ACIT Circle 1, Namakkal V. Seshasayee Paper & Boards Ltd., Namakkal

ITA 2775/CHNY/2017

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3716 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 3 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-02-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2000-2001
• Appeal Filed On: 20-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRS VIJAYA PRABHA
• Assessee Lawyers: G BASKAR
• Keywords: Tax effect; TDS; Set aside
• Section: 143(3); 80HHC

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: CHENNAI , ! ' # , $ %& BEFORE SHRI MAHAVIR SINGH , VICE PRESIDENT AND SHRI M. BALAGANESH, ACCOUNTANT MEMBE R ./ ITA NO.2775/CHNY/2017 ' ( )( /ASSESSMENT YEAR: 2000-01 THE ASST. COMMISSIONER OF INCOME TAX, CIRCLE-1, NAMAKKAL. VS. M/S. SESHASAYEE PAPER & BOARDS LTD., KAVERI RS POST, PALLIPALAYAM, NAMAKKAL 638 007. [PAN: AACCS 1192G] ( *+ /APPELLANT) ( ,-*+ /RESPONDENT) ./ ITA NO.2834/CHNY/2017 ' ( )( /ASSESSMENT YEAR: 2000-01 M/S. SESHASAYEE PAPER & BOARDS LTD., KAVERI RS POST, PALLIPALAYAM, NAMAKKAL 638 007. [PAN: AACCS 1192G] VS. THE ASST. COMMISSIONER OF INCOME TAX, CIRCLE-1, NAMAKKAL. ( *+ /APPELLANT) ( ,-*+ /RESPONDENT) *+ . / / ASSESSEE BY : SHRI G. BASKAR, ADVOCATE ,-*+ . / /REVENUE BY : MRS. VIJAYAPRABHA, JCIT 0 . 1$ /DATE OF HEARING : 25.02.2020 23) . 1$ /DATE OF PRONOUNCEMENT : 25.02.2020 %# / O R D E R PER SHRI MAHAVIR SINGH, VICE PRESIDENT : THESE CROSS APPEALS, BY THE ASSESSEE AND REVENUE, A RE ARISING OUT OF THE ORDER OF CIT(A), SALEM, IN ITA NO.76/2009-10 DATED 31.08.2017. THE ITA NOS.2775 & 2834 /CHNY/2017 (A.Y 2000-01) M/S. SESHASAYEE PAPER & BOARDS LTD. :- 2 -: ASSESSMENT WAS FRAMED BY DCIT, CENTRAL CIRCLE-II(1) , CHENNAI FOR THE RELEVANT A.Y. 2000-01 VIDE ORDER DATED 05.03.2003 U /S. 143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT). 2. FIRST WE WILL TAKE UP THE ASSESSEES APPEAL IN I TA NO.2834/CHNY/2017. THE FIRST ISSUE IN THIS APPEAL OF THE ASSESSEE IS A S REGARDS TO THE ORDER OF CIT(A) NOT ADJUDICATING THE GROUNDS RAISED BEFORE HIM VIDE GROUNDS NO. 3.1 TO 3.3. FOR THIS THE ASSE SSEE RAISED GROUNDS WHICH READS AS UNDER: 1.1 THE LEARNED COMMISSIONER OF INCOME-TAX (APPEA LS) WAS INCORRECT IN NOT ADJUDICATING THE GROUNDS NO.3.1 TO 3.3 TAKEN UP BEFORE HIM FOR ADJUDICATION. 