ITO, Bangalore V. M/s Amco Power Systems Pvt. Ltd., Bangalore

ITA 228/BANG/2009

• Counselvise Citation: [2009] 114 COUNSELVISE.COM (IT) 9551 (ITAT-BANGALORE)
• Duration Of Justice: 5 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-08-2009
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 06-08-2009
• Assessment Year: 2002-2003
• Appeal Filed On: 19-03-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ATARAYANAPURA BANGALORE
• Keywords: Depreciation; Revised return; Unabsorbed depreciation
• Section: 80HHC; 115JB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH B BEFORE SHRI N.L.KALRA, ACCOUNTANT MEMBER AND SHRI GEORGE GEORGE, K, JUDICIAL MEMBER ITA NO.228(BANG)/2009 (ASSESSMENT YEAR: 2002-03) INCOME-TAX OFFICER, WARD 11(1), BANGALORE. .... APPELLANT VS. M/S. AMCO POWER SYSTEMS LTD., (NOW M/S. AMCO SAFT INDIA LTD.) HEBBAL BELLARY JAKKUR ROAD, BYATARAYANAPURA, BANGALORE. .... RESPONDENT APPELLANT BY : SMT. V.S.SREELEKHA. RESPONDENT BY : SHRI V.SRINIVASAN. O R D E R PER GEORGE GEORGE K, JM : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-I, BANGALORE, DATED 6-1-2009. THE AS SESSMENT YEAR CONCERNED IS 2002-03. 2. THE REVENUE HAS RAISED THE FOLLOWING MATERIAL GR OUND: THE LEARNED CIT(APPEALS) WAS NOT JUSTIFIED IN HOLDING THAT THE DEDUCTION UNDER SECTION80HHC WHILE COMPUTING THE BOOK PROFIT U/S 115JB HAS TO BE WORKED OUT ON THE BASIS OF THE ADJUSTED BOOK PROFIT AS PROVIDED UNDER CLAUSE (A) OR CLAUSE (B) O R CLAUSE (C) OF SUB-SECTION (3) OR SUB-SECTION 3(A) O F SECTION 80HHC AND NOT ON THE BASIS OF THE PROFIT COMPUTED AS PER THE REGULAR PROVISIONS APPLICABLE TO THE COMPUTATION OF PROFITS AND GAINS OF BUSINESS OR PROFESSION. ITA 228/B/2009 PAGE 2 OF 3 3. BRIEF FACTS OF THE CASE ARE AS FOLLOWS: THE ASSE SSEE- COMPANY IS ENGAGED IN THE BUSINESS OF MANUFACTURE A ND SALE OF STORAGE BATTERIES. THE ASSESSEE FILED ITS ORIGIN AL RETURN OF INCOME DECLARING A LOSS OF RS.20,65,456/-. SUBSEQUE NTLY, THE ASSESSEE FILED A REVISED RETURN REVISING THE ADJUS TED BOOK PROFIT U/S 115JB TO RS.1,35,64,211/- AFTER REDUCING DEDUCTION CLAIMED U/S 80HHC TO THE TUNE OF RS.11,39,119/-. T HE AO DETERMINED THE BOOK PROFIT U/S 115JB AT RS.1,47,32, 415/- AS AGAINST THE SUM OF RS.1,35,64,211/- OFFERED BY THE ASSESSEE. THE DIFFERENCE BETWEEN THE TWO FIGURES RELATES TO T HE DISALLOWANCE OF DEDUCTION CLAIMED OF RS.11,39,119/- U/S 80HHC OF THE IT ACT WHILE COMPUTING BOOK PROFIT. THE AO MADE THE VARIATION BECAUSE THE ASSESSEE WAS NOT ENT ITLED TO ANY DEDUCTION U/S 80HHC AFTER SETTING OFF BROUGHT F ORWARD LOSSES AND UNABSORBED DEPRECIATION RESULTING IN THE RE BEING NO PROFITS TO CLAIM THE DEDUCTION. CONSEQUENTLY TA X PAYABLE AS PER MAT WAS ADOPTED SINCE TAX PAYABLE ON INCOME COMPUTED UNDER NORMAL PROVISIONS WAS LESS THAN TAX PAYABLE AS PER MAT. ON APPEAL, LD. CIT(A) GRANTED RELIEF T O THE ASSESSEE FOLLOWING THE ORDER OF THE ITAT, SPECIAL B ENCH (MUMBAI) IN THE CASE OF DCIT VS. SYNCOME FORMULATIONS (I) LTD., (292 ITR (AT) 144). BEING AGGRIEVED, REVENUE IS IN APPEAL BEFORE US. 4. WE HAVE CONSIDERED THE MATTER AND PERUSED MATERIAL ON RECORD. IN THE CASE OF SYNCOME FORMULATIONS (I) LTD., SPECIAL BENCH (MUMBAI) HELD THAT DEDUCTION U/S 80H HC IN A CASE OF MINIMUM ALTERNATE TAX ASSESSMENT IS TO BE ITA 228/B/2009 PAGE 3 OF 3 WORKED OUT ON THE BASIS OF THE ADJUSTED BOOK PROFIT AND NOT ON THE BASIS OF THE PROFIT COMPUTED UNDER THE REGUL AR PROVISIONS OF LAW APPLICABLE TO THE COMPUTATION OF PROFITS AND GAINS OF BUSINESS OR PROFESSION. RESPECTFULLY FOLL OWING THE ORDER OF THE SPECIAL BENCH IN THE CASE CITED SUPRA, WE UPHOLD THE ORDER OF THE LD. CIT(A). 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST AUGUST, 2009. SD/- SD/- (N.L.KALRA) (GEORGE GEORGE K) ACCOUNTANT MEMBER JUDICIAL MEMBER BANGALORE: D A T E D : 21 ST AUGUST,2009. EKS* COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT 4 CIT(A)-I, BANGALORE. 5 DR, ITAT, BANGALORE. 6 GUARD FILE (1+1) BY ORDER ASSISTANT REGISTRA R, ITAT, BANGALORE.