Veekesy Polymers P.Ltd, Calicut V. The ACIT, Calicut

ITA 28/COCH/2014

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 73931 (ITAT-COCHIN)
• Duration Of Justice: 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-03-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 27-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M ANIL KUMAR
• Assessee Lawyers: M V VENUGOPAL
• Keywords: Period of limitation; Reassessment proceedings
• Section: 80IB; 147; 263

Judgement Text

1 ITA NO. 28/COCH/2014 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI N.R.S. GANESAN (JM) AND SHRI B.R. BASKA RAN(AM) I.T.A NO. 28/COCH/2014 (ASSESSMENT YEAR 2007-08) VEEKESY POLYMERS PVT LTD VS ACIT, CIR.2(1) 6/1, RAMANATTUKARA CALICUT CALICUT 673 633 PAN : AAACV7735N (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI M.V. VENUGOPAL RESPONDENT BY : SHRI M ANIL KUMAR, CIT(DR) DATE OF HEARING : 25-03-2014 DATE OF PRONOUNCEMENT : 28-03-2014 O R D E R PER N.R.S. GANESAN (JM) THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF THE ADMINISTRATIVE COMMISSIONER, KOZHIKODE DATED 09-01- 2014 FOR THE ASSESSMENT YEAR 2007-08. 2. SHRI M.V. VENUGOPAL, THE LD.REPRESENTATIVE FOR T HE ASSESSEE SUBMITTED THAT THE ADMINISTRATIVE COMMISSIONER REVI SED THE ORDER OF THE ASSESSING OFFICER DATED 18-02-2013 ON THE GROUND TH AT 2 ITA NO. 28/COCH/2014 I. THE ASSESSING OFFICER ALLOWED EXCESS DEPRECIATIO N; II. THERE IS NO EVIDENCE FOR PAYMENT OF TDS TO GOVE RNMENT ACCOUNT IN RESPECT OF TRANSPORTATION CHARGES; III. DISALLOWANCE U/S 40(A)(IA); AND IV. NON DEDUCTION OF TAX IN RESPECT OF PAYMENT OF S ECURITY CHARGES, FORWARDING CHARGES, CASH PRIZE AND WORLD C UP CONTEST. REFERRING TO THE ASSESSMENT ORDER DATED 18-02-2013, ACCORDING TO THE LD.REPRESENTATIVE, THE ONLY SUBJECT MATTER OF ASSES SMENT WAS WITH REGARD TO DEDUCTION U/S 80IB OF THE ACT. THE ASSESSING OFFIC ER HAS NOT DISCUSSED ANYTHING IN THE ASSESSMENT ORDER DATED 18-02-2013. THE ORIGINAL ASSESSMENT ORDER BEFORE REOPENING WAS CONCLUDED ON 03-12-2009. REFERRING TO THE JUDGMENT OF THE APEX COURT IN CIT VS ALAGENDRAN FINANCE LTD (2007) 293 ITR 1 (SC), THE LD.DR SUBMITTED THAT IN RESPECT OF AN ISSUE WHICH WAS NOT SUBJECT MATTER OF RE-ASSESSMENT, LIMI TATION U/S 263(2) WOULD RUN FROM THE DATE OF THE ORIGINAL ASSESSMENT. ACCO RDING TO THE LD.REPRESENTATIVE, THE DOCTRINE OF MERGER WOULD NOT BE APPLICABLE IN SUCH CASES. THE ISSUE RAISED BY THE ADMINISTRATIVE COMM ISSIONER IS NOT SUBJECT MATTER OF RE-ASSESSMENT, THEREFORE, THE LIMITATION FOR REVISION OF THE ASSESSMENT WOULD RUN FROM THE ORIGINAL DATE OF ASSE SSMENT I.E. 03-12- 2009. THE REVISIONAL ORDER WAS PASSED ON 09-01-201 4. ACCORDING TO THE LD.REPRESENTATIVE, UNDER SECTION 263(2) NO ORDER SH ALL BE MADE U/S 263(1) 3 ITA NO. 28/COCH/2014 AFTER EXPIRY OF