M/s Continental Device India Ltd., New Delhi V. DCIT, New Delhi

ITA 3686/DEL/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 52876 (ITAT-DELHI)
• Duration Of Justice: 1 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2000-2001
• Appeal Filed On: 01-08-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: KRISHNA
• Section: 143(3); 80HHC

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCHES : 'B' : NEW DELHI BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER & SHRI K.D. RANJAN, ACCOUNTANT MEMBER ITA NO. 3686 & 3687/DEL./2011 ASSESSMENT YEAR : 2000-01 & 2001-02 CONTINENTAL DEVICE INDIA LTD., VS. D.C.I.T., CIRC LE 3(1), NARAINA INDL. AREA, NEW DELHI. NEW DELHI. (PAN : AAACC 1835 E) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PRADEEP DINODIA, C.A. RESPONDENT BY : SHRI KRISHNA, CIT/ D.R. & SHRI ROHIT GARG. SR. D.R. ORDER PER K.D. RANJAN, A.M.: THESE APPEALS BY THE ASSESSEE FOR THE ASSESSMENT Y EAR 2000-01 AND 2001-02 ARISE OUT OF SEPARATE ORDERS OF CIT(A)-V, NEW DELHI. THES E APPEALS WERE HEARD TOGETHER AND FOR THE SAKE OF CONVENIENCE, ARE DISPOSED OF BY THI S COMMON ORDER. 2. THE ONLY ISSUE FOR CONSIDERATION, WHICH IS COMMO N IN BOTH THE APPEALS RELATES TO COMPUTATION OF DEDUCTION U/S. 80HHC(3) IN RESPECT O F DEPB RECEIPTS. IN THIS CASE, THE ORIGINAL ASSESSMENT WAS PASSED U/S. 143(3) ON 17.03 .2004. THE MATTER IN RELATION TO DEDUCTION U/S. 80HHC TRAVELED UP TO THE LEVEL OF IT AT. THE ITAT DELHI BENCH B IN ITA NO. 1363/DEL/2009 FOR THE ASSESSMENT YEAR 2000- 01 IN ORDER DATED 30.10.2009 SET ASIDE THE ISSUE TO THE FILE OF ASSESSING OFFICER WI TH THE DIRECTIONS TO COMPUTE THE RELIEF U/S. 80HHC AFTER VERIFICATION OF FACTS IN THE LIGHT OF DECISION OF SPECIAL BENCH IN THE CASE OF TOPMAN EXPORTS REPORTED IN 2009, TIOL 531. 3. THE ASSESSING OFFICER, WHILE COMPLETING THE SET ASIDE ASSESSMENT FOR BOTH THE YEARS, COMPUTED DEDUCTION U/S. 80HHC IN THE LIGHT O F DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. KALPATARU COLOURS AND CHEMICALS, MUMBAI, 328 ITR 451 ON THE GROUND THAT THE DECISION ON THE ISSUE HAS BEEN RENDERED BY HONBLE BOMBAY HIGH COURT IN FAVOUR OF THE REVENUE. 4. ON APPEAL, IT WAS PLEADED BEFORE THE CIT(A) THAT THE ASSESSING OFFICER HAD COMPUTED THE DEDUCTION U/S. 80HHC IGNORING THE DIRE CTIONS GIVEN BY ITAT ON THE BASIS 3686 & 3687/DEL./2011 2 OF DECISION OF SPECIAL BENCH IN THE CASE OF TOPMAN EXPORTS (SUPRA). THE LD. CIT(A), HOWEVER, HELD THAT THE DECISION OF ITAT, SPECIAL BE NCH, IN THE CASE OF TOPMAN EXPORTS (SUPRA) HAS BEEN REVERSED BY HONBLE BOMBAY HIGH CO URT IN THE CASE OF KALPATARU COLOURS & CHEMICALS (SUPRA) AND, THEREFORE, THE ASS ESSING OFFICER WAS JUSTIFIED IN COMPUTING THE DEDUCTION U/S. 80HHC IN VIEW OF THE D ECISION OF HONBLE BOMBAY HIGH COURT. 5. BEFORE US, LD. AR OF THE ASSESSEE SUBMITTED THAT THE ASSESSING OFFICER HAD NOT FOLLOWED THE DIRECTIONS OF ITAT IN THE CASE OF ASSE SSEE TO COMPUTE DEDUCTION U/S. 80HHC IN THE LIGHT OF DECISION OF SPECIAL BENCH IN THE CA SE OF TOPMAN EXPORTS (SUPRA). UNLESS THE ORDER PASSED BY THE ITAT DIRECTING THE ASSESSIN G OFFICER TO FOLLOW THE DECISION OF SPECIAL BENCH, IS RECALLED BY ITAT, THE DIRECTIONS OF ITAT ARE BINDING ON THE ASSESSING OFFICER. THEREFORE, THE ORDER PASSED BY THE ASSESSI NG OFFICER, CONTRARY TO THE DIRECTIONS OF ITAT, ARE BAD IN LAW. ON THE OTHER HAND, THE LD. CI T/D.R. SUBMITTED THAT THE DECISION OF SPECIAL BENCH IN THE CASE OF TOPMAN EXPORTS (SUPRA) HAS BEEN OVERRULED BY HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. KALPATARU COLOURS AND CHEMICALS(SUPRA). THEREFORE, THE LD. CIT(A) HAS RIGHTLY UPHELD THE OR DER OF THE ASSESSING OFFICER. 6. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. WE HAVE ALSO GONE THROUGH THE ORDER OF ITAT, DELHI BENCH B IN ASSESSEES OWN CASE DATED 30.10.2009. THE ITAT, DELHI BENCH B HAS RES TORED THE ISSUE TO THE FILE OF ASSESSING FOR RE-ADJUDICATION AFTER VERIFICATION OF THE FACTS IN THE LIGHT OF DECISION OF SPECIAL BENCH IN THE CASE OF TOPMAN EXPORTS (SUPRA) . IN THE CASES, WHERE THE ISSUE OF COMPUTATION OF DEDUCTION U/S. 80HHC WAS SET ASIDE W ITH THE DIRECTION TO COMPUTE THE DEDUCTION U/S. 80HHC AFTER VERIFICATION OF FACTS AN D FOLLOWING THE DECISION OF SPECIAL BENCH. THE ASSESSEES HAVE ADOPTED EITHER OF TWO COU RSES OF ACTION. IN FIRST CATEGORY, FALL THOSE ASSESSEES WHO DID NOT CHALLENGE THE DECISION OF ITAT BEFORE THE HIGH COURTS AND IN SECOND CATEGORY, ARE THOSE CASES WHERE THE DECISION OF ITAT WAS CHALLENGED BEFORE THE HONBLE HIGH COURTS. HONBLE DELHI HIGH COURT, IN T HE SECOND CATEGORY OF CASES, HAS BEEN SETTING ASIDE THE MATTER TO THE FILE OF ITAT W ITH THE DIRECTIONS TO DECIDE THE ISSUE ON MERITS IN THE LIGHT OF DECISION OF CIT VS. KALPATAR U COLOURS AND CHEMICALS (SUPRA). THERE IS NO DISPUTE THAT THE DECISION OF ITAT, SPECIAL BE NCH IN THE CASE OF TOPMAN EXPORTS HAS BEEN OVERRULED BY HONBLE BOMBAY HIGH COURT IN THE CASE OF KALPATARU COLOURS AND CHEMICALS (SUPRA). IN VIEW OF THESE FACTS, IN OUR C ONSIDERED OPINION, THE LD. CIT(A) IS JUSTIFIED IN UPHOLDING THE ORDER PASSED BY THE ASSE SSING OFFICER IN THE LIGHT OF DECISION OF 3686 & 3687/DEL./2011 3 CIT VS. KALPATARU COLOURS AND CHEMICALS(SUPRA). ACC ORDINGLY, WE DO NOT FIND ANY INFIRMITY IN THE ORDERS PASSED BY THE CIT(A) UPHOLD ING THE STAND OF THE ASSESSING OFFICER. 7. IN THE RESULT, THE APPEALS FILED BY THE ASSESSEE FOR BOTH THE YEARS ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30.09.2011. SD/- SD/- (RAJPAL YADAV) (K.D. RANJAN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE : 30 TH SEPTEMBER, 2011 *AKS/- COPY OR ORDER FORWARDED TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT CONCERNED 4. CIT(A) CONCERNED 5. D.R., ITAT BY ORDER 6. GUARD FILE ASSISTANT REGISTRAR