Maharashtra State Warehousing Corporation, Pune V. Assistant Commissioner of Income-tax,

ITA 252/PUN/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 0342 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 9 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-12-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 12-03-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: HITENDRA NINAWE
• Keywords: Opportunity of being heard
• Section: 80IB

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE . . , ! , # $ BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO.252/PN/2015 #& & / ASSESSMENT YEAR : 2010-11 MAHARASHTRA STATE WAREHOUSING CORPORATION, KHANDELWAL JAIN & ASSOCIATES, ALANKAR CINEMA BUILDING, IST FLOOR, ABOVE UNITED BANK, PUNE 411001 PAN :AABCM3988M . / APPELLANT V/S ACIT, CIRCLE-1(2), PUNE . / RESPONDENT / APPELLANT BY : SHRI NEELESH KHANDELWAL / RESPONDENT BY : SHRI HITENDRA NINAWE / ORDER PER R.K.PANDA, AM : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGA INST THE ORDER DATED 16-01-2015 OF THE CIT(A)-7, PUNE RELATING TO ASSESSMENT YEAR 2010-11. 2. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESS EE IS A GOVERNMENT UNDERTAKING, I.E. A DEEMED COMPANY UNDER THE INCOME TAX LAW (CORPORATION) ENGAGED IN THE BUSINESS OF PROVIDING WAREHOUSING FACILITY INCLUDING BONDED WAREHOUSES. IT FILED ITS RETURN O F INCOME ON 27-09-2010 / DATE OF HEARING :14.12.2016 / DATE OF PRONOUNCEMENT:15.12.2016 2 ITA NO.252/PN/2015 DECLARING TOTAL INCOME OF RS.33,23,23,166/-. DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER OBSERV ED THAT THE ASSESSEE HAS CLAIMED DEDUCTION U/S.80IB(11A) OF THE ACT AMOUNTING TO RS.32,44,867/-. ON BEING ASKED BY THE ASSESSING OF FICER TO JUSTIFY THE CLAIM OF DEDUCTION THE ASSESSEE REPLIED AS UNDER : 1. U/S 80IB(11A) DEDUCTION IS AVAILABLE IN THE CASE O F AN UNDERTAKING DERIVING PROFIT FROM THE INTEGRATED BUSI NESS OF HANDLING, STORAGE AND TRANSPORTATION OF FOOD GRAINS. THE ASSESSEE IS ENGAGED IN INTEGRATED BUSINESS OF HANDLING, STORAGE AND TRANSPORTAT ION OF FOOD GRAINS. IN A.Y. 2010-11, THE VIEW HAS BEEN TAKEN THA T THE ENTIRE UTILIZATION OF WAREHOUSES IS NOT FOR THE STORAGE OF FO OD GRAINS. IT IS RESPECTFULLY SUBMITTED THAT SUCH OBJECTION OR VIEW IS N OT LEGALLY UNTENABLE. MERELY BECAUSE, ONLY 40.81% (A.Y. 2010-1 1) OF THE UTILIZATION OF WAREHOUSE IS FOR FOOD GRAINS AND THE B ALANCE UTILIZATION IS FOR STORAGE OF ARTICLES OTHER THAN FOOD GRAINS, IT C ANNOT BE SAID THAT THE ASSESSEE IS NOT CARRYING ON INTEGRATED BUSINESS OF HAND LING, STORAGE AND TRANSPORTATION OF FOOD GRAINS. THE SECTION DOES NOT USE THE WORDS MAINLY OR WHOLLY. FURTHER THE ACTIVIT Y OF STORAGE OF GOOD