DCIT, Tiruppur V. Sri Vignesh Yarns Pvt Ltd., Tiruppur

ITA 45/CHNY/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 9459 (ITAT-CHENNAI)
• Duration Of Justice: 3 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-04-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 08-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P RADHAKRISHNAN
• Keywords: Reasonable cause
• Section: 143(3); 115JB

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , A B ENCH, CHENNAI . . . , . , % BEFORE SHRI N.R.S.GANESAN, JUDICIAL MEMBER AND SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ I.T.A.NO.45/MDS/2016 ( / ASSESSMENT YEAR: 2011-12) THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-2, 121, 60 FEET ROAD, TIRUPUR-641 602 VS M/S. SRI VIGNESH YARNS PVT.LTD 88,, F-17-C, KAMARAJ ROAD, TIRUPUR-641 604. PAN:AACCS4775P ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR. P.RADHAKRISHNAN, JCIT /RESPONDENT BY : NONE /DATE OF HEARING : 17 TH FEBRUARY, 2016 /DATE OF PRONOUNCEMENT : 22 ND APRIL, 2016 / O R D E R PER A. MOHAN ALANKAMONY, AM:- THIS APPEAL IS FILED BY THE REVENUE AGGRIEVED BY THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX(APP EALS)- 3, COIMBATORE DATED 25.09.2015 IN ITA NO.117/2014- 15 PASSED UNDER SECTION 143(3) OF THE ACT. 2. THE APPEAL FILED BY THE REVENUE WAS BARRED BY LIMITATION OF 13 DAYS. THE REVENUE HAS FILED AN AFF IDAVIT EXPLAINING THE REASON THAT DUE TO INTERVENING HOLID AYS THERE WAS A DELAY IN FILING THE APPEAL. IT WAS FURTHER SUBMITTED THAT THE DELAY IN FILING THE APPEAL WAS UNINTENTIONAL AN D THEREFORE 2 ITA NO.45 /MDS/2016 PRAYED FOR CONDONATION OF DELAY. CONSIDERING THE SUBMISSIONS OF THE REVENUE, WE ARE SATISFIED THAT T HERE WAS REASONABLE CAUSE FOR THE DELAY IN FILING THE APPEAL . THEREFORE IN THE INTEREST OF JUSTICE, WE HEREBY CONDONE THE D ELAY IN FILING THIS APPEAL AND ADMIT THE SAME FOR ADJUDICATION. 3. THOUGH THE REVENUE HAS RAISED ELABORATE GROUNDS , THE CRUX OF THE ISSUE IS THAT THE LEARNED COMMISSIO NER OF INCOME TAX (APPEALS) HAS ERRED IN DELETING THE ADDI TION OF ` 70,11,755/- MADE BY THE LEARNED ASSESSING OFFICER DISALLOWING THE CLAIM OF THE ASSESSEE UNDER SECTION 80IA OF THE ACT . 4. BRIEF FACTS ARE THAT THE ASSESSEE IS A COMPANY FILED ITS RETURN OF INCOME ON 30.09.2011 FOR THE ASSESSMENT Y EAR 2011-12 ADMITTING INCOME OF ` 37,34,302/- AND AGRICULTURAL INCOME OF ` 4,84,890/- UNDER NORMAL COMPUTATION AND BOOK PROFIT OF ` 3,61,18,968/- UNDER SECTION 115JB OF THE ACT. IN THE SCRUTINY ASSESSMENT PROCEEDINGS, THE LEARNED ASSESSING OFFICER DISALLOWED THE CLAIM OF DEDUCTION UNDER SECTION 80IA OF THE ACT MADE BY THE ASSESSEE BECAUS E THE ASSESSEE HAD TAKEN THE INITIAL ASSESSMENT YEAR AS T HE YEAR IN 3 ITA NO.45 /MDS/2016 WHICH IT HAD CLAIMED DEDUCTION UNDER SECTION 80IA O F THE ACT INSTEAD OF THE INITIAL ASSESSMENT YEAR IN WHICH THE ASSESSEE COMMENCE THE ELIGIBLE BUSINESS FOR COMPUTING THE PE RIOD OF DEDUCTION. THOUGH THE ISSUE WAS HELD IN FAVOUR OF THE ASSESSEE BY THE HONBLE JURISDICTIONAL HIGH COURT, THE LEARNED ASSESSING OFFICER OPINED THAT HE NEED NOT FOLLOW TH E SAME BECAUSE THE MATTER WAS PENDING BEFORE THE APEX COUR T BY WAY OF SLP. 5. ON APPEAL, THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS) FOLLOWING