DCIT - 8(2)(2), MUMBAI V. SUNSHIELD CHEMICALS LTD., MUMBAI

ITA 2346/MUM/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 8238 (ITAT-MUMBAI)
• Duration Of Justice: 9 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-02-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 29-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation; Revised return; Unabsorbed depreciation
• Section: 143(3); 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES J MUMBAI BEFORE SHRI B.R. BASKARAN (AM) AND SHRI RAM LAL NEGI (JM) ITA NO 2346/MUM/2016 ASSESSMENT YEAR: 2010-11 DY. COMMISSIONER OF INCOME TAX 8(2)(2), ROOM NO.615, M.K. RD. MUMBAI- 400 020. VS. M/S SUNSHIELD CHEMICALS LTD. PHOENIX HOUSE, A-WING, 4 TH FLOOR, 462 SENAPATI BAPAT MARG, LOWER PAREL(W), MUMBAI-400013 PAN:- AAFCS8219K (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI. VAIBHAV JAIN, DR RESPONDENT BY : SHRI. JITENDRA JAIN, AR DATE OF HEARING: 19 /1 2 /2016 DATE OF PRONOUNCEMENT: 15/02/20 17 O R D E R PER RAM LAL NEGI, JM THIS APPEAL HAS BEEN PREFERRED BY THE REVENUE AGAIN ST THE ORDER OF THE CIT(A)-14, MUMBAI DATED 26-02-2016 FOR THE A.Y. 201 0-11, WHEREBY THE LEARNED CIT(A) PARTLY ALLOWED THE APPEAL FILED BY T HE ASSESSEE PASSED U/S 143(3) OF THE INCOME TAX ACT (THE ACT) 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE EN GAGED IN THE BUSINESS OF MANUFACTURING OF CHEMICALS, FILED ITS RETURN OF INC OME FOR THE A.Y. 2010-11 DECLARING TOTAL INCOME AS NIL AS PER THE NORMAL P ROVISIONS AND RS.1,93,84,437/- UNDER THE PROVISIONS OF SECTION 11 5JB OF THE ACT. THE RETURN WAS PROCESSED AND AFTER EXAMINING THE DETAILS FURNI SHED BY THE ASSESSEE IN THE LIGHT OF THE SUBMISSIONS MADE, DECLINED TO ACCEPT T HE CLAIM OF ASSESSEE TO SET OFF THE LOSS AMOUNTING TO RS. 2,50,83,839/-, SINCE THE ASSESSEE HAD ONLY CLAIM AN AMOUNT OF RS. 1,78,28,655/-IN THE RETURN OF INCO ME AND HAD NOT FILED ANY REVISED RETURN OF INCOME TO CLAIM THE ADDITIONAL AM OUNT OF BIG LOSS AVAILABLE ON ITA NO 2346/MUM/2016 ASSESSMENT YEAR: 2010-11 PAGE 2 OF 6 THE AVERAGE BASIS, THE ASSESSEE WAS ALLOWED TO SET OFF THE LOSS AS CLAIMED IN THE ORIGINAL RETURN OF INCOME. 3. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER BEFOR E THE LD. CIT(A) IN FIRST APPEAL. THE LD. CIT(A) AFTER HEARING THE ASSESSEE P ARTLY ALLOWED THE APPEAL. THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL AGAINST TH E FINDINGS OF THE LD. CIT(A) RAISING THE FOLLOWING GROUNDS OF APPEAL. I. THE LEARNED CIT (A) HAS ERRED ON FACTS AND IN L AW IN DIRECTING THE ASSESSING OFFICER TO CONSIDER THE REVISED STATEMENT OF UNABSORBED DEPRECIATION AND BOOK LOSS FURNISHED BY THE ASSESSE E FOR COMPUTATION OF BOOK PROFIT U/S 11 5JB OF