Appeal details
Counselvise Citation
[2018] 112 COUNSELVISE.COM (IT) 6028 (ITAT-MUMBAI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
1 year(s) 6 month(s) 14 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
31-12-2018
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
F
Assessment Year
2008-2009
Appeal Filed On
16-06-2017
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH F MUMBAI BEFORE SHRI C.N. PRASAD (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 4466/MUM/2017 ASSESSMENT YEAR: 2008 - 09 D.C.I.T., CENTRAL CIRCLE - 1(2), ROOM NO. 906, PRATISTHA BHAVAN, 10 TH F LOOR, OLD CGO BUILDING ANNEXE, MUMBAI - 400020. VS. M/S JWC LOGISTIC PARK PVT. LTD., PLOT NO 69 - 91, 1 NATIONAL HIGHWAY, PALASPE VILLAGE, PANVEL, DISTT. RAIGAD - 410206 PAN NO. AABCJ4231E APPELLANT RESPONDENT REVENUE BY : MR. RAJIV GUBGOTRA, DR ASSESSEE BY : MR. SATISH MODI , AR DATE OF HEARING : 24 /10/2018 DATE OF PRONOUNCEMENT : 31/12/2018 ORDER PER N.K. PRADHAN, AM THIS IS AN APPEAL FILED BY THE R EVENUE. THE RELEVANT ASSESSMENT YEAR IS 2008 - 09 . THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISS IONER OF INCOME TAX (APPEALS) - 47 , MUMBAI [IN SHORT CIT(A)] AND ARISES OUT OF THE ASSESSMENT COMPLETED U/S 143(3) OF THE INCOME TAX ACT 1961, (THE ACT). 2. THE GROUNDS OF APPEAL FILED BY THE ASSESSEE READ AS UNDER: I. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE CIT(A) ERRED IN ALLOWING CLAIM OF DEDUCTION U/S 80IA(4) ON ACCOUNT OF FDR INTEREST OF RS.45,086/ - , SCRAP SALES OF RS.2,67,591/ - AND EDI CHARGES M/S JWC LOGISTICS PARK ITA NO. 4466/MUM/2017 2 OF RS.1,27,315/ - WITHOUT APPRECIATING THE FACT THAT THESE INCOMES C ANNOT BE SAID TO BE DERIVED FROM THE BUSINESS ACTIVITY OF THE ASSESSE E OF RUNNING A CONTAINER FREIGHT STATION. II. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD . CI T(A) ERRED IN ALLOWING THE DEDUCTION OF RS. 3,12,60,53 1/ - U/S 80 IA(4) OF THE I T ACT 1961 ON THE PROFIT EARNED FROM THE OPERATION O F A INLAND CONTAINER DEPOT (I CD ) TREATING THAT AS AN INFRASTRUCTURE FACILITY BEING 'INLAND PO RT' WITHOUT APPRECIATING THAT C B DT'S CLARIFIC ATION ISSUED VIDE LETTER NO F. NO. 178/42/2010 - ITA - I DATED 06 . 01.2011 STATES CLEARLY THAT INLAND CONTAINER DEPOT(ICD) /CONTAINER FREIGHT STATION (CFS) ARE NOT PORTS LOCATED ON ANY INLAND WATERWAYS, RIVER, OR CANAL AND THEREFORE THAT CANNO T BE CLASSIFIED AS INLAND PORT FOR THE PURPOSE OF SECTION 80IA(4)(I) . III. ON THE FACTS AND CIRCU MSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) ERRED IN ALLOWING THE DEDUCTIO N OF RS.3,12,60,531/ - U/S 80IA(4) OF THE I T ACT 1961 ON THE PROFIT EARNED FROM THE OPERATI ON OF A INLAND CONTAINER DEPOT ( I CD) WITHOUT APPRECIATING THAT THE BENEFIT OF DEDUCTION UNDER THE SAID SECT ION IS NOT AT ALL INTENDED TO A NY INLAND CONTAINER DEPOT (ICD)/ CONTAINER FREIGHT STATION (CFS); AND EVEN OTHERWISE FOR BEING ELIGIBLE TO ANY SUCH DEDUC TION, THERE OUGHT TO BE AN AGREEMENT EXECUTED BETWEEN THE ASSESSEE COMPANY A ND THE GOVERNMENT FOR DEVELOPING, OPERATING AND MAINTAINING THE INFRASTRUCTURE FACILITY WHE REAS THERE IS NO SUCH AGREEMENT. IV. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, T HE LD. CIT(A ) ERRED IN ALLOWING THE DEDUCTION OF RS.3,12,60,531/ - U/S 80IA(4) OF THE I T ACT 1961 ON THE PROFIT EARNED FROM THE OPERATION OF A INLAND CONTAINER DEPOT (ICD) WITHOUT APPRECIATING THAT THE LICENCE WHICH WAS ISSUED BY DIRECTOR, INFRAST RUCTURE D IVISION, DEPARTMENT, OF COMMERCE DATED 24.11. 2004, DIRECTOR, CUSTOM CBEC DEPARTMENT OF REVENUE DATED 24. 03.2009 ARE WITH REFERENCE TO THE REQUEST MADE BY M/S JWC LOGISTICS PARK ITA NO. 4466/MUM/2017 3 THE ASSESSEE FOR CONSTRUCTING ICD / CFS AND THAT SUCH LICENCE CANNOT BE CONSIDERED TO BE A REQUIRED AG REEMENT BETWEEN THAT ASSESSEE COMPANY AND THE GOVERNM ENT AS PROVIDED IN SUB CLAUSE (B ) TO SECTION 80IA(4)(I) OF THE ACT 1961. 3. WE BEGIN WITH THE 2 ND , 3 RD AND 4 TH GROUND OF APPEAL TOGETHER, AS THEY ADDRESS A COMMON ISSUE. THE ASSESSEE - COMPANY WAS OPERATI NG CONTAINER FREIGHT STATION IN THE VICINITY OF JAWAHARLAL NEHRU PORT TRUST. A SEARCH AND SEIZURE ACTION U/S 132 WAS INITIATED IN THE CASE OF LALIT JOBANPUTRA GROUP ON 19.08.2011 BY THE DIT (INVESTIGATION), MUMBAI AFTER RECEIPT OF INFORMATION OF UNDISCLOSE D OVERSEAS HSBC ACCOUNT. SIMULTANEOUSLY, THE OFFICE OF THE ASSESSEE - COMPANY WAS COVERED U/S 133A OF THE ACT. THE ASSESSING OFFICER (AO) MADE THE ASSESSMENT U/S 143(3) R.W.S. 153C ON 28.03.2014 DETERMINING THE TOTAL INCOME OF THE ASSESSEE AT RS.3,10,09,960/ - AFTER MAKING CERTAIN ADDITIONS/DISALLOWANCES. THE ASSESSEE HAD CLAIMED A DEDUCTION OF RS3,12,60,531/ - U/S 80IA(4) OF THE ACT IN RESPECT OF ITS INLAND PORT/CONTAINER FREIGHT STATION SET UP AT PANVEL. THE AO REFERRED TO THE CBDT CIRCULAR NO. 772 DATED 23.12.1998, CBDT INSTRUCTION ISSUED VIDE F. NO. 178/42/2010 - ITA - 1 DATED 6.1.2011 AND OBSERVED THAT THE ASSESSEE - COMPANY HAD NOT FULFILLED AND SATISFIED THE CONDITIONS LAID DOWN IN THE ACT TO AVAIL THE BENEFIT OF DEDUCTION U/S 80IA(4), WHICH ARE AS UNDER: (I) THE ASSESSEE - COMPANY IS NOT AN INLAND PORT (INFRASTRUCTURE FACILITY) AS PER THE EXPLANATION TO SECTION 80IA(4) OF THE ACT, M/S JWC LOGISTICS PARK ITA NO. 4466/MUM/2017 4 (II) THE ASSESSEE - COMPANY HAS NOT ENTERED INTO AN AGREEMENT WITH THE CENTRAL GOVERNMENT/STATE GOVERNMENT/LOCAL AUTHORITY OR ANY OTHER STATUTORY BODY FOR DEVELOPING, OR OPERATING AND MAINTAINING OR DEVELOPING, OPERATING, MAINTAINING A NEW INFRASTRUCTURE FACILITY. STATING THAT THE ASSESSEE HAS NOT FULFILLED THE CONDITIONS LAID DOWN IN SECTION 80IA(4), THE AO DISALLOWED THE CLAIM OF DEDUCTION OF RS. 3,12,60,531 / - . 4. AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT(A). THE LD. CIT(A) RELIED ON THE CONSOLIDATED ORDER DATED 21.08.2014 OF THE ITAT, PUNE BENCH IN ITA NO. 1121 & 1122/PN/2013 FOR THE AYS 2008 - 09 & 2009 - 10 AND THE ORDER DATED 27.04.2016 OF THE ITAT, MUMBAI BENCH IN THE CASE OF THE ASSESSEE FOR AY 2010 - 11 (ITA NO. 5849/MUM/2014) AND HELD THAT THE CFS SET UP, OPERATED AND MAINTAINED BY THE ASSESSEE IN THE VICINITY OF JNPT IS AN INFRASTRUCTUR E FACILITY WITHIN THE MEANING OF SECTION 80IA(4) AND THE ASSESSEE FULFILLS THE PREREQUISITE CONDITIONS FOR CLAIMING DEDUCTION U/S 80IA(4) OF THE ACT. THUS THE LD. CIT(A) DIRECTED THE AO TO ALLOW THE APPROPRIATE AMOUNT OF DEDUCTION TO THE ASSESSEE U/S 80IA (4), WHILE GIVING EFFECT TO HIS ORDER. 