Kavin Engineering and Services P Limited, Coimbatore V. DCIT Corporate Circle 2, Coimbatore

ITA 2234/CHNY/2018

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 9730 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-12-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2014-2015
• Appeal Filed On: 26-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K MOHAMED MUSTAFA
• Assessee Lawyers: S SRIDHAR
• Keywords: Fair market value
• Section: 10AA

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI . . . , . !', $ '% BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ ITA NO.2234/CHNY/2018 ' (' / ASSESSMENT YEAR : 2014-15 M/S KAVIN ENGINEERING AND SERVICES PVT. LTD., MODULE 102, TIDEL PARK COIMBATORE LTD., VILAKURICHI ROAD, COIMBATORE 641 014. PAN : AACCK 3228 M V. THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE 2, RACE COURSE ROAD, COIMBATORE. (*+/ APPELLANT) (,-*+/ RESPONDENT) *+ . / / APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE ,-*+ . / / RESPONDENT BY : SHRI K. MOHAMED MUSTAFA, JCIT 0 . 1$ / DATE OF HEARING : 20.11.2018 23( . 1$ / DATE OF PRONOUNCEMENT : 03.12.2018 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -1, COIMBA TORE, DATED 22.06.2018 AND PERTAINS TO ASSESSMENT YEAR 2014-15. 2 I.T.A. NO.2234/CHNY/18 2. THE ONLY ISSUE ARISES FOR CONSIDERATION IS DISAL LOWANCE OF EXEMPTION CLAIMED BY THE ASSESSEE UNDER SECTION 10A A OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). 3. SHRI S. SRIDHAR, THE LD.COUNSEL FOR THE ASSESSEE , SUBMITTED THAT THE ASSESSEE HAS ESTABLISHED A NEW UNIT IN SPE CIAL ECONOMIC ZONE AND CLAIMED EXEMPTION UNDER SECTION 10AA OF TH E ACT IN RESPECT OF THE PROFIT EARNED. ACCORDING TO THE LD. COUNSEL, THE ASSESSING OFFICER DISALLOWED THE CLAIM OF THE ASSES SEE ON THE GROUND THAT THE VALUE OF ASSET TRANSFERRED EXCEEDED 20%. THE ASSESSING OFFICER, ACCORDING TO THE LD. COUNSEL, HA S TAKEN THE ACTUAL COST OF THE ASSET. THE FAIR MARKET VALUE HA S TO BE TAKEN INTO CONSIDERATION. IF THE FAIR MARKET VALUE IS TAKEN O N THE DATE OF TRANSFER, ACCORDING TO THE LD. COUNSEL, IT WOULD BE LESS THAN 20%, THEREFORE, THE DISALLOWANCE IS NOT JUSTIFIED. 4. ON THE CONTRARY, SHRI K. MOHAMED MUSTAFA, THE LD . DEPARTMENTAL REPRESENTATIVE, SUBMITTED THAT THE VAL UATION OF ASSET WAS AVAILABLE AS ANNEXURE-1 TO THE ASSESSMENT ORDER . ACCORDING TO THE LD. D.R., IT IS NOT CLEAR FROM ANNEXURE-1 AS TO THE VALUE OF ASSETS ADOPTED BY THE ASSESSEE AND THE ASSESSING OF FICER. 3 I.T.A. NO.2234/CHNY/18 THEREFORE, THERE WAS A CONFUSION WITH REGARD TO THE VALUE ADOPTED BY THE ASSESSING OFFICER ALSO. HENCE, ACCORDING TO THE LD. D.R., THE MATTER MAY BE REMITTED BACK TO THE ASSESSING OFFICE R. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSING OFFICER HAS ANNEXED NOTE 10- FIXED ASSETS AS ANNEXU RE-1 TO THE ASSESSMENT ORDER. THIS ACCORDING TO THE LD. D.R., SHOWS THE VALUE OF ASSET. THIS VALUATION IS NOT CLEAR AS RIGHTLY C LAIMED BY THE LD. D.R. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE MATTER NEEDS TO BE RE-EXAMINED. ACCORDINGLY, ORDER S OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE ENTIRE ISSU E IS REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSIN G OFFICER SHALL RE- EXAMINE THE MATTER IN THE LIGHT OF THE MATERIAL THA T MAY BE FILED BY THE ASSESSEE AND THEREAFTER DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW, AFTER GIVING A REASONABLE OPPORTUNITY TO THE ASSESSEE. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 4 I.T.A. NO.2234/CHNY/18 ORDER PRONOUNCED IN THE COURT ON 3 RD DECEMBER, 2018 AT CHENNAI. SD/- SD/- (. !' ) ( . . . ) (S. JAYARAMAN) (N.R.S. GANESAN) $ / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 5 /DATED, THE 3 RD DECEMBER, 2018. KRI. . ,167 87(1 /COPY TO: 1. *+/ APPELLANT 2. ,-*+/ RESPONDENT 3. 0 91 () /CIT(A)-1, COIMBATORE 4. PRINCIPAL CIT- 1, COIMBATORE 5. 7: ,1 /DR 6. ' ; /GF.