Tamil Nadu Cements Corporation Limited, CHENNAI V. ACIT, CHENNAI

ITA 2722/CHNY/2019

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 9471 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 4 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-01-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 1997-1998
• Appeal Filed On: 23-09-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Business income; Revision of order; Depreciation; Unabsorbed depreciation; Set aside
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 143(3); 92

Judgement Text

आयकर अपीलीय अिधकरण, ’डी’ Ɋायपीठ, चेɄई IN THE INCOME-TAX APPELLATE TRIBUNAL ‘D’ BENCH, CHENNAI ŵी वी दुगाŊ राव Ɋाियक सद˟ एवं ŵी जी. मंजुनाथा, लेखा सद˟ के समƗ Before Shri V. Durga Rao, Judicial Member & Shri G. Manjunatha, Accountant Member आयकर अपील सं./I.T.A. No.2722/Chny/2019 िनधाŊरण वषŊ/Assessment Year: 1997-98 M/s. Tamil Nadu Cements Corporation Limited, No. 735, LLA Building, Anna Salai, Chennai 600 002. [PAN:AABCT1819J] Vs. The Assistant Commissioner of Income Tax, Company Circle III(1), Chennai 34. (अपीलाथŎ/Appellant) (ŮȑथŎ/Respondent) अपीलाथŎ की ओर से / Appellant by : Shri G. Baskar, Advocate ŮȑथŎ की ओर से/Respondent by : Shri G. Johnson, Addl. CIT सुनवाई की तारीख/ Date of hearing : 25.01.2022 घोषणा की तारीख /Date of Pronouncement : 31.01.2022 आदेश /O R D E R PER V. DURGA RAO, JUDICIAL MEMBER: This appeal filed by the assessee is directed against the order of the ld. Commissioner of Income Tax (Appeals) 11, Chennai dated 08.07.2019 relevant to the assessment year 1997-98. 2. Brief facts of the case are that the assessment for the assessment year 1997-98 was completed on 13.03.2000 and reassessment was completed on 31.03.2005 and subsequently revised on 31.10.2005. In its original return of income, the assessee has I.T.A. No. 2722/Chny/19 2 claimed carry forward depreciation of ₹.15,36,91,995/-, and investment allowance of ₹.4,71,806/- and set it off against income from business. The income computed under section 115JA of the Act was ₹.5,16,13,292/-. In the course of the reassessment, the Assessing Officer set off brought forward depreciation of ₹.10,89,92,040/- and business loss of ₹.64,83,291/- for the assessment year 1995-96. 3. However, the ld. CIT issued notice under section 263 of the Act dated 05.02.2007 on the assessee show-causing as to why the assessment made on 31.3.2005 should not be set aside to compute the correct amount of carried forward business loss, depreciation and investment allowable in accordance with law. After considering the submissions of the assessee and materials available on record as well as in view of the decision of the case of Seshasayee Paper & Boards Ltd. Vs. DCIT 272 ITR 165 (Mad), the ld. CIT remanded the matter to the Assessing Officer to recompute the income of the year after deter mining the correct amount of brought forward los, unabsorbed depreciation and investment allowance in accordance with law. Against the order of the ld. CIT, the assessee preferred an appeal before the Tribunal. The appeal filed by the assessee was disposed of by this I.T.A. No. 2722/Chny/19 3 Tribunal vide order dated 07.01.2009 for want of clearance from High Powered Committee to pursue its appeal as the assessee being a Public Sector Undertaking. Against order of the Tribunal, the assessee filed an appeal before the Hon’ble jurisdictional High Court and the Hon’ble High Court vide its order in Tax Case (Appeal) No.471 of 2009 dated 10.11.2009, remitted the matter back to the file of the Tribunal for adjudication on merits after taking note of the fact that the High Powered Committee has permitted the assessee to pursue its appeal before the Tribunal. After considering the rival submissions, orders of authorities below, vide order in I.T.A. No. 1544/Mds/2007 dated 30.03.2007, the Tribunal upheld the revision order passed under section 263 of the Act and dismissed the appeal filed by the assessee. 