GRAINED IS SEASONAL. THE INTENTION OF THE PARLIA MENT COULD NOT HAVE BEEN IN SUCH SITUATION, THE WAREHOUSES BE LEFT VAC ANT AND UNUTILIZED. CLEARLY, IF THE ASSESSEE MAKES THE BEST POSSIB LE USE OF ITS WAREHOUSES, SUCH ACTION CANNOT DEFEAT ITS BASIC CLAIM FO R DEDUCTION. AS LONG AS PRIMARY ACTIVITY INTEGRATED BUSINESS OF HANDL ING, STORAGE AND TRANSPORTATION OF FOOD GRAINS, THE ASSESSEES BUSINESS WILL BE ELIGIBLE BUSINESS IN TERMS OF SUB-CLAUSE(11A) AND THE ASSES SEE IS ENTITLED TO THE DEDUCTION. CONSIDERING THE FACTS AND CIRCUMSTANCES PREVAILING IN T HE CASE, THE CLAIM OF THE ASSESSEE MADE U/S.80IA(4) & 80IB(11A) BE AL LOWED. 3. HOWEVER, THE ASSESSING OFFICER WAS NOT SATISFIED WITH THE EXPLANATION GIVEN BY THE ASSESSEE. ACCORDING TO HI M, THE ASSESSEE MADE ONLY LENGTHY SUBMISSIONS BUT HAS NOT SUBMITTED ANY SUBSTANTIAL SUBMISSION OR THE COPIES OF THE DECISIONS RELIED ON WHEN HE WAS SPECIFICALLY ASKED TO. IN VIEW OF THE ABOVE, THE A SSESSING OFFICER DISALLOWED THE CLAIM OF DEDUCTION OF RS.32,44,867/- U/S.80IB(11A). 4. IN APPEAL THE LD.CIT(A) FOLLOWING HIS ORDER FOR A.Y. 2008-09 AND 2009-10 WHEREIN HIS PREDECESSOR HAS DECIDED THE ISS UE AGAINST THE ASSESSEE DISMISSED THE APPEAL FILED BY THE ASSESSEE ON THIS ISSUE. 3 ITA NO.252/PN/2015 5. AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE ASSE SSEE IS IN APPEAL BEFORE US. 6. THE LD. COUNSEL FOR THE ASSESSEE AT THE TIME OF HEARING FILED A COPY OF THE ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE VIDE ITA NOS.819/PN/2012 & 820/PN/2013 ORDER DATED 09-05-201 6 FOR A.Y. 2008- 09 AND SUBMITTED THAT THE ISSUE HAS BEEN DECIDED B Y THE TRIBUNAL IN FAVOUR OF THE ASSESSEE. SINCE THE CIT(A) HAS FOLLO WED THE ORDER OF HIS PREDECESSOR FOR A.Y. 2008-09 AND 2009-10 AND SINCE THE TRIBUNAL HAS ALREADY DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE , THEREFORE, THE ISSUE SHOULD BE DECIDED IN FAVOUR OF THE ASSESSEE. 7. THE LD. DEPARTMENTAL REPRESENTATIVE ON THE OTHER HAND WHILE SUPPORTING THE ORDER OF THE CIT(A) FAIRLY CONCEDED THAT THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY THE DECISION O F THE TRIBUNAL. 8. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY B OTH THE SIDES, PERUSED THE ORDERS OF THE AO AND CIT(A) AND THE PAP ER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED TH E VARIOUS DECISIONS CITED BEFORE US. WE FIND THE ASSESSING OFFICER IN THE INSTANT CASE DENIED THE CLAIM OF DEDUCTION U/S.80IB(11A) ON THE GROUND THAT THE ASSESSEE DID NOT FILE ANY SUBMISSION OR THE COPIES OF THE DECISI ONS RELIED ON BY IT. WE FIND THE LD.CIT(A) FOLLOWING THE DECISION OF HIS PR EDECESSOR IN ASSESSEES OWN CASE FOR THE IMMEDIATELY TWO PRECEDING ASSESSME NT