DCIT, Coimbatore V. Precot Meridian Ltd., Coimbatore

ITA 2241/CHNY/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 9534 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-05-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 13-04-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 10-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PATHLAVATH PEERYA
• Assessee Lawyers: K RAVI
• Section: 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , A B ENCH, CHENNAI . . . , . , % BEFORE SHRI N.R.S.GANESAN, JUDICIAL MEMBER AND SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ I.T.A.NO.2241/MDS/2015 ( / ASSESSMENT YEAR: 2011-12) THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE-2, 63-A RACE COURSE ROAD, COIMBATORE. VS M/S. PRECOT MERIDIAN LTD., SUPREME, P.B. NO.7161, GREEN FIELDS,PULIAKULAM ROAD, COIMBATORE-641 045. PAN:AABCP3038K ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR. PATHLAVATH PEERYA, CIT /RESPONDENT BY : MR. K.RAVI, ADVOCATE /DATE OF HEARING : 13 TH APRIL, 2016 /DATE OF PRONOUNCEMENT : 2 ND MAY, 2016 / O R D E R PER A. MOHAN ALANKAMONY, AM:- THIS APPEAL IS FILED BY THE REVENUE AGGRIEVED BY T HE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX(APP EALS)- 1, COIMBATORE DATED 25.09.2015 IN ITA NO.471/13-14 PASSED UNDER SECTION 143(3) OF THE ACT. 2. THOUGH THE REVENUE HAS RAISED FOUR ELABORATE GROUNDS, THE CRUX OF THE ISSUE IS THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN D ELETING THE ADDITION OF ` 6,06,56,354/- MADE BY THE LEARNED 2 ITA NO.2241 /MDS/2016 ASSESSING OFFICER DISALLOWING THE CLAIM OF THE ASS ESSEE UNDER SECTION 80IA OF THE ACT . 3. BRIEF FACTS ARE THAT THE ASSESSEE IS A COMPANY ENGAGED IN THE MANUFACTURE OF COTTON YARN, POLYESTE R SEWING THREAD AND YARN DYED SHIRTING FABRICS AND ALSO IN THE ACTIVITY OF GENERATION OF POWER FROM WINDMILLS, FILED ITS RE TURN OF INCOME ON 30.09.2011 FOR THE ASSESSMENT YEAR 2011-1 2 ADMITTING INCOME OF ` 27,13,53,746/-. IN THE SCRUTINY ASSESSMENT PROCEEDINGS, THE LEARNED ASSESSING OFFIC ER DISALLOWED THE CLAIM OF DEDUCTION UNDER SECTION 80I A OF THE ACT MADE BY THE ASSESSEE BECAUSE THE ASSESSEE HAD TAKEN THE INITIAL ASSESSMENT YEAR AS THE YEAR IN WHICH IT HAD CLAIMED DEDUCTION UNDER SECTION 80IA OF THE ACT INS TEAD OF THE INITIAL ASSESSMENT YEAR IN WHICH THE ASSESSEE C OMMENCE THE ELIGIBLE BUSINESS FOR COMPUTING THE PERIOD OF D EDUCTION. THOUGH THE ISSUE WAS HELD IN FAVOUR OF THE ASSESSEE BY THE HONBLE JURISDICTIONAL HIGH COURT, THE LEARNED ASSE SSING OFFICER OPINED THAT HE NEED NOT FOLLOW THE SAME BEC AUSE THE MATTER WAS PENDING BEFORE THE APEX COURT BY WAY OF SLP. 3 ITA NO.2241 /MDS/2016 4. ON APPEAL, THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS) FOLLOWING THE DECISION OF THE JURISDICTI ONAL HIGH COURT IN THE CASE OF SRI VELAYUTHASAMY SPINNING MIL LS REPORTED