ACIT,Central Cir,1, Nashik, Nashik V. M/s Ashoka Buildicon Ltd, Nashik

ITA 2316/PUN/2012

• Counselvise Citation: 231624514 RSA 2012
• Duration Of Justice: 1 year(s) 1 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2004-2005
• Appeal Filed On: 23-11-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GARIMA C HOUDHARY
• Assessee Lawyers: SHEETAL GODIYA
• Section: 43B; 143(3); 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE BEFORE: SHRI G. S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NO. 23 16 /PN/20 12 ASSESSMENT YEAR : 200 4 - 05 ASSISTANT COMMISSIONER OF INCOME T AX, CENTRAL, CIRCLE - 1 NASHIK VS. M/S. ASHOKA BUILDCON LTD., ASHOKA HOUSE, ASHOKA MARG, VADALA, NASHIK (APPELLANT) (RESPONDENT) PAN NO. AABCA9292J APPELLANT BY: SMT. GARIMA CHOUDHARY RESPONDENT BY: SMT. SHEETAL GODIYA DATE OF HEARING : 0 1 - 01 - 201 4 DATE OF PRONOUNCEMENT : 17 - 01 - 2014 ORDER P ER R.S. PADVEKAR , JM : - THIS APPEAL IS FILED BY THE REVENUE CHALLENGING THE IMPUGNED ORDER OF THE LD. CIT(A) - II, NASHIK, DATED 11 - 09 - 2012 FOR THE A.Y. 200 4 - 05. TH IS APPEAL IS ARISING FROM THE ORDER OF THE LD. CIT(A) PASSED U/S. 154 OF THE INCOME - TAX ACT. THE REVENUE HAS TAKEN THE FOLLOWING GROUNDS IN THE APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(A) ERRED IN ADMITTING ADDITIONAL GROUND OF APPEAL THAT DEDUCTION UND ER SECTION 35DD OF THE ACT FOR RS. 23,00,000/ - BE ALLOWED TO THE ASSESSEE ALTHOUGH THERE WAS NO SUCH CLAIM IN THE ORIGINAL RETURN OF INCOME. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(A) ERRED IN ADMITTING ADDITIONAL GROU NDS OF APPEAL THAT THE DEDUCTION UNDER SECTION 35DD OF RS. 23,00,000/ - BE ALLOWED WHEN THE HON'BLE SUPREME COURT IN THE CASE OF GOETZE INDIA LTD V/S CIT (284 ITR 323) HAD HELD THAT NO DEDUCTION CAN BE ALLOWED, WHICH HAD NOT BEEN CLAIMED IN THE RETURN OF IN COME FILED BY THE ASSESSEE. 2 ITA NO. 23 16 /PN/2012, M/S. ASHOKA BUILDCON LTD., NASHIK 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(A) ERRED IN ALLOWING DEDUCTION UNDER SECTION 35DD OF RS. 23,00,000/ - , WHEN THE PAYMENT WAS TOWARDS 'DUTY' AND WAS COVERED BY THE PROVISION OF SECTION 43B OF THE ACT. 2. THE BRIEFLY STATED FACTS ARE AS UNDER. THE ASSESSEE IS A PRIVATE LIMITED COMPANY WHICH IS ENGAGED IN THE MANUFACTURING OF READY MIX CONCRETE, CIVIL CONSTRUCTION CONTRACT , DEVELOPMENT, OPERATION AND MAINTENANCE OF INFRASTRUCTURE FACILIT IES ON BUILD, OPERATE AND TRANSFER (BOT) BASIS. THE ASSESSEE FILED THE RETURN OF INCOME FOR THE A.Y. 2004 - 05 DECLARING TOTAL INCOME OF RS.2,81,67,780/ - . THE ASSESSEES CASE WAS SELECTED FOR THE SCRUTINY AND ASSESSMENT HAS BEEN COMPLETED U/S. 143(3) OF TH