YEARS DECIDED THE ISSUE AGAINST THE ISSUE. WE FIND THE TRIBUNAL IN ASSESSEES OWN CASE FOR THE IMMEDIATELY TWO PRECEDING ASSESSMENT YEARS HAS DECIDING THE ISSUE IN FAVOUR OF THE ASSESSEE BY OBSERVING AS UND ER : 7. WE HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESENTA TIVES OF RIVAL SIDES AND HAVE PERUSED THE ORDERS OF THE AUTHORIT IES BELOW. THE COMMON ISSUES FOR ADJUDICATION IN BOTH THE APPEALS OF T HE ASSESSEE IS WITH RESPECT TO DISALLOWANCE U/S. 80IB(11A) OF THE ACT . TO BE ELIGIBLE TO CLAIM DEDUCTION U/S. 80IB(11A) UNDERTAKING SHOULD DERIVE PROFIT FROM THE INTEGRATED BUSINESS OF HANDLING, STORAGE AND T RANSPORTATION OF FOOD GRAINS. THE ASSESSEE IN THE PRESENT CASE IS A STATE WAREHOUSING 4 ITA NO.252/PN/2015 CORPORATION SET UP UNDER THE PROVISIONS OF THE WAREHOU SING CORPORATIONS ACT, 1962. SECTION 24 OF THE WAREHOUSIN G CORPORATIONS ACT ENUMERATES THE FUNCTIONS OF THE STATE WAREHOUSING CORPORATION. THE SAME IS REPRODUCED HERE-IN-UNDER: 24. SUBJECT TO THE PROVISIONS OF THIS ACT, A STATE WAREHOUSING CORPORATION MAY (A) ACQUIRE AND BUILD GODOWNS AND WAREHOUSES AT SUC H PLACES WITHIN THE STATE AS IT MAY WITH THE PREVIOUS APPROV AL OF THE CENTRAL WAREHOUSING CORPORATION, DETERMINE; (B) RUN WAREHOUSES IN THE STATE FOR THE STORAGE OF AGRICULTURAL PRODUCE, SEEDS, MANURES, FERTILIZERS, AGRICULTURAL, IMPLEMENTS AND NOTIFIED COMMODITIES; (C) ARRANGE FACILITIES FOR THE TRANSPORT OF AGRICUL TURAL PRODUCE, SEEDS, MANURES, FERTILIZERS, AGRICULTURAL IMPLEMENT S AND NOTIFIED COMMODITIES TO AND FROM WAREHOUSES; (D) ACT AS AN AGENT OF THE-CENTRAL WAREHOUSING CORP ORATION OR OF THE GOVERNMENT FOR THE PURPOSES OF THE PURCHASE, SALE, STORAGE AND DISTRIBUTION, OF AGRICULTURAL PRODUCE, SEEDS, M ANURES, FERTILIZERS, AGRICULTURAL IMPLEMENTS AND NOTIFIED C OMMODITIES; AND E) CARRY OUT SUCH OTHER FUNCTIONS AS MAY BE PRESCRI BED. 8. THE ASSESSEE HAS SET UP 160 WAREHOUSES IN THE ENTIRE STA TE OF MAHARASHTRA FOR PROVIDING WAREHOUSING FACILITIES FOR ST ORAGE OF FOOD GRAINS AND OTHER COMMODITIES. A PERUSAL OF SECTION 24 OF THE WAREHOUSING CORPORATIONS ACT WOULD SHOW THAT THE ASSES SEE CORPORATION HAS BEEN INCORPORATED WITH THE OBJECT OF STORAGE, TRANSPORTATION AND DISTRIBUTION OF FOOD GRAINS AND OTH ER COMMODITIES. THE LD. AR HAS REFERRED TO THE COMMODITIES WISE BREAKU P OF AVERAGE UTILIZATION OF WAREHOUSES. A PERUSAL OF THE SAME AT P AGE 48 OF THE PAPER BOOK SHOWS THAT THE WAREHOUSING FACILITIES TO THE EXTENT OF 56.22% IS UTILIZED FOR STORAGE OF FOOD GRAINS IN ASSESSMEN T YEAR 2008- 09 AND 51.41% IN ASSESSMENT YEAR 2009-10. THE PROVISION S OF SUB- SECTION (11A) TO SECTION 80IB WERE INTRODUCED BY THE FINANCE ACT, 2001 W.E.F. 01-04-2002 TO