DCIT, CHENNAI V. Presidency Kid Leather Pvt. Ltd., CHENNAI

ITA 2211/CHNY/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 9632 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-04-2016
• Appeal Filed By: Department
• Bench Allotted: C
• Next Hearing Date: 28-03-2016
• Assessment Year: 1999-2000
• Appeal Filed On: 04-12-2015
• Court: TRIBUNAL
• Department Lawyers: PATHLAVATH PEERYCIT
• Assessee Lawyers: S SRIDHAR

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI , ! ' #! ' $ . %& ' () BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI DUVVURU RL REDDY , JUDICIAL MEMBER ./ I.T.A.NO.2211 /MDS./2015 ( / ASSESSMENT YEAR :1999-2000) DEPUTY COMMISSIONER OF INCOME TAX, COMPANY CIRCLE 5(2), 121,UTHAMAR GANDHI SALAI, CHENNAI 600 034. VS. M/S. PRESIDENCY KIND LEATHER PVT LTD., PLOT NO.2165,L.BLOCK, I STREET, SHANTHI COLONY, ANNA NAGAR, CHENNAI 600 040. PAN AAACP 1952 D ( *+ / APPELLANT ) ( ,-*+ / RESPONDENT ) / APPELLANT BY : MR.PATHLAVATH PEERY,CIT D.R / RESPONDENT BY : MR.S.SRIDHAR,ADVOCATE / DATE OF HEARING : 28.03.2016 /DATE OF PRONOUNCEMENT : 06.04.2016 . / O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER: THIS APPEAL IS FILED BY THE REVENUE IS DIRECTED A GAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX(A)-3, CHE NNAI DATED 01.09.2015 PERTAINING TO THE ASSESSMENT YEAR 1999- 2000 . ITA NO.2211/MDS/2015 2 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS:- 1 . THE ORDER OF THE LD. COMMISSIONER OF INCOME-TAX ( APPEALS) IS CONTRARY TO LAW AND FACTS OF THE CASE. 2. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN D IRECTING THE ASSESSING OFFICER TO RECOMPUTE THE DEDUCTION U/S.8O HHC BY REDUCING THE PROFIT ELEMENT ON SALE OF DEPB LICENCE . 3. THE LD.CIT(A) HAS ERRED IN RELYING ON THE DECISI ON OF THE HONBLE SUPREME COURT IN TOPMAN EXPORTS VS. CIT (20 12) 342 ITR 49 (2012) WHICH WAS DELIVERED MUCH LATER THAN T HE ASSESSMENT ORDER UNDER CONSIDERATION I.E., ASSESSME NT YEAR 2009-2010 AND HENCE NOT APPLICABLE IN THE CASE OF T HE ASSESSEE. 4. THE LD.CIT(A) HAS ERRED IN NOT CONSIDERING THE F ACT THAT THE ASSESSEE HAS NOT FULFILLED THE CONDITIONS SPECIFIED IN THE 3RD PROVISO TO SECTION 8OHHC(3) AS THE TURNOVER EXCEEDS RS. 10 CRORES AND IS HENCE NOT ELIGIBLE FOR DEDUCTION U/S. 8OHHC IN RESPECT OF PROFIT ON SALE OF DEPB LICENCE. 5. FOR THESE AND OTHER GROUNDS THAT MAY BE ADDUCED AT THE TIME OF HEARING, IT IS PRAYED THAT THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) MAY PLEASE BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. ITA NO.2211/MDS/2015 3 3. BEFORE THE LD.CIT(A), THE ASSESSEE CHALLENGED T HE CONSIDERATION OF 90% OF THE RECEIPTS FROM SALE OF D EPB OF ` 1,09,66,187/- U/S.80HHC OF THE ACT. ACCORDING TO T HE ASSESSEE, THE LD. ASSESSING OFFICER HAS TO CONSIDER NOT THE GROSS SALE OF DEPB, BUT HE SHALL CONSIDER ONLY THE NET CONSIDERATION TO DET ERMINE THE DEDUCTION U/S.80HHC OF THE ACT. ACCORDINGLY, LD.CI T(A), IN VIEW OF THE JUDGMENT OF SUPREME COURT IN THE CASE OF TOPMA N EXPORTS V. CIT REPORTED IN [2012] 342 ITR 49, DIRECTED THE AS SESSING OFFICER TO CONSIDER 90% OF THE NET DEPB AFTER TAKING THE FACE VALUE OF THE DEPB FROM THE SALE VALUE OF DEPB. AGAINST THIS, TH E REVENUE IS IN APPEAL BEFORE US. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. IN OUR OPINION, THE ISSUE IS SQUARELY COV ERED BY THE DECISIONS OF THE SUPREME COURT IN THE CASE OF TOPM AN EXPORTS V. CIT CITED SUPRA. ACCORDINGLY, 90% OF THE NET DEPB IS TO BE CONSIDERED FOR DETERMINING DEDUCTION U/S.80HHC OF T HE ACT. ITA NO.2211/MDS/2015 4 5. THE REVENUE HAS RAISED THE ISSUE IN GROUND NO.4 WHICH IS NOT EMANATED FROM THE ORDER OF THE LOWER AUTHORITIES. HENCE, IT IS NOT CONSIDERED FOR ADJUDICATION. 6. IN THE RESULT, THE APPEAL OF REVENUE IS DISMISSE D. ORDER PRONOUNCED ON WEDNESDAY, THE 6 TH OF APRIL, 2016 AT CHENNAI. SD/- SD/- ! ' # . $ %& ' ( DUVVURU RL REDDY ) ) ( ( () * + ) ) ! CHANDRA POOJARI ', JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 6 TH APRIL,2016 . K S SUNDARAM. -.,, /0,10 /COPY TO: , 1. /APPELLANT 2. /RESPONDENT 3. , 2,!' /CIT(A) 4. , 2 /CIT 5. 034, 5 /DR 6. 4&,6 /GF