TWO YEARS FROM THE END OF THE FINAN CIAL YEAR IN WHICH THE ORDER SOUGHT TO BE REVISED WAS PASSED. THEREFORE, ACCORDING TO THE LD.REPRESENTATIVE, IN THIS CASE, THE ADMINISTRATIVE COMMISSIONER CANNOT PASS REVISIONARY ORDER ON OR AFTER 31-03-2012. SIN CE ADMITTEDLY, THE ORDER WAS PASSED ON 03-01-2014, ACCORDING TO THE LD.REPRE SENTATIVE, THE ORDER IS BARRED BY LIMITATION. WE HEARD SHRI M ANIL KUMAR, THE LD.DR ALSO. 3. ADMITTEDLY, THE ORIGINAL ASSESSMENT ORDER U/S 14 3(3) WAS PASSED ON 03-12-2009. COPY OF THE ORDER IS AVAILABLE AT PAGE 1 OF THE PAPER BOOK. SUBSEQUENTLY, THE ASSESSING OFFICER FOUND THAT INCO ME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. ACCORDINGLY, THE ASSESSMEN T WAS REOPENED U/S 147 OF THE ACT BY ISSUING NOTICE TO THE ASSESSEE ON 29-03-2012. IN THE REOPENED ASSESSMENT, THE ONLY SUBJECT MATTER WAS DE DUCTION U/S 80IB OF THE ACT. THE GROUND ON WHICH THE ADMINISTRATIVE CO MMISSIONER EXERCISED HIS JURISDICTION IS NOT THE SUBJECT MATTER IN THE R EOPENED / REASSESSMENT PROCEEDINGS. THE QUESTION ARISES FOR CONSIDERATION IS WHEN THE ISSUE RAISED BY THE ADMINISTRATIVE COMMISSIONER IS NOT SU BJECT MATTER OF THE RE- ASSESSMENT / RE-OPENED ASSESSMENT, WHETHER THE LIMI TATION FOR EXERCISING JURISDICTION U/S 263 WOULD RUN EITHER FROM THE ORIG INAL ASSESSMENT ORDER DATED 03-12-2009 OR FROM THE REOPENED / REASSESSMEN T ORDER DATED 18-02- 2013. THIS ISSUE WAS EXAMINED BY THE APEX COURT IN THE CASE OF ALAGENDRAN FINANCE LTD (SUPRA). THE APEX COURT FOU ND THAT IN SUCH A 4 ITA NO. 28/COCH/2014 CIRCUMSTANCE, THERE IS NO QUESTION OF APPLICATION O F DOCTRINE OF MERGER. THE APEX COURT FOUND THAT THE LIMITATION U/S 263(2) WOULD RUN FROM THE DATE OF THE ORIGINAL ASSESSMENT ORDER AND NOT FROM THE D ATE OF THE RE- ASSESSMENT ORDER. IN VIEW OF THE JUDGMENT OF THE A PEX COURT IN THE CASE OF ALAGENDRAN FINANCE LTD, THE LIMITATION WOULD RUN FROM 03-12-2009. THEREFORE, THE ORDER PASSED BY THE ADMINISTRATIVE C OMMISSIONER ON 09-01- 2014 IS BEYOND THE PERIOD OF LIMITATION, I.E. TWO Y EARS FROM THE END OF THE FINANCIAL YEAR IN WHICH THE ORIGINAL ASSESSMENT ORD ER WAS PASSED. THEREFORE, THE ORDER PASSED BY THE ADMINISTRATIVE C OMMISSIONER IS BARRED BY LIMITATION. ACCORDINGLY, THE SAME IS QUASHED. 4. IN THE RESULT, APPEAL OF THE ASSESSEE STANDS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 28 TH MARCH, 2014. SD/- SD/- (B.R. BASKARAN) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN, DT : 28 TH MARCH, 2014 PK/- COPY TO: 1. VEEKESY POLYMERS PVT LTD, 6/1, RAMANATTUKARA, CA LICUT 673 633 2. ACIT, CIR.2(1), CALICUT 3. THE COMMISSIONER OF INCOME-TAX, OFFICE OF THE CO MMISSIONER OF INCOME-TAX, AAYAKAR BHAVAN, NORTH BLOCK, KOZHIKODE 673 001 4. THE DR (TRUE COPY) BY ORDER ASSTT. REGISTRAR, INCOME-TAX APPELLATE TRIBUNAL, COCHIN BENCH