Shri Ravikumar Radhyesham Adukiya, Ichalkaranji V. Asst. CIT, Ichalkaranji Circle, Ichalkaranji

ITA 512/PUN/2013

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 2264 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 07-12-2015
• Assessment Year: 2003-2004
• Appeal Filed On: 15-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(3); 80HHC; 234B

Judgement Text

] ]] ] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE , !', $ % BEFORE MS. SUSHMA CHOWLA, JM AND SHRI PRADIP KUMAR KEDIA, AM ITA NO.512/PN/2013 ASSESSMENT YEAR : 2003-04 SHRI RAVIKUMAR RADHYESHAM ADUKIYA, PLOT NO.125, THE ICHALKARANJI CO.OP. ESTATE LTD., BABASO KHANJIRE NAGAR, SHAHPUR, ICHALKARANJI 416 121. PAN : AAVPA1544N . APPELLANT VS. THE ASSTT. COMMISSIONER OF INCOME TAX, ICHALKARANJI CIRCLE, ICHALKARANJI. . RESPONDE NT / APPELLANT BY : SHRI M. K. KULKARNI / RESPONDENT BY : SHRI MAHESH AKHADE / DATE OF HEARING : 07.12.2015 / DATE OF PRONOUNCEMENT: 16.12.2015 & / ORDER PER PRADIP KUMAR KEDIA, AM : THE PRESENT APPEAL PREFERRED BY THE ASSESSEE IS AGA INST THE ORDER OF CIT(A), KOLHAPUR DATED 18.08.2011 RELATING TO ASSES SMENT YEAR 2003-04 PASSED UNDER SECTION 143(3) OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT). 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE REPRODUCED AS UNDER :- 1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE DISALLOWANCE OF RS.20,3 8,918/- CLAIMED UNDER S. 80-HHC OF THE ACT. IT BE ALLOWED TO THE APPELLANT. 2) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE CIT(A) OUGHT TO HAVE CONSIDERED THE LEGAL POSITION THAT THE CONTENT OF IMPORT COST IN THE EXPORTS IS NIL OR MEAGER AND THE FACE VALUE OF THE DEPB LICENC ES TRANSFERRED WAS ITSELF A PREMIUM RECEIVED ON DEPB LICENCES AND BEING PROFIT WAS TAXABLE U/S 28(III-D) OF THE ACT FOLLOWING HON'BLE SUPREME COURT JUDGMENT IN TOPMAN'S CASE (SUPRA). THE BENEFIT U/S 80HHC BE GIVEN TO THE APPELLANT. 2 ITA NO.512/PN/2013 3) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE APPEAL IS DELAYED BECAME OF WRONG ADVICE GIVEN TO THE APPELLANT ASSES SEE. THE HON'BLE SUPREME COURT JUDGMENT IN TOPMAN EXPORTS V. CIT (2012) 342 ITR 49(SC) WAS ALSO PRONOUNCED ON FEB.8, 2012. THE APPELLANT ASSESSEE P AID THE APPEAL FEE OF RS.10,000/- ON 08-11-2011. IN VIEW OF THESE CIRCUMS TANCES THE DELAY BE CONDONED AND APPEAL BE ADMITTED FOR ADJUDICATION TO GIVE FUL L JUSTICE TO THE ASSESSEE. THE DETAILED AFFIDAVIT WITH A PRAYER TO CONDONE THE DEL AY WILL BE FILED LATER ON. 4) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE LEVY OF INTEREST U/S 234A, 234B AND 234C IS NOT JUSTIFIED AND IN THE CIR CUMSTANCES IT BE DELETED. 5) THE APPELLANT CRAVES/LEAVE TO ADD, AMEND OR ALTE R ANY OF THE ABOVE GROUNDS OF APPEAL. 3. BEFORE ADJUDICATING THE ISSUE INVOLVED, WE NOTIC E THAT THERE IS A DELAY OF 466 DAYS IN FILING THE PRESENT APPEAL BEFORE THE TR IBUNAL. ON GOING THROUGH THE AVERMENTS MADE BY THE ASSESSEE IN AFFIDAVIT DAT ED 28 TH MAY, 2015 PLACED BEFORE US, WE FIND THAT ASSESSEE WAS NOT GUILTY OF NEGLIGENCE FOR SUCH ATTRIBUTES IN NOT FILING THE APPEAL BEFORE THE TRIBUNAL IN TIM E. IN FACT, THE APPEAL FEES OF RS.10,000/- WERE PAID ON 08.11.2011 AND CHALLAN WAS HANDED-OVER TO THE CONSULTANT FOR FURTHER COMPLIANCES. IT CAN BE PRES UMED THAT THE DELAY HAS OCCURRED OWING TO DEFAULT ON THE PART OF THE CONSUL TANT AND NOT CAUSE OF INDOLENCE FROM THE ASSESSEE. THE AFFIDAVIT HAS NAR RATED THE DETAILS CIRCUMSTANCES FOR DELAY, WE FIND THAT THERE A SUFFI CIENT CAUSE FOR FILING THE BELATED APPEAL BEFORE THE TRIBUNAL. IN THE FACTS A ND CIRCUMSTANCES OF THE CASE, WE FIND IT IS ONLY JUST AND PROPER TO CONDONE THE D ELAY CAUSED IN FILING THE APPEAL. ACCORDINGLY, THE DELAY IS CONDONED AND APP EAL IS ADMITTED FOR HEARING ON MERITS. 