ADDRESS THE COUNTRYS BASIC C ONCERNS RELATING TO ENHANCED FOOD SECURITY AND AGRICULTURAL DEVELOPMENT. DEVELOPMENT, UPGRADATION AND MODERNIZATION OF INFRA STRUCTURE FOR EFFICIENT STORAGE, HANDLING AND TRANSPORTATION OF FOO DGRAINS WITH MINIMUM POST HARVEST FOODGRAINS LOSS WAS MAJOR CONCERN O F THE GOVERNMENT. THE SUB-SECTION WAS INTRODUCED TO ENCOURA GE BUILDING OF STORAGE CAPACITIES, BY PROVIDING DEDUCTION TO THE UNDERTAKINGS ENGAGED IN INTEGRATED BULK HANDLING, STORAGE AND TRA NSPORTATION OF FOOD GRAINS. THE ASSESSEE IS A STATE GOVERNMENT ENTERPR ISE HAS SET UP WAREHOUSES IN LINE WITH THE POLICY OF CENTRAL GOVERNM ENT TO ENHANCE WAREHOUSING CAPACITY FOR STORAGE OF FOODGRAINS. IN VIEW OF THE FUNCTIONS OF STATE WAREHOUSING CORPORA TION AS ENVISAGED U/S. 24 OF THE WAREHOUSING CORPORATIONS ACT A ND THE MATERIAL AVAILABLE ON RECORD, IT IS AMPLY CLEAR THAT THE ASSESSEE IS ENGAGED IN INTEGRATED BUSINESS OF HANDLING, STORAGE AND TRANSPORTATION OF FOODGRAINS AND THUS, IS ELIGIBLE TO C LAIM DEDUCTION U/S. 80IB(11A) OF THE ACT. NOW, THE QUESTION THAT AR ISE IS THE QUANTUM 5 ITA NO.252/PN/2015 OF DEDUCTION ADMISSIBLE TO THE ASSESSEE UNDER THE PROVISI ONS OF SECTION 80IB(11A) OF THE ACT. 9. THE DEDUCTION U/S. 80IB(11A) IS ADMISSIBLE TO UNDERT AKING ENGAGED IN THE INTEGRATED BUSINESS OF HANDLING, TRANSPO RTATION AND STORAGE OF FOOD GRAINS AND STARTS OPERATING ON OR AFTER THE 1 ST DAY OF APRIL, 2001. UNDISPUTEDLY, THE ASSESSEE IS PROVIDING WAR EHOUSING FACILITIES FOR STORAGE OF FOODGRAINS APART FROM OTHER PRODUCTS VIZ. FERTILIZERS, COTTON BALES, ETC. THE LD. AR OF THE A SSESSEE HAS MADE TWO FOLD SUBMISSIONS. THE FIRST PRAYER OF THE ASSESSEE IS THAT T HE ASSESSEE SHOULD BE ALLOWED 100% DEDUCTION ON THE WAREHOUSING B USINESS BY LIBERALLY INTERPRETING THE PROVISIONS OF STATUTE. HOW EVER, WE DO NOT FIND MERIT IN THIS CONTENTION OF THE ASSESSEE. AS BY GRA NTING DEDUCTION ON THE ENTIRE INCOME FROM WAREHOUSING BUSINESS WHICH IN CLUDES RECEIPTS FOR WAREHOUSING PRODUCTS OTHER THAN FOOD GRAI NS, THE SPIRIT OF SUB-SECTION (11A) WOULD BE VITIATED. THE ASSESSEE IS ELIG IBLE TO CLAIM DEDUCTION U/S. 80IB(11A) ON THE INCOME ARISING FROM I NTEGRATED BUSINESS OF STORAGE, TRANSPORT AND HANDLING OF FOODGRAIN S ALONE. HERE IT WOULD BE RELEVANT TO CLARIFY FURTHER THAT THE ASSE SSEE WOULD BE ELIGIBLE TO CLAIM DEDUCTION U/S. 80IB(11A) ON THE UN ITS (WAREHOUSES) THAT HAVE STARTED OPERATING ON OR AFTER 01-04-2001. 