Cheviot Agro Industries Pvt. Ltd., Kolkata V. DCIT, Circle - 4(1), Kolkata, Kolkata

ITA 2278/KOL/2017

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 9855 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 10 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2013-2014
• Appeal Filed On: 06-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROBIN CHOWDHURY
• Assessee Lawyers: MANISH TIWARI
• Keywords: Earning of tax free income
• Section: 143(3); 115JB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B, BENC H KOLKATA BEFORE SHRI S.S.GODARA, JM &DR. A.L.SAINI, AM ./ITA NO.2278/KOL/2017 ( / ASSESSMENT YEAR:2013-14) CHEVIOT AGRO INDUSTRIES PVT. LTD. MAGMA HOUSE, 9 TH FLOOR, 24, PARK STREET, KOLKATA-700016 VS. DCIT, CIRCLE-4(1), KOLKATA ./ ./PAN/GIR NO.: AABCC 0652 L (ASSESSEE) .. (REVENUE) ASSESSEE BY : SHRI MANISH TIWARI, A.R. RESPONDENT BY : SHRI ROBIN CHOWDHURY, CIT DR / DATE OF HEARING : 25/07/2019 /DATE OF PRONOUNCEMENT : 25/09/2019 / O R D E R PER DR. A. L. SAINI: THE CAPTIONED APPEAL FILED BY THE ASSESSEE, PERTAI NING TO ASSESSMENT YEAR 2013-14, IS DIRECTED AGAINST THE ORDER PASSED BY TH E COMMISSIONER OF INCOME TAX (APPEAL)-2, KOLKATA, WHICH IN TURN ARISES OUT OF AN ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER U/S 143(3) OF THE INCOME TAX ACT , 1961 (IN SHORT THE ACT) DATED 03.03.2016. 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE AS FOLLOWS: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF LD. A.O. WHO COMPUTED B OOK PROFIT U/S 115JB BY DEDUCTING THE EXEMPT INCOME U/S 10(1) AT RS. 1,19,7 6,438/- INSTEAD OF RS. 2,08,86,160/- WORKED OUT IN THE MAIN COMPUTATION OF INCOME. 2. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, A DDUCE OR AMEND ANY GROUND OR GROUNDS ON OR BEFORE THE DATE OF HEARING OF THE APP EAL. CHEVIOT AGRO INDUSTRIES PVT. LTD. ITA NO.2278/KOL/2017 ASSESSMENT YEAR:2013-14 PAGE | 2 3. BRIEF FACTS QUA THE ISSUE ARE THAT DURING THE AS SESSMENT PROCEEDINGS THE ASSESSING OFFICER HAS COMPUTED THE REVISED INCOME F ROM TEA GROWING AND MANUFACTURING BUSINESS AT RS. 3,48,10,266/- AS FOLL OWS: THEREAFTER THE LD. ASSESSING OFFICER COMPUTED THE B OOK PROFIT U/S 115JB OF THE ACT AS FOLLOWS: CHEVIOT AGRO INDUSTRIES PVT. LTD. ITA NO.2278/KOL/2017 ASSESSMENT YEAR:2013-14 PAGE | 3 THIS WAY THE ASSESSING OFFICER HAS COMPUTED THE BOO K PROFIT TO THE TUNE OF RS. 1,13,94,648/- AND SINCE THE AMOUNT OF TAX ON THE BO OK PROFIT COMPUTED U/S 115JB WAS MORE THAN THE TAX COMPUTED UNDER NORMAL PROVISI ON(S) OF THE ACT, THEREFORE THE ASSESSING OFFICER DIRECTED THE ASSESSEE TO PAY TAX CALCULATED ON THE BOOK PROFIT. U/S 115JB OF THE ACT. 4. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A) WHO HAS CONFIRMED T HE ADDITION MADE BY THE ASSESSING OFFICER OBSERVING THE FOLLOWING: I HAVE CONSIDERED THE SUBMISSIONS OF THE AUTHORIZE D REPRESENTATIVE OF THE APPELLANT AS WELL AS THE ASSESSMENT ORDER FRAMED IN THE LIGHT OF THE MATERIALS AVAILABLE ON RECORD BEFORE THE ASSESSING OFFICER DU RING THE ASSESSMENT PROCEEDINGS. THE AR OF THE APPELLATE HAS SUBMITTED THAT THE AO D ETERMINING BOOK PROFITS U/S. 115JB BY INCORRECTLY DEDUCTING EXEMPT AGRICULTURAL INCOME U/S. 10(1) OF THE I. T. ACT AT RS. 1,19,76,438/-, AS AGAINST RS. 2,08,86,16 0/- CORRECTLY DEDUCTIBLE. THAT EXEMPT AGRICULTURAL INCOME U/S. 10(1) IS A