THE LT. ACT, 1961 WITH OUT PROPERLY APPRECIATING THE FACTUAL AND LEGAL MATRIX OF THE CA SE AS CLEARLY BROUGHT OUT BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDE R. II. THE LEARNED CIT (A) HAS ERRED ON FACTS AND IN L AW IN DIRECTING THE ASSESSING OFFICER TO CONSIDER THE REVISED STATEMENT OF UNABSORBED DEPRECIATION AND BOOK LOSS FURNISHED BY THE ASSESSE E FOR COMPUTATION OF BOOK PROFIT U/S 11 5JB OF THE LT. ACT, 1961 WITH OUT PROPERLY APPRECIATING THE FACT THAT THE ASSESSING OFFICER IS BOUND BY THE LAW TO ACCEPT ONLY THE CLAIM MADE BY THE ASSESSEE ALONG WI TH THE RETURN OF INCOME. III. THE LEARNED CIT (A) HAS ERRED ON FACTS AND IN LAW IN DIRECTING THE ASSESSING OFFICER TO ALLOW SET OFF OF UNABSORBED DE PRECIATION PERTAINING TO A.Y. 1995-96 TO A.Y. 1999-2000 AGAINST THE 'INCO ME FROM OTHER SOURCES' WITHOUT APPRECIATING THE FACT THAT THE TIM E PERIOD FOR CLAIMING THE ABOVE DEPRECIATION HAD ALREADY LAPSED. 2. THE LD. CIT(A) 'S ORDER IS CONTRARY IN LAW AND O N FACTS AND DESERVES TO BE SET ASIDE. 3. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND THAT MAY BE NECESSARY. 4. THE APPELLANT PRAYS THAT THE ORDER OF CIT(A) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT OF THE AO RESTORED. 4. BEFORE US, THE LEARNED COUNSEL FOR THE ASSESSEE POINTED OUT THAT THE PRESENT CASE OF THE ASSESSEE IS COVERED BY THE DECI SION OF ITAT MUMBAI RENDERED IN ASSESSEES OWN CASE ITA NO.3346/MUM/2013 FOR THE A.Y. 2009- 10 IN WHICH THE IDENTICAL ISSUES WERE DECIDED BY THE ITAT IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. THE LEARNED COUNS EL FURTHER SUBMITTED ITA NO 2346/MUM/2016 ASSESSMENT YEAR: 2010-11 PAGE 3 OF 6 THAT THE PRESENT APPEAL IS REQUIRED TO BE DISPOSED OF ACCORDINGLY. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL REPRESENTATIVE DID NOT CONTROVERT THE FACT THAT THE ISSUES INVOLVED IN THIS CASE ARE IDEN TICAL TO THE CASE OF THE ASSESSEE FOR THE A.Y. 2009-10 AND ALL THE THREE ISS UES HAVE BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY THE ITAT MUMBAI. 5. WE NOTICE THAT ALL THE THREE GROUNDS RAISED IN T HE PRESENT APPEAL ARE IDENTICAL TO THE GROUNDS RAISED BY THE ASSESSEE IN ITS OWN CASE ITA NO.3346/MUM/2013 FOR THE A.Y. 2009-10 AND THE COORD INATE BENCH HAS DECIDED ALL THE THREE ISSUES VIDE ORDER DATED 09-12 -2015. THE FIRST AND SECOND GROUNDS OF THE APPEAL HAVE BEEN DECIDED BY THE COOR DINATE BENCH IN FAVOUR OF THE ASSESSEE HOLDING AS UNDER: - 8. WE HAVE CONSIDERED THE RIVAL SUBMISSION AND PER USED THE MATERIAL ON RECORD. WE HAVE OBSERVED THAT THE ASSES SEE COMPANY HAS RAISED ADDITIONAL CLAIM BEFORE THE A.O. DURING THE ASSESSMENT PROCEEDINGS BY FILING A REVISED STATEMENT OF UNABSO RBED