ITO 25(3)(2), MUMBAI V. DEEPALI J SHAH, MUMBAI

ITA 5028/MUM/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 59751 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-01-2012
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 18-01-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 17-06-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: C G K NAIR
• Assessee Lawyers: M D PRAJAPATI
• Keywords: Opportunity of being heard; Rule of consistency
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, D, MUMBAI BEFORE SHRI D.K.AGARWAL (JM) AND SHRI T.R.SOOD(AM) ITA NO.5028/MUM/2010 (ASSESSMENT YEAR: 2007-08) INCOME TAX OFFICER, 25(3)(2), C-11, ROOM NO.306, PRATYAKSHAKAR BHAVAN, BANDRA- KURLA- COMPLEX, BANDRA (E), MUMBAI-400051 MRS.DEEPALI J SHAH, 42, TANAY, SKY BUILD VILLAGE, BEHIND BHATIA SCHOOL, OFF SAIBABA ROAD, KANDIVALI (WEST), MUMBAI-400067. PAN:AWPPS2195B APPELLANT V/S RESPONDENT ITA NO.5029/MUM/2010 (ASSESSMENT YEAR: 2007-08) INCOME TAX OFFICER, 25(3)(2), C-11, ROOM NO.306, PRATYAKSHAKAR BHAVAN, BANDRA- KURLA- COMPLEX, BANDRA (E), MUMBAI-400051. SHRI DINESH H. SHAH, 42, TANAY, SKY BUILD VILLAGE, BEHIND BHATIA SCHOOL, OFF SAIBABA ROAD, KANDIVALI (WEST), MUMBAI-400067. PAN:AAQPS1808N APPELLANT V/S RESPONDENT DATE OF HEARING : 19.1.2012 DATE OF PRONOUNCEMENT : 25.1.2012 REVENUE BY : SHRI C.G.K.NAIR ASSESSEES BY : SHRI M.D.PRAJAPATI ITA NO.5028/MUM/2010 ITA NO.5029/MUM/2010 (ASSESSMENT YEAR: 2007-08) 2 O R D E R PER D.K.AGARWAL (JM) THESE TWO APPEALS OF RESPECTIVE ASSESSEES PREFERRED BY THE REVENUE ARE DIRECTED AGAINST TH E SEPARATE ORDERS DATED 19.3.2010 PASSED BY THE LD.CIT(A) FOR THE ASSESSMENT YEAR 2007-08. SINCE FACTS ARE IDENTICAL AND ISSUE INVOLVED IS COMMON BO TH THESE APPEALS ARE DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVEYANCE. 2. BRIEFLY STATED FACTS OF THE CASE EXTRACTED FROM THE ITA NO.5028/MUM/2010 IN THE CASE OF MRS.DEEPAL I J SHAH ARE THAT THE ASSESSEE AN INDIVIDUAL DERIVE S INCOME FROM TRADING AND MANUFACTURING OF ENGINEERING, HOTEL AND HOSPITAL EQUIPMENTS, FILED RETURN DECLARING TOTAL INCOME OF RS.1,65,929/-. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE A O OBSERVED THAT THE ASSESSEE HAS CLAIMED DEDUCTION U/ S 80IB (4) OF RS.35,77,971/-. ON BEING ASKED TO FILE JUSTIFICATION FOR THE CLAIM OF DEDUCTION, THE ASSES SEE SUBMITTED THAT SHE HAS FULFILLED ALL THE CRITERIA MENTIONED IN SECTION 80IB(4) FOR GETTING DEDUCTION UNDER THE SAID SECTION. HOWEVER, THE AO OBSERVED ITA NO.5028/MUM/2010 ITA NO.5029/MUM/2010 (ASSESSMENT YEAR: 2007-08) 3 THAT IN THE IMMEDIATELY PRECEDING ASSESSMENT YEAR, I.E. ASSESSMENT YEAR 2006-07, THE CLAIM OF THE ASSESSEE OF DEDUCTION U/S 80IB(4) WAS DISALLOWED ON THE FOLLOWING GROUNDS : (A) THE ASSESSEE FAILED TO SUBSTANTIATE THAT ASSESSEE COMMENCED ITS PRODUCTION BEFORE 31.3.2004 AS IS MANDATORY FOR CLAIM OF DEDUCTION U/S 80IB(4). (B) IT WAS HELD IN THE ASSESSMENT THAT ASESEEE IS NOT ENGAGED IN COMPREHENSIVE MANUFACTURING PROCESS. RELIANCE WAS PLACED ON CATINA OF JUDICIAL PRONOUNCEMENTS; AND ( C) VARIOUS OTHER FACTORS DESCRIBED THEREIN. HE FURTHER OBSERVED THAT ON APPEAL, THE LD. CIT(A), HOWEVER, ALLOWED THE CLAIM OF THE ASSESSEE AGAINST WHICH THE DEPARTMENT IS IN APPEAL BEFORE THE TRIBU NAL AND ACCORDINGLY, THE AO HELD THAT THE ASSESSEE IS NOT ELIGIBLE FOR CLAIMING DEDUCTION U/S 80IB(4) OF THE ACT AND ADDED THE DISALLOWANCE OF THE SAID DEDUCTION OF RS.35,77,971/- TO THE TOTAL INCOME OF THE ASSESSEE. 