M/s Bengal Tea & Fabrics Ltd., Kolkata V. DCIT, Circle -4, Kolkata, Kolkata

ITA 467/KOL/2012

• Counselvise Citation: 46723514 RSA 2012
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-07-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2008-2009
• Appeal Filed On: 28-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: L K S DEHIYA
• Keywords: Depreciation; Unabsorbed depreciation
• Section: 263; 143(3)

Judgement Text

I.T.A. NO.:467/ KOL. / 2012 ASSESSMENT YEAR : 2008-09 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA C BENCH, KOLKATA BEFORE SHRI PRAMOD KUMAR (ACCOUNTANT MEMBER), AND SHRI MAHAVIR SINGH (JUDICIAL MEMBER) I.T.A. NO.: 467/ KOL. / 2012 ASSESSMENT YEAR : 2008-09 M/S. BENGAL TEA & FABRICS LIMITED, . .APPELLANT C/O. SALARPURIA JAJODIA & CO., 7, CHITTARANJAN AVENUE, KOLKATA-700 072 [PAN :AABCB 1006 D] -VS.- DEPUTY COMMISSIONER OF INCOME TAX.....RESPO NDENT, CIRCLE-4, KOLKATA, AAYAKAR BHAWAN, P-7, CHOWRINGHEE SQUARE, KOLKATA-700 069 APPEARANCES BY: NONE, FOR THE APPELLANT SHRI L.K.S. DEHIYA, CIT(D.R.), FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : JULY 26, 2012 DATE OF PRONOUNCING THE ORDER : JULY 26, 2012 O R D E R PER PRAMOD KUMAR: 1. BY WAY OF THIS APPEAL, THE ASSESSEE-APPELLANT HA S CHALLENGED CORRECTNESS OF LEARNED COMMISSIONERS ORDER DATED 6 TH MARCH, 2012 PASSED UNDER SECTION 263 R.W.S. 143(3) OF THE INCOM E TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2008-09. 2. THE SHORT ISSUE ON WHICH IMPUGNED REVISION ORDER IS PASSED IS AS FOLLOWS :- I.T.A. NO.:467/ KOL. / 2012 ASSESSMENT YEAR : 2008-09 PAGE 2 OF 4 VIDE FINANCE ACT NO. 2 OF 1996, THE LAW RELATING T O UNABSORBED DEPRECIATION WAS AMENDED W.E.F. THE ASSE SSMENT YEAR 1997-98. AS PER THE AMENDED PROVISIONS, THE UNABSORBED DEPRECIATION COULD BE SET OFF AGAINST TH E PROFITS AND GAINS OF THE BUSINESS OR PROFESSIONS OR ANY OTH ER INCOME OF THE ASSESSMENT YEAR 1997-98 OR IT COULD BE CARRI ED FORWARD AND SET OFF AGAINST THE INCOME OF THE NEXT SEVEN ASSESSMENT YEARS. SO, THE UNABSORBED DEPRECIATION O F THE ASSESSMENT YEARS 1997-98 AND 1998-99 COULD BE CARRI ED FORWARD AND SET OFF AGAINST THE INCOME OF THE ASSES SMENT YEAR 1997-98 TO 2004-05 AND 1998-99 TO 2005-06, RESPECTIVELY. IN VIEW OF THE AMENDED PROVISIONS OF THE LAW, THE ASSESSEE COMPANY WAS NOT ENTITLED TO SET OFF THE UN ABSORBED DEPRECIATION FOR THE ASSESSMENT YEARS 1997-98 AND 1 998-99 AGAINST THE INCOME OF THE ASSESSMENT YEAR 2008-09 ( I.E. BEYOND ASSESSMENT YEARS 2004-05/ 2005-06). HENCE, PROCEEDINGS U/S. 263 OF THE I.T. ACT WAS INITIATED . 