Assistant Commissioner of Income-tax, V. Maharashtra State Warehousing Corpn. Ltd., Pune

ITA 452/PUN/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9444 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 1 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-05-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 13-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R G NAHAR
• Assessee Lawyers: SUHAS S KULKARNI
• Section: 143(3)

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO.452/PUN/2015 [ [ / ASSESSMENT YEAR : 2010-11 THE ASST.COMMISSIONER OF INCOME TAX, CIRCLE 14, 2 ND FLOOR, PMT COMMERCIAL COMPLEX, SWARGATE, PUNE 411 037. . / APPELLANT V/S MAHARASHTRA STATE WAREHOUSING CORPORATION LIMITED, 583/B, MARKET YARD, GULTEKDI, PUNE 411037. . / RESPONDENT / APPELLANT BY : SHRI R.G. NAHAR / RESPONDENT BY : SHRI SUHAS S. KULKARNI / ORDER PER ANIL CHATURVEDI, AM : THIS APPEAL FILED BY THE REVENUE IS EMANATING OUT OF THE ORDER OF COMMISSIONER OF INCOME TAX (A) 7, PUNE DT.16.01.2015 FOR THE ASSESSMENT YEAR 2010-11. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER :- / DATE OF HEARING : 17.04.2017 / DATE OF PRONOUNCEMENT: 17.05.2017 2 2.1 ASSESSEE IS A GOVERNMENT UNDERTAKING ENGAGED PRIMARILY IN THE BUSINESS OF PROVIDING WAREHOUSING FACILITY INCLUDING BONDED WAREHOUSES, HANDLING, FUMIGATION, TRANSPORT, RUNNING CONTAINER FREIGHT STATION. ASSESSEE FILED ITS RETURN OF INCOME FOR A.Y. 2010-11 ON 27.09.2010 DECLARING TOTAL INCOME OF RS.33,23,23,166/-. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER ASSESSMENT WAS FRAMED U/S 143(3) OF THE ACT VIDE ORDER DT.28.03.2013 DETERMINING THE TOTAL INCOME AT RS.34,96,66,240/-. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A), WHO VIDE ORDER DT.16.01.2015 GRANTED SUBSTANTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE ORDER OF LD. CIT(A), REVENUE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS : 1) WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE HON'BLE COMMISSIONER OF INCOME TAX (APPEAL) WAS JUSTIFIED IN HOLDING THAT THE ASSESSEE WAS ELIGIBLE FOR DEDUCTION CLAIMED UNDER SECTION 80IA(4) OF THE IT ACT CLAIMED DURING THE YEAR OF RS.79,43,510 ? 2) WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE HON'BLE COMMISSIONER OF INCOME TAX (APPEAL) WAS JUSTIFIED IN RELYING ON THE DECISION OF CONTAINER CORPORATION OF INDIA LTD VS ACIT (2012) 346 ITR 140 (DELHI) WHICH HAS BEEN MISPLACED? BEFORE US, LD. D.R. SUBMITTED THAT BOTH THE GROUNDS RAISED BY REVENUE ARE INTERCONNECTED AND IS WITH REFERENCE TO ALLOWING DEDUCTION U/S.80IA(4) OF THE ACT. 3. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, AO NOTICED THAT ASSESSEE HAD CLAIMED DEDUCTION OF RS.79,43,510/- U/S 80IA(4) OF THE ACT AMOUNTING TO RS.79,43,510/-. ASSESSEE WAS ASKED TO SUBSTANTIATE ITS CLAIM. AO NOTED THAT ASSESSEE DID NOT FURNISH THE NECESSARY DETAILS. IN VIEW OF THE INORDINATE DELAY, INCOMPLETE 3 EXPLANATION AND SINCE THE ASSESSMENTS WERE GETTING TIME BARRED, THE CLAIM OF DEDUCTION U/S 80IA(4) OF THE ACT WAS REJECTED BY AO. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A), WHO DECIDED THE ISSUE IN FAVOUR OF ASSESSEE BY HOLDING AS UNDER : 4. IN GROUND OF APPEAL NO.2 RAISED THE APPELLANT HAS CONTESTED THE DISALLOWANCE OF DEDUCTION CLAIM U/S 801A(4) OF THE ACT AMOUNTING TO RS. 79,43,510/-. DURING THE ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER FOR REASONS STATED IN PARA 3.3. OF THE ORDER REJECTED THE CLAIM OF DEDUCTION U/S 80IA(4) AMOUNTING TO RS. 79,43,510/-. 4.1 DURING THE APPELLATE PROCEEDINGS THE LD COUNSEL OF THE APPELLANT HAS SUBMITTED THAT SIMILAR ISSUE AROSE BEFORE CIT(APPEALS) DURING A.Y. 2009-10 AND THE COPY OF THE SAID ORDER HAS ALSO BEEN FILED DURING THE APPELLATE PROCEEDINGS. THE LD COUNSEL HAS STATED THAT THE SUBMISSION MADE FOR A.Y. 2009-10 HAS BEEN RELIED UPON AND IN ADDITION ALSO RELIED UPON THE DECISION OF THE DELHI HIGH COURT IN THE CASE OF CONTAINER CORPORATION OF INDIA LTD VS ACIT & CIT (2012) 346 ITR 140 FOR THE PROPOSITION THAT INLAND CONTAINER DEPOTS (ICDS) ARE INLAND PORTS UNDER EXPLANATION (D) OF SECTION 80IA(4). THE LD COUNSEL HAS FURTHER EXPLAINED THAT THE APPELLANT HAS CONTAINER FREIGHT STATIONS (CFSS) AT NAVA SHEVA, NAVI MUMBAI AND HAS FILED PAMPHLETS GIVING DETAILS RELATING TO THE FACILITIES AND FUNCTIONS SUCH AS WAREHOUSING PROVIDING CONNECTIVITY, HANDLING OF THE GOODS AND PROVIDING VEHICLES. THE APPELLANT HAS FURTHER WITH RESPECT TO ISSUE OF THE CONTAINER FREIGHT STATION BEING TREATED AS INFRASTRUCTURE FACILITY HAS RELIED UPON THE DECISION OF ITAT PUNE IN THE CASE OF JWC LOGISTIC PARK (P) LTD. 52 TAXMANN.COM 144, WHICH ALSO CONSIDERED THE SPECIAL BENCH DECISION OF MUMBAI ITAT OF ALL CARGO GLOBAL LOGISTICS LTD. VS DCIT, 23 TAXMANN.COM 103. THE 'APPELLANT HAS ALSO FILED COPIES OF THE DECISIONS RELIED UPON. 4.3 I HAVE CONSIDERED THE SUBMISSION MADE BY THE APPELLANT AND PERUSED MATERIAL ON RECORD. THE MATERIAL BROUGHT ON RECORD INDICATES THAT SIMILAR ISSUE AROSE DURING THE APPELLATE PROCEEDINGS FOR A.Y. 2009-10 BEFORE THE CIT (APPEALS)-I, PUNE WHEREIN THE DISALLOWANCE MADE BY THE ASSESSING OFFICER WAS UPHELD BY THE LD CIT (APPEALS). THE LD CIT (APPEALS)-I RELYING ON THE BOARD'S NOTIFICATION DATED 23.06.2000 WHICH CLARIFIED THAT A STRUCTURE WOULD BE INCLUDED IN THE DEFINITION 'PORT' FOR THE PURPOSES OF SECTION 801A OF THE ACT PROVIDED THE CONCERNED AUTHORITY HAD ISSUED A CERTIFICATE THAT THE SAID STRUCTURE FORMS PART OF THE PORT AND IN VIEW OF THE LETTER FROM JAWAHARLAL NEHRU PORT TRUST HELD THE APPELLANT TO BE NOT ENTITLED TO THE CLAIM MADE U/S 80IA(4) AND ACCORDINGLY 4 DISMISSED THE APPEAL. HOWEVER, IT IS SEEN THAT THE LD CIT(APPEALS)-1 DID NOT HAVE THE OCCASION TO EXAMINE THE ISSUE BASED UPON THE DECISIONS CITED BY THE APPELLANT AND THE SAME WERE ALSO NOT BROUGHT TO NOTICE. IT IS UNDISPUTED THAT THE APPELLANT HAS GOT CONTAINER FREIGHT STATION (CFS) SITUATED AT DRONAGIRI NODE, NAVA SHEVA, NAVI MUMBAI AND INFORMATION PAMPHLETS FILED SHOWS THE FACILITIES AND FUNCTIONS AND HIGHLIGHT THE ACTIVITY SUCH AS WAREHOUSING PROVIDING