DCIT, Pondicherry V. Kamivisa Products, Pondicherry

ITA 536/CHNY/2015

• Counselvise Citation: 53621714 RSA 2015
• Duration Of Justice: 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2015
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 17-11-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 16-03-2015
• Court: TRIBUNAL
• Department Lawyers: A B KOLI
• Assessee Lawyers: S SRIDHAR
• Keywords: Reopening of assessment; Additional evidence; Difference of opinion; Change of opinion
• Section: 143(3); 80IB; 147

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : CHENNAI . . . , . !' , # $ % [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ] ./ I.T.A.NOS.525/MDS/2013, 536 & 537/MDS/2015 / ASSESSMENT YEARS : 2009-10 TO 2011-12 THE ASSTT. COMMISSIONER OF INCOME-TAX/DY COMMISSIONER OF INCOME-TAX CIRCLE I, PUDUCHERRY VS. M/S KAMIVISA PRODUCTS C-7, INDUSTRIAL ESTATE THATTANCHAVADY PONDICHERRY 605 009 [PAN AAEFK 3686 J ] ( &' / APPELLANT) ( ()&' /RESPONDENT) ./ I.T.A.NO.426/MDS/2015 / ASSESSMENT YEAR : 2008-09 M/S KAMIVISA PRODUCTS C-7, INDUSTRIAL ESTATE THATTANCHAVADY PONDICHERRY 605 009 VS. THE ASSTT. COMMISSIONER OF INCOME-TAX CIRCLE I, PUDUCHERRY ( &' / APPELLANT) ( ()&' /RESPONDENT) DEPARTMENT BY : SHRI A. B KOLI, JCIT ASSESSEE BY : SHRI S. SRIDHAR, ADVOCATE / DATE OF HEARING : 17 - 1 1 - 2015 / DATE OF PRONOUNCEMENT : 09 - 12 - 2015 / O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER ALL THE APPEALS OF THE REVENUE ARE DIRECTED AGAIN ST THE RESPECTIVE ORDERS OF THE COMMISSIONER OF INCOME-TA X (APPEALS), ITA NO.525/13 ETC :- 2 -: CHENNAI, FOR ASSESSMENT YEARS 2009-10, 2010-11 AND 2011-12. THE ASSESSEE HAS ALSO FILED APPEAL FOR ASSESSMENT YEAR 2008-09. SINCE COMMON ISSUE ARISES FOR CONSIDERATION IN ALL THE AP PEALS, WE HEARD THEM TOGETHER AND DISPOSING OF THE SAME BY THIS CO MMON ORDER. 2. SHRI A.B KOLI, LD. DEPARTMENTAL REPRESENTATIVE SUBM ITTED THAT THE MAIN CONTENTION OF THE REVENUE BEFORE THIS TRIB UNAL IS THAT THE CIT(A) ADMITTED ADDITIONAL MATERIAL IN THE FORM OF COST SHEET FOR ESTIMATING THE COST OF PRODUCTION WITHOUT GIVING AN Y OPPORTUNITY TO THE ASSESSING OFFICER. REFERRING TO THE ORDER OF THE C IT(A), MORE PARTICULARLY FOR THE ASSESSMENT YEAR 2010-11, THE L D. DR SUBMITTED THAT THE ASSESSEE APPEARS TO HAVE FILED A COST SHEET TO COMPUTE THE COST OF PRODUCTION BEFORE THE CENTRAL EXCISE DEPARTMENT. T HE COPY OF THE COST SHEET FILED BEFORE THE CENTRAL EXCISE DEPARTME NT WAS FILED BEFORE THE CIT(A) AS ADDITIONAL MATERIAL. THE CIT(A), WIT HOUT GIVING ANY OPPORTUNITY TO THE ASSESSEE, FOUND THAT THE ASSES SEE WAS ELIGIBLE FOR DEDUCTION U/S 80IB OF THE ACT. SINCE THE COST SHE ET WAS NOT AVAILABLE BEFORE THE ASSESSING OFFICER, ACCORDING TO THE LD. DR, AN OPPORTUNITY MAY BE GIVEN TO THE ASSESSING OFFICER TO CONSIDER T HE COST SHEET WHICH WAS SAID TO BE FILED BEFORE THE CIT(A). 