10. AS HAS BEEN POINTED OUT EARLIER THE ASSESSEE HAS SEVER AL WAREHOUSES IN THE STATE OF MAHARASHTRA. THE LD. AR OF THE ASSESSEE HAS SUBMITTED THAT STATISTICS OF THE INDIVIDUAL WAREHOUSE S ARE NOT AVAILABLE. THE CONSOLIDATED AUDIT REPORT GIVING THE DETAILS OF COMMODITIES WISE BREAKUP OF AVERAGE UTILIZATION OF WA REHOUSES IN THE STATE OF MAHARASHTRA IS AVAILABLE. THE ASSESSEE HAS EXPRES SED ITS INABILITY TO PREPARE AUDIT REPORT OF THE INDIVIDUAL WAREHOUSES KEEPING IN VIEW OF LARGE NUMBER OF WAREHOUSES AND VARIOUS PROD UCTS STORED THOUGHT OUT THE STATE. HOWEVER, THE LD. AR REFERRE D TO THE COMMODITIES WISE BREAKUP OF THE UTILIZATION OF ALL WA REHOUSES ACCORDING TO WHICH THE FOOD GRAINS CONSTITUTE 56.22% IN FINANCIAL YEAR 2007-08 AND 51.41% IN FINANCIAL YEAR 2008-09. THE LD. AR HAS REFERRED TO THE DECISION OF HYDERABAD BENCH OF THE T RIBUNAL IN THE CASE OF A P STATE WAREHOUSING CORPORATION LTD. VS. DY. COMMISSIONER OF INCOME TAX (SUPRA) WHEREIN THE SIMILAR ISSUE WAS CON SIDERED. THE HYDERABAD BENCH OF THE TRIBUNAL REMITTED THE MATTER BACK TO THE ASSESSING OFFICER FOR CONSIDERING THE CLAIM OF DEDUCTION U/S. 80IB(11A) BY OBSERVING AS UNDER : 6. WE HAVE HEARD THE PARTIES AND PERUSED THE ORDER S OF THE REVENUE AUTHORITIES AS WELL AS OTHER MATERIALS ON R ECORD. AT THE VERY OUTSET, THE LEARNED AR SUBMITTED BEFORE US THA T THE ISSUE IN DISPUTE IS SQUARELY COVERED BY THE ORDER OF THE ITA T, HYDERABAD BENCH IN ASSESSEES OWN CASE FOR THE PRECEDING ASSE SSMENT YEARS 2005-06, 2006-07 AND 2007-08. ON PERUSAL OF THE ORD ER OF THE COORDINATE BENCH DATED 24/01/2014 IN ITA NO. 834, 8 35 & 836/HYD/2012, WE FIND THAT IDENTICAL ISSUE CAME UP FOR CONSIDERATION BEFORE THE TRIBUNAL IN ASSESSEES OWN CASE. THE COORDINATE BENCH AFTER CONSIDERING THE SUBMISSIONS OF THE PARTIES AND EXAMINING THE RELEVANT STATUTORY PROVISION HELD AS UNDER: 11. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND P ERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS EVIDENT FROM TH E ORDERS OF THE LOWER AUTHORITIES THAT THE CLAIM OF THE ASSESSEE FO R RELIEF UNDER S.80IB(11A) HAS BEEN DISALLOWED MAINLY ON THE GROUN D THAT THE 6 ITA NO.252/PN/2015 ACTIVITIES OF THE ASSESSEE DO NOT CONSTITUTE AN IN TEGRATED. THE NEXT REASON FOR WHICH THE CLAIM WAS DISALLOWED WAS ALSO THAT, ASSESSEE CORPORATION, HAVING BEEN INCORPORATED IN 1 958, AND IN THE ABSENCE OF ANYTHING ON RECORD TO SUBSTANTIATE T HAT THE ASSESSEE HAS TAKEN UP ANY NEW ACTIVITY OF HANDLING AND TRANSPORTATION OF FOODGRAINS SUBSEQUENT TO 2002, AS SESSEE IS NOT ENTITLED FOR RELIEF UNDER S.80IB(11A), SINCE RELIEF UNDER THAT SECTION IS AVAILABLE ONLY FOR FIVE YEARS FROM INIT IAL YEAR, VIZ. EITHER FROM 1958 OR FROM THE YEAR IN WHICH SUCH NEW ACTIVITY WAS TAKEN UP BY THE ASSESSEE. WE DO NOT FIND MERIT IN T HESE REASONS OF THE LOWER AUTHORITIES FOR MAKING THE DISALLOWANCE. WE MAY NOW EXAMINE THE CORRECTNESS OR OTHERWISE OF THESE REASO NS GIVEN BY THE LOWER AUTHORITIES. 