E INCOME - TAX ACT. IN RESPECT OF THE ISSUE IN CONTROVERSY BEFORE US THAT IS IN RESPECT OF THE DEDUCTION U/S. 35DD OF THE ACT , BEING 1/5 TH OF THE STAMP DUTY PAID ON AMALGAMATION. THE ASSESSEE HAD NOT CLAIMED THE SAID DEDUCTION IN THE RETURN OF INCOME BUT D URING THE COURSE OF THE ASSESSMENT PROCEEDING THE ASSESSEE FILED THE LETTER DATED 22 - 12 - 2006 AND CLAIMED THE DEDUCTION. HOWEVER, THE ASSESSING OFFICER RELYING ON T HE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. VS. CIT 284 ITR 323 REJECTED THE ASSESSEES CLAIM. IT APPEARS THAT EVEN THOUGH THE CLAIM WAS MADE BEFORE THE LD. CIT(A) BY TAKING THE ADDITIONAL GROUND BUT T HE SAME WAS REMAINED TO BE ADJUDICATED . THE LD. CIT(A) PASSED THE ORDER U/S. 154 AND ALLOWED THE CLAIM OF THE ASS ESSEE. THE OPERATIVE PART OF THE FINDINGS OF THE LD. CIT(A) ARE AS UNDER: 5. I HAVE CAREFULLY GONE THROUGH THE RECTIFICATION APPLICATION, REMAND REPORT OF THE AO, HON'BLE ITAT'S ORDER IN APPELLANT'S OWN CASE FOR AY 2006 - 07 AND THE MATERIAL AVAILABLE ON RECORD. IT IS AN UNDISPUTED FACT THAT THE APPELLANT VIDE LETTER DT. 22/12/2006 DID RAISE THE ISSUE OF DEDUCTION U/S 35DD OF THE ACT. THE APPELLANT ALSO TOOK THE ADDITIONAL GROUND IN THIS RESPECT VIDE ITS SUBMISSION DT. 05/11/2007. MY PREDECESSOR IN HIS ORD ER DT.28/08/2009 HAS NOT ADJUDICATED THE SAID GROUND. THE MISTAKE IS APPARENT FROM THE 3 ITA NO. 23 16 /PN/2012, M/S. ASHOKA BUILDCON LTD., NASHIK RECORD. AS REGARDS ADDITIONAL GROUND BEFORE THE CIT (A), THE APPELLANT HAS RELIED ON THE DECISION OF HON'BLE BOMBAY HIGH COURT IN THE CASE OF PRUTHAVI BROKERS AND SHARE HOLDERS FOR MAKING THE CLAIM BEFORE THE APPELLATE AUTHORITIES EVEN IF THE SAID CLAIM WAS NOT MADE IN THE RETURN OF INCOME. IN AY 2006 - 07, THE CIT(A) HAD DELETED THE L/5 TH OF THE EXPENSES ON AMALGAMATION DISALLOWED BY THE AO BY INVOKING THE PROVISION OF SEC . 43B OF THE ACT. AS POINTED OUT BY THE AR, I FIND THAT THIS VERY ISSUE HAS BEEN DECIDED BY THE HON'BLE ITAT, PUNE ON 30/09/2011 (ITA NO. 378/PN/2010 FOR AY 2006 - 07) IN ASSESSEE'S OWN CASE. THE HON'BLE ITAT HELD THAT AS PER THE PROVISION OF SEC. 3 5DD, THE DEDUCTION IS AVAILABLE FOR FIVE SUCCESSIVE PREVIOUS YEARS BEGINNING WITH PREVIOUS YEAR IN WHICH THE AMALGAMATION OR DE - MERGER TOOK PLACE. AS PER THE ORDER DT. 28/02/2005 OF THE HON'BLE MUMBAI HIGH COURT, AMALGAMATION HAD TAKEN PLACE W.E.F. 01/04/2003 I.E. PY 2003 - 04 OR AY 2004 - 05. THEREFORE, RESPECTFULLY FOLLOWING THE SAID DECISION OF THE HON'BLE ITAT, I ALLOW ASSEESSEE'S ADDITIONAL GROUND OF APPEAL FOR DEDUCTION OF RS. 23,00,000 / - U/S 35DD IN ITS FAVOUR AND DIRECT THE AO TO ALLOW THE DEDUCTION FOR THE SAM E U/S 35DD. NOW