The Asstt. Commissioner of Income-tax, Amritsar. V. Smt. Davinder Kaur, Amritsar.

ITA 500/ASR/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 63521 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-10-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 04-10-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 26-09-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R L CHHANALIA
• Assessee Lawyers: S S KALRA
• Section: 143(3); 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER I.T.A. NO. 550(ASR)/2011 ASSESSMENT YEAR:2006-07 PAN :ABCFS8691L THE ASSTT. COMMR. OF INCOME-TAX, VS. M/S. SPEEDWAYS FOOTWEAR, CENTRAL CIRCLE-1, AMRITSAR. G.T.ROAD, JALANDHAR. (APPELLANT) (RESPONDENT) APPELLANT BY:SH. R.L. CHHANALIA, DR RESPONDENT BY:SH. S.S. KALRA, CA DATE OF HEARING:27/09/2012 DATE OF PRONOUNCEMENT:03/10/2012 ORDER PER BENCH ; THE REVENUE HAS FILED THE PRESENT APPEAL AGAINST T HE IMPUGNED ORDER OF CIT(A), JALANDHAR, DATED 23.09.2011 RELATING TO ASSESSMENT YEAR 2006-07 ON THE FOLLOWING GROUNDS: 1. THAT THE LD.CIT(A) HAS ERRED BOTH IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.18,72,289/- AS MADE BY DISALLOWING DEDUCTION CLAIMED U/S 80IB, IN THE RETURN OF INCOME . ITA NO.550(ASR)/2011 2 2. THAT THE LD. CIT(A) HAS ERRED BOTH IN LA AND ON FACTS WHILE ADMITTING THE CLAIM OF THE ASSESSEE WITH REGARD TO PURPORTED MISTAKE IN WRITING SECTION 80IB IN PLACE OF SECTION 80IC IN THE INCOME TAX RETURN WITHOUT REVISING IT WITHIN THE TI ME ALLOWED THEREFORE, IGNORING THE JUDGMENT OF HONBLE SUPREME COURT OF INDIA IN THE CASE OF GOETZE (INDIA)LTD VS. CIT (200 6) 284 ITR 323 (SC). 3. THE APPELLATE CRAVES LEAVE TO ADD OR AMEND THE G ROUNDS OF APPEAL ON OR BEFORE IT IS HEARD AND DISPOSED OFF. 4. IT IS PRAYED THAT THE ORDER OF THE CIT(A), JALAN DHAR BE SET ASIDE AND THAT OF THE AO BE RESTORED.S 2. THE BRIEF FACTS RELATING TO THE ISSUE IN DISPUTE ARE THAT THE ASSESSEE HAD CLAIMED DEDUCTION U/S 80IB OF THE INCOME TAX ACT, 1 961 ( IN SHORT, THE ACT) IN ITS RETURN OF INCOME. THE AO WAS OF THE VI EW THAT DEDUCTION WAS CLAIMED APPARENTLY UNDER SUB-SECTION (5) OF SECTION 80IB SINCE THE ASSESSEE WAS A SMALL SCALE MANUFACTURING UNIT. HE NOTED THAT UNDER THIS SUB-SECTION DEDUCTION U/S 80IB WAS ALLOWED TO INDUSTRIAL UNDERT AKING WHICH BEGAN MANUFACTURING ACTIVITIES BETWEEN 1.10.1994 TO 31.03 .2004. HE ALSO NOTED THAT IN THE AUDIT REPORT IN FORM NO.10CCB THE CA HA D CERTIFIED THE DATE OF COMMENCEMENT OF OPERATION BY THE UNDERTAKING AS 01 .09.2004. HE ALSO NOTED THAT THE STOCK REGISTER MAINTAINED BY THE ASS ESSEE SHOWED THAT THE FIRST