12. WE FIND THAT THE ASSESSEE-CORPORATION OWNS PREM ISES ACCOMMODATING GODOWNS AT DIFFERENT PLACES ALL OVER THE STATE. IN EACH AREA IT EITHER CONSTRUCTS OR OFFERS AN INVESTO R TO CONSTRUCT NEW GODOWNS, WHICH THE CORPORATION TAKES ON LEASE. IT IS THE CLAIM OF THE ASSESSEE BEFORE THE CIT(A) THAT THE PL INTH AREA OF CONSTRUCTION OF THE GODOWNS VARIES FROM MINIMUM ARE A OF 10,000 SFT. UP TO A MAXIMUM AREA OF 50,000 SFT. AND THE SCHEME OF CONSTRUCTION OF GODOWNS STARTED IN THE YEAR 2002 . EACH UNIT IS AN UNDERTAKING BECAUSE FOOD-GRAINS ARE STORED AND H ANDLED AND TRANSPORTED THERETO AND THEREFROM. IT MAY BE NOTED AT THIS JUNCTURE THAT THERE IS NO RESTRICTION IN S.80-IB TH AT AN EXISTING BUSINESS UNIT CANNOT SET UP NEW UNDERTAKINGS TO CAR RY ON THE INTEGRATED BUSINESS OF HANDLING, STORAGE AND TRANSP ORTATION OF FOOD GRAINS. THE GODOWNS WHERE THIS BUSINESS IS TO BE CARRIED ON NEED NOT BE OWNED BY THE ASSESSEE. WHEN THE ASSESSE E- CORPORATION HAS SET UP THESE GODOWNS IN AS MANY AS IN 73 TOWNS AND AT DIFFERENT PLACES IN THOSE TOWNS, IT IS VERY MUCH ENTITLED FOR RELIEF UNDER S.80IB(11A) OF THE ACT IN RESPECT OF E ACH SUCH NEW UNDERTAKING SET UP BY IT. IT APPEARS FROM THE IMPUG NED ORDERS THAT THE LOWER AUTHORITIES HAVE PROCEEDED AS IF THE ASSESSEES CLAIM FOR RELIEF UNDER S.80IB(11A) IS IN RESPECT OF EXISTING GODOWNS, AND NOT MERELY IN RESPECT OF THE NEW ONES STARTED AFTER 2001. IT IS SO BECAUSE THE PERIOD OF FIVE YEARS WAS SOUGHT TO BE COUNTED FROM THE YEAR OF INCORPORATION OF THE ASSES SEE, VIZ. 1958; AND ALSO OBSERVING THAT NO NEW ACTIVITY WAS TAKEN U P AFTER 2001. SINCE EACH NEW GODOWN IS AN UNDERTAKING IN ITSELF, ASSESSEE IS ENTITLED FOR SUCH RELIEF UNDER S.80IB(11A) FOR FIVE YEARS IN RESPECT OF EACH SUCH UNDERTAKING FROM THE INITIAL YEAR IN WHICH IT WAS SET UP. 13. AS FOR THE ELIGIBILITY OF THE ACTIVITY OF THE A SSESSEE TO THE RELIEF UNDER S.80IB(11A), IT IS WORTHWHILE TO REFER TO THE INTENTION OF THE LEGISLATURE IN INTRODUCING SEC 80IB(11A), WHICH IS REPRODUCED HEREUNDER : UNDER THE EXISTING PROVISIONS OF SEC. 80-IB OF THE INCOME- TAX ACT, A DEDUCTION IS ALLOWED, IN COMPUTING THE T AXABLE INCOME, IN RESPECT OF PROFITS DERIVED FROM A NEW IN DUSTRIAL UNDERTAKING OR A SHIP OR THE BUSINESS OF A HOTEL. T O ADDRESS THE COUNTRY'S BASIC CONCERNS RELATING TO EN HANCED FOOD SECURITY AND AGRICULTURAL DEVELOPMENT, UPGRADA TION AND MODERNIZATION OF INFRASTRUCTURE FOR STORAGE, HA NDLING AND TRANSPORTATION OF FOOD GRAINS IS A CENTRAL CONC ERN IN WHICH INTRODUCTION OF MODERN TECHNOLOGY WOULD BRING 7 ITA NO.252/PN/2015 GREATER EFFICIENCY IN THE GRAIN MANAGEMENT SYSTEM A ND MINIMIZE POST HARVEST FOOD GRAIN LOSSES. IT IS EVIDENT FROM THE