3. ON APPEAL, THE LD. CIT(A) FOLLOWING THE APPELLAT E ORDER FOR THE ASSESSMENT YEAR 2006-07, HOWEVER, ALLOWED THE CLAIM OF THE ASSESSEE. ITA NO.5028/MUM/2010 ITA NO.5029/MUM/2010 (ASSESSMENT YEAR: 2007-08) 4 4. BEING AGGRIEVED BY THE ORDER OF THE LD. CIT(A), THE REVENUE IS IN APPEAL BEFORE US TAKING FOLLOWIN G EFFECTIVE GROUNDS OF APPEAL: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, AND IN LAW, THE LD. CIT(A) ERRED IN ALLOWING THE APPEAL OF THE ASSESSEE WITHOUT APPRECIATING THE FACT THAT AT ASSESSMENT STAGE, THE ASSESSEE FAILED TO SUBSTANTIATE COMMENCEMENT OF PRODUCTION BY 31.3.2004 AS ALSO WITHOUT APPRECIATING THE FACT THAT FABRICATION OF SS SHEETS IS NOT A COMPREHENSIVE MANUFACTURING ACTIVITY SO AS TO QUALIFY FOR DEDUCTION U/S 80IB(4). 5. AT THE TIME OF HEARING, BOTH THE PARTIES HAVE AGREED THAT IN THE ASSESSEES OWN GROUP CASES IN IT O V/S DINESH H SHAH AND ITO V/S SMT.DEEPALI J.SHAH AND VICE-VERSA IN ITA NO.4958 AND 4959/MUM/2009 AND CO NO.90 AND 91/MUM/2010 FOR THE ASSESSMENT YEAR 2006-07 DATED 15.12.2010 HAS SET ASIDE THE ISSUE TO THE FILE OF THE AO, THEREFORE, THE ISSUE MAY BE SET ASIDE TO THE FILE OF THE AO. 6. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE RIVAL PARTIES AND PERUSED THE MATERIAL AVAILABL E ON RECORD. WE FIND THAT THE FACTS ARE NOT IN DISPUTE INASMUCH AS IT IS ALSO NOT IN DISPUTE THAT THE FAC TS OF THE IMPUGNED ASSESSMENT YEAR ARE SIMILAR TO THE FAC TS ITA NO.5028/MUM/2010 ITA NO.5029/MUM/2010 (ASSESSMENT YEAR: 2007-08) 5 OF THE ASSESSMENT YEAR 2006-07 WHEREIN THE TRIBUNA L HAS HELD VIDE 27 OF THE ORDER AS UNDER : CONSIDERING THE TOTALITY OF THE FACTS OF THE CASE AND IN VIEW OF THE ANOMALIES APPEARING IN THE VARIOUS INVOICES, WE ARE OF THE CONSIDERED OPINION THAT THE MATTER REQUIRES PROPER ENQUIRY/ INVESTIGATION AT THE LEVEL OF THE ASSESSING OFFICER . WE, THEREFORE, DEEM IT PROPER TO SET ASIDE THE ORDER OF THE CIT(A) AND DIRECT THE ASSESSING OFFICER TO DECIDE THE ISSUE AFRESH. NEEDLESS TO SAY THE ASSESSING OFFICER SHALL GIVE DUE OPPORTUNITY OF BEING HEARING TO THE ASSESSEE AND DECIDE THE ISSUE IN ACCORDANCE WITH LAW. WE HOLD AND DIRECT ACCORDINGLY. THE GROUNDS RAISED BY THE REVENUE ARE ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSE. IN THE ABSENCE OF ANY DISTINGUISHING FEATURE BROUGH T ON RECORD BY THE PARTIES, WE RESPECTFULLY FOLLOWING THE ORDER OF THE TRIBUNAL AND KEEPING IN VIEW THE RULE OF CONSISTENCY SET ASIDE THE ORDER PASSED BY THE REVENUE AUTHORITIES ON THIS ACCOUNT AND SEND BACK T HE MATTER TO THE FILE OF THE AO TO DECIDE THE SAME AFRESH IN THE LIGHT OF THE OBSERVATIONS MADE BY TH E TRIBUNAL (SUPRA) AND ACCORDING TO LAW AFTER PROVID ING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. THE GROUNDS TAKEN BY THE REVENUE ARE, THEREFORE, PARTLY ALLOWED FOR STATISTICAL PURPOSES. ITA NO.5028/MUM/2010 ITA NO.5029/MUM/2010 (ASSESSMENT YEAR: 2007-08) 6 ITA NO.5029/MUM/2007 7. AT THE TIME OF HEARING, BOTH THE PARTIES HAVE AGREED THAT THE FACTS OF THE PRESENT CASE AND GROUN D TAKEN BY THE REVENUE ARE SIMILAR TO THE CASE OF MRS.DEEPALI J SHAH, THEREFORE, THE PLEA TAKEN BY TH EM IN THE SAID APPEAL MAY BE CONSIDERED WHILE DECIDI NG THE PRESENT APPEAL. 8. THAT BEING SO AND IN THE ABSENCE OF ANY DISTINGUISHING FEATURE BROUGHT ON RECORD BY THE PARTIES, WE DIRECT THE AO TO FOLLOW OUR FINDINGS RECORDED IN PARAGRAPH 6 OF THIS ORDER. WE HOLD AN D ORDER ACCORDINGLY. THE GROUNDS TAKEN BY THE REVENU E ARE, THEREFORE, PARTLY ALLOWED FOR STATISTICAL PURP OSES. 9. IN THE RESULT, BOTH THE APPEALS STAND PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 25TH JAN., 2012. SD SD (T.R.SOOD) (D.K.A GARWAL) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, 25TH JANUARY, 2012 SRL: ITA NO.5028/MUM/2010 ITA NO.5029/MUM/2010 (ASSESSMENT YEAR: 2007-08) 7 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT CONCERNED 4. CIT(A) CONCERNED 5. DR CONCERNED BENCH 6. GUARD FILE. TRUE COPY BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI