M/s. Marck Biosciences Ltd. (Now know as Amanta Healthcare Ltd.), Ahmedabad V. The Dy. CIT(OSD)-1, Circle-4, Ahmedabad

ITA 3301/AHD/2016

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 1065 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 3 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-03-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2007-2008
• Appeal Filed On: 08-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S N SOPARKAR
• Keywords: Reassessment proceedings
• Section: 143(3); 115JB; 148

Judgement Text

ITA NO. 3301/AHD/2016 MARK BIOSCIENCES LTD VS. DCIT (OSD) ASSESSMENT YEAR : 2007-08 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH, AHMEDABAD [CORAM: PRAMOD KUMAR, VP AND MS. MADHUMITA ROY, JM] ITA NO. 3301/AHD/2016 ASSESSMENT YEAR: 2007-08 MARCK BIOSCIENCES LIMITED .................. APPELLANT (NOW KNOWN AS AMANTA HEALTHCARE LTD) 5 TH FLOOR, HERITAGE, NEAR GUJARAT VIDYAPITH, OFF. ASHRAM ROAD, AHMEDABAD [PAN NO. AABCM 0366 P] VS. DY. COMMISSIONER OF INCOME-TAX ............................RESPONDENT (OSD)-1, CIRCLE-4, AHMEDABAD APPEARANCES BY: SN SOPARKAR, FOR THE APPELLANT MUDIT NAGPAL, FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : 13.03.2019 DATE OF PRONOUNCING THE ORDER : 14.03.2019 O R D E R PER PRAMOD KUMAR, VICE PRESIDENT : 1. BY WAY OF THIS APPEAL, THE ASSESSEE APPELLANT HA S CHALLENGED CORRECTNESS OF LEARNED CIT(A)S ORDER DATED 20 TH OCTOBER 2016, IN THE MATTER OF ASSESSMENT UNDER SECTION 143(3) R.W.S. 147 OF THE INCOME-TAX ACT, 19 61, FOR THE ASSESSMENT YEAR 2007-08. 2. GRIEVANCES RAISED BY THE APPELLANT ARE AS FOLLOW S:- (1) THE LEARNED ASSESSING OFFICER HAS ERRED IN LAW AND ON FACTS IN INITIATING REOPENING ASSESSMENT PROCEEDINGS BY ISSUING NOTICE U/S 147/148 AND FINALISING THE ASSESSMENT US 143(3)/R.W.S. 147. (2) THE LEARNED ASSESSING OFFICER HAS ERRED IN LAW AND ON FACTS IN PASSING THE ORDER DT. 28/08/2014 : (I) BY REJECTING THE OBJECTS RAISED BY THE ASSESSEE AGAINST REASONS RECORDED FOR REOPENING U/S 148 AND (II) IN NOT CONSIDERING THE SUBMISSIONS THAT THE RE OPENING IS ON SOME OTHER OFFICER'S INFORMATION AND NOT THAT OF THE ASS ESSING OFFICER ISSUING NOTICE AND HON.CIT IN REJECTING THE ABOVE SUBMISSIO NS OF THE ASSESSEE. ITA NO. 3301/AHD/2016 MARK BIOSCIENCES LTD VS. DCIT (OSD) ASSESSMENT YEAR : 2007-08 PAGE 2 OF 4 (3) THE LEARNED ASSESSING OFFICER HAS ERRED IN LAW AND ON FACTS IN NOT CONSIDERING THE EVIDENCES PRODUCED AND ON RECORD IN RESPECT OF ADDITIONS MADE : (A) IN RESPECT OF ALL THE PERSON WHOSE AMOUNT ARE A DDED WHEN IDENTITY WAS PROVED. (B) SHRI NARESH R. THAKORE AND SHRI JAGDISHBHAI SHE TH HAVE PERSONALLY ATTENDED AND HAVE CONFIRMED THE