THE REVENUE I S IN APPEAL BEFORE US. 3. WE HAVE HEARD THE LD. DR. THE ASSESSEE HAS FILED THE WRITTEN SUBMISSION S WHICH HA VE BEEN CONSIDERED. WE FIND THAT THE LD. CIT(A) FOLLOWED THE DECISION OF THE ITAT, PUNE IN ASSESSEES OWN CASE FOR THE A.Y. 2006 - 07 ITA NO. 378/PN/2010 DATED 30 - 09 - 2011. THE COPY OF THE ORDER IS MADE AVAILABLE ON THE RECORD. WE FIND THAT THE IDENTICAL ISSUE HAS BEEN CONSIDERED BY THE TRIBUNAL IN ASSESSEES OWN CASE IN THE A.Y. 2006 - 07. THE RELEVANT DISCUSSION S AND FINDING S OF THE TRIBUNAL ARE AS UNDER: AFTER HEARING BOTH THE PARTIES AND PERUSING THE MATERIAL ON RECORD, THE REASONED FINDING GIVEN BY THE CIT(A) NEEDS NO INTERFERENCE AT OUR HAND. IT IS SEEN THAT THE ASSESSING OFFICER HAS ACCEPTED THAT THE AMOUNT CLAI MED WAS RELATING TO THE PROVISIONS U/S. 35DD OF THE ACT BUT DISALLOWED THE SAME BY INVOKING THE PROVISIONS OF SECTION 43B OF THE ACT ON ACTUAL PAYMENT BASIS. AS PER THE PROVISIONS OF SECTION 35DD THE DEDUCTION IS AVAILABLE FOR FIVE SUCCESSIVE PREVIOUS YEA RS BEGINNING WITH THE PREVIOUS YEAR IN WHICH THE AMALGAMATION OR DE - 4 ITA NO. 23 16 /PN/2012, M/S. ASHOKA BUILDCON LTD., NASHIK MERGER TOOK PLACE. THE ASSESSEE CLAIMED THE EXPENDITURE FROM THE BEGINNING WITH THE PREVIOUS YEAR 2004 - 05 AND 1/5 TH OF THE SAME IS CLAIMED DURING THE PERIOD UNDER CONSIDERATION. IN VIEW OF PROVISIONS OF SECTION 35DD THE ASSESSEE IS ENTITLED FOR DEDUCTION. FURTHER, THE EXPENDITURE IS NOT IN THE NATURE OF EXPENDITURE PROVIDED IN THE PROVISIONS OF SECTION 43B OF THE ACT. THEREFORE, THE CIT(A) WAS JUSTIFIED IN DELETING THE DISALLOWANCE IN Q UESTION. WE UPHOLD THE SAME . 4. SO FAR AS THE GRIEVANCE OF THE REVENUE IS THAT THE ASSESSING OFFICER WAS JUSTIFIED IN REJECTING THE CLAIM OF THE ASSESSEE BY THE FOLLOWING DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. (SUPRA) . IN OUR OPINION THE ASSESSING OFFICER HAS RIGHTLY DENIED THE DEDUCTION TO THE ASSESSEE. SO FAR AS THE MERITS ARE CONCERNED , THE ISSUE STANDS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE TRIBUNAL IN ASSESSEES OWN CASE REFERRED (SUPRA). IN O UR OPINION, THERE IS NO MERIT IN THE APPEAL FILED BY THE REVENUE. WE, ACCORDINGLY, DISMISS THE GROUNDS TAKEN BY THE REVENUE. 5. I N THE RESULT, THE REVENUES APPEAL IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON 17 - 01 - 201 4 SD/ - SD/ - ( G.S. PA NNU ) ( R.S. PADVEKAR ) ACCOUNTANT MEMBER JUDICIAL MEMBER RK /PS PUNE , DATED : 17 TH JANUARY, 2014 COPY TO 1 ASSESSEE 2 DEPARTMENT 3 THE CIT(A) - II, NASHIK 4 THE CIT - II, NASHIK 5 THE DR, ITAT, A BENCH, PUNE . 6 GUARD FILE. //TRUE COPY// BY ORDER PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL PUNE