CONNECTIVITY HANDLING OF THE GOODS AND PROVIDING VEHICLES. THE LD CIT (APPEALS)-I WHILE UPHOLDING THE DISALLOWANCE MADE BY THE A.O. HAD RELIED UPON THE NOTIFICATION OF THE BOARD DATED 23.06.2000 WHEREBY IT HAD BEEN CLARIFIED THAT SUCH STRUCTURES WILL BE INCLUDED IN THE DEFINITION OF 'PORT' FOR THE PURPOSE OF SECTION 80LA WHERE THE CONCERNED PORT AUTHORITY ISSUED A CERTIFICATE THAT THE SAID STRUCTURE FORMED PART OF PORT, HOWEVER, THE SAME GOT DELETED W.E.F. 16.12.2005. THUS, AS PER LAW EXISTING BEFORE 01.04.2002 INFRASTRUCTURE FACILITY INCLUDED INLAND PORTS AND ANY OTHER PUBLIC FACILITY OF SIMILAR NATURE AS MAY BE NOTIFIED BY THE BOARD. BY NOTIFICATION DATED 01.09.1998, ICDS & CFSS WERE NOTIFIED AS INFRASTRUCTURE FACILITY PROVIDED THEY WERE ALSO NOTIFIED AS ICD / CFS UNDER SECTION 7(AA) OF CUSTOMS ACT, 1962. HOWEVER, W.E.F. 01.04.2002 POWER TO NOTIFY SUCH OTHER PUBLIC FACILITY WAS WITHDRAWN BUT IT WAS CLARIFIED THAT SUCH FACILITIES NOTIFIED PRIOR TO 31.03.2001 WOULD CONTINUE TO ENJOY THE BENEFIT, PROVIDED THE UNIT HAS COMMENCED ITS ACTIVITIES ON OR BEFORE 31.03.2001. FURTHER VIDE NOTIFICATION NO. 188 DATED 20.07.2006 NOTIFIED IN EXERCISE OF THE POWERS CONFERRED BY CLAUSE (D) OF THE EXPLANATION TO SECTION 36(1)(VIII) OF THE ACT, 1961 IT HAS CLARIFIED THAT ICD AND CFS ARE INFRASTRUCTURE FACILITY FOR THE PURPOSE OF SECTION 36(1)(VIII) OF THE ACT. 4. 4 THE APPELLANT STARTED ITS OWN INLAND CONTAINER DEPORT (ICD), CONTAINER FREIGHT STATION (CFS, STORAGE FACILITY, HANDLING BONDED WAREHOUSE ON THE LEASEHOLD LAND OF CIDCO, MAHARASHTRA LOCATED ABOUT 3 TO 4 KMS AWAY FROM THE BOUNDARY WALL OF JAWAHARLAL NEHRU PORT TRUST AND THE UNIT COMMENCED ITS ACTIVITIES IN DECEMBER 2004. THE AFORESAID UNIT IS ALSO NOTIFIED UNDER THE CUSTOMS ACT VIDE NOTIFICATION NO. 03/2005 DATED 04.02.2005 AS 'CUSTOMS AREA'. 4.5 THE EXPLANATION TO SUB-SECTION 4 OF SECTION 80IA OF THE ACT DEFINES THE TERM INFRASTRUCTURE FACILITY AND THE SAID EXPLANATION IS INSERTED BY THE FINANCE ACT 2001 W.E.F. 01.04.2002 REPLACING THE EARLIER EXPLANATION THEREBY AMENDING THE EXPLANATION TO SECTION 80IA(4), THE POWER OF THE CBDT TO NOTIFY THE OTHER PUBLIC FACILITY HAS BEEN WITHDRAWN. THUS THE CONDITION OF ISSUANCE OF CERTIFICATE BY THE CONCERNED PORT AUTHORITY EXISTED AS PER THE BOARD'S NOTIFICATION DATED 23.05.2000 WHICH WAS PRIOR TO THE AMENDMENT OF EXPLANATION TO SECTION 80IA(4). IN THE PRESENT CASE THUS THE AMENDED EXPLANATION IS APPLICABLE AND, THEREFORE, THE ICD /CFS FACILITIES CAN BE SAID TO BE PART OF PORT WITHIN THE ORDINARY AND POPULAR MEANING OF THE TERMS. IN THIS REGARD THE DECISION OF THE PUNE ITAT IN THE CASE OF ACIT VS JWC LOGISTIC PARK PVT. LTD. (CITED SUPRA) AND ALSO RELIED UPON BY THE APPELLANT WHEREIN WITH RESPECT TO THE ISSUE OF THE CONTAINER FREIGHT 5 STATION BEING TREATED AS INFRASTRUCTURE FACILITY HAS BEEN DEALT WITH BY THE TRIBUNAL WHICH HELD THAT INLAND CONTAINER DEPORT OPERATED BY COMPANY IS AN 'INLAND PORT' WHICH IS ONE OF THE INFRASTRUCTURE FACILITY FOR THE PURPOSE OF SECTION 80IA. THE TRIBUNAL WHILE DECIDING THE ISSUE ALSO TOOK INTO CONSIDERATION THE FOLLOWING DECISION OF THE COURTS. 