3. IN ALL FAIRNESS, LEARNED COMMISSIONER DID NOTE T HAT THE STAND OF THE ASSESSEE WAS ACTUALLY SUPPORTED BY HONBLE KARN ATAKA HIGH COURTS DECISION IN THE CASE OF KARNATAKA COOPERATI VE MILK PRODUCERS FEDERATION LTD. VS.- DCIT (53 DTR 81) AND BY AMRIT SAR BENCH OF THIS TRIBUNAL IN THE CASE OF ITO VS.- SURAJ SOLVENT VAN ASPATI INDUSTRIES LTD. (16 DTR 492) BUT BRUSHED THEM ASIDE BY OBSERVI NG THAT, AS REGARDS THE CASE LAW, THE JUDICIAL VIEW WILL TAKE I TS OWN TIME IN REACHING A FINALITY BUT FOR NOW, WE ARE BOUND BY FIRST AMEND MENT WHICH PRESCRIBES THAT SET OFF OF UNABSORBED DEPRECIATION OF THE YEAR S 1997-98 AND 1998-99, BEYOND THE ASSESSMENT YEARS 2004-05 AND 2005-06 RES PECTIVELY. THE ASSESSING OFFICER WAS, ACCORDINGLY, DIRECTED TO WIT HDRAW THE UNABSORBED DEPRECIATION OF RS.59,34,549/- AND RS.41 ,47,057/- RESPECTIVELY AGGRIEVED, ASSESSEE IS IN APPEAL BEFOR E US. I.T.A. NO.:467/ KOL. / 2012 ASSESSMENT YEAR : 2008-09 PAGE 3 OF 4 4. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTUAL MATRIX OF THE CA SE AS ALSO THE APPLICABLE LEGAL POSITION. 5. WE FIND THAT ADMITTEDLY THE VIEW TAKEN BY THE AS SESSEE WHICH WAS ACCEPTED IN THE ORIGINAL ASSESSMENT PROCEEDINGS, IS A VIEW WHICH HAS BEEN HELD BY HONBLE KARNATAKA HIGH COURT IN THE CA SE OF KARNATAKA COOPERATIVE MILK PRODUCERS FEDERATION LTD. (SUPRA) AND THERE IS NOTHING TO THE CONTRARY THERETO BY HONBLE JURISDIC TIONAL HIGH COURT. THIS VIEW, THEREFORE, IS NOT ONLY A REASONABLE VIEW OF THE MATTER BUT, AS THE LAW CURRENTLY IS CORRECT VIEW OF THE MATTER. TH E POWERS UNDER SECTION 263 CLEARLY THEREFORE CANNOT BE INVOKED ON THE FACTS OF THIS CASE TO SIMPLY SAFEGUARD THE INTERESTS OF THE REVENUE. T HIS POWER CAN ONLY BE EXERCISED WHEN ORDER SOUGHT TO BE REVISED IS ERR ONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE, AND AN ORDER CANNOT BE TREATED AS ERRONEOUS AS LONG AS THE ASSESSING OFFIC ER HAS TAKEN A POSSIBLE VIEW OF THE MATTER EVEN THOUGH, ACCORDING TO THE COMMISSIONER, THE VIEW SO TAKEN IS NOT THE CORRECT VIEW OF THE MATTER. BEARING IN MIND ALL THESE FACTORS, AS ALSO ENTIRETY OF THE CASE, WE FIND THE IMPUGNED REVISION ORDER UNSUSTAINABLE IN LAW, A ND WE, THEREFORE, CANCEL THE SAME. THE ASSESSEE GETS THE RELIEF ACCOR DINGLY. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 26 TH DAY OF JULY, 2012. SD/- SD/- MAHAVIR SINGH PRAMOD KUMAR (JUDICIAL MEMBER) (ACC OUNTANT MEMBER) KOLKATA, THE 26 TH DAY OF JULY, 2012 I.T.A. NO.:467/ KOL. / 2012 ASSESSMENT YEAR : 2008-09 PAGE 4 OF 4 COPIES TO : (1) THE APPELLANT (2) THE RESPONDENT (3) CIT (4) CIT(A) (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ETC ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.