LOT OF SHOES WAS MANUFACTURED BY THE ASSESSEE ON 07 .06.2005. THEREFORE, THE ASSESSEE HAD COMMENCED PRODUCTION AFTER 31.03.2004 WHICH WAS BEYOND THE TIME LIMIT PRESCRIBED UNDER SECTION 80IB(5) FOR CLA IMING DEDUCTION UNDER ITA NO.550(ASR)/2011 3 THIS SECTION. THE AO FURTHER NOTED THAT THE CLAIM O F DEDUCTION U/S 80IB HAD BEEN NOTED AT SEVERAL PLACES IN THE RETURN OF INCOM E, IN THE TAX AUDIT REPORT UNDER SECTION 44AB AND FORM NO.10CCB AND AO ASKED T HE ASSESSEE TO JUSTIFY THE CLAIM OF DEDUCTION U/S 80IB. IN RESPONS E TO THE QUERY OF THE AO, THE ASSESSEE SUBMITTED THAT THE AUDITORS REPORT IN FORM NO.10CCB WAS ALREADY SUBMITTED WITH THE RETURN OF INCOME-TAX. IT WAS CLAIMED THAT THE FIRM HAD COMMENCED COMMERCIAL PRODUCTION AS ON 01.09.200 4 AND WAS ELIGIBLE FOR DEDUCTION U/S 80IC (3) FOR TEN ASSESSMENT YEARS AND THIS DEDUCTION WAS ALLOWABLE IN RESPECT OF SMALL SCALE INDUSTRIAL UND ERTAKING WHICH BEGAN TO MANUFACTURE ARTICLES OR THINGS DURING THE PERIOD BE GINNING FROM 07.01.2003 AND ENDING ON 01.04.2012. BUT THE AO REJECTED THE C ONTENTIONS OF THE ASSESSEE BY REFERRING TO THE JUDGMENT OF HONBLE SU PREME COURT IN THE CASE OF GOETZE (INDIA) LTD. VS. CIT 284 ITR 323 (SC) AND LASTLY HE CAME TO THE CONCLUSION THAT DEDUCTION UNDER SECTION 80IB WAS NO T TENABLE BOTH IN LAW AND FACTS AND HE ALSO DISALLOWED DEDUCTION CLAIMED BY THE ASSESSEE U/S 80IB OF THE ACT BY PASSING ASSESSMENT ORDER UNDER SECTIO N 143(3) OF THE ACT ON 18.12.2008. AGGRIEVED BY THE SAME, THE ASSESSEE FIL ED AN APPEAL BEFORE THE LD. CIT(A), WHO VIDE IMPUGNED ORDER DATED 23.09.201 1 DELETED THE ADDITION IN DISPUTE BY ALLOWING THE APPEAL FILED BY THE ASS ESSEE. ITA NO.550(ASR)/2011 4 3. NOW , THE REVENUE IS AGGRIEVED BY THE IMPUGNED O RDER OF THE CIT(A) AND IS IN APPEAL BEFORE THIS BENCH. 4. AT THE TIME OF HEARING, THE LD. DR, RELIED UPON THE ORDER PASSED BY THE ASSESSING OFFICER. 5. ON THE CONTRARY, THE LD. COUNSEL FOR THE ASSESS EE RELIED UPON THE IMPUGNED ORDER OF THE LD. CIT(A). THE LD. COUNSEL F OR THE ASSESSEE, SH. S.S. KALRA, CA, FURTHER STATED THAT NO DOUBT, THE A SSESSEE HAS CLAIMED DEDUCTION U/S 80IB OF THE ACT, IN ITS RETURN BUT DU RING THE COURSE OF ASSESSMENT PROCEEDINGS WHEN DETAILED QUESTIONNAIRE WAS ISSUED TO THE ASSESSEE ON 18.10.2007 AND ASSESSEE WAS ASKED TO J USTIFY THE CLAIM OF DEDUCTION U/S 80IB, THEN THE LD. COUNSEL FOR THE AS SESSEE FILED A LETTER DATED 25.02.2008, IN WHICH THE ASSESSEE HAS CLAIMED DEDUC TION U/S 80IC OF THE ACT. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ELEVANT RECORDS AVAILABLE WITH US. WE ARE OF THE CONSIDERED OPINION THAT NO DOUBT THE LD. FIRST APPELLATE AUTHORITY HAS REJECTED VARIOUS CONTENTION S OF THE ASSESSEE IN ALLOWING THE CLAIM U/S 80IC OF THE ACT BECAUSE THE ASSESSEE HAS NOT CLAIMED THE SAME IN THE ORIGINAL RETURN OF INCOME BUT LASTL Y WHILE DECIDING THE CASE ON MERIT THE LD. FIRST APPELLATE AUTHORITY HAS HELD THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF MANUFACTURING OF SPORT SHOES, HA VING ITS FACTORY AT PLOT ITA NO.550(ASR)/2011 5 NO.43-44, PHASE-II, SANSARPUR TERRACE, DISTT. KANGR A (HP) AS PER FORM NO.3CD FILED WITH THE RETURN OF INCOME. AS PER SECT ION 80IC(2)(A)(II) DEDUCTION U/S 80IC WILL BE AVAILABLE TO A UNIT WHIC H BEGINS TO MANUFACTURE OR PRODUCE ANY ARTICLE OR THING SPECIFIED IN THIRTE ENTH SCHEDULE BETWEEN 07.01.2003 AND 31.03.2012 IN THE STATE OF HIMACHAL PRADESH OR UTTRANCHAL PRADESH. SCHEDULE THIRTEEN, PART-B, CONTAINING LIST OF ITEMS FOR THE STATES OF HIMACHAL PRADESH AND UTTRANCHAL , DOES NOT CONTAIN THE ITEMS SPORTS SHOES. BUT AS PER CBDT NOTIFICATION NO.273 OF 2003 DATED 04.11.2003, SANSAR TERRACE IN H.P. IS NOTIFIED U/S 80IC(2)(A)(I I). THE LD. FIRST APPELLATE AUTHORITY HAS ALSO NOTICED THAT THE ASSESSEE HAD MA NUFACTURED THE FIRST LOT OF SHOES ON 07.06.2005 I.E. DURING THE RELEVANT PREVI OUS YEAR. KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES, IT IS VERY CLEAR THAT THE ASSESSEE HAS SATISFIED THE REQUIREMENTS OF BEING ELIGIBLE FOR DEDUCTION U/S 80 IC AND HAD COMMENCED MANUFACTURING ACTIVITIES DURING THE RELEVANT PREVIO US YEAR. EVEN OTHERWISE IN THE SUBSEQUENT YEAR I.E. ASSESSMENT YEAR 2007-08 , THE AO PASSED ORDER ON 28.12.2010 U/S 143(3)/153A/153C ALLOWING THE SIMILA R CLAIM TO THE ASSESSEE U/S 80IC OF THE ACT. AFTER GOING THROUGH THE ORDER PASSED BY THE REVENUE AUTHORITIES, ESPECIALLY THE IMPUGNED ORDER, WE ARE OF THE CONSIDERED OPINION THAT THE LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY ALLOWED THE CLAIM OF THE ASSESSEE U/S 80IC OF THE ACT. THEREFORE, NO INTERFE RENCE IS CALLED FOR IN THE ITA NO.550(ASR)/2011 6 WELL REASONED ORDER PASSED BY THE LD. FIRST APPELLA TE AUTHORITY. ACCORDINGLY, WE UPHOLD THE SAME BY DISMISSING THE APPEAL FILED B Y THE REVENUE. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 3RD OCTOBER, 2012. SD/- SD/- (B.P. JAIN) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 3RD OCTOBER, 2012 /SKR/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE:M/S. SPEEDWAYS FOOTWEAR, G.T.ROAD, JAL ANDHAR. 2. THE ACIT, CENTRAL CIRCLE-1, JALANDHAR. 3. THE CIT(A), JALANDHAR. 4. THE CIT, JALANDHAR. 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.