THE DECISION OF THE JURISDICTI ONAL HIGH COURT IN THE CASE OF SRI VELAYUTHASAMY SPINNING MIL LS REPORTED IN 231 ITR 368 ALLOWED THE APPEAL OF THE A SSESSEE BY OBSERVING AS UNDER:- 6. I HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE APPELLANT AND THE MATERIALS AVAILABLE ON RECORD. A PERUSAL OF THE ASSESSMENT ORDER ITSELF INDICATES TH AT THE ISSUE IS COVERED BY THE JURISDICTIONAL HIGH COURT I N THE CASE OF CIT VS. SRI VELAYUTHASAMY SPINNING MILLS REPORTED IN 231 ITR 368. THE ASSESSING OFFICER HAS ADDED THIS AMOUNT SINCE THE DEPARTMENT HAS FILED SL P BEFORE THE SUPREME COURT CHALLENGING THE ABOVE DECISIONS. 6.1 IN VIEW OF THE BINDING DECISION OF THE JURISDIC TIONAL HIGH COURT IN THE CASE OF CIT VS. SRI VELAYUTHASAMY SPINNING MILLS THE 80IA CLAIM OF THE ASSESSEE TO THE EXTENT OF RS.88,91,835/- IS ALLOWED. 4 ITA NO.45 /MDS/2016 6. BEFORE US, THE LEARNED DEPARTMENTAL REPRESENTATI VE ARGUED IN SUPPORT OF THE ORDER OF THE LEARNED ASSES SING OFFICER. NONE APPEARED ON BEHALF OF THE ASSESSEE AN D THERE WAS NO PETITION FOR ADJOURNMENT. SINCE THE ISSUE IN APPEAL IS SQUARELY COVERED, WE PROCEED TO DISPOSE OF THIS APP EAL AFTER HEARING LEARNED DEPARTMENTAL REPRESENTATIVE AND THE MATERIALS ON RECORD. 7. WE HAVE HEARD THE LEARNED DEPARTMENTAL REPRESENTATIVE AND CAREFULLY PERUSED THE MATERIAL O N RECORD. ON A PERUSAL OF THE ASSESSMENT ORDER, IT APPEARS TH AT THE LEARNED ASSESSING OFFICER WAS OF THE VIEW THAT SINC E THE REVENUE PREFERRED AN APPEAL AGAINST THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF SRI VELAYU DHASWAMY SPINNING MILLS PVT.LTD. CITED SUPRA BEFORE THE HON BLE SUPREME COURT, THE ISSUE HAS NOT BECOME FINAL. HOWE VER, WE FIND THAT THE LEARNED COMMISSIONER OF INCOME TAX (A PPEALS) BY FOLLOWING THE DECISION OF THE JURISDICTIONAL HIG H COURT IN THE CASE OF SRI VELAYUDHASWAMY SPINNING MILLS PVT.LTD. CITED SUPRA HAS RIGHTLY ALLOWED THE CLAIM OF THE ASSESSEE UNDER SECTION 80IA OF THE ACT. FURTHER, IT IS NOT THE CAS E OF THE 5 ITA NO.45 /MDS/2016 REVENUE THAT THE JUDGMENT OF THE HONBLE MADRAS HIG H COURT IN THE CASE VELAYUDHASWAMY SPINNING MILLS P. LTD (S URPA) IS STAYED BY THE HONBLE APEX COURT. IT IS PERTINENT TO MENTION THAT IN THE ABSENCE OF ANY STAY GRANTED BY THE HON BLE APEX COURT AGAINST THE OPERATION OF THE JUDGMENT OF THE HONBLE MADRAS HIGH COURT, ALL THE LOWER JUDICIARIES AS WEL L AS QUASI JUDICIAL AUTHORITIES ARE BOUND TO FOLLOW THE DECISI ON OF THE HONBLE JURISDICTIONAL HIGH COURT. SINCE THE LEARN ED COMMISSIONER OF INCOME TAX (APPEALS) HAS RIGHTLY F OLLOWED THE DECISION OF THE HONBLE JURISDICTIONAL MADRAS H IGH COURT(SUPRA) AND HELD THE ISSUE IN FAVOUR OF THE AS SESSEE, WE DO NOT FIND IT NECESSARY TO INTERFERE WITH THE ORD ERS OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS). THER EFORE WE HEREBY CONFIRM THE ORDER OF THE LEARNED COMMISSI ONER OF INCOME TAX (APPEALS). 8. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON THE 22 ND APRIL, 2016 SD/- SD/- ( . . . ) ( . ) (N.R.S.GANESAN) ( A.M OHAN ALANKAMONY ) # % / JUDICIAL MEMBER % / ACCOUNTANT MEMBER 6 ITA NO.45 /MDS/2016 # /CHENNAI, ( /DATED 22 ND APRIL, 2016 SOMU *+ ,+ /COPY TO: 1. APPELLANT 2. RESPONDENT 3. - () /CIT(A) 4. - /CIT 5. + 1 /DR 6. /GF