MESERS JAMMU MATCHEM PVT LIMITED, JAMMU & KASHMIR V. INCOME TAX OFFICER, WARD 1 (4), JAMMU AND KASHMIR

ITA 536/ASR/2018

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 4237 (ITAT-AMRITSAR)
• Duration Of Justice: 3 year(s) 7 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-06-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 05-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 154; 143(3); 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR BEFORE DR. M. L. MEENA, ACCOUNTANT MEMBER AND SH. ANIKESH BANERJEE, JUDICIAL MEMBER I.T.A. No. 536/Asr/2018 Assessment Year: 2009-10 M/s Jammu Metchem Pvt. Ltd., Khasra No. 717/721 Village Logate More, Near Railway Crossing, Kathua J & K 184104 [PAN: AABCJ 6960C] Vs. Income Tax Officer, Aayakar Bhawan, Ward 1(4) Kathua, J & K (Appellant) (Respondent) Appellant by : Sh. P. N. Arora, Adv. Respondent by: Sh. S. M. Surendranath, Sr. DR Date of Hearing: 27.04.2022 Date of Pronouncement: 23.06.2022 ORDER Per Anikesh Banerjee, JM: The instant appeal is directed against the order of the Learned Commissioner of Income Tax (Appeal) Jammu [in brevity CIT(A)], bearing appeal case number 115/2014-15 dated 20/08/2018 passed under section 250(6) of Income Tax Act, 1961 [in brevity the Act]. The impugned order was arising out from the order of ITA No. 536/Asr/2018 Jammu Metchem Pvt Ltd v. ITO 2 the Ld. Income Tax Officer, Ward, Kathua passed under section 154 of the Act, date of order 29.03.2014 for Assessment year 2009-10. 2. Brief facts of the case are that the assessee claimed deduction under section 80IB of the Act for the assessment year 2009-10 during filing its return. The assessment U/s 143(3) of the Act was completed, and order dated 30/12/2011 with the addition in the following heads: - 1. Disallowance U/s 80IB (4) of the Actin respect of profit attributable to Central Excise Duty Refund-amount of Rs. 48,18,093/-. 2. Disallowance under section 80IB (4) on account of interest on FDR- amount to Rs. 9,52,992/-. 3. Disallowance U/s 36(1)(iii) of the Act on account of bank interest for non-business advance- amount to Rs. 5,16,209/- In assessee’s appeal in point-1 & 3 (mentioned above) had already been allowed by the CIT(A) on order dated 23-02-2012 under section 250(6) of the Act. Only the interest of FDR amount to Rs 9,52,992/- was not allowed by appellate authority. After 1 st adjudication the assessee filed the rectification petition before the Learned AO under section 154 of the Act. This particular FDR interest is not allowable under section 80IB. The assessee filed details calculation before the learned AO (in paper book page-42-43). But the learned AO disallowed the rectification petition of the assessee by an order dated 29.03.2014. Against the order, the assessee filed an appeal before the learned CIT(A). The learned CIT(A) rejected the assessee’s ITA No. 536/Asr/2018 Jammu Metchem Pvt Ltd v. ITO 3 plea & upheld the order of the learned AO. Aggrieved assessee filed an appeal before us. 3. The learned counsel of the assessee referred the paper book containing, page nos-1 to 62 which is kept in record & argued that the interest on FDR was already taken in the profit and loss account, as per PB page 38. The interest on FDR is reflected in Profit & Loss a/c. The said interest is part of the total income of the assessee. As per the landed council this FDR interest cannot be taxed twice. As it is already the part of the net profit. During the calculation of deduction under section 80IB, this FDR should be removed. The rest of the amount should be calculated under section 8IB. During the calculation of tax in relation to appeal order, the Ld. AO had taken the FDR interest twice in the (tax). The assessee filed a rectification u/s 154 and requested for not to allow double taxation on FDR interest during calculation of tax. But the Ld. AO without considering the petition u/s 154 passed the order. Accordingly, the assessee filed an appeal before the Ld. CIT(A) for considering the rectification petition before the Ld. AO. But during adjudication, the Ld. CIT(A) rejected the plea and not to consider the issue related to a double taxation, here the order of the Ld. CIT(A) page no. 4 point no. 5.2 is extracted as follows: “5.2 I have considered the material on record as well as the order passed by the Assessing Officer under section 154 of the Act. Although the assessee ITA No. 536/Asr/2018 Jammu Metchem Pvt Ltd v. ITO 4 company has been given so many opportunities but it could not avail even single opportunity? It has also not been explained that as to how the mistake pointed out by the assessee company in its application under section 154 of the Act was apparent from record. In view of these facts, I do not consider the case of the assessee company to be a fit case for allowing any relief. Under such circumstances, the action of the Assessing Officer in rejecting the application of the assessee company filed by it under section 154 of the Act cannot be said to be unjustified. Having said so, the action of the Assessing Officer in rejecting the application of the assessee company filed by it under section 154 of the Act is, therefore, upheld. In the result, the grounds No. 1, 2 and 3 of appeal taken by the assessee company are dismissed.” 4. The Ld. DR relied on the order of both the revenue authorities. 5. We heard the rival submissions and relied on the documents available in the record. First, the addition was made by the Ld. AO by disallowing deduction u/s 80IB of the Act. Later on, assessee was granted relief and the deduction u/s 80IB is allowed but the interest on FDR was not allowed. The assessee had already taken the FDR interest in profit and loss account which is the part of the net profit. The same amount can’t be added once with the net profit and further added in calculation of tax by the Ld. AO. The same cannot be taxed doubly. Accordingly, the addition amount of Rs.9,52,992/- should be taken once during calculation of tax. The Ld. AO was directed to consider the calculation of total income by taking the FDR interest in one time. Accordingly, the appeal of the assessee is allowed. ITA No. 536/Asr/2018 Jammu Metchem Pvt Ltd v. ITO 5 6. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 23.06.2022 Sd/- Sd/- (Dr. M. L. Meena) (Anikesh Banerjee) Accountant Member Judicial Member *GP/Sr. PS* Copy of the order forwarded to: (1) The Appellant: (2) The Respondent: (3) The CIT(A), (4) The CIT concerned (5) The Sr. DR, I.T.A.T (6) The Guard File True Copy By Order