ABOVE, THAT THE INSERTION OF SUB-SECTION (11A) IS INTENDED TO ENCOURAGE BUILDING OF STORAGE CAPACITIES, BY PROVIDING THAT ANY UNDERTAKING ENGAGED IN INTEGRATE D BULK HANDLING, STORAGE AND TRANSPORTATION WOULD BE ALLOW ED HUNDRED PER CENT DEDUCTION FOR THE FIRST FIVE YEARS AND THI RTY PER CENT DEDUCTION FOR THE NEXT FIVE YEARS. THUS, SEC 80IB(1 1A) IS APPLICABLE TO INCOME DERIVED FROM THE INTEGRATED BU SINESS OF HANDLING, STORAGE AND TRANSPORTATION OF FOODGRAINS. A PERUSAL OF THE ACTIVITIES OF THE ASSESSEE IN ASSOCIATION WITH THE FOOD CORPORATION OF INDIA, AS DEMONSTRATED BY THE LEARNE D COUNSEL FOR THE ASSESSEE IN THE PAPER-BOOK FILED, CLEARLY INDIC ATES IT IS ENGAGED IN THE INTEGRATED BUSINESS OF HANDLING, STO RAGE AND TRANSPORTATION OF FOOD GRAINS. THERE IS NO DISPUTE THE ASSESSEES MAIN BUSINESS IS TO PROVIDE WAREHOUSING FACILITY FO R FOODGRAINS. THE ASSESSEE HAS BEEN CONSTITUTED UNDER WITH THESE VERY OBJECTS IN VIEW. MERELY BECAUSE THE ASSESSEE HAS ENGAGED OU TSIDERS FOR TRANSPORTATION OR LEASED OUT SOME OF THE GODOWNS FO R STORAGE DOES NOT MEAN THAT THE ASSESSEE IS NOT ENGAGED IN T HE INTEGRATED BUSINESS OF HANDLING AND STORAGE OF FOODGRAINS. IN THE COURSE OF THEIR INTEGRATED BUSINESS, THE ASSESSEE HAD COLLECT ED RENTALS FOR STORING FOODGRAINS AND HAD ENGAGED OUTSIDERS TO TRA NSPORT THE FOOD GRAINS. FURTHER, THE FACT THAT THE ASSESSEE HA D BEEN CARRYING ON SIMILAR BUSINESS WOULD NOT DISENTITLE THE ASSESS EE FROM CLAIMING RELIEF U/S 80IB(11A), IN RESPECT OF THE NE W WAREHOUSES PUT TO USE AFTER THE INTRODUCTION OF SEC 80IB(11A) I.E ON OR AFTER 1.4.2001. THE ASSESSEE HAS FURNISHED IN THE PAPER-B OOK LIST OF NEW GODOWNS, WHICH HAVE BEEN PUT TO USE BY THE ASSE SSEE AFTER 1.4.2001. IT IS WELL SETTLED THAT DEDUCTION UNDER C HAP VIA, IN RESPECT OF NEW UNDERTAKINGS SET UP BY THE ASSESSEE BY WAY OF EXPANSION OF THE EXISTING UNDERTAKINGS, AS HELD BY THE APEX COURT IN THE CASES OF TEXTILE MACHINERY CORPORATION LTD V CIT 107 ITR 195 SC AND CIT V INDIAN ALUMINIUM COMPANY LTD (108 ITR 367). THE NUMBER OF NEW GODOWNS OPERATED BY THE ASSESSEE AFTER 1.4.2001 CLEARLY SHOWS THAT THERE WAS SUBSTANTIAL E XPANSION OF THE ASSESSEES BUSINESS OF HANDLING, STORING AND TR ANSPORTATION OF FOOD GRAINS, WHICH OBVIOUSLY COULD HAVE BEEN DONE O NLY BE UNDERTAKING NEW WAREHOUSING FACILITIES YEAR AFTER Y EAR EVEN AFTER 2001. IN RESPECT OF THESE NEW WAREHOUSES, EAC H OF WHICH CONSTITUTES AN ELIGIBLE UNDERTAKING, ASSESSEE IS SE PARATELY ENTITLED FOR DEDUCTION UNDER S.80IB(11A) OF THE ACT . IN OUR OPINION THEREFORE, THE ASSESSEE IS ENTITLED TO DEDU CTION U/S 80IB(11A), IN RESPECT OF INCOME DERIVED FROM THE NE W UNDERTAKINGS, WAREHOUSES, SET UP AND OPERATED