IN 231 ITR 368 ALLOWED THE APPEAL OF THE A SSESSEE BY OBSERVING AS UNDER:- 7. I HAVE GONE THROUGH REPRESENTATION MADE Y T HE APPELLANT AND ALSO THE ORDER OF THE ASSESSING OFFIC ER. ON GOING THROUGH THE FACTS OF THE CASE, THE ASSESSI NG OFFICER HAS DISALLOWED THE DEDUCTION CLAIMED U/S.80 IA OF THE ACT. RESPECTFULLY FOLLOWING THE DECISION OF JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. SR I VELAYUTHASAMY SPINNING MILLS REPORTED IN 231 ITR 36 8, THE ASSESSING OFFICER IS DIRECTED TO ALLOW THE CLA IM OF THE DEDUCTION U/S.80IA OF THE ACT. THIS GROUND OF APPEA L IS ALLOWED. 5. BEFORE US, THE LEARNED DEPARTMENTAL REPRESENTATI VE ARGUED IN SUPPORT OF THE ORDER OF THE LEARNED ASSES SING OFFICER WHILE AS THE LEARNED AUTHORIZED REPRESENTAT IVE ARGUED IN SUPPORT OF THE ORDER OF THE LEARNED COMMI SSIONER OF INCOME TAX (APPEALS). 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND CAREFULL Y PERUSED THE MATERIAL ON RECORD. ON A PERUSAL OF THE ASSESSMENT ORDER, IT APPEARS THAT THE LEARNED ASSES SING OFFICER WAS OF THE VIEW THAT SINCE THE REVENUE PREF ERRED AN APPEAL AGAINST THE DECISION OF THE JURISDICTIONAL H IGH COURT IN 4 ITA NO.2241 /MDS/2016 THE CASE OF SRI VELAYUDHASWAMY SPINNING MILLS PVT.L TD. CITED SUPRA BEFORE THE HONBLE SUPREME COURT, THE ISSUE H AS NOT BECOME FINAL. HOWEVER, WE FIND THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) BY FOLLOWING T HE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CA SE OF SRI VELAYUDHASWAMY SPINNING MILLS PVT.LTD. CITED SUPRA HAS RIGHTLY ALLOWED THE CLAIM OF THE ASSESSEE UNDER SEC TION 80IA OF THE ACT. FURTHER, IT IS NOT THE CASE OF THE REVE NUE THAT THE JUDGMENT OF THE HONBLE MADRAS HIGH COURT IN THE CA SE VELAYUDHASWAMY SPINNING MILLS P. LTD (SURPA) IS STA YED BY THE HONBLE APEX COURT. IT IS PERTINENT TO MENTION THAT IN THE ABSENCE OF ANY STAY GRANTED BY THE HONBLE APEX COU RT AGAINST THE OPERATION OF THE JUDGMENT OF THE HONBL E MADRAS HIGH COURT, ALL THE LOWER JUDICIARIES AS WELL AS QU ASI JUDICIAL AUTHORITIES ARE BOUND TO FOLLOW THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT. SINCE THE LEARNED COMMI SSIONER OF INCOME TAX (APPEALS) HAS RIGHTLY FOLLOWED THE DECI SION OF THE HONBLE JURISDICTIONAL MADRAS HIGH COURT(SUPRA) AND HELD THE ISSUE IN FAVOUR OF THE ASSESSEE, WE DO NOT FIND IT NECESSARY TO INTERFERE WITH THE ORDERS OF THE LEARNED COMMISS IONER OF INCOME TAX (APPEALS). THEREFORE WE HEREBY CONFIRM THE 5 ITA NO.2241 /MDS/2016 ORDERS OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS). 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON THE 2 ND MAY, 2016 SD/- SD/- ( . . . ) ( . ) (N.R.S.GANESAN) ( A.M OHAN ALANKAMONY ) # % / JUDICIAL MEMBER % / ACCOUNTANT MEMBER # /CHENNAI, ( /DATED 2 ND MAY, 2016 SOMU *+ ,+ /COPY TO: 1. APPELLANT 2. RESPONDENT 3. - () /CIT(A) 4. - /CIT 5. + 1 /DR 6. /GF