3. ON THE CONTRARY, SHRI S. SRIDHAR, LD. COUNSEL FOR T HE ASSESSEE SUBMITTED THAT THE ENTIRE MATERIAL WHICH WAS FILED BEFORE THE CENTRAL ITA NO.525/13 ETC :- 3 -: EXCISE DEPARTMENT WAS AVAILABLE WITH THE ASSESSING OFFICER INCLUDING THE COST SHEET, THEREFORE, IT IS NOT AN ADDITIONAL EVIDENCE FILED BEFORE THE CIT(A). AFTER VERIFYING THE LETTER RECEIVED FROM THE ASSESSING OFFICER WHICH WAS SHOWN TO HIM BY THE LD. DR, THE L D. COUNSEL CLARIFIED THAT THE DOCUMENTS APPEARS TO BE NOT AVAILABLE BEFO RE THE ASSESSING OFFICER. THEREFORE, THE LD. COUNSEL SUBMITTED THAT THE MATTER MAY BE REMANDED BACK TO THE ASSESSING OFFICER FOR RECONSID ERATION. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. IN A LL THE THREE APPEALS THE COMMON ISSUE ARISES FOR CONSIDERATION IS THAT T HE CIT(A) ESTIMATED THE COST OF PRODUCTION ON THE BASIS OF THE COST SHE ET FILED BY THE ASSESSEE BEFORE HIM. THOUGH THE LD. COUNSEL CLAIME D AT THE INITIAL STAGE THAT THE COST SHEET WAS AVAILABLE BEFORE THE ASSESSING OFFICER, DURING THE COURSE OF HEARING WHEN THE LD. DR PRODUC ED A LETTER RECEIVED FROM THE ASSESSING OFFICER THAT THE COST S HEET IS NOT AVAILABLE BEFORE HIM, THE LD. COUNSEL CLARIFIED THAT THE MATT ER MAYBE REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER FOR RECON SIDERATION. THE FACT REMAINS THAT THE COST OF PRODUCTION WAS ESTIMATED O N THE BASIS OF THE COST SHEET FILED BY THE ASSESSEE BEFORE THE CIT(A) . THEREFORE, THE ASSESSING OFFICER HAS NO OCCASION TO EXAMINE THE CO ST SHEET FILED BEFORE THE CIT(A). IN SUCH A SITUATION, THIS TRIB UNAL IS OF THE CONSIDERED OPINION THAT THERE IS A CLEAR VIOLATION OF RULE 46A OF THE ITA NO.525/13 ETC :- 4 -: INCOME-TAX RULES. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSING OFFICER HAS TO EXAMINE T HE COST SHEET FILED BY THE ASSESSEE BEFORE THE CIT(A). ACCORDINGLY, THE ORDERS OF THE LOWER AUTHORITIES ARE SET ASIDE AND THE ENTIRE ISSU E IS REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING O FFICER SHALL RECONSIDER THE ISSUE AFRESH IN THE LIGHT OF THE COST SHEET FIL ED BY THE ASSESSEE BEFORE THE CIT(A) AND THEREAFTER DECIDE THE SAME IN ACCORDANCE WITH LAW AFTER GIVING A REASONABLE OPPORTUNITY TO THE A SSESSEE. 5. IN THE RESULT, ALL THE THREE APPEALS OF THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. 6. NOW, COMING TO ASSESSEES APPEAL FOR ASSESSMENT YE AR 2008-09, THE FIRST ISSUE ARISES FOR CONSIDERATION I S REOPENING OF ASSESSMENT U/S 147 OF THE ACT. 7. WE HEARD SHRI S. SRIDHAR, LD. COUNSEL FOR THE ASSES SEE. ACCORDING TO THE LD. COUNSEL, THE ORIGINAL ASSESSME NT WAS FRAMED U/S 143(3) ON 30.12.2010 AND THE ASSESSING OFFICER ALLO WED THE CLAIM OF THE ASSESSEE U/S 80IC OF THE ACT, THEREFORE, THER E IS NO REASON FOR REOPENING OF THE ASSESSMENT. ACCORDING TO THE LD. COUNSEL, IT IS A CHANGE OF OPINION, THEREFORE, THE REOPENING OF THE ASSESSMENT IS INVALID. ITA