PPN Power Generating Plant Pvt.Ltd., CHENNAI V. ACIT, CHENNAI

ITA 568/CHNY/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 68853 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 8 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 20-11-2013
• Assessment Year: 2005-2006
• Appeal Filed On: 16-03-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: R VIJAYARAGHAVAN
• Keywords: Business income

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI BEFORE SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ITA NO. 568/MDS/2012 (ASSESSMENT YEAR: 2005-06) M/S. PPN POWER GENERATING COMPANY PVT. LTD., JHAVER PLAZA, 3 RD FLOOR 1A, N.H.ROAD, CHENNAI-600 034. PAN:AABCP8131D VS. THE ASSISTANT COMMISSIONER OF INCOME TAX, COMPANY CIRCLE-V(4) CHENNAI-600 034 (APPELLANT) (RESPONDENT) APPELLANT BY : MR. R.VIJAYARAGHAVAN , ADVOCATE RESPONDENT BY : MR. SHAJI P.JACOB, ADDL. CIT DATE OF HEARING : 20 TH NOVEMBER, 2013 DATE OF PRONOUNCEMENT : 27 TH NOVEMBER, 2013 O R D E R PER CHALLA NAGENDRA PRASAD, JM : THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) VI, CH ENNAI DATED 19.12.2011 FOR THE ASSESSMENT YEAR 2005-06. T HE ASSESSEE HAS RAISED SEVERAL GROUNDS IN ITS APPEAL. HOWEVER, ALL THESE GROUNDS ARE IN RESPECT OF TWO ISSUES MAIN LY IN RESPECT OF DISALLOWANCE OF EXPENSES OF ` 60.49 CRORES AND IN RESPECT OF DENYING EXEMPTION UNDER SECTION 80IA ON INTEREST EARNED ON DEPOSITS. ITA NO.568/MDS//2012 2 2. WITH REGARD TO THE FIRST ISSUE I.E. DISALLOWANCE OF EXPENSES OF ` 60.49 CRORES IS CONCERNED, THE LEARNED COUNSEL SUBMITS THAT THESE EXPENSES ARE ONLY PROVIS IONS MADE IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE WHICH WERE CLAIMED AS DEDUCTION AND THIS TRIBUNAL IN THE ASSES SEES OWN CASE IN ITA NO.2393/MDS/2007 DATED 2 ND MARCH, 2009 FOR THE IMMEDIATELY PRECEDING ASSESSMENT YEAR 2004-05 CONSI DERED WHETHER SUCH TYPE OF EXPENSES ARE ALLOWABLE OR NOT AND THIS TRIBUNAL HELD THAT SUCH EXPENSES ARE NOT ALLOWABLE. THE LEARNED COUNSEL SUBMITS THAT THIS ISSUE IS DECIDED AGAINST THE ASSESSEE BY THE CO-ORDINATE BENCH OF THIS TRIBUNAL AND A COPY OF THE ORDER IN ITA NO.2393/MDS/2007 DATED 02. 03.2009 IS PLACED ON RECORD. 3. THE LEARNED DEPARTMENTAL REPRESENTATIVE SUPPORTS THE ORDER OF THE LOWER AUTHORITIES. 4. HEARD BOTH SIDES. PERUSED THE ORDERS OF THE LOWE R AUTHORITIES AND THE DECISION RELIED ON. WE FIND THA T THIS ISSUE IS DECIDED AGAINST THE ASSESSEE BY THE CO-ORDINATE BENCH OF ITA NO.568/MDS//2012 3 THIS TRIBUNAL IN ASSESSEES OWN CASE FOR THE EARLIE R ASSESSMENT YEAR I.E. 2004-05 IN ITA NO.2393/MDS/200 7 VIDE ORDER DATED 02.03.2009. RESPECTFULLY FOLLOWING THE ORDER OF THIS TRIBUNAL CITED ABOVE, WE DISMISS THE GROUND OF THE ASSESSEE IN RESPECT OF DISALLOWANCE OF VARIOUS OPE RATIONAL EXPENSES OF ` 60.49 CRORES AS THESE EXPENSES ARE ONLY PROVISIONS AND ARE CONTINGENT. 5. AS FAR AS THE SECOND ISSUE I.E. NOT CONSIDERING INTEREST ON DEPOSITS AS BUSINESS INCOME FOR THE PURPOSE OF A LLOWING DEDUCTION UNDER SECTION 80IA IS CONCERNED, THE COUN SEL FOR THE ASSESSEE RELIED ON THE GROUNDS OF APPEAL. 6. THE DEPARTMENTAL REPRESENTATIVE SUPPORTS THE OR DERS OF THE LOWER AUTHORITIES. 7. HEARD BOTH SIDES. PERUSED THE ORDERS OF LOWER AUTHORITIES. WE FIND THAT THE COMMISSIONER OF INCOM E TAX (APPEALS) FOLLOWING THE DECISION OF THE HONBLE SUP REME COURT IN THE CASE OF PANDIAN CHEMICALS (262 ITR 278 ) HELD ITA NO.568/MDS//2012 4 THAT INTEREST ON DEPOSITS IS NOT ALLOWABLE FOR DEDU CTION UNDER SECTION 80IA OF THE ACT. WE UPHOLD THE VIEW OF THE COMMISSIONER OF INCOME TAX (APPEALS) AND REJECT THE GROUNDS RAISED BY THE ASSESSEE ON THIS ISSUE. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON WEDNESDAY, THE 27 TH DAY OF NOVEMBER, 2013 AT CHENNAI. SD/- SD/- (A. MOHAN ALANKAMONY ) (CHALLA NAGENDRA PRASAD) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI. DATED THE 27 TH NOVEMBER, 2013. SOMU COPY TO: (1) APPELLANT (4 ) CIT(A) (2) RESPONDENT (5 ) D.R. (3) CIT (6 ) G.F.