The ACIT,1(2), V. M/s Premier Industries (India) Ltd.,

ITA 452/IND/2007

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 3000 (ITAT-INDORE)
• Duration Of Justice: 2 year(s) 7 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-04-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 12-04-2010
• Assessment Year: 1994-1995
• Appeal Filed On: 17-08-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: APARNA KARAN
• Assessee Lawyers: M C MEHTA; HITESH CHIMNANI CAS

Judgement Text

PAGE 1 OF 4 - I.T.A.NO. 452/IND/2007 M/S. PERMIER INDUSTRIES (INDIA) LIMITED, INDORE. IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH : INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI V.K. GUPTA, ACCOUNTANT MEMBER PAN NO. : AABCP1890P I.T.A.NO. 452/IND/2007 A.Y. : 1994-95 ACIT, M/S. PREMIER INDUSTRIES (INDIA) LIMITED, 1(2), VS 167, CHETAK CENTRE, R.N. T. MARG, INDORE INDORE. APPELLANT RESPONDENT APPELLANT BY : SMT.APARNA KARAN, SR.DR RESPONDENT BY : SHRI M.C.MEHTA AND SHRI HITESH CHIMNANI, CAS DATE OF HEARING : 12.04.2010 O R D E R PER V.K. GUPTA, A.M. THIS APPEAL FILED BY THE REVENUE ARISES OUT OF ORDE R OF THE LD. CIT(A)-I, INDORE, DATED 30.5.2007, FOR THE ASSESSME NT YEAR 1994-95. 2. WE HAVE HEARD BOTH THE PARTIES AND HAVE ALSO PERUSE D THE MATERIAL AVAILABLE ON RECORD. 3. IN THIS APPEAL, THE REVENUE HAS RAISED FOLLOWING TW O GROUNDS :- PAGE 2 OF 4 - I.T.A.NO. 452/IND/2007 M/S. PERMIER INDUSTRIES (INDIA) LIMITED, INDORE. 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A)-I, INDORE, HAS ERRED IN DELETING THE ADDITIO N OF RS. 8,90,377/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF DISALLOWANCE OF LOSS ON FLUCTUATION OF RATE OF FORE IGN CURRENCY. 2. THE LD. CIT(A) ERRED IN DIRECTING THE A.O. TO ALLOW CARRIED FORWARD LOSSES WITHOUT APPRECIATING THE BACKGROUND OF LOSSES ASSESSED IN THE EARLIER YEARS. 4. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE IS ENGAG ED IN THE EXPORT OF SOYA PRODUCTS AND IN ONE OF THE YEARS, IT HAD RE CEIVED THE ADVANCE IN FOREIGN CURRENCY, WHICH WAS ORIGINALLY CONVERTED IN TO AN INDIAN RUPEE AT A PARTICULAR RATE. HOWEVER, AS PER THE SUBSEQUENT A CTION OF THE RBI, THE ASSESSEE WAS PUT INTO A SITUATION WHEREBY IT HAD TO SUPPLY ADDITIONAL QUANTITY OF SOYA DOC. IN THE ASSESSMENT YEAR 1993-9 4, THE ASSESSEE CLAIMED A DEDUCTION OF RS. 1,72,51,266/-. IN THE YE AR UNDER CONSIDERATION , THE A.O. FOUND THAT THE ASSESSEE HAD CLAIMED ADDI TIONAL AMOUNT OF RS. 8,90,377/- ON THE SAME ACCOUNT. SINCE THE A.O. FURT HER FOUND THAT IN THE ASSESSMENT YEAR 1994-95, THE ASSESSEE COMPANY AGREE D TO ADDITION OF RS.1,72,51,266/-, WHICH HAD BEEN CLAIMED BY IT IN T HE PROFIT AND LOSS ACCOUNT FOR THE REASON THAT THE DEDUCTION FOR THE S AME HAD BEEN ALLOWED IN THE ASSESSMENT YEAR 1993-94. THE ASSESSEE NARRAT ED THE FACTS AND PAGE 3 OF 4 - I.T.A.NO. 452/IND/2007 M/S. PERMIER INDUSTRIES (INDIA) LIMITED, INDORE. JUSTIFIED ITS CLAIM. THE A.O., HOWEVER, REJECTED TH E CLAIM OF LOSS MADE BY THE ASSESSEE COMPANY IN THE YEAR UNDER CONSIDERATIO N FOR THE REASON THAT THE ASSESSEE DID NOT PRODUCE THE REQUIRED EVIDENCES TO SEPARATE SUCH CLAIM. AGGRIEVED BY THIS, THE ASSESSEE CARRIED THE MATTER INTO APPEAL BEFORE THE LD. CIT(A), WHO ACCEPTED THE CLAIM OF TH E ASSESSEE FOR THE REASON THAT ONCE THE SUBSTANTIAL PART OF THE LOSS O F THE SAME TRANSACTION HAD BEEN ALLOWED IN EARLIER YEARS, THERE WAS NO VAL ID REASON AS TO THE BALANCE LOSS AT RS. 8,90,377/-, WHICH CRYSTALLIZED IN THE YEAR UNDER CONSIDERATION COULD NOT BE ALLOWED. ACCORDINGLY, H E REVERSED THE DECISION OF THE A.O. THE LD. CIT(A) ALSO DIRECTED T HE A.O. TO ALLOW BENEFIT OF UNABSORBED LOSSES AS A CONSEQUENCE OF AP PELLATE ORDER FOR ASSESSMENT YEAR 1993-94 AND FOR THE YEAR UNDER CONS IDERATION . AGGRIEVED BY THIS, THE REVENUE IS IN APPEAL BEFORE US. 5. THE LD. DR NARRATED THE FACTS AND PLACED RELIANCE O N THE ORDER OF THE AO. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OT HER HAND, PLACED STRONG RELIANCE ON THE ORDER OF THE LD. CIT(A). 6. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY BOTH THE SIDES, MATERIAL ON RECORD AND THE ORDERS OF THE AUTHORITIE S BELOW. 7. IT IS NOTED THAT IN THE ASSESSMENT YEAR UNDER CONSI DERATION AS PER THE NOTE 10 OF NOTES TO THE ACCOUNT, IT IS EVIDENT THAT THE TOTAL LOSS OF RS. 1,81,41,643/- HAS ARISEN ON THE BASIS OF ACTUAL EXP ORT OF DOC DUE TO PAGE 4 OF 4 - I.T.A.NO. 452/IND/2007 M/S. PERMIER INDUSTRIES (INDIA) LIMITED, INDORE. FLUCTUATION IN FOREIGN CURRENCY RATE. THE SUBSTANTI AL PART OF SUCH LOSS HAS BEEN ALLOWED BY THE TRIBUNAL IN ASSESSMENT YEAR 19 93-94 AND, THEREFORE, IN THE ABSENCE OF ANY CONTRARY MATERIAL ON RECORD, THE BALANCE LOSS, IN OUR OPINION, HAS RIGHTLY BEEN ALLOWED BY THE CIT(A). WE ARE FURTHER OF THE OPINION THAT CONSEQUENTLY DETERMINATION OF LOSS TO BE CARRIED FORWARD AND SET OFF OF THE SAME IS ALSO TO BE ALLOWED TO THE AS SESSEE. ACCORDINGLY, WE DISMISS BOTH THESE GROUNDS OF THE REVENUE. 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 16 TH APRIL, 2010. SD/- SD/- (JOGINDER SINGH) (V. K. GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 16 TH APRIL, 2010. CPU* 13154