Sh. Tejpal Singh Kohli, New Delhi V. CIT-XI, New Delhi

ITA 3637/DEL/2014

• Counselvise Citation: 363720114 RSA 2014
• Duration Of Justice: 3 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-10-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 30-09-2014
• Assessment Year: 2010-2011
• Appeal Filed On: 18-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Revision of order
• Section: 143(3); 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : H NEW DELHI BEFORE SHRI I.C. SUDHIR, JM AND SHRI J.SUDHAKAR REDDY, AM ITA NO:3637/DE L/2014 AY : - 2010-11 TEJPAL SINGH KOHLI, VS. CIT-X I PROP. CONCEPT INDUSTRIES, NEW DEL HI. H-3/18, MODEL TOWN-II, NEW DELHI. PAN AFXPK9227P (APPELLANT) (RES PONDENT) APPELLANT BY :S HRI RAJESH MAHNA, ADVOCATE RESPONDENT :SH RI R.S. MEENA,CIT (DR) O R D E R PER J.SUDHAKAR REDDY, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE REVENUE DIRECTED AGA INST THE ORDER OF THE COMMISSIONER OF INCOME TAX PASSED U/S 263 OF THE AC T ON 29.5.2014 WHEREIN THE DEDUCTION GRANTED U/S 80IC OF INCOME TA X ACT, 1961 IN THE ASSESSMENT ORDER PASSED U/S 143(3) ON 8.3.2014 BY T HE AO WAS HELD TO HAVE BEEN WRONGLY GRANTED. LD. CIT HELD THAT THE AS SESSMENT ORDER PASSED U/S 143(3) ON 8.3.2013 WAS ERRONEOUS IN SO FAR AS I T IS PREJUDICIAL TO THE INTEREST OF REVENUE. 2. AGGRIEVED THE ASSESSEE IS IN APPEAL BEFORE US. 3. WE HAVE HEARD SHRI RAJESH MAHNA , LD. COUNSEL FO R THE ASSESSEE AND SHRI R.S. MEENA, THE LD. CIT, DR ON BEHALF OF THE R EVENUE. ITA 5081/DEL/2010 AY 2006-07 ITO VS. DR. TEJ PAL SINGH 2 4. ON A CAREFUL CONSIDERATION OF RIVAL SUBMISSIONS WE HOLD AS FOLLOWS :- LD. COMMISSIONER OF INCOME TAX IN HIS NOTICE U/S 26 3 DATED 18.3.2014 STATED THAT PRIMA FACIE DEDUCTION CLAIMED U/S 80IC OF THE ACT BY THE ASSESSEE IS NOT JUSTIFIABLE ON THE FOLLOWING GR OUNDS :- A) ASSESSEE IS ASSEMBLING AND TRADING LCDS AND IT IS NOT CARRYING ON MANUFACTURING OF GOODS. B) THE UNIT OF THE ASSESSEE IS NOT IN A NOTIFIED AREA 5. THE ASSESSEE GAVE A DETAILED REPLY ON 7.4.201 4, INTER ALIA MENTIONING THAT THE VERY SAME ISSUE OF CLAIM OF EXEMPTION U/S 80IC OF THE ACT FOR THE EARLIER ASSTT. YEAR 2009-10 IN THE ASSESSEES OWN C ASE HAS COME UP BEFORE THE COMMISSIONER OF INCOME TAX AND THAT THE LD. CI T VIDE HER ORDER DATED 31.10.2012 IN APPEAL NO. 222/2011-12 ALLOWED THE CL AIM OF THE ASSESSEE. MANY OTHER CONTENTIONS WERE RAISED INCLUDING THE JU RISDICTION OF THE LD. CIT INVOKING ITS POWERS U/S 263. 6. LD. CIT(A) REJECTED THE CONTENTION OF THE AS SESSEE AND CAME TO THE CONCLUSION THAT THE ASSESSEE IS ENGAGED ONLY IN AS SEMBLING THE LCD MONITORS AND THAT THE UNIT OF THE ASSESSEE IS NOT L OCATED IN THE NOTIFIED AREA AND HENCE THE ASSESSEE HAS WRONGLY CLAIMED DEDUCTIO N U/S 80IC OF THE ACT AND THE AO HAS WRONGLY GRANTED DEDUCTION U/S 80IC O F THE ACT. 7. AGGRIEVED THE ASSESSEE IS IN APPEAL. 8. AFTER HEARING RIVAL CONTENTIONS WE FIND THAT ON MERITS THE H BENCH OF THE ITAT IN ITA NO.362/DEL/2013 FOR THE ASSTT. YEAR 2009-10 THE ASSESSEES OWN CASE VIDE ORDER DATED 11 TH JULY, 2014 AT PARA 7 AND 8 HELD AS FOLLOWS:- ITA 5081/DEL/2010 AY 2006-07 ITO VS. DR. TEJ PAL SINGH 3 7. EVEN BEFORE THE ITAT, THE ASSESSEE HAS FILED D ETAILS OF VARIOUS PURCHASES MADE FROM VARIOUS PARTIES IN THE COURSE O F IMPORT OR PROCESSING WITH RELEVANT ACCOUNT AND COPIES OF WHIC H ARE AT (PAGES 2 TO 81); NOTIFICATION OF GOVERNMENT OF INDIA, MINISTRY OF COMMERCE & IND. (PAGES 82 TO 98); FLOW CHART OF ASSEMBLING (PAGES 9 9 TO 132); DETAILS OF PARTIES TO WHOM SALES WERE MADE WITH DETAILS OF ITE MS (PAGES 133 TO 150) FORM NO. 1 ISSUED BY SINGLE WINOW CLEARING AG ENCY, DEPARTMENT OF INDUSTRY, GOVT. OF HIMACHAL PRADESH, NAJFGARH (PAGE 151); 10CCB CERTIFICATE (PAGES 152 TO 158); QUALIFICATION OF SE RVICE OF ENGINEERING (PAGE 159) AND COPIES OF WRITTEN SUBMISSIONS MADE B EFORE THE LEARNED CIT(APPEALS) (PAGES 160 TO 165). 