DEPRECIATION AND BOOK LOSS FOR COMPUTING THE BOOK PROFIT U/S 115 JB OF THE ACT IN WHICH THE LOSSES WERE DIFFERENT FROM THE ONE WHICH WAS CLAIMED IN THE RETURN OF INCOME FILED WITH REVENUE, THE SAID REVIS ED STATEMENT FILED BY THE ASSESSEE COMPANY BEFORE THE AO DURING ASSESSMEN T PROCEEDINGS WAS NOT CONSIDERED BY THE A.O AND NO COGNIZANCE WAS TAKEN THEREOF BY THE AO ON THE GROUND THAT THE ASSESSEE COMPANYS CL AIM RAISED VIDE RETURN OF INCOME FILED WITH REVENUE CAN ONLY BE CON SIDERED. THE CIT(A) DULY CONSIDERED THE SAID CLAIM AND HAS ALLOWED THE SAME ON MERITS. WE DO NOT FIND ANY INFIRMITY IN THE ORDERS OF THE C IT(A) IN CONSIDERING THE SAID CLAIM AS ADJUDICATING AUTHORITIES CAN ALWA YS CONSIDER AND DECIDE ON MERITS, ANY CLAIM WHICH THE TAXPAYER HAS RAISED BEFORE THE AO DURING ASSESSMENT PROCEEDINGS ALTHOUGH THE SAME IS NOT CLAIMED BY THE TAXPAYER VIDE RETURN OF INCOME FILED WITH TH E REVENUE AS HELD BY HONBLE BOMBAY HIGH COURT IN CIT V. PRUTHVI BROK ERS & SHAREHOLDERS (P) LTD., (2012) 349 ITR 336 (BOM). TH US, THE GROUNDS OF APPEAL RAISED BY THE REVENUE IN GROUND NO.I AND II ARE, THEREFORE, DISMISSED BASED ON OUR ABOVE DISCUSSIONS. WE ORDER ACCORDINGLY. ITA NO 2346/MUM/2016 ASSESSMENT YEAR: 2010-11 PAGE 4 OF 6 6. SINCE, THE IDENTICAL ISSUE HAS ALREADY BEEN DECI DED IN FACOUR OF THE ASSESSEE IN ASSESSEES OWN CASE, WE RESPECTFULLY, F OLLOW THE FINDINGS OF THE COORDINATE BENCH AND DISMISS GROUND NO N1& 2 OF THE APPEAL OF THE REVENUE. 7. SIMILARLY, THE CO-ORDINATE BENCH HAS ALLOWED GRO UND NUMBER (III) OF THE APPEAL BY FOLLOWING THE DECISION OF CO-ORDINATE BENCH IN THE CASE OF DHADDA DIAMONDS P. LTD VS ITO IN ITA NOS. 3908 TO 3 911/MUM/2013 DATED 25-03-2015 AND THE DECISION RENDERED BY THE COORDIN ATE BENCH IN MILTONS P. LTD, VS. CIT-6 IN ITA NO.3019/MUM/2012 ORDER DATED 22.05. SINCE, THE IDENTICAL ISSUES HAVE ALREADY BEEN DECIDED IN FAVOU R OF THE ASSESSEE BY THE COORDINATE BENCH IN THE ASSESSEES OWN CASE FOR THE A.Y. 2009-10 (SUPRA) WE RESPECTFULLY FOLLOW THE DECISION OF THE CO-ORDINATE BENCH AND DISMISS GROUND NO.3 OF THE APPEAL RAISED BY THE REVENUE. 8. IN THE RESULT, THE APPEAL OF THE REVENUE FOR THE A.Y. 2010-11 IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH FEBRUARY, 2017 SD/- SD/- ( B.R. BASKARAN ) ( RAM LAL NEGI ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI; DATED:15/02/2017 SUDIP SARKAR /S SUDIP SARKAR /S SUDIP SARKAR /S SUDIP SARKAR /SR.PS R.PS R.PS R.PS ITA NO 2346/MUM/2016 ASSESSMENT YEAR: 2010-11 PAGE 5 OF 6 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A)- 4. / CIT 5. , , !'# / DR, ITAT, MUMBAI 6. $% &# / GUARD FILE. / BY ORDER, ' //TRUE COPY// / (DY./ASSTT. REGISTRAR) , !'# / ITAT, MUMBAI