INVESTMENT MADE BY THEM. (C) MODERN MARINE PVT. LTD. HAS SHOWN THE INVESTMEN T IN ITS BALANCE SHEET. (D) (I) PURVISH SHAH (II) DAHYABHAI THAKORE AND (II I) DINESHBHAI SHAH. HAVE MADE INVESTMENT BY CHEQUES AND HON. CIT HAS E RRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITIONS. (4) THE LEARNED ASSESSING OFFICER HAS ERRED IN LAW AND ON FACTS IN MAKING ADDITIONS ON THE PLEA THAT THE SOURCE OF SOURCE IS NOT PROVED AND HON.CIT(A) HAS ERRED IN CONFIRMING THE SAME. (5) THE LEARNED ASSESSING OFFICER HAS ERRED IN LAW AND ON FACTS IN PASSING ASSESSMENT ORDER BY MAKING ADDITIONS DISREGARDING T HE FACT THAT EVEN AFTER ADDITIONS THE TAX PAYABLE ON NORMAL INCOME IS NIL, AS THE TOTAL INCOME FOR CHARGE OF INCOME TAX IS ARRIVED AT U/S 1 15JB AND HON CIT(A) HAS ERRED IN CONFIRMING THE SAME. 3. TO ADJUDICATE ON THIS APPEAL, ONLY A FEW MATERIA L FACTS NEED TO BE TAKEN NOTE OF. IT IS A CASE OF REOPENED ASSESSMENT. THE ORIG INAL ASSESSMENT WAS DONE ON BOOK PROFITS UNDER SECTION 115JB. EVEN THOUGH AS A RESULT OF REASSESSMENT PROCEEDINGS, THERE WAS AN ADDITION TO THE RETURNED INCOME BUT IT HAD NO IMPACT ON THE ACTUAL TAXABILITY INASMUCH AS, EVEN AFTER THE I MPUGNED ADDITION, THE ACTUAL ASSESSMENT WAS ON THE SAME BOOK PROFITS UNDER SECTI ON 115JB. THESE MATERIAL FACTS ARE NOT IN DISPUTE, AND, IN RESPONSE TO OUR S PECIFIC QUESTION, LEARNED DEPARTMENTAL REPRESENTATIVE SPECIFICALLY CONFIRMED THIS POSITION. 4. THE SHORT QUESTION THAT WE NEED TO ADDRESS OURSE LVES TO IS WHETHER, ON THESE UNDISPUTED FACTS, REOPENING PROCEEDINGS, TO ASSESSE E INCOME ESCAPING ASSESSMENT, CAN BE LEGALLY SUSTAINED. THE AUTHORITIES BELOW HA VE HELD THAT THE IMPUGNED REASSESSMENT PROCEEDINGS ARE VALID AND LAWFUL. 5. HAVING HEARD THE RIVAL CONTENTIONS AND HAVING PE RUSED THE MATERIAL ON RECORD, WE FIND THAT THE LEGAL POSITION IS WELL SETTLED, IN THIS RESPECT, BY HONBLE JURISDICTIONAL HIGH COURTS JUDGMENTS IN THE CASES OF INDIA GELATI NE & CHEMICAL INDUSTRIES LTD VS. ACIT (364 ITR 649), MOTTOTILES PVT LTD VS. ACIT (38 6 ITR 280) AND PKM ADVISORY ITA NO. 3301/AHD/2016 MARK BIOSCIENCES LTD VS. DCIT (OSD) ASSESSMENT YEAR : 2007-08 PAGE 3 OF 4 SERVICES PVT LTD VS. ITO (339 ITR 585). WE MAY, IN THIS REGARD, REFER TO THE FOLLOWING OBSERVATIONS MADE BY THE HONBLE JURISDICTIONAL HIG H COURT IN THE CASE OF MOTTO TILES PVT LTD (SUPRA):- ...........THE CONTROVERSY STANDS SQUARELY CONCLUD ED BY THE DECISION OF THIS COURT IN THE CASE OF INDIA GELATINE AND CHEMICALS L TD. (SUPRA) WHEREIN, THE COURT IN A CASE WHERE THE ASSESSEE HAD DECLARED A L OSS OF RS.1.44 CRORES UNDER THE NORMAL COMPUTATION AND THE ASSESSMENT WAS FRAMED ON BOOK PROFIT OF RS.2.89, HAD HELD THAT EVEN IF THE