4. NOW, WE SHALL DWELL UPON THE ISSUE RAISED BY THE ASSESSEE BY WAY OF ABOVE GROUNDS OF APPEAL. THE BRIEF FACTS OF THE CA SE ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF CLOTH TRADING, MANUFACTU RING AND EXPORT OF PROCESSED GOODS IN CLOTH UNDER THE NAME AND STYLE O F M/S RAVIKUMAR R. ADUKIYA. FOR THE YEAR UNDER CONSIDERATION, THE AS SESSEE FILED HIS RETURN OF INCOME DISCLOSING TOTAL INCOME OF RS.23,90,600/-. THE ASSESSEE, INTER-ALIA , CLAIMED DEDUCTION UNDER SECTION 80HHC OF THE ACT OF RS.20,50,918/-. THE TOTAL EXPORT TURNOVER WAS DECLARED AT RS.10,63,58,8 08/- WHICH, INTER-ALIA , INCLUDES EXPORT IN RESPECT OF TRADING GOODS AND ALS O MANUFACTURED GOODS. THE 3 ITA NO.512/PN/2013 EXPORT INCENTIVES RECEIVED/RECEIVABLE STAND AT RS.6 1,85,918/-. AS PER THE REPORT IN FORM NO.10CCAC, THE ASSESSEE DECLARED LOS S FROM TRADING EXPORT AND MANUFACTURING EXPORT AND DECLARED INCOME EARNED FROM INCENTIVES WHICH WAS SET-OFF FROM THE EXPORT LOSSES AND THE RESULTAN T INCOME WAS CLAIMED FOR DEDUCTION UNDER THE PROVISIONS OF SECTION 80HHC OF THE ACT. THE ASSESSING OFFICER REJECTED THE CLAIM MADE UNDER SECTION 80HHC ON THE GROUND THAT THE ASSESSEE HAS NOT SATISFIED ALL THE THREE CONDITIONS SIMULTANEOUSLY VIZ. (I) THE TURNOVER IS MORE THAN RS.10 CRORE; (II) THE ASSESSE E HAD THE OPTION TO CHOOSE BETWEEN DUTY DRAWBACK AND DEPB; AND, (III) THE RATE OF DUTY DRAWBACK WAS HIGHER THAN THAT OF DEPB NECESSARY FOR DEDUCTION ON PROFIT ON TRANSFER OF DEPB. THE ASSESSING OFFICER, ACCORDINGLY, ADDED AN AMOUNT OF RS.20,38,918/- TO THE TOTAL INCOME OF THE ASSESSEE. THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A). 5. THE CIT(A) ALSO CONFIRMED THE ADDITION MADE BY T HE ASSESSING OFFICER. THE CONTENTION OF THE ASSESSEE THAT THE INCENTIVES EARNED I.E. PROFIT ON TRANSFER OF DEPB IN SECTION 28(IIID) OF THE ACT IS DECIDED A GAINST THE ASSESSEE BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. KA LPATARU COLOURS AND CHEMICALS, (2010) 328 ITR 451 (BOM.). 6. THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSESS EE SUBMITTED THAT THE ISSUE IS NOW COVERED IN FAVOUR OF THE ASSESSEE BY T HE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF TOPMAN EXPORTS VS. CIT , (2012) 342 ITR 49 (SC). THE LD. DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE, ON THE OTHER HAND, RELIED UPON THE ORDER OF THE CIT(A). 7. WE HAVE HEARD BOTH THE SIDES. IT IS THE ARGUMEN T RAISED BY THE ASSESSEE THAT THE JUDGMENT OF THE HONBLE SUPREME COURT IN T HE CASE OF TOPMAN EXPORTS (SUPRA) SUPPORTS THE CLAIM MADE BY THE ASSE SSEE AND THEREFORE THE BENEFIT OF DEDUCTION UNDER SECTION 80HHC OF THE ACT IS REQUIRED TO BE GRANTED IN THE CASE OF THE ASSESSEE. WE FIND MUCH FORCE IN THE ARGUMENT OF THE ASSESSEE. THE HONBLE COURT HELD THAT THERE IS NOT HING IN EXPLANATION (BAA) TO 4 ITA NO.512/PN/2013 SECTION 80HHC OF THE ACT TO SHOW THAT THIS BENEFIT OF EXCLUSION OF A SMALLER FIGURE FROM PROFITS OF THE BUSINESS WILL NOT BE AVA ILABLE TO AN ASSESSEE HAVING AN EXPORT TURNOVER EXCEEDING RS.10 CRORES. 8. THEREFORE, WE FIND THAT THE QUANTUM OF DEDUCTION AVAILABLE TO THE ASSESSEE UNDER SECTION 80HHC OF THE ACT TOWARDS INC ENTIVES BE RECOMPUTED IN ACCORDANCE WITH THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF TOPMAN EXPORTS (SUPRA). THE ASSESSEE IS ENTITLED F OR THE BENEFIT TO THE EXTENT EXPLAINED BY THE HONBLE SUPREME COURT. THEREFORE, THE MATTER IS REMITTED BACK TO THE ASSESSING OFFICER FOR RE-COMPUTATION OF QUANTUM OF DEDUCTION AVAILABLE TO THE ASSESSEE UNDER SECTION 80HHC OF TH E ACT IN ACCORDANCE WITH LAW AND IN THE LIGHT OF THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF TOPMAN EXPORTS (SUPRA). 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TRE ATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 16 TH DAY OF DECEMBER, 2015. SD/- SD/- ( SUSHMA CHOWLA ) ( PRADIP KUMAR KEDIA ) / JUDICIAL MEMBER $ / ACCOUNTANT MEMBER PUNE ; DATED : 16 TH DECEMBER, 2015. & ' ()* +*( / COPY OF THE ORDER IS FORWARDED TO : 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A), KOLHAPUR; 4) THE CIT, KOLHAPUR; 5) THE DR B BENCH, I.T.A.T., PUNE; 6) GUARD FILE. &, / BY ORDER , ' # //TRUE COPY// $ %& # '( / SR. PRIVATE SECRETARY ) '* , / ITAT, PUNE