DCIT, New Delhi V. AR Loomtex India (P) Ltd., Delhi

ITA 3787/DEL/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 52575 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-08-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 23-08-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 06-08-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANUSHA KHURANA
• Keywords: Tax effect
• Section: 80IB; 80IA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : A : NEW DELHI BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.3787/DEL/2010 ASSESSMENT YEAR : 2004-05 DCIT, CIRCLE 2 (1), ROOM NO.398D, CR BUILDING, NEW DELHI. VS. AR LOOMTEX INDIA (P) LTD., (FORMERLY KNOWN AS AR LOOMTEX (INDIA) LTD.), MANGLAM PLACE, SECTOR-3, ROHINI, DELHI. PAN : AAACA6934E (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI MANU MONGA, ADVOCATE REVENUE BY : SMT. ANUSHA KHURANA, SR. DR ORDER PER I.P. BANSAL, JUDICIAL MEMBER THIS IS AN APPEAL FILED BY THE REVENUE. IT IS DIRECT ED AGAINST THE ORDER PASSED BY THE CIT (A) DATED 25 TH MAY, 2010 FOR ASSESSMENT YEAR 2004-05. THE GROUNDS OF APPEAL READ AS UNDER:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, THE ORDER OF THE LD. CIT (A) IS WRONG, PERVERSE, ILLE GAL AND AGAINST THE PROVISIONS OF LAW WHICH IS LIABLE TO BE SE T ASIDE. 2. THE LEARNED CIT (A) HAS ERRED IN LAW AND ON FACTS IN DIRECTING THE ASSESSING OFFICER TO INCLUDE RECEIPT OF JOB WORK A ND SALE OF SCRAPS IN THE ELIGIBLE PROFITS OF THE UNDERTAKING FOR TH E PURPOSE OF COMPUTATION OF DEDUCTION U/S 80IA OF THE IT ACT. HON BLE SUPREME COURT HAD OBSERVED IN THE CASE OF M/S LIBERTY INDIA LTD., 317 ITR 218 THAT IT IS NECESSARY TO PROVE THAT THE RE CEIPT GENERATED SHOULD BE OF FIRST DEGREE OF SPECIAL ACTIVITY , BUT NOT OF ANCILLARY AND INCIDENTAL ACTIVITY OF THE UNDERTAKING. M ERELY CREDITING CERTAIN SUM AS REVENUE RECEIPT CANNOT IPSO FA CTO BE ELIGIBLE FOR DEDUCTION U/S 80IA OF THE ACT. ITA NO.3787/DEL/2010 2 3. THE APPELLANT CRAVES LEAVE FOR RESERVING THE RIGHT TO AMEND, MODIFY, ALTER, ADD OR FOREGO ANY GROUND (S) OF APPEA L AT ANY TIME BEFORE OR DURING THE HEARING OF THIS APPEAL. 2. AT THE OUTSET, IT WAS POINTED OUT BY LD. AR THAT T HE TAX EFFECT IN THE PRESENT APPEAL IS ONLY A SUM OF ` 1,71,102/- AND H E HAS CALCULATED THE TAX EFFECT IN THE FOLLOWING MANNER:- MATTER IN APPEAL ALLOWANCE OF 80IB ON THE FOLLOWING MATTER IN APPEAL ALLOWANCE OF 80IB ON THE FOLLOWING MATTER IN APPEAL ALLOWANCE OF 80IB ON THE FOLLOWING MATTER IN APPEAL ALLOWANCE OF 80IB ON THE FOLLOWING INCOMES INCOMES INCOMES INCOMES AMOUNTS AMOUNTS AMOUNTS AMOUNTS JOB WORK 15,13,744 SALE OF SCRAP 76,055 TOTAL 15,89,799 DEDUCTION UNDER SECTION 80IB 4,76,940 TAX DUE ON ABOVE 1,66,929 ADD: SURCHARGE 4,173 TOTAL TAX IN DISPUTE 1,71,102 3. THE COPY OF TAX CALCULATION WAS ALSO GIVEN TO THE LEARNED DR. 4. IN THIS VIEW OF THE POSITION, AFTER HEARING BOTH T HE PARTIES, WE DISMISS THE APPEAL FILED BY THE REVENUE ON ACCOUNT OF LOW TAX EFFECT WHICH IS LESS THAN ` 2 LAC. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED ON ACCOUNT OF LOW TAX EFFECT. THE ORDER PRONOUNCED IN THE OPEN COURT ON 23.08.20 11. SD/- SD/- [B.C. MEENA] [I.P. BANSAL] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED, 23.08.2011. DK ITA NO.3787/DEL/2010 3 COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, DEPUTY REGISTRAR, ITAT, DELHI BENCHES