EXPENDITURE O F RS.116.86 LAKHS IS DISALLOWED, THERE WOULD BE NO RESULTANT CHANGE IN T HE PETITIONER'S TAX LIABILITY SINCE THE PETITIONER HAD ALREADY PAID MUCH HIGHER T AX AND HAD ALLOWED THE PETITION. IT APPEARS THAT THE REVENUE HAS ACCEPTED THE SAID DECISION AND HAS NOT CHALLENGED THE SAME BEFORE THE HIGHER FORUM. TH E LEARNED COUNSEL FOR THE RESPONDENT HAS URGED THAT THE DECISION REQUIRES REC ONSIDERATION. HAVING REGARD TO THE FACTS AND CIRCUMSTANCES OF THE CASE, AS WELL AS THE FACT THAT THE REVENUE HAS ACCEPTED THE SAID DECISION, THE COURT D OES NOT FIND ANY REASON TO REFER THE MATTER FOR CONSIDERATION TO A LARGER BENC H. 12. IN THE LIGHT OF THE DECISION OF THIS COURT IN T HE CASE OF INDIA GELATINE AND CHEMICALS LTD. (SUPRA), HAVING REGARD TO THE FACT T HAT EVEN IF THE ENTIRE AMOUNT WHICH IS PROPOSED TO BE ADDED BY THE ASSESSI NG OFFICER IS SUSTAINED, THERE WOULD BE NO ADDITION TO THE TAX LIABILITY OF THE PETITIONER AND THE PETITIONER WOULD STILL BE GOVERNED BY THE PROVISIONS OF SECTIO N 115JB OF THE ACT AND ASSESSED ON THE SAME BOOK PROFIT, IT CANNOT BE SAID THAT THERE WAS SUFFICIENT MATERIAL BEFORE THE ASSESSING OFFICER TO FORM THE B ELIEF THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. THE IMPUG NED NOTICE ISSUED UNDER SECTION 148 OF THE ACT, THEREFORE, CANNOT BE SUSTAINED. 6. RESPECTFULLY FOLLOWING THE ESTEEMED VIEWS OF HON BLE JURISDICTIONAL HIGH COURT, WE HOLD THAT THE REASSESSMENT PROCEEDINGS WE RE VITIATED IN LAW, AND WE QUASH THE REASSESSMENT ITSELF. ALL OTHER ISSUES, I N THE LIGHT OF THIS CONCLUSION AND FOR THIS SHORT REASON, ARE RENDERED ACADEMIC AND NOT RE QUIRING ANY SPECIFIC ADJUDICATION AT THIS STAGE. 7. IN THE RESULT, THE APPEAL IS ALLOWED IN THE TERM S INDICATED ABOVE. PRONOUNCED IN THE OPEN COURT TODAY ON THE 14 TH MARCH, 2019. SD/- SD/- MS. MADHUMITA ROY PRA MOD KUMAR (JUDICIAL MEMBER) (VICE PRESIDENT) AHMEDABAD, THE 14 TH DAY OF MARCH, 2019 *BT ITA NO. 3301/AHD/2016 MARK BIOSCIENCES LTD VS. DCIT (OSD) ASSESSMENT YEAR : 2007-08 PAGE 4 OF 4 COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD 1. DATE OF DICTATION: ORDER PREPARED AS PER THE 3 PAGES MANUSCRIPTS OF HONBLE VP WHICH ARE ATTACHED....13.03.2019.. 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: .. 13.03.2019......... 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR . P.S./P.S.: .14.03.2019.... 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT:... 14.03.2019.. 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK : .... 14.03.2019.................. 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK : . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER: 8. DATE OF DESPATCH OF THE ORDER: ......