FROM 1.4.2001 FOR STORAGE, HANDLING AND TRANSPORTATION OF FOOD GRAINS . WE ACCORDINGLY SET ASIDE THE IMPUGNED ORDERS OF THE CI T(A) ON THIS ISSUE FOR ALL THE THREE YEARS AND SET ASIDE THE MAT TER TO THE FILE OF THE ASSESSING OFFICER, WITH A DIRECTION TO VERIFY T HE CLAIM OF THE ASSESSEE FOR DEDUCTION UNDER S.80IA(11A) OF THE ACT IN RESPECT OF NEW UNDERTAKINGS SET UP AFTER 2001, AND ALLOW THE S AME IN ACCORDANCE WITH LAW, AND AFTER GIVING DUE OPPORTUNI TY OF HEARING TO THE ASSESSEE. 7. THE LEARNED DR HAS NEITHER CONTROVERTED THE FACT THAT THE ISSUE IS COVERED BY THE AFORESAID DECISION OF THE COORDIN ATE BENCH NOR COULD BRING ANY CONTRARY DECISION TO OUR NOTICE. FA CTS BEING 8 ITA NO.252/PN/2015 IDENTICAL AND ISSUE IN DISPUTE BEING THE SAME, RESP ECTFULLY FOLLOWING THE ORDER OF THE ITAT IN ASSESSEES OWN C ASE (SUPRA), WE SET ASIDE THE IMPUGNED ORDER OF LD. CIT(A) AND D IRECT THE AO TO VERIFY THE CLAIM OF THE ASSESSEE FOR DEDUCTION U /S 80IB(11A) IN RESPECT OF NEW UNDERTAKINGS/WAREHOUSES SETUP AFTER 01/04/2001 AND ALLOW DEDUCTION ACCORDINGLY. THE AO MUST AFFORD A REASONABLE OPPORTUNITY OF BEING HEARD TO T HE ASSESSEE BEFORE DECIDING THE ISSUE. RESPECTFULLY FOLLOWING THE DECISION OF HYDERABAD BENC H OF THE TRIBUNAL, WE DEEM IT APPROPRIATE TO REMIT THE FILE BACK TO THE ASSESSING OFFICER TO CONSIDER THE CLAIM OF THE ASSESSEE. TH E ASSESSEE WOULD BE ELIGIBLE TO CLAIM DEDUCTION U/S. 80IB( 11A) ON THE SHARE OF INCOME FROM THE BUSINESS OF WAREHOUSING , TRANSPORTATION AND HANDLING OF FOODGRAINS OF THE UNI TS (WAREHOUSES) WHICH HAVE STARTED OPERATING ON OR AFTER 01-04- 2001. 11. WE ACCEPT THE ALTERNATIVE SUBMISSIONS MADE ON BEHAL F OF THE ASSESSEE AND ACCORDINGLY PARTLY ALLOW THE GROUND NO. 1 RAISED IN THE APPEALS BY THE ASSESSEE FOR THE ASSESSMENT YEARS 2008-09 AND 2009- 10 FOR STATISTICAL PURPOSE. 9. SINCE THE FACTS OF THE INSTANT CASE ARE IDENTICA L TO THE FACTS OF THE CASE IN THE PRECEDING 2 ASSESSMENT YEARS, THEREFORE , WE REMIT THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER WITH A DI RECTION TO RECOMPUTE THE DEDUCTION U/S.80IB(11A) IN THE LIGHT OF THE DECISIO N OF THE TRIBUNAL FOR A.Y. 2008-09 AND 2009-10. THE GROUND RAISED BY THE ASSE SSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 15-12-2016. SD/- SD/- (VIKAS AWASTHY) (R.K. PANDA) JUDICIAL MEMBER ACC OUNTANT MEMBER PUNE; DATED : 15 TH DECEMBER, 2016. 9 ITA NO.252/PN/2015 ) *#,! -! / COPY OF THE ORDER FORWARDED TO : / BY ORDER , // # % / TRUE COPY // // TRUE COPY // &' % * / SR. PRIVATE SECRETARY *, / ITAT, PUNE 1. / THE APPELLANT 2. / THE RESPONDENT 3. THE CIT(A) - 7, PUNE 4. CIT-6, PUNE 5. # %%* , * , B BENCH / DR, ITAT, B BENCH PUNE; 6. 2 / GUARD FILE.