NO.525/13 ETC :- 5 -: 8. ON THE CONTRARY, SHRI A.B.KOLI, LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSEE IS ARRA NGING BUSINESS IN SUCH A MANNER SO AS TO PRODUCE MORE PROFIT TO GUWAH ATI UNIT WHICH IS CLAIMING DEDUCTION U/S 80IC OF THE ACT. THE ASSES SING OFFICER, AFTER VERIFYING THE BOOKS OF ACCOUNT AND THE PROFIT & LOS S ACCOUNT FOUND THAT THE ASSESSEE CLAIMED DEDUCTION U/S 80IC IN R ESPECT OF GUWAHATI UNIT AND ALSO DISCOUNT TO THE EXTENT OF ` 1,72,674/-. ACCORDING TO THE LD. DR, SINCE THE DISCOUNT IS NOT DERIVED FROM THE MANUFACTURING PROCESS OF GUWAHATI UNIT, THE ASSESSING OFFICER FOU ND THAT THERE WAS ESCAPEMENT OF INCOME WHICH IS OTHERWISE CHARGEABLE TO TAX. THEREFORE, THE ASSESSING OFFICER HAS RIGHTLY REOPEN ED THE ASSESSMENT. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. TH E ASSESSING OFFICER FOUND THAT THE ASSESSEE IS ARRANGING BUSINESS IN S UCH A MANNER SO AS TO PRODUCE MORE PROFIT BY GUWAHATI UNIT WHICH IS AD MITTEDLY CLAIMING DEDUCTION U/S 80IC OF THE ACT. THEREFORE, THIS T RIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSING OFFICER HAS R IGHTLY REOPENED THE ASSESSMENT U/S 147 OF THE ACT. THIS TRIBUNAL DO N OT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE CIT(A) ON THIS I SSUE. ACCORDINGLY, THE SAME IS CONFIRMED. ITA NO.525/13 ETC :- 6 -: 10. NOW COMING TO THE CLAIM OF DEDUCTION U/S 80IC OF T HE ACT, WHEN IN THE APPEALS OF THE REVENUE IN RESPECT OF AS SESSMENT YEARS 2009-10, 2010-11 AND 2011-12, THE MATTER WAS REMITT ED BACK TO THE FILE OF THE ASSESSING OFFICER FOR RECONSIDERATION S INCE THERE WAS VIOLATION OF RULE 46A OF THE INCOME-TAX RULES IN AD MITTING ADDITIONAL MATERIAL BY THE CIT(A), THEREFORE, FOR THE SAKE OF CONSISTENCY, THE CLAIM OF THE ASSESSEE FOR ASSESSMENT YEAR 2008-09 IS ALSO NEEDS TO BE RECONSIDERED BY THE ASSESSING OFFICER ALONGWITH OTH ER ASSESSMENT YEARS. ACCORDINGLY, THE ORDERS OF THE LOWER AUTHOR ITIES ARE SET ASIDE AND THE ISSUE IS REMITTED BACK TO THE FILE OF THE A SSESSING OFFICER FOR RECONSIDERATION. THE ASSESSING OFFICER SHALL RECON SIDER THE ISSUE AFRESH ALONGWITH OTHER ASSESSMENT YEARS AND DECIDE THE SAME IN ACCORDANCE WITH LAW AFTER GIVING A REASONABLE OPPOR TUNITY TO THE ASSESSEE. 11. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTL Y ALLOWED FOR STATISTICAL PURPOSES. 12. TO SUMMARIZE THE RESULT, ALL THE THREE APPEALS OF T HE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES WHEREA S THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSE S. ITA NO.525/13 ETC :- 7 -: ORDER PRONOUNCED IN THE OPEN COURT ON 9 TH DECEMBER, 2015, AT CHENNAI. SD/- SD/- ( . !' ) (A. MOHAN ALANKAMONY) # / ACCOUNTANT MEMBER ( . . . ) ) (N.R.S. GANESAN) / JUDICIAL MEMBER / CHENNAI ! / DATED: 9 TH DECEMBER, 2015 RD !' # $% &% / COPY TO: 1 . '( / APPELLANT 4. ) / CIT 2. #*'( / RESPONDENT 5. %+, # - / DR 3. ) () / CIT(A) 6. ,/ 0 / GF