1. CONTAINER CORPORATION OF INDIA LTD VS ACIT (2012) 346 ITR 140 (DEL) 2. ALL CARGO GLOBAL LOGISTIC LTD VS DCIT (2012) 18 ITR (TRIB) 106 (MUM)(SB) THE HON'BLE TRIBUNAL HAS HELD AS UNDER: '7. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH SIDES, PERUSED THE ORDERS OF THE ASSESSING OFFICER AND THE COMMISSIONER OF INCOME-TAX (APPEALS) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECISIONS CITED BEFORE US. FROM THE STATEMENT OF FACTS FILED BY THE REVENUE, WE FIND THE ONLY GRIEVANCE OF THE REVENUE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) IS THAT THE ORDER RELIED ON BY THE COMMISSIONER OF INCOME-TAX (APPEALS) IN THE CASE OF CONTINENTAL WAREHOUSING CORPN. (NHAVA SEVA) LTD. (SUPRA) HAS BEEN CHALLENGED BY THE REVENUE BEFORE THE HON'BLE HIGH COURT AND THE SAME IS PENDING. THE LEARNED DEPARTMENTAL REPRESENTATIVE FAIRLY CONCEDED THAT THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE MUMBAI BENCH OF THE TRIBUNAL AND TO KEEP THE MATTER ALIVE THE REVENUE HAS FILED THIS APPEAL SINCE THE DECISION OF THE TRIBUNAL IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVA SEVA) LTD (SUPRA) HAS BEEN CHALLENGED BY THE REVENUE BEFORE THE HON'BLE HIGH COURT 8. LEARNED COUNSEL FOR THE ASSESSEE FILED THE DECISION OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF CONTAINER CORPN. OF INDIA LTD V. ASSTS. CIT [20121 346 ITR 140 (DELHI) AND SUBMITTED THAT THE HON'BLE HIGH COURT IN THE ABOVE DECISION HAS HELD THAT THE INCOME OF ICDS IS ELIGIBLE FOR DEDUCTION UNDER SECTION 80-IA(4)(I) OF THE INCOME-TAX ACT. HE ALSO RELIED ON THE DECISION OF THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF UNITED LINER AGENCIES OF INDIA (P.) LTD. V. J1 CIT [IT APPEAL NO. 273 (MUM.) OF 2013, DATED 28-6-2013] FOR THE ASSESSMENT YEARS 2006-07 AND 2009-10 RESPECTIVELY. HE SUBMITTED THAT SINCE THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY VARIOUS DECISIONS OF THE TRIBUNAL AND THE HON'BLE DELHI HIGH COURT, THEREFORE, THE GROUND RAISED BY THE REVENUE SHOULD BE DISMISSED. SINCE THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) WHILE ALLOWING THE CLAIM OF DEDUCTION UNDER SECTION 80-IA(4) HAS FOLLOWED THE DECISION OF THE TRIBUNAL, THEREFORE, MERELY BECAUSE THE REVENUE HAS CHALLENGED THE DECISION OF THE TRIBUNAL BEFORE THE HON'BLE HIGH COURT, THE SAME IN OUR OPINION CANNOT BE A GROUND TO TAKE A CONTRARY DECISION THAN THE VIEW TAKEN BY THE TRIBUNAL. IN THIS VIEW OF THE MATTER, WE UPHOLD THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) AND THE GROUND RAISED BY THE REVENUE IS DISMISSED. 6 4.6 IN VIEW OF THE FACTS AND RATIO OF THE DECISION CITED SUPRA GROUND OF APPEAL NO. 4,RAISED BY THE APPELLANT IS ALLOWED. 