1.2 THE LEARNED CIT(A) WAS INCORRECT IN COMING TO A CONCLUSION THAT THE ASSESSEE HAS FAILED TO ADDUCE ANY CONCRETE EVIDENCE IN SUPPORT OF THEIR CLAIM WHEN VARIOUS DOCUMENTS AND DETAILS WERE FILED BEFORE THE LEARNED CIT(A). 1.3 THE LEARNED CIT(A) ERRED IN CONFIRMING THE ORDE R OF THE ASSESSING OFFICER AND REJECTING THE CONTENTIONS OF THE ASSESS EE WHEN THE ISSUE HAS BEEN SETTLED IN FAVOUR OF THE ASSESSEE FOR THE ASSE SSMENT YEAR 1997-98 BY THE HONBLE INCOME TAX APPELLANT TRIBUNAL IN ITA NO .860/MDS/2003. 3. SUBSEQUENTLY, THE LD. COUNSEL FOR THE ASSESSEE H E TOOK US THROUGH THE ORDER OF CIT(A), WHEREIN THE CIT(A) AFTER TAKIN G THE REMAND REPORT FROM THE ASSESSING OFFICER DATED 03.09.2012 CONSIDERED T HE ISSUE OF THE CLAIM OF DEDUCTION U/S. 80HHC OF THE ACT BEING 90% OF THE FO LLOWING TO BE REDUCED FROM PROFIT OF THE BUSINESS: A) RENT AMOUNT OF RS. 6,05,000/- B) INTEREST AMOUNT OF RS. 2,88,000/- C) LEASE AMOUNT OF RS. 23,30,71,000/- D) DIVIDEND AMOUNT OF RS. 18,70,000/- E) INCOME FROM UNITS OF UTI RS. 85,50,000/- F) PROFIT ON SALE OF ASSETS OF RS. 5,68,000/- G) MISCELLANEOUS RECEIPTS OF RS. 20,83,000/- ITA NOS.2775 & 2834 /CHNY/2017 (A.Y 2000-01) M/S. SESHASAYEE PAPER & BOARDS LTD. :- 3 -: 4. THE LD. COUNSEL FOR THE ASSESSEE DREW OUR ATTENT ION TO THE FINDINGS OF THE CIT(A) WHICH ARE GIVEN IN PARA 6.1 AS UNDER: 6.1 THE ASSESSEE HAS FAILED TOA DDUCE ANY CONCRETE EVIDENCE IN SUPPORT OF THEIR CLAIM. THE ASSESSING OFFICER HAS CORRECTLY RELIED ON THE HONBLE APEX COURT CASE LAWS IN THE CASE OF CIT VS. RAVINDRANATHAN NAIR 295 ITR 228 AND REJECTED THE CONTENTIONS OF THE ASS ESSEE. I DO NOT FIND ANY MERIT IN THE ARGUMENTS OF THE ASSESSEE AND HENC E THERE IS NO REASON FOR ME TO INTERFERE WITH THE FINDINGS OF THE ASSESS ING OFFICER. HENCE THIS GROUND OF APPEAL OF THE ASSESSEE IS DISMISSED. 5. IN VIEW OF THE ABOVE, THE LD. COUNSEL FOR THE AS SESSEE STATED THAT THE CIT(A) HAS NOT ADJUDICATED THE ISSUE AT ALL AS IS E VIDENT FROM PARA 6.1 OF THE APPELLATE ORDER AS REPRODUCED. HE STATED THAT THER E SHOULD BE A SPEAKING ORDER ON EACH OF THE ITEM FOR DECIDING THE ISSUE. WHEN THIS WAS POINTED OUT TO LD. SR. DR, SHE RELIED ON PARA 6 AND 6.1 OF CIT( A) ORDER, WHEREIN ACCORDING TO HER PROPER ADJUDICATION IS DONE BY THE CIT(A). 