8. UNDER THESE FACTS AND CIRCUMSTANCES, WE FULLY CONCUR WITH THE FINDINGS OF THE LEARNED CIT(APPEALS) THAT THE ASSES SEE WAS VERY MUCH ELIGIBLE FOR THE CLAIMED DEDUCTION U/S 80IC OF THE INCOME-TAX ACT,1961 WHICH WAS WRONGLY DENIED BY THE ASSESSING OFFICER. THUS, HE HAS RIGHTLY DIRECTED THE ASSESSING OFFICER TO PASS A CO NSEQUENTIAL ORDER ACCEPTING THE CLAIM OF THE ASSESSEE FOR DEDUCTION U /S 80IC(2)(B)(II) OF THE ACT AS PER LAW. THE SAME IS UPHELD. THE ISSUE IS, T HUS, DECIDED IN FAVOUR OF THE ASSESEE. 9. THE AO ON RECEIPT OF THE ORDER OF THE FIRST APPE LLATE AUTHORITY FOR THE ASSTT. YEAR 2009-10 VIDE APPEAL NO. 222/2011-12 ORD ER DATED 31.10.2012 IN THE ASSESSMENT ORDER AT PARA NO. 3 PAGE 1 OBSERVED AS FOLLOWS :- THE ASSESSEE WAS ASKED TO JUSTIFY CLAIM OF DEDUCTI ON U/S 80-IC OF THE ACT IN VIEW OF THE FACT THAT ACTIVITY CARRIED OUT B Y THE ASSESSEE IS ASSEMBLING. THE ASSESSEE HAS FURNISHED A DETAILED R EPLY SUPPORTED WITH VARIOUS JUDICIAL PRONOUNCEMENTS. KEEPING IN VI EW THE FACTS OF THE CASE AND VARIOUS JUDICIAL PRONOUNCEMENTS IT IS SEEN THAT ASSESSEE BRINGS INTO EXISTENCE A NEW IDENTIFIABLE COMMERCIAL PRODUCT FROM VARIOUS COMPONENTS. ACCORDINGLY DEDUCTION U/S 80-IC OF THE I.T. ACT IS ALLOWED TO THE ASSESSEE. WITH THESE REMARKS INCOME AS RETURNED IS ACCEPTED. 10. ON PERUSAL OF THE ABOVE PARAGRAPH IN THE ASSE SSMENT ORDER, COUPLED WITH THE FACTS THAT IN THE EARLIER ASSESSMENT YEAR THE SAME AO DENIED THE ITA 5081/DEL/2010 AY 2006-07 ITO VS. DR. TEJ PAL SINGH 4 EXEMPTION U/S 80IC TO THE ASSESSEE ON THE VERY SAME GROUNDS AND THE FACTS THAT THE COMMISSIONER OF INCOME TAX (APPEALS) HAS R EVERSED SUCH ADDITION, WE ARE OF THE OPINION THAT THE AO HAS PROPERLY APPL IED HIS MIND AND HENCE TAKE A PLAUSIBLE VIEW. THUS APPLYING THE PROPORTION S LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. MAX IN DIA LTD. (2007) 295 ITR 285(SC) AND THE PROPORTIONS LAID DOWN IN THE CASE O F MALBAR INDUSTRIES CO. LTD. VS. CIT 243 ITR 83 (SC) WE CONCLUDE THAT ORDER PASSED U/S 263 IS BAD IN LAW. 11. THE ASSESSEE FILED A PAPER BOOK RUNNING INTO 86 PAGES. THE PAPER BOOK CONSISTS OF THE DOCUMENTS FILED BEFORE THE AO IN SU PPORT OF ITS CLAIM OF DEDUCTION U/S 80IC. THESE ARE THE VERY SAME DOCUMEN TS WHICH WERE CONSIDERED BY THE LD. CIT(A) AND THE ITAT, WHILE AD JUDICATING THE SIMILAR CLAIM FOR THE EARLIER ASSESSMENT YEAR. THE TRIBUNAL ADJUDICATED THE ISSUE IN FAVOUR OF THE ASSESSEE. 12. CONSISTENT WITH THE VIEW TAKEN THEREIN WE U PHOLD THE CONTENTION OF THE ASSESEE THAT THE AO HAS RIGHTLY GRANTED DEDUCTI ON U/S 80IC AND HELD THAT THE ORDER OF THE LD. CIT(A) IS BAD IN LAW. 13. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH OCTOBER,2014. SD/- SD/- (I.C. SUDHIR) (J.SUDHAKAR REDDY) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: THE 15 TH OCTOBER,2014 *VEENA ITA 5081/DEL/2010 AY 2006-07 ITO VS. DR. TEJ PAL SINGH 5 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT; 2. RESPONDENT; 3. CIT; 4. CIT(A); 5. DR; 6. GUARD FILE BY ORDER ASST. REGISTRAR