4. BEFORE US, LD.D.R. SUPPORTED THE ORDER OF AO. LD.A.R. ON THE OTHER HAND REITERATED THE SUBMISSIONS MADE BEFORE THE AO AND LD. CIT(A) AND FURTHER SUBMITTED THAT IDENTICAL ISSUE AROSE IN ASSESSEES OWN CASE IN A.Y. 2009-10 AND THE ISSUE WAS DECIDED BY THE CO-ORDINATE BENCH OF THE TRIBUNAL IN ITA NO.820/PN/2013 ORDER DT.09.05.2016 IN FAVOUR OF THE ASSESSEE. HE PLACED ON RECORD THE COPY OF THE AFORESAID DECISION. HE THEREFORE SUBMITTED THAT IN VIEW OF THE AFORESAID DECISION OF THE CO-ORDINATE BENCH OF THE TRIBUNAL, THE GROUND OF REVENUE NEEDS TO BE DISMISSED. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS WITH RESPECT TO DEDUCTION U/S 80IA(4) OF THE ACT. WE FIND THAT IDENTICAL ISSUE AROSE BEFORE THE CO-ORDINATE BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE IN A.Y. 2009-10 AND THE ISSUE WAS DECIDED BY CO-ORDINATE BENCH OF THE TRIBUNAL BY OBSERVING AS UNDER : 13. THE GROUND NO. 2 IN THE APPEAL OF THE ASSESSEE FOR ASSESSMENT YEAR 2009-10 RELATES TO DISALLOWANCE OF DEDUCTION 4,50,17,204/- U/S. 80IA(4) OF THE ACT. THE ASSESSEE HAS SET UP INLAND CONTAINER DEPOT (ICD) AND CONTAINER FREIGHT STATION (CFS) FOR HANDLING BONDED WAREHOUSING FACILITIES ON LEASEHOLD LAND OF SIDCO. THE ICD ESTABLISHED BY THE ASSESSEE IS LOCATED AT ABOUT 3-4 KMS. AWAY FROM THE BOUNDARY WALL OF JAWAHARLAL NEHRU PORT TRUST AND THE UNIT COMMENCED ITS ACTIVITIES IN DECEMBER, 2004. THE UNIT IS SAID TO BE MODIFIED UNDER CUSTOMS ACT AS CUSTOMS AREA FOR THE PURPOSE OF STORAGE, STUFFING, DESTUFFING AND CLEARANCE OF EXPORT AND IMPORT. THE ASSESSEE CLAIMED DEDUCTION U/S. 80IA(4) IN VIEW OF BOARDS NOTIFICATION NO. F.NO.205/17/2000/ITA-2 DATED 23-06-2000. THE ASSESSING OFFICER DENIED THE CLAIM OF THE ASSESSEE U/S. 80IA(4) ON THE GROUND THAT CBDT CIRCULAR DATED 23-06- 2000 (SUPRA) HAS BEEN WITHDRAWN W.E.F. 16-12-2005 AND THE BOARD PORT TRUST HAS STATED THAT THE AREA FROM WHERE ASSESSEE IS OPERATING DOES NOT FORM PART OF THE PORT. IN FIRST APPEAL THE COMMISSIONER OF INCOME TAX (APPEALS) UPHELD THE FINDINGS OF ASSESSING OFFICER AND DENIED THE BENEFIT OF DEDUCTION U/S. 80IA(4) TO THE ASSESSEE. 7 14. THE LD. AR OF THE ASSESSEE SUBMITTED THAT THE CASE OF THE ASSESSEE IS SQUARELY COVERED BY THE DECISION OF CO-ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF ACIT VS. JWC LOGISTICS PARK PVT. LTD. (SUPRA). IN THE SAID CASE THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF RUNNING CONTAINER YARD, INLAND CONTAINER DEPOT (ICD), CONTAINER FREIGHT STATION (CFS), BONDED WAREHOUSE ETC. THE ICD/CFS OF THE ASSESSEE COMPANY STARTED ITS OPERATIONS IN YEAR 2004. THE ASSESSEE CLAIMED DEDUCTION U/S. 80IA(4) IN RESPECT OF ICD/CFS FACILITIES SET UP BY THE ASSESSEE. THE ASSESSING OFFICER REJECTED THE CLAIM OF THE ASSESSEE ON THE GROUND THAT THE ASSESSEE DID NOT FULFILL THE REQUIRED CONDITIONS AS PRESCRIBED FOR CLAIMING DEDUCTION U/S. 80IA(4) OF THE ACT. THE ASSESSING OFFICER FURTHER OBSERVED THAT THE ASSESSEE HAS NOT BEEN ABLE TO SHOW ANY AGREEMENT WITH THE CENTRAL GOVT./STATE GOVT./LOCAL AUTHORITY OR ANY OTHER STATUTORY BODY FOR DEVELOPING OR DEVELOPING, OPERATING AND MAINTAINING A NEW INFRASTRUCTURE FACILITY. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY. THE COMMISSIONER OF INCOME TAX (APPEALS) BY FOLLOWING THE DECISION OF THE MUMBAI SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF M/S. ALL CARGO GLOBAL LOGISTICS LTD. VS. DCIT IN ITA NOS. 5018 TO 5022 & 5059 FOR ASSESSMENT YEARS 2004-05 TO 2009- 10 DECIDED ON 06-07-2012 AND THE DECISION OF THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVA SHEVA) VS. ACIT IN ITA NO. 7055/MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 DECIDED ON 31- 08-2012 ALLOWED THE CLAIM OF THE ASSESSEE. AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) THE DEPARTMENT FILED APPEAL BEFORE THE TRIBUNAL. THE GROUND BEFORE THE TRIBUNAL FOR ADJUDICATION WAS : 2. THE ONLY EFFECTIVE GROUND RAISED BY THE REVENUE READS AS UNDER : WHETHER THE CIT(A)-I, THANE IS RIGHT IN LAW IN HOLDING THAT THE ASSESSEE IS ENTITLED TO DEDUCTION U/S. 80IA OF THE INCOME TAX ACT, 1961 EVEN THOUGH ACTIVITIES UNDERTAKEN BY THE ASSESSEE DO NOT FALL WITHIN CLAUSE (D) OF THE EXPLANATION TO 80IA(4) DEFINING THE TERM INFRASTRUCTURE FACILITIES? THE TRIBUNAL DISMISSED THE APPEAL OF THE DEPARTMENT BY HOLDING AS UNDER: 4. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE ASSESSING OFFICER AND THE CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECISIONS CITED BEFORE US. FROM THE STATEMENT OF FACTS FILED BY THE REVENUE, WE FIND THE ONLY GRIEVANCE OF THE REVENUE AGAINST THE ORDER OF THE CIT(A) IS THAT THE ORDER RELIED ON BY THE CIT(A) IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVE SHEVA) LTD. (SUPRA) HAS BEEN CHALLENGED BY THE REVENUE BEFORE THE HONBLE HIGH COURT AND THE SAME IS PENDING. THE LD. DEPARTMENTAL REPRESENTATIVE FAIRLY CONCEDED THAT THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE MUMBAI BENCH OF THE TRIBUNAL AND TO KEEP THE MATTER ALIVE THE REVENUE HAS FILED THIS APPEAL SINCE THE DECISION OF THE TRIBUNAL IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVE SHEVA) LTD. (SUPRA) HAS BEEN CHALLENGED BY THE REVENUE BEFORE THE HONBLE HIGH COURT. 4.1 THE LD. COUNSEL FOR THE ASSESSEE FILED THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CONTAINER CORPORATION OF INDIA LTD. VS. ACIT REPORTED IN 346 ITR 140 AND SUBMITTED THAT THE HONBLE HIGH COURT IN THE ABOVE DECISION HAS HELD THAT THE INCOME OF ICDS IS ELIGIBLE FOR DEDUCTION U/S.80IA(4)(I) OF THE I.T. ACT. HE ALSO 8 RELIED ON THE DECISION OF THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF UNITED LINER AGENCIES OF INDIA (PVT.) LTD. VS. JCIT AND VICE VERSA ORDER DATED 28-06-2013 FOR A.YRS 2006-07 AND 2009-10 RESPECTIVELY. HE SUBMITTED THAT SINCE THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY VARIOUS DECISIONS OF THE TRIBUNAL AND THE HONBLE DELHI HIGH COURT, THEREFORE, THE GROUND RAISED BY THE REVENUE SHOULD BE DISMISSED. SINCE THE LD.CIT(A) WHILE ALLOWING THE CLAIM OF DEDUCTION U/S.80IA(4) HAS FOLLOWED THE DECISION OF THE TRIBUNAL, THEREFORE, MERELY BECAUSE THE REVENUE HAS CHALLENGED THE DECISION OF THE TRIBUNAL BEFORE THE HONBLE HIGH COURT, THE SAME IN OUR OPINION CANNOT BE A GROUND TO TAKE A CONTRARY DECISION THAN THE VIEW TAKEN BY THE TRIBUNAL CITED (SUPRA). IN THIS VIEW OF THE MATTER, WE UPHOLD THE ORDER OF THE CIT(A) AND THE GROUND RAISED BY THE REVENUE IS DISMISSED. 15. WE FIND THAT THE FACTS OF THE CASE OF THE ASSESSEE IS SIMILAR TO THAT OF THE CASE DECIDED BY THE CO-ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF ACIT VS. JWC LOGISTICS PARK PVT. LTD. (SUPRA). WE OBSERVE THAT THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. CONTINENTAL WAREHOUSING CORPORATION (SUPRA) HAS UPHELD THE ORDER OF TRIBUNAL. THE HON'BLE COURT AFTER CONSIDERING THE PROVISIONS OF SECTION 80IA(4) OBSERVED : 39. ..WE ARE CONCERNED WITH SUB-SECTION (4) AND AS IT READ AT THE RELEVANT TIME. IT SAYS THAT THIS SECTION APPLIES TO ANY ENTERPRISE CARRYING ON THE BUSINESS OF DEVELOPING OR OPERATING AND MAINTAINING ANY INFRASTRUCTURE FACILITY WHICH FULFILLS ALL THE CONDITIONS, NAMELY, IT IS OWNED BY A COMPANY REGISTERED IN INDIA OR BY A CONSORTIUM OF SUCH COMPANIES OR BY AN AUTHORITY OR A BOARD OR A CORPORATION OR ANY OTHER BODY ESTABLISHED OR CONSTITUTED UNDER ANY CENTRAL OR STATE ACT, IT HAS ENTERED INTO AN AGREEMENT WITH THE CENTRAL GOVERNMENT OR A LOCAL AUTHORITY OR ANY OTHER STATUTORY BODY FOR DEVELOPING OR OPERATING AND MAINTAINING OR DEVELOPING, OPERATING AND MAINTAINING A NEW INFRASTRUCTURE FACILITY AND IT HAS STARTED OR STARTS OPERATING AND MAINTAINING THE INFRASTRUCTURE FACILITY ON OR AFTER 1ST DAY OF APRIL, 1995. THE EXPLANATION DEFINES THE INFRASTRUCTURE FACILITY TO MEAN, INTER ALIA, A PORT, AIRPORT, INLAND WATERWAY, INLAND PORT OR NAVIGATIONAL CHANNEL IN THE SEA. THE WORD 'INLAND PORT' WAS ALWAYS THERE IN CLAUSE (D). WHAT WAS THERE PRIOR TO ITS SUBSTITUTION BY FINANCE ACT OF 2007 WITH EFFECT FROM 1ST APRIL, 2008, WERE THE WORDS 'OR INLAND PORT'. NOW THE WORD 'OR' IS DELETED, BUT THE WORDS ARE 'INLAND PORT OR NAVIGATIONAL CHANNEL IN THE SEA'. THUS, AN 'INLAND PORT' WAS ALWAYS WITHIN THE CONTEMPLATION OF THE LEGISLATURE AND IT IS TREATED SPECIFICALLY AS A INFRASTRUCTURAL FACILITY. THEREFORE, TO THAT EXTENT MR. DASTUR IS RIGHT IN HIS SUBMISSION. THE HON'BLE COURT FURTHER AFTER CONSIDERING THE DECISION OF HON'BLE DELHI HIGH COURT IN THE CASE OF CONTAINER CORPORATION OF INDIA LTD. VS. ASSTT. COMMISSIONER OF INCOME TAX REPORTED AS 346 ITR 140 (DELHI) CONCLUDED AS UNDER : 46. WE HAVE FOUND THAT THERE IS A SPECIFIC REFERENCE MADE BY THE DELHI HIGH COURT TO THE COMMUNICATION DATED 24TH APRIL, 2007, FROM THE GOVERNMENT OF INDIA, MINISTRY OF FINANCE, DEPARTMENT OF REVENUE. THESE ARE THEN CLASSIFIED AS INLAND PORTS AND CATEGORISED ACCORDINGLY. THERE IS A FURTHER COMMUNICATION FROM THE MINISTRY OF COMMERCE AND INDUSTRY AS WELL. WE DO NOT FIND THAT A VIEW DIFFERENT THAN THE ONE TAKEN BY THE DELHI HIGH COURT IS POSSIBLE. BEARING IN MIND THE FACILITIES THAT ARE EXTENDED AND FOR PURPOSES OF 9 LOADING, UNLOADING, STORAGE AND WAREHOUSING OF THE GOODS THAT THE FACILITY IS A INFRASTRUCTURE FACILITY. THAT IT HAS EASY ACCESSIBILITY TO THE PORT AND PARTICULARLY THE SEA-PORT GIVES IT CERTAIN ADVANTAGES AND BENEFITS AND WHICH CLEARLY ACCRUE TO THOSE USING THE PORT FOR IMPORT AND EXPORT OF CARGO. FURTHER, THE LOCATION THEREOF IS ALSO A RELEVANT FACTOR AS NOTED. IN SUCH CIRCUMSTANCES, THE RELIANCE BY THE SPECIAL BENCH AND EQUALLY BY THE BENCH OF THE TRIBUNAL IN THE IMPUGNED ORDERS ON THE DIVISION BENCH JUDGMENT OF THE DELHI HIGH COURT IS THUS WELL PLACED. 47. WE DO NOT FIND THAT ANYTHING OTHER AND FURTHER THAN THIS MATERIAL IS RELIED. HOWEVER, EVEN THE HIGH COURT OF JUDICATURE AT MADRAS HAS REFERRED IN ITS DIVISION BENCH DECISION TO THE VIEW TAKEN BY THE DELHI HIGH COURT. THE DIVISION BENCH IN PARAGRAPHS 10 AND 12 OF ITS JUDGMENT EXTENSIVELY REFERRED TO THE TRIBUNAL'S CONCLUSIONS. IT ALSO REFERRED TO THE SPECIAL BENCH DECISION OF THE TRIBUNAL. THUS, WHEN THE PROPOSAL TO SET UP A CFS HAS BEEN ACCEPTED BY THE GOVERNMENT, THERE IS NO REQUIREMENT OF EITHER A SPECIFIC AGREEMENT AS CONTENDED BY MR. SURESH KUMAR. NOR CAN IT BE SAID THAT BY VIRTUE OF ANY CERTIFICATION OF THE JNPT AND ITS SUBSEQUENT WITHDRAWAL THE POSITION UNDERGOES ANY CHANGE. ONCE THE FACILITY IS NOTHING BUT A INFRASTRUCTURAL FACILITY SET UP AND WITHIN THE PRECINCTS OF THE PORT, THEN, CONSIDERING AND EVEN OTHERWISE HAVING CONSIDERED ITS PROXIMITY TO THE SEA PORT AND ITS ACTIVITIES THAT WE HAVE NO DOUBT AND IT CAN BE SAFELY CONCLUDED THAT THE DEDUCTION ADMISSIBLE UNDER SUB-SECTION (4) OF SECTION 80-IA CAN BE CLAIMED BY BOTH THE ICDS AND CFSS. 16. THE HON'BLE MADRAS HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. A.L. LOGISTICS (P.) LTD. (SUPRA) HAS HELD THAT CFS IS PART OF INLAND PORT AND THEREFORE, IS AN INFRASTRUCTURE FACILITY AS DEFINED IN EXPLANATION TO SECTION 80IA(4)(I) OF THE ACT. 17. IN VIEW OF THE VARIOUS DECISIONS DISCUSSED ABOVE AND THE FACTS OF THE INSTANT CASE WE ACCEPT GROUND NO. 2 RAISED IN THE APPEAL OF THE ASSESSEE FOR ASSESSMENT YEAR 2009-10. THUS, WE HOLD THAT THE ASSESSEE IS ELIGIBLE TO CLAIM DEDUCTION U/S. 80IA(4) IN RESPECT OF THE ICD/CFS SET UP BY THE ASSESSEE. 6. BEFORE US, REVENUE HAS NOT PLACED ANY MATERIAL TO DEMONSTRATE THAT THE DECISION OF THE COORDINATE BENCH OF TRIBUNAL IN ASSESSEES OWN CASE FOR A.Y. 2009-10 HAS BEEN SET ASIDE BY HIGHER JUDICIAL FORUM NOR HAS PLACED ANY CONTRARY BINDING DECISION NOR HAS POINTED OUT ANY DISTINGUISHING FEATURE IN THE FACTS OF THE YEAR UNDER CONSIDERATION AND THAT OF A.Y. 2009-10. IN VIEW OF THE AFORESAID FACTS AND FOLLOWING THE REASONING OF THE COORDINATE BENCH IN ASSESSEES OWN CASE IN A.Y. 2009-10, WE FIND NO REASON TO 10 INTERFERE WITH THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) AND THUS THE GROUNDS OF REVENUE ARE DISMISSED. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON 17 TH DAY OF MAY, 2017. SD/- SD/- ( SUSHMA CHOWLA ) ( ANIL CHATURVEDI ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER PUNE; DATED : 17 TH MAY, 2017. YAMINI / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. 4. 5. 6. CIT(A)-7, PUNE. CIT-6, PUNE. , , / DR, ITAT, A PUNE; [ / GUARD FILE. / BY ORDER, // //// // TRUE COP // /// TRUE // //COPY // TRUE COPY // //// // // / ASSISTANT REGISTRAR, , / ITAT, PUNE.