Tulip Granites Pvt.Ltd., Hyderabad V. Asst. Commissioner of I T, Citcle-2(3), Hyderabad

ITA 502/HYD/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 66463 (ITAT-HYDERABAD)
• Duration Of Justice: 6 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 10-04-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: KAMAL JOGPAL
• Assessee Lawyers: T CHAITANYA KUMAR
• Keywords: Deemed export
• Section: 80HHC; 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER I.T.A. NO. 502/HYD/2012 A.Y. 2008-09 M/S. TULIP GRANITES PVT. LTD. HYDERABAD PAN: AABCT7314E VS. THE ASST. CIT CIRCLE-2(3) HYDERABAD APPELLANT RESPONDENT APPELLANT BY: SRI T. CHAITANYA KUMAR RESPONDENT BY: SMT. KAMAL JOGPAL DATE OF HEARING: 06 . 11 .2012 DATE OF PRONOUNCEMENT: 06 . 11 .2012 O R D E R PER CHANDRA POOJARI, AM: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF THE CIT(A)-III, HYDERABAD DATED 14 TH MARCH, 2012 FOR A.Y. 2008-09. 2. THE ASSESSEE RAISED THE FOLLOWING EFFECTIVE GROUND OF APPEAL: 'THE LEARNED CIT(A) ERRED IN HOLDING THAT THE APPEL LANT HEREIN IS NOT ELIGIBLE FOR DEDUCTION U/S. 10B OF TH E IT ACT IN RESPECT OF ALL THE EXPORTS MADE BY IT. THE LEAR NED CIT(A) OUGHT TO HAVE DIRECTED THE ASSESSING OFFICER TO GRANT ENTIRE EXEMPTION U/S. 10B CLAIMED OF RS. 1,35,34,288 INSTEAD OF CONFIRMING THE ORDER OF THE ASSESSING OFFICER LIMITING THE EXEMPTION TO ONLY RS . 14,02,852.' 3. AFTER HEARING BOTH THE PARTIES WE ARE OF THE OPINIO N THAT SAME ISSUE CAME FOR CONSIDERATION BEFORE THIS TRIBU NAL IN ASSESSEES OWN CASE IN A.YS. 2006-07 AND 2007-08 IN ITA NOS. 238 AND 239/HYD/2009, RESPECTIVELY AND THE TRIBUNAL VID E ORDER DATED 21 ST APRIL, 2011 DECIDED THE ISSUE AGAINST THE ASSESSEE BY HOLDING AS FOLLOWS: I.T.A. NO. 502/HYD/2012 M/S. TULIP GRANITES PVT. LTD. ====================== 2 '7. WE HAVE HEARD BOOTH THE PARTIES AND PERUSED T HE MATERIALS AVAILABLE ON RECORD. THE LEARNED AUTHORIZED REPR ESENTATIVE PLACED THE SAME ARGUMENT WHAT HE HAS MADE BEFORE TH E CIT(A). THE LEARNED AUTHORIZED REPRESENTATIVE HAS ALSO DRE W OUR ATTENTION TO THE COPIES OF THE INVOICES FOR SALE OF GRANITE AND ALSO DISCLAIMER CERTIFICATE ISSUED BY VARIOUS PARTIES TH AT THEY HAVE NOT CLAIMED DEDUCTION U/S 10B OF THE IT ACT ON IMPUGNED EXPORTS. WE HAVE CAREFULLY GONE THROUGH THE PAPER BOOK SUBMITTE D BY THE ASSESSEE. AFTER GOING THROUGH THE DOCUMENTS CITED BEFORE US, WE ARE NOT CONVINCED ABOUT THE CLAIM OF THE ASSESSEE THE MAIN CONTENTION OF THE ASSESSEE COUNSEL BEFORE US IS THA T EVEN THE DEEMED EXPORT, THOUGH THE GOODS IS NEITHER EXPORTED BY THE ASSESSEE NOR THE PAYMENT FOR SUCH SUPPLIES RECEIVED IN CONVERTIBLE FOREIGN EXCHANGE, THE ASSESSEE IS ELIGIBLE FOR BENE FITS U/S 10B OF THE IT ACT. WE HAVE GONE THROUGH THE ENTIRE DOCUM ENTS FILED BY THE ASSESSEE BEFORE US, WE ARE NOT CONVINCED ABOUT THE CLAIM OF THE ASSESSEE. FIRST OF ALL, THE WORD EXPORT IS NOT D EFINED IN SECTION 10B OF THE IT AC OR UNDER SECTION 2 OF THE IT ACT. THEN, WE HAVE TO RELY ON ONLY THE PROVISIONS U/S 80HHC WHEREIN AS EXPLANATION TO SUB SECTION (4C) OF 80HHC OF THE UT ACT 1961, TH E WORD EXPORT AND THE EXPORT TURNOVER WHICH HAS BEEN D EFINED AS FOLLOWS: EXPLANATION TO SECTION 80HHC (4C): A) CONVERTIBLE FOREIGN EXCHANGE MEANS FOREIGN EX CHANGE WHICH IS FOR THE TIME BEING TREATED BY THE RESERVE BANK OF INDIA AS CONVERTIBLE FOREIGN EXCHANGE FOR THE PURPO SES OF THE FOREIGN EXCHANGE REGULATION ACT, 1973 (46 OF 19 73), AND ANY RULES MADE THERE UNDER. (AA) EXPORT OUT OF INDIA SHALL NOT INCLUDE ANY T RANSACTION BY WAY OF SALE OR OTHERWISE, IN A SHOP, EMPORIUM OR A NY OTHER ESTABLISHMENT SITUATED IN INDIA, NOT INVOLVIN G CLEARANCE AT ANY CUSTOMS STATION AS DEFINED IN THE CUSTOMS ACT, 1962 (52 OF 1962). (B) EXPORT TURNOVER MEANS THE SALE PROCEEDS, (REC EIVED IN, OR BROUGHT INTO, INDIA) BY ASSESSEE IN CONVERTIBLE FOR EIGN EXCHANGE (IN ACCORDANCE WITH CLAUSE (A) OF SUB SECT ION (2) OF ANY GOODS OR MERCHANDISE TO WHICH THIS SECTION A PPLIES AND WHICH ARE EXPORTED OUT OF INDIA, BUT DOES NOT I NCLUDE FREIGHT OR INSURANCE ATTRIBUTABLE TO THE TRANSPORT OF THE GOODS OR MERCHANDISE BEYOND THE CUSTOMS STATION AS DEFINED IN THE CUSTOMS ACT, 1962 (52 OF 1962). 8. IN OUR OPINION, IN VIEW OF THE ABOVE PROVISION S OF THE IT ACT, DEEMED EXPORT IS NOT RECOGNIZED BY THE PROVISIONS O F THE IT ACT. EVEN OTHERWISE, AS SEEN FROM THE FACTS OF THE CASE, IT IS AN ADMITTED I.T.A. NO. 502/HYD/2012 M/S. TULIP GRANITES PVT. LTD. ====================== 3 FACT THAT THE ASSESSEE IS NOT THE EXPORTER OF THE G OODS. THE ASSESSEE DELIVERED THE GOODS TO THE BUYER IN INDIA ONLY. THEREFORE, IT IS NOT THE CASE THAT THE ASSESSEE HAD SOLD THE GOODS TO OTHER EOU AGAINST RELEVANT DECLARATION IN FORM CT 3 , SO AS TO CONSIDER THE TRANSACTION AS AN EXPORT. IN VIEW OF THIS FACT, WE DO NOT FIND ANY MERIT IN THE CONTENTION THAT THERE WAS A CASE OF SALE FROM ONE EOU TO ANOTHER. THEREFORE, FOR THE MERE F ACT THAT THERE WAS MOVEMENT OF GOODS FROM ONE PLACE TO ANOTHER WIT H IN INDIA, IT CANNOT BE TAKEN TO CONSIDER THAT THERE WAS AN EXPO RT. IN ORDER TO CLAIM DEDUCTION U/S 10B, IT MUST BE PROVED BY THE A SSESSEE THAT SUCH SALE TRANSACTION MUST INVOLVE CLEARANCE AT ANY CUSTOMS STATION AS DEFINED IN THE CUSTOMS ACT. OTHERWISE, THERE WAS POSSIBILITY THAT GOODS AFTER THE PURCHASE MAY NOT B E EXPORTED AT ALL AND YET THE BENEFIT MAY BE CLAIMED. SINCE IN THE P RESENT CASE, THE TRANSACTION INVOLVES NO CLEARANCE AT THE CUSTOMS ST ATION, IT CANNOT BE TREATED AS EXPORT OUT OF INDIA. IN THE PRESENT CASE THERE IS NO EVIDENCE TO SHOW THAT THE GOODS MOVED OUT OF INDIA SO AS TO FALL WITHIN THE DEFINITION OF EXPORTS. FURTHER, DELIVE RING OF THE GOODS TO LOCAL PERSON CANNOT BE CONSIDERED AS EXPORT. I N OUR OPINION, THE CIT(A) CONSIDERED THE ALL RELEVANT FACTS OF THE CASE AND NOT CONSIDERED ANY IRRELEVANT MATERIAL AND THE CONCLUSI ON ARRIVED BY HIM IS NOT PERVERSE AND IS BASED ON THE FACTS OF TH E CASE. THE ORDER OF THE CIT(A) NEED NOT BE SCRUTINIZED WORD BY WORD MERELY TO FIND OUT WHETHER ALL THE FACTS HAVE BEEN SET OUT BY HIM IN DETAIL OR NOT. THE READING OF THE CIT(A) SHOWS THAT HE H AS TAKEN INTO ACCOUNT THE RELEVANT FACTS OF THE CASE AND CAME TO RIGHT CONCLUSION. WE CANNOT FIND ANY INFIRMITY IN HIS OR DER. THUS, THE GROUND RAISED BY THE ASSESSEE IS REJECTED. 9. SINCE WE HAVE HELD THAT THERE WAS NO VALID EXP ORT OPERATIONS IN THIS CASE, THE OTHER GROUNDS RAISED BY THE ASSES SEE HAS BECOME INFRUCTUOUS AND THE SAME ARE DISMISSED AS INFRUCTUO US.' 4. RESPECTFULLY FOLLOWING THE ABOVE ORDER OF THE TRIBU NAL, WE ARE INCLINED TO DISMISS THE GROUND RAISED BY THE AS SESSEE. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 6 TH NOVEMBER, 2012. SD/ - (ASHA VIJAYARAGHAVAN) JUDICIAL MEMBER SD/ - (CHANDRA POOJARI) ACCOUNTANT MEMBER HYDERABAD, DATED THE 6 TH NOVEMBER, 2012 I.T.A. NO. 502/HYD/2012 M/S. TULIP GRANITES PVT. LTD. ====================== 4 COPY FORWARDED TO: 1. M/S. TULIP GRANITES PVT. LTD., C/O. SRI S. RAMA RAO , ADVOCATE, FLAT NO. 101, SHRIYA'S ELEGANCE, ST. NO. 9, HIMAYATHNAGAR, HYDERABAD-500 029. 2. THE ASST. CIT, CIRCLE - 2(3), HYDERABAD. 3. THE CIT - III, HYDERABAD. 4. THE CIT - II, HYDERABAD. 5. THE DR A BENCH, ITAT, HYDERABAD. TPRAO