Kisan Sahkari Chini Mills Ltd., SAHARANPUR V. JCIT, RANGE- 3, SAHARANPUR

ITA 2322/DEL/2018

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 3538 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 6 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2014-2015
• Appeal Filed On: 04-04-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: AGAINST PASSED

Judgement Text

1 ITA NO. 2322/DEL/2018 IN THE INCOME TAX APPE LLATE TRIBUNAL DELHI BENCH: C NEW DELHI BEFORE SH. ANIL CHATURVEDI, ACCOUNTANT MEMBER AND MS. SUCHITRA KAMBLE, J UDICIAL MEMBER I.T.A. NO. 2322/DEL/20 18 (A.Y 2014-15) (THROUGH VIDEO CON FERENCING) KISAN SAHKARI CHINI MILLS LTD. NANAUTA, SHARANPUR, UTTAR PRADESH AAAAK0211G (APPELLANT) VS JCIT RANGE-3 SAHARANPUR (RESPONDENT) ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST ORDER 22/03/2018 PASSED BY CIT(A)-27, NEW DELHI FOR ASSESSMENT YEAR 2013-14. 2. THE GROUNDS OF APPEAL ARE AS UNDER:- 1. THE LD.CIT(A) HAS ERRED IN CONFIRMING THE DISA LLOWANCE OF RS.3090610/- MADE BY ASSESSING OFFICER ON ACCOUNT OF REPAIR AND MAINTENANCE OF PLANT AND MACHINERY ON ESTIMATE BASIS. 3. ASSESSEE FILED ITS RETURN OF INCOME DECLARING TOTAL LOSS OF RS. 60,01,13,940/-. THE ASSESSEE IS A CO-OPERATIVE SOCI ETY AND MAIN BUSINESS OF THE ASSESSEE IS MANUFACTURING OF SUGAR. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSING OFFICER MADE AN ADDITION OF RS. 3,77,368/ - UNDER THE HEAD SELLING & APPELLANT BY SH. ANIL KUMAR JAIN, ADV RESPONDENT BY MS. SUNITA SINGH, CIT DR DATE OF HEARING 12.10.2021 DATE OF PRONOUNCEMENT 14.10.2021 2 ITA NO. 2322/DEL/2018 DISPATCHING EXPENSES AND OF RS. 30,90,610/- UNDER THE HEAD REPAIR & MAINTENANCE OF PLANT & MACHINERY. THUS, THE ASSESSI NG OFFICER ASSESSED TOTAL LOSS OF RS. 58,86,88,937/- AS INCOME OF THE ASSESSE E. 4. BEING AGGRIEVED BY THE ASSESSMENT ORDER, THE AS SESSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE. 5. THE LD. AR SUBMITTED THAT THE DISTRICT MAGISTRAT E OF THE AREA IS A CHAIRMAN OF THE SOCIETY AND ANY SCRAP CAN BE SOLD W ITH HIS APPROVAL AND BY TENDERS. SINCE SCRAP IS GENERATED IN SMALL QUANTITY HENCE THE SAME IS ACCUMULATED AND SOLD AFTER TWO OR THREE YEARS BY FO LLOWING THE PROCEDURE LAID DOWN AND AS PER THE APPROVAL OF DISTRICT MAGISTRATE . THE LD. AR ALSO RELIED UPON THE ORDER OF THE TRIBUNAL FOR A.Y. 2012-13 IN SUBSIDIARY OF ASSESSEES CASE. [KISAN SAHKARI CHINNI MILLS LTD. NANAUTA VS. DCIT I.T.A. NO.4485/DEL/2016 (A.Y 2012-13) AND THE KISAN COOPER ATIVE SUGAR VS. DCIT ITA NO. 4606/DEL/2016 (A.Y. 2012-13) ORDER DATED 20 .09.2021] 6. THE LD. DR RELIED UPON THE ASSESSMENT ORDER AND THE ORDER OF THE CIT(A). 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED ALL T HE RELEVANT MATERIALS AVAILABLE ON RECORD. IT IS PERTINENT TO NOTE THAT T HE ASSESSING OFFICER HAS DISALLOWED THESE EXPENSES ONLY ON THE BASIS OF ESTI MATED VALUE OF SCRAP AT 10% WITHOUT ANY PROPER FINDING AND ON PROPER BASIS. TH E ADDITION IS MERELY ON A PRESUMPTION BASIS. THEREFORE, THE SAME IS NOT SUSTA INABLE IN EYES OF LAW. THE CIT(A) ALSO HAS OBSERVED THAT THE DISTRICT MAGISTRA TES APPROVAL/SANCTION IS NECESSARY FOR MAKING SALE OF SCRAP. THUS, THE ASSES SING OFFICER AS WELL AS THE CIT(A) WAS NOT CORRECT IN MAKING THE ADDITION ON AC COUNT OF REPAIR AND MAINTENANCE OF PLANT AND MACHINERY. THE ISSUE IS AL READY DECIDED IN FAVOUR OF THE ASSESSEE IN A.Y. 2012-13 IN SUBSIDIARY OF ASSES SEES CASE. NO DISTINGUISHING FACTS WERE POINTED OUT BY THE LD. DR. HENCE, THE AP PEAL OF THE ASSESSEE IS ALLOWED. 3 ITA NO. 2322/DEL/2018 8. IN RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 14TH DAY OF OCTOBER, 2021 SD/- SD/- (ANIL CHATURVEDI) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEM BER DATED: 14/10/2021 R. NAHEED * COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI