Smt. D. Vallinayaki, Bhavani V. ITO, Erode

ITA 2274/CHNY/2013

• Counselvise Citation: 227421714 RSA 2013
• Duration Of Justice: 2 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-03-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 27-12-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: GURU BHASHYAM IRS
• Assessee Lawyers: K C AARTHI
• Keywords: Capital receipt
• Section: 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , . . !' , # '$ % BEFORE DR. O.K. NARAYANAN, VICE PRESIDENT & SHRI S.S. GODARA, JUDICIAL MEMBER ./ I.T.A. NO.2274 /MDS/2013 ( / ASSESSMENT YEAR : 2010-2011) SMT. S. VALLINAYAKI, PROP. M/S. NARMADA TEXTILES, NO.1/5-262, ANTHIYUR ROAD, KADAYAMPATTI PO BHAVANI 638 302 . [PAN: ABRPV2566Q] ( &' /APPELLANT) VS THE INCOME TAX OFFICER, WARD II(2) ERODE. ( ()&' /RESPONDENT) / APPELLANT BY : SHRI. K.C. AARTHI, ADVOCATE / RESPONDENT BY : SHRI. GURU BHASHYAM, I.R.S. JCIT. /DATE OF HEARING : 10.03.2014 /DATE OF PRONOUNCEMENT : 10.03.2014 '* / O R D E R PER S.S. GODARA, JUDICIAL MEMBER THIS ASSESSEES APPEAL ARISES FROM ORDER OF THE CO MMISSIONER OF INCOME TAX (APPEALS)-I, COIMBATORE DATED 03.10.2013 , PASSED IN ITA I.T.A.NO.2274/MDS/2013 :- 2 -: NO.148/12-13 FOR ASSESSMENT YEAR 2010-2011, IN PROC EEDINGS UNDER SECTION 143(3) OF THE INCOME TAX ACT 1961 [IN SHORT THE ACT]. 2. IT IS TO BE SEEN THAT THE SOLE GROUND RAISED IS AG AINST THE ORDER OF THE CIT(A) HOLDING COMPENSATION RECEIVED THROUGH WAIVER OF SUPPLIERS CREDIT AS A REVENUE RECEIPT LIABLE TO BE TAXED. IN THE COURSE OF HEARING AS WELL, THE ASSESSEE ARGUES THAT THIS SUM OF H8,54,952/- CREDITED IS FOR IMPROVEMENT OF THE CAP ITAL ASSET AND LIABLE TO BE TREATED AS A CAPITAL RECEIPT. ACCORDINGL Y, SHE PRAYS FOR ACCEPTANCE OF THE APPEAL. 3. IN REPLY, THE REVENUE QUOTES ORDER OF THE CO-ORDINA TE BENCH IN ITA NO.1679/MDS/2012 AND SUBMITS THAT THE VERY ISSU E STANDS DECIDED AGAINST THE ASSESSEE IN PRECEDING ASSESSMENT YEAR I .E 2009-2010 AND NO INTERFERENCE IS CALLED FOR. 4. THE ASSESSEE IS AN INDIVIDUAL, ENGAGED IN THE BU SINESS OF JOB WORK IN DYEING AND GENERATION OF POWER. ON 15.10.2 010 SHE HAD FILED HER RETURN DECLARING TOTAL INCOME OF H 8,42,830/- WHICH WAS SUMMARILY PROCESSED. 5. IN THE COURSE OF SCRUTINY, THE ASSESSING OFFICER NOTICED THAT IN RELEVANT PREVIOUS YEAR, THE ASSESSEE HAD PURCHASED WINDMILL THROUGH I.T.A.NO.2274/MDS/2013 :- 3 -: AN AGREEMENT DATED 04.02.2009 AND ALSO CREDITED ABO VE SAID AMOUNT IN THE BALANCE SHEET AS CAPITAL RESERVE. THEREIN, THE ASSESSEE PLEADED THAT THE CAPITAL RESERVE AMOUNT HAD BEEN TRANSFERR ED BY TREATING IT AS A CAPITAL RECEIPT OUT OF SUPPLIERS CREDIT (INTEREST FREE LOAN) AS LIQUIDATED DAMAGES AGAINST SUPPLY OF MACHINERY CONTRACTED FOR. IN THE ASSESSMENT ORDER DATED 13.02.2013, THE ASSESSING OF FICER HELD THIS COMPENSATION IN THE NATURE OF A REVENUE RECEIPT. HE ACTED ACCORDINGLY AND MADE THE IMPUGNED ADDITION. 6. IN THE LOWER APPELLATE PROCEEDINGS, THE CIT(A) HAS FOLLOWED ORDER OF THE TRIBUNAL DATED 21 ST FEBRUARY, 2013 (SUPRA) TO AFFIRM ACTION OF THE ASSESSING OFFICER. AT THE SAME TIME, HE HAS ENTERTAINED AN ADDITIONAL GROUND RAISED BY THE ASSESSEE FOR ALL OWING DEDUCTION UNDER SECTION 80IA FOR THE AMOUNT IN QUESTION AND D IRECTED THE ASSESSING OFFICER TO EXAMINE IT AS PER LAW AS NO DE TAILS HAD BEEN FILED BEFORE HIM. THEREFORE, THE ASSESSEE IS IN APPEA L. 7. WE HAVE HEARD BOTH PARTIES AND GONE THROUGH THE CAS E FILE. AS FAR AS THE NATURE OF THE COMPENSATION AMOUNT I.E W HETHER CAPITAL OR REVENUE IS CONCERNED, UNDISPUTEDLY, THE SAME IS COVERED AGAINST THE ASSESSEE IN VIEW OF THE TRIBUNAL ORDER (SUPRA) IN PRECEDING ASSESSMENT YEAR. BESIDES THAT, WE FIND THAT THE CI T(A) HAS ALREADY I.T.A.NO.2274/MDS/2013 :- 4 -: DIRECTED THE ASSESSING OFFICER TO EXAMINE THE ASSES SEES CLAIM UNDER SECTION 80IA. IN THESE CIRCUMSTANCES, THERE IS NO G ROUND FOR THE ASSESSEE TO BE AGGRIEVED AGAINST THE ORDER UNDER CH ALLENGE. THE CIT(A)S FINDINGS ARE AFFIRMED. 8. IN RESULT, THE ASSESSEE APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF H EARING ON MONDAY, THE 10 TH OF MARCH, 2014 AT CHENNAI SD/- SD/- (DR. O.K. NARAYANAN) VICE PRESIDENT (S.S. GODARA) JUDICIAL MEMBER DATED:10 TH MARCH, 2014 K.V COPY TO: APPELLANT/RESPONDENT/CIT(A)/CIT/DR