6. AFTER HEARING BOTH SIDES AND GONE THROUGH THE FA CTS OF THE CASE, WE ARE OF THE VIEW THAT THE ADJUDICATION OF CIT(A) LAC S SPEAKING ORDER. EVEN THERE IS NO REASONING FOR NOT ENTERTAINING THE CLAI M OF THE ASSESSEE. WE ARE OF THE VIEW THAT THE CIT(A) SHOULD HAVE GIVEN SOME REASONS FOR DECIDING THE CLAIM OF THE ASSESSEE. HENCE, WE SET ASIDE THE ORD ER OF CIT(A) ON THIS ISSUE AND REMAND THE MATTER BACK TO HIS FILE FOR FR ESH ADJUDICATION. NEEDLESS TO SAY THAT THE CIT(A) WILL PROVIDE REASON ABLE OPPORTUNITY BEING HEARD TO THE ASSESSEE AND ALSO PASS A SPEAKING ORDE R. HENCE, THIS ISSUE IS REMITTED BACK TO THE FILE OF THE CIT(A). ITA NOS.2775 & 2834 /CHNY/2017 (A.Y 2000-01) M/S. SESHASAYEE PAPER & BOARDS LTD. :- 4 -: 7. THE NEXT ISSUE IN THIS APPEAL OF THE ASSESSEE IS AS REGARDS NOT ALLOWING CREDIT FOR TDS AMOUNTING TO RS. 11,173/-. 8. BOTH THE LD. COUNSEL FOR THE ASSESSEE AS WELL AS LD. SR. DR AGREED THAT THE MATTER CAN GO BACK TO THE FILE OF ASSESSIN G OFFICER AND WHILE GIVING APPEAL EFFECT TO THIS ORDER, THE ASSESSING OFFICER WILL ALLOW CREDIT FOR TDS PAYMENTS SUBJECT TO VERIFICATION OF TDS CERTIFICATE S. HENCE, THE ASSESSING OFFICER IS DIRECTED TO ALLOW THE CREDIT AS PER LAW. HENCE, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE AS INDI CATED ABOVE. 9. COMING TO THE REVENUES APPEAL IN ITA NO.2775/CH NY/2017. AT THE OUTSET THE LD. COUNSEL FOR THE ASSESSEE STATED THAT THE DISALLOWANCE OF EXPENDITURE ON SCIENTIFIC RESEARCH IS TO THE EXTENT OF RS. 40,59,000/- AND TAX EFFECT IN THIS APPEAL WILL BE LESS THAN THE MONETAR Y LIMIT OF .50,00,000/- FIXED BY THE CBDT TO FILE AN APPEAL BY THE REVENUE BEFORE THE TRIBUNAL AS PER THE CBDT CIRCULAR NO. 17/2019, DATED 08.08.2019. THE LD . DR FAIRLY CONCEDED THE SUBMISSIONS MADE BY THE LD. COUNSEL FOR THE ASS ESSEE. BEING SO, THE REVENUE AUTHORITIES ARE PRECLUDED FROM FILING THE A PPEAL BEFORE THE TRIBUNAL, SINCE THE TAX EFFECT IS LESS THAN .50,00,000/ - IN THIS APPEAL AND THE APPEAL FILED BY THE REVENUE IS LIABLE TO BE DISMISSED. ACC ORDINGLY, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ITA NOS.2775 & 2834 /CHNY/2017 (A.Y 2000-01) M/S. SESHASAYEE PAPER & BOARDS LTD. :- 5 -: 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IN IT A NO.2834/CHNY/2017 IS ALLOWED FOR STATISTICAL PURPOSE AND THE APPEAL OF R EVENUE IN ITA NO.2775/CHNY/2017 IS DISMISSED. ORDER PRONOUNCED ON 25 TH DAY OF FEBRUARY, 2020 IN CHENNAI. SD/- SD/- ) (M. BALAGANESH) /ACCOUNTANT MEMBER ( ) (MAHAVIR SINGH) /VICE PRESIDENT /CHENNAI, 4% /DATED: 25 TH FEBRUARY, 2020 . EDN, SR. P.S %# . ,'15 65)1 /COPY TO: 1. *+ /APPELLANT 2. ,-*+ /RESPONDENT 3. 0 71 ( )/CIT(A) 4. 0 71 /CIT 5. 58' ,'1' /DR 6. '9( : /GF