLE AND IN ACCORDANCE WITH LAW. ACCORDINGLY THE AO IS DIRECTED TO CONSIDER UNA BSORBED DEPRECIATION AND BUSINESS LOSS TOGETHER FOR ALL YEA RS WHILE ARRIVING AT THE AMOUNT TO BE SET OFF UNDER PROVISIONS OF 115JB( 2)(II) F THE ACT. THE RELEVANT GROUNDS OF APPEAL IS THUS ALLOWED. 4. WE SEE NO INFIRMITY IN THE STAND SO TAKEN BY THE LD. CIT(A). RESPECTFULLY FOLLOWING THE VIEW EXPRESSED BY THE CO-ORDINATE BEN CH IN THE CASE OF AMLINE TEXTILE PVT. LTD. (SUPRA), WE APPROVE THE CONCLUSIO NS ARRIVED AT BY THE CIT(A) AND DECLINE TO INTERFERE IN THE MATTER. 5. IN THE RESULT, THE APPEAL IS DISMISSED. PRONOUNCED TODAY ON 16 TH DAY OF NOVEMBER, 2015. SD/- SD/- (S. S. GODARA) PRAMOD KUMAR (JUDICIAL MEMBER) (AC COUNTANT MEMBER) AHMEDABAD, THE 16 TH DAY OF NOVEMBER, 2015 COPIES TO: (1) THE APPELLANT (2) THE RESPON DENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ETC ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD