DCIT, Circle- I , Faridabad V. Indian Armour Systems P. Ltd., Palwal

ITA 3738/DEL/2018

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 8720 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 2 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-07-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 18-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIMA
• Assessee Lawyers: M K GUPTA
• Section: 271(1)(c); 143(3); 10B; 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH C NEW DLEHI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI K. NARASIMHA CHARY, JUDICIAL MEMBER ITA NO. 3738 & 3739/DEL/2018 ASSESSMENT YEAR: 2009-10 & 2010-11 DCIT, CIRCLE-1, VS. INDIAN ARMOUR SYSTEMS P. LTD ., FARIDABAD. UNIVERSAL LANE, 22 FT. ROAD, VILLAGE DUDHOLA, PO- BHAGOLA, PALWAL (HARYANA) PAN : AABCI5575Q (APPELLANT) (RESPONDENT) APPELLANT BY : MS. ANIMA, SR. DR RESPONDENT BY: SH. M.K. GUPTA, CA DATE OF HEARING: 28/07/2021 DATE OF ORDER : 28/07/2021 ORDER PER K. NARASIMHA CHARY, J.M. AGGRIEVED BY THE ORDERS DATED 14/03/2018 PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-FARIDABAD ('LD . CIT(A)') IN THE CASES OF INDIAN ARMOUR SYSTEM PVT. LTD. (THE ASSES SEE) FOR THE ASSESSMENT YEAR 2009-10 AND 2010-11, THE REVENUE F ILED THESE APPEALS, CHALLENGING THE DELETION OF PENALTIES U/S. 271(1)(C ) OF THE INCOME-TAX ACT, 1961 (THE ACT) OF RS.70,18,643/- AND RS.1,62,25,0 16/- RESPECTIVELY. 2. BRIEF FACTS, NECESSARY FOR DISPOSAL OF THESE APP EALS, ARE THAT BY ASSESSMENT ORDERS U/S. 143(3) OF THE ACT DATED 19.1 2.2011 AND 2 30.03.2013 FOR ASSESSMENT YEARS 2009-10 AND 2010-11 , THE LD. ASSESSING OFFICER MADE ADDITIONS OF RS.2,06,49,141/- AND RS.4 ,77,34,675/- RESPECTIVELY ON ACCOUNT OF DISALLOWANCE OF DEDUCTIO N U/S. 10B OF THE INCOME-TAX ACT, 1961 (THE ACT) ON THE PREMISE THA T THE ASSESSEE FAILED TO SATISFY THE PREREQUISITES FOR ALLOWABILITY OF DE DUCTION U/S. 10B OF THE ACT THAT THE UNDERTAKING SHOULD NOT BE FORMED BY TR ANSFER TO A NEW BUSINESS OF MACHINERY OR PLANT PREVIOUSLY USED FOR ANY PURPOSE; AND THAT THE INDUSTRIAL UNDERTAKING SHOULD NOT BE FORMED BY SPLITTING UP OR RECONSTRUCTION OF A BUSINESS ALREADY IN EXISTENCE. THESE ADDITIONS STOOD CONFIRMED IN APPEALS BEFORE THE FIRST APPELLATE AUT HORITY. BASED ON THESE ADDITIONS, THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS U/S. 271(1)(C) OF THE ACT AND HAVING RECEIVED THE ORDERS OF APPEALS, IMPOSED PENALTIES AGAINST THE ASSESSEE FOR BOTH THE YEARS T O THE TUNE OF RS.70,18,643/- AND RS.1,62,25,016/- FOR ASSESSMENT YEARS 2009-10 AND 2010-11 RESPECTIVELY. 3. AGGRIEVED BY SUCH PENALTY ORDERS, ASSESSEE PREFE RRED APPEALS BEFORE THE LD. CIT(A), WHO DELETED THE PENALTIES ON THE PREMISE THAT THE ADDITION SO MADE U/S. 10B OF THE ACT STOOD DELETED BY TRIBUNAL IN QUANTUM APPEAL NO. 808/DEL/2014 FOR A.Y. 2008-09 AN D 5647/DEL/2014 FOR A.Y. 2009-10 FILED BY ASSESSEE. LEARNED CIT(A) FURTHER RECORDED A FINDING THAT ONCE THE CLAIM OF THE ASSESSEE HAS BEE N ACCEPTED BY ITAT FOR THESE TWO ASSESSMENT YEARS, IT IS OBVIOUS THAT SAME IS ACCEPTABLE FOR THE SUBSEQUENT ASSESSMENT YEARS AS WELL. 4. HAVING GONE THROUGH THE RECORD IN THE LIGHT OF U NDISPUTED FACTS, AS NOTED ABOVE, WE FIND NO JUSTIFICATION TO INTERFERE WITH THE FINDINGS REACHED BY THE LEARNED CIT(A) IN THE IMPUGNED ORDER S. IT IS WORTHWHILE TO 3 NOTE THAT ONCE THE ADDITION, ON THE BASIS OF WHICH IMPUGNED PENALTY IS IMPOSED, IS DELETED BY ITAT IN QUANTUM APPEALS FOR ASSESSMENT YEARS 2008-09 AND 2009-10 HOLDING THE ASSESSEE ELIGIBLE F OR DEDUCTION U/S. 10B OF THE ACT, THE VERY BASIS OF IMPOSITION OF IMPUGNE D PENALTY STANDS COLLAPSED. THEREFORE, WE ARE OF THE CONSIDERED OPIN ION THAT THE IMPUGNED ORDERS DO NOT SUFFER ANY ILLEGALITY OR IRR EGULARITY WHILE DELETING THE PENALTIES IMPOSED BY ASSESSING OFFICER. ACCORDI NGLY, THE APPEALS OF THE REVENUE ARE FOUND DEVOID OF MERITS AND ARE DISM ISSED. 5. IN THE RESULT, THE APPEALS OF THE REVENUE ARE D ISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS THE 28 TH DAY OF JULY, 2021. SD/- SD/- ( N.K. BILLAIYA) (K. NARSIMHA CHARY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 28/07/2021 AKS