4. The Assessing Officer completed the assessment under section 143(3) r.w.s. 263 of the Act dated 28.12.2007, against which, the assessee filed an appeal before the ld. CIT(A). After considering the submissions of the assessee and facts of the case, the ld. CIT(A) has observed as under: “7. The assessee has objected to the same. However, it is seen that the unabsorbed depreciation of the previous years does get merged into the depreciation of the current year and shall be given precedence while computing the business income of the assessee. The net business income thus computed after allowing depreciation, is available for any I.T.A. No. 2722/Chny/19 4 set off of unabsorbed investment allowance. To this extent, the order of the Assessing Officer dated 28.12.2017 is sustained. The AR for the assessee has also expressed her inability to produce any order of M/s. BFIR to the contrary and in favour of the assessee. Considering the same, the grounds of appeal of the assessee, taken as per original appeal filed in ITA No. 1951/2013-14 of 2018, are rejected. 5. Against the above order of the ld. CIT(A), the assessee preferred appeal by raising following grounds: 1. The order of the CIT(A) is wrong, untenable in law, opposed to facts and is liable to set aside. 2.1 The CIT(A) erred in upholding the giving effect order of the AO wherein he has given precedence to set off unabsorbed investment allowance over unabsorbed depreciation. 2.2 The CIT(A) failed to consider the specific submission of the Appellant that the procedure in setting off unabsorbed depreciation first has been followed for many years and disturbing the same this year will distort the financials of all previous and subsequent years. 2.3 The CIT(A) ought to have seen that there is a specific direction from the Board for Industrial Finance and Reconstruction (BIFR) to set off unabsorbed depreciation first. 2.4 The CIT(A) has incorrectly and hastily concluded that the issue has been decided against the assessee by the order of CIT dated 30.03.2007, and has failed to see that the findings in the said order have no bearing on the present appeal. 2.5 In any event, the CIT(A) should have seen that the order u/s 263 dated 30.03.2007 has not been accepted by the Appellant and an appeal challenging the same is admitted and pending disposal before the Hon’ble High Court. 3. Any other ground/s that may be appended at the time of hearing. 6. Besides challenging the appellate order passed by the ld. CIT(A), I.T.A. No. 2722/Chny/19 5 the ld. Counsel for the assessee has mainly agitated that the assessee has preferred further appeal against the revision order passed under section 263 of the Act before the Hon’ble Jurisdictional High Court and therefore, the assessment order passed in view of the order under section 263 of the Act as well as appellate order are liable to be dismissed. 7. On the other hand, the ld. DR has submitted that the order passed under section 263 of the Act has been upheld by the Jurisdictional Tribunal vide order in I.T.A. No. 1544/Mds/2007 dated 30.03.2012 and become final, being final facts finding authority, the present appeal of the assessee is liable to be dismissed. 8. We have heard both the sides, perused the materials available on record and gone through the orders of authorities below. In this case, against the assessment order, by invoking the provisions of section 263 of the Act, the ld. CIT directed the Assessing Officer to redo the assessment. Accordingly, the Assessing Officer completed the assessment order under section 143(3) r.w.s. 263 of the Act dated 28.12.2007. The appeal filed by the assessee before the Tribunal against the order under section 263 of the Act has been dismissed and I.T.A. No. 2722/Chny/19 6 the Tribunal has upheld the revision order vide order in I.T.A. No. 1544/Mds/2007 dated 30.03.2012. The ld. Counsel for the assessee has not brought on record any order of higher forum having modified or reverted the order of the Tribunal dated 30.03.2012, which was filed against the revision order under section 263 of the Act, the present appeal filed by the assessee is liable to be dismissed. On merits, the ld. Counsel for the assessee has not advanced any argument. Accordingly, the appeal filed by the assessee is dismissed. 9. In the result, the appeal filed by the assessee is dismissed. Order pronounced on 31 st January, 2022 at Chennai. Sd/- Sd/- (G. MANJUNATHA) ACCOUNTANT MEMBER (V. DURGA RAO) JUDICIAL MEMBER Chennai, Dated, 31.01.2022 Vm/- आदेश की Ůितिलिप अŤेिषत/Copy to: 1. अपीलाथŎ/Appellant, 2.ŮȑथŎ/ Respondent, 3. आयकर आयुƅ (अपील)/CIT(A), 4. आयकर आयुƅ/CIT, 5. िवभागीय Ůितिनिध/DR & 6. गाडŊ फाईल/GF.