SUM OF R S. 2,08,86,160/- AS WORKED OUT IN THE ORDER BY THE AO, WHILE COMPUTING TAXABLE INC OME PER NORMAL INCOME TAX PROVISIONS, [RS.3,48,10,266/- BEING THE REVISED COM POSITE INCOME LESS RS.1,39,24,106/- BEING FORTY PERCENT INCOME CHARGEA BLE TO TAX UNDER I. T. ACT AS PER RULE 8]. THAT THE AO WHILE COMPUTING BOOK PROFI TS U/S. 115JB OF THE I. T. ACT, AS CONSIDERED A SUM OF RS. 1,19,76,438/- BY STATING THE SAME TO BE AGRICULTURAL INCOME U/S. 10(1), IN SPITE OF THE AGRICULTURAL INC OME WORKED OUT BY HIM AT RS.2;08,86,160/- AS MENTIONED ABOVE AND AS PER THE ORDER. A VERY APPARENT MISTAKE IS VISIBLE IN THE BOOK PROFITS WORKED OUT U /S. 115JB, IN AS MUCH THAT HE HAS RIGHTLY CONSIDERED DEDUCTIONS U/S. 10(34), 10(1 5) AND 10(30) AS PER THE I. T. ACT AND AS SHOWN IN THE MAIN COMPUTATION OF INCOME IN THE ORDER ALSO, BUT THE AGRICULTURAL INCOME EXEMPT U/S. 10(1) HAS BEEN INCO RRECTLY TAKEN ,AT RS. 1,19,76,438/- INSTEAD OF RS.2,08,86,160/- WORKED-O UT-BY HIM ONLY. I HAVE CONSIDERED THE SUBMISSION OF THE APPELLATE. 'THE AO HAS ALREADY DISCUSSED THE ISSUE IN THE ORDER AND CORRECTLY TAKEN CALCULA TED THE AGRICULTURE INCOME FOR COMPUTATION OF BOOK PROFIT. I AGREE WITH THE VIEW O F THE AO AS TAKEN IN THE MATTER. IN VIEW OF ABOVE, THE ORDER OF THE ASSESSING OFFICE R IS UPHELD. THIS GROUND OF APPEAL IS DISMISSED. 5. AGGRIEVED BY THE ORDER OF THE LD. CIT(A) THE ASS ESSEE IS IN APPEAL BEFORE US. 6. THE LD. DR HAS PRIMARILY REITERATED THE STAND TA KEN BY THE ASSESSING OFFICER WHICH WE HAVE ALREADY NOTED IN OUR EARLIER PARA AND THE SAME IS NOT BEING REPEATED FOR THE SAKE OF BREVITY AND ON THE OTHER HAND THE L D. COUNSEL FOR THE ASSESSEE HAS RELIED ON THE SUBMISSIONS MADE BEFORE AUTHORITIES B ELOW. CHEVIOT AGRO INDUSTRIES PVT. LTD. ITA NO.2278/KOL/2017 ASSESSMENT YEAR:2013-14 PAGE | 4 7. WE HEARD BOTH THE PARTIES AND CAREFULLY GONE THR OUGH THE SUBMISSION PUT FORTH ON BEHALF OF THE ASSESSEE ALONG WITH THE DOCUMENTS FURNISHED AND THE CASE LAWS RELIED UPON, AND PERUSED THE FACT OF THE CASE INCLU DING THE FINDINGS OF THE LD CIT(A) AND OTHER MATERIALS AVAILABLE ON RECORD. WE NOTE THAT THE ONLY GROUND IN APPEAL FOR THE YEAR, IS IN THE AO DETERMINING BOOK PROFITS U/S. 115JB BY INCORRECTLY DEDUCTING EXEMPT AGRICULTURAL INCOME U/ S. 10(1) OF THE I. T. ACT AT RS. 1,19,74,638/-, AS AGAINST RS. 2,08,86,160/- CORRECT LY DEDUCTIBLE. WE NOTE THAT EXEMPT AGRICULTURAL INCOME U/S. 10(1) IS A SUM OF R S. 2,08,86,160/-, AS WORKED OUT IN THE ORDER BY THE AO, WHILE COMPUTING TAXABLE INC OME AS PER NORMAL INCOME TAX PROVISIONS, [RS.3,48,10,266/- BEING THE REVISED COM POSITE INCOME LESS RS.1,39,24,106 BEING FORTY PERCENT INCOME CHARGEABL E TO TAX UNDER I. T. ACT AS PER RULE 8]. THEREFORE, WE DIRECT THE ASSESSING OFFICER TO TAKE AGRICULTURAL INCOME U/S 10(1) AT RS. 2,08,89,160/- TO COMPUTE BOOK PROFIT U/S 115JB OF THE ACT. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED IN THE COURT ON 25.09.2019 SD/- ( S.S.GODARA ) SD/- (A.L.SAINI) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / DATE: 25/09/2019 ( SB, SR.PS ) COPY OF THE ORDER FORWARDED TO: 1. CHEVIOT AGRO INDUSTRIES PVT. LTD. 2. DCIT, CIRCLE-4(1), KOLKATA 3. C.I.T(A)- 4. C.I.T.- KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. 6. GUARD FILE. TRUE COPY BY ORDER ASSIST ANT REGISTRAR ITAT, KOLKA TA BENCHES