5. BEFORE US, THE LD. DR SUPPORTS THE ORDER PASSED BY THE AO. ON THE OTHER HAND, THE LD. COUNSEL OF THE ASSESSEE RELIES ON THE ORDER OF THE HONBLE BOMBAY HIGH COURT IN ASSESSEES OWN CASE I.E. PR. CIT V. JWC LOGISTI CS PARK PVT. LTD . (ITA NO. 613 & 618 OF 2015) AND ORDER IN M/S TEMA EXCHANGERS MANUFACTURERS PVT. LTD. V. ACIT (ITA NO. 415 OF 2004). M/S JWC LOGISTICS PARK ITA NO. 4466/MUM/2017 5 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIALS ON RECORDS. WE FIND THAT THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY THE HONBLE BOMBAY HIGH COURT IN ASSESSEES OWN CASE. THE QUESTION BEFORE THE HONBLE HIGH COURT WAS THE FOLLOWING: WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE HONBLE INCOME TAX APPELLATE TRIBUNAL WAS JUSTIFIED IN ALLOWING THE CLAIM OF DEDUCTION U/S 80IA MADE BY THE ASSESSEE? THE HONBLE HIGH COURT HELD AS UNDER: 3. THE IMPUGNED ORDER OF THE TRIBUNAL DISMISSED THE REVENUE'S APPEAL BEFORE IT BY HOLDING THAT THE CONTAINER FREIGHT STATION (CFS) RUN BY THE RESPONDENT ASSESSEE IS ELIGIBLE FOR DEDUCTION UNDER SECTION 80IA OF THE ACT AS AN INFRASTRUCTURE FACILITY. THUS, UPHOLDIN G THE VIEW OF THE COMMISSIONER OF INCOME - TAX APPEALS (CIT (A)). THIS BY FOLLOWING THE DECISIONS OF THE SPECIAL BENCH OF THE TRIBUNAL IN M/S. ALL CARGO GLOBAL LOGISTICS LTD. VS. DCIT (ITA NO.5018 TO 5022 AND 5059) RENDERED ON 6TH JULY, 2012 AND THE DECISION OF THE REGULAR BENCH OF THE TRIBUNAL IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVA SHEVA) VS. ACIT (ITA NO. 7055/MUM/2011) DATED 31ST AUGUST, 2012. THE SUBMISSION OF THE REVENUE THAT AS APPEALS HAVE BEEN FILED AGAINST THE AFORESAID TWO DECISIO NS OF THE TRIBUNAL, BEFORE THIS COURT, THE REVENUE'S APPEAL BE ALLOWED, WAS NOT ACCEPTED BY THE TRIBUNAL. IN THE MEANTIME, THE ABOVE TWO TRIBUNAL DECISIONS IN CASE OF ALL CARGO GLOBAL LOGISTICS LTD. (SUPRA) AND CONTINENTAL WAREHOUSING CORPORATION (NHAVA SH EVA) (SUPRA) HAVE BEEN UPHELD BY THIS COURT IN COMMISSIONER OF INCOME TAX V. 1. CONTINENTAL WAREHOUSING CORPORATION (NHAVA SHEVA) LTD. AND ANR. [2015] 374 ITR 645 (BOM) WHILE DISMISSING THE REVENUE'S APPEAL. THIS ISSUE THEREFORE STANDS CONCLUDED IN FAVOUR OF THE RESPONDENT ASSESSEE. M/S JWC LOGISTICS PARK ITA NO. 4466/MUM/2017 6 6.1 FACTS BEING IDENTICAL, WE FOLLOW THE ABOVE DECISION OF THE HONBLE BOMBAY HIGH COURT AND UPHOLD THE ORDER OF THE LD. CIT(A). 7. HAVING EXAMINED THE RELEVANT DOCUMENTS AVAILABLE ON RECORD WE FIND THAT THE LD. CIT(A) HAS RI GHTLY ALLOWED THE CLAIM OF THE ASSESSEE OF DEDUCTION U/S 80IA(4) ON ACCOUNT OF FDR INTEREST OF RS.45,086/ - , SCRAP SALES OF RS.2,67,591/ - AND EDI CHARGES OF RS.1,27,315/ - . 8 . IN THE RESULT, THE APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 31/12/2018. SD/ - SD/ - (C.N. PRASAD) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED: 31/12/2018 RAHUL SHARMA, SR. P.S. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) - 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE . BY ORDER, //TRUE COPY// (SR. PRIVATE SECRETARY) ITAT, MUMBAI
