Deputy Commissioner of Income tax, Pune V. Maharashtra State Warehousing Corporation , Pune

ITA 649/PUN/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 6858 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 11 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-02-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 17-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NANDITA KANCHAN
• Section: 80IA; 201

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUN E BEFORE SHRI ANIL CHATURVEDI, AM AND SHRI PARTHA SARATHI CHAUDHURY, JM / ITA NO.649/PUN/2017 / ASSESSMENT YEAR : 2013-14 THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-14, PUNE. ....... / APPELLANT / V/S. MAHARASHTRA STATE WAREHOUSING CORPORATION, 583/B, MARKET YARD, GULTEKDI, PUNE-411 037. PAN : AABCM3988M / RESPONDENT ASSESSEE BY : SHRI SARVESH KHANDELWAL REVENUE BY : SMT. NANDITA KANCHAN / DATE OF HEARING : 26.02.2019 / DATE OF PRONOUNCEMENT : 28.02.2019 / ORDER PER PARTHA SARATHI CHAUDHURY, JM : THIS APPEAL PREFERRED BY THE REVENUE EMANATES FROM THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-7, PUNE DATED 20.10.2 016 FOR THE ASSESSMENT YEAR 2013-14 AS PER GROUNDS OF APPEAL ON RECORD. 2 ITA NO.649 /PUN/2017 A.Y.2013-14 2. THE ONLY GRIEVANCE OF THE REVENUE IS THE FACT THAT L D. CIT(APPEALS) HAS HELD THAT THE ASSESSEE IS ELIGIBLE FOR CLAIMING DEDUCTION U/S .80IA(4) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE A CT) AMOUNTING TO RS.13,93,92,592/-. 3. THE BRIEF FACTS OF THIS CASE ARE THAT THE ASSESSEE IS A GOVERNMENT UNDERTAKING ENGAGED PRIMARILY IN THE BUSINESS OF PROVIDING WAREHOUSING FACILITY INCLUDING BONDED WAREHOUSES, HANDLING, FUMIGATION, TRANS PORT, RUNNING CONTAINER FREIGHT STATION & INLAND CONTAINERS DEP OT AT DRONAGIRI VILLAGE NEAR JAWAHARLAL NEHRU PORT TRUST. THE ASSESSEE HA S E-FILED RETURN OF INCOME ON 28.09.2013 DECLARING TOTAL INCOME OF RS.22,39,44,610/ - WHICH WAS ASSESSED U/S.143(3) OF THE ACT TO RS.36,44,68,600/- BY MAKIN G VARIOUS ADDITIONS/DISALLOWANCES AS PER THE ASSESSMENT ORDER. 4. DURING FIRST APPELLATE PROCEEDINGS, THE ASSESSEE HAS FILE D DETAILED WRITTEN SUBMISSION WHICH IS AS UNDER: GROUND NO.1 GROUND NO.1 PERTAINS TO DISALLOWANCE OF RS.13,93,92 ,592/- U/S.80IA(4) OF THE INCOME TAX ACT IN RESPECT OF INFRASTRUCTURE FAC ILITY OPERATED AT J N P T BY RUNNING CONTAINER FREIGHT STATION. VIDE NOTIFICATION NO. 3/2005 DATED 04.02.2005 GOVER NMENT OF INDIA, MINISTRY OF FINANCE (DEPARTMENT OF REVENUE), JAWAHA RLAL NEHRU CUSTOMS HOUSE, SHEVA, TAL. URAN DIST : RAIGAD 477707. THE AREA OWNED BY THE ASSESSEE AT PLOT NO. 89 SECTOR NO.1 DRONAGIRI HAS B EEN RECOGNIZED AS 'CUSTOM AREA' FOR THE PURPOSE OF STORAGE, STUFFING /DE-STUFFING & CLEARANCE OF EXPORT/ IMPORT(BONDED AS WELL AS FOR HOME CONSUM PTION) GOODS. SIMILARLY OFFICE OF THE COMMISSIONER OF CUSTOMS JAWA HARLAL NEHRU CUSTOMS HOUSE, SHEVA , TAL URAN DIST: RAIGAD 477707 VIDE NOTIFICATION NO. S/15-GEN-2890/04 DT. 28/10/2004 HAS DECLARED TH E WAREHOUSE AS A PUBLIC BONDED WAREHOUSE & ALSO ANNEXURE A TO THE SAID NOTIFICATION LISTS DOWN THE VARIOUS CONDITIONS WITH REFERENCE TO THE SAID NOTIFICATION. ALSO THE AUDIT REPORT U/S.10CCB HAS BEEN FIL ED WITH THE RETURN OF INCOME PERTAINING TO DEDUCTION U/S. 80IA(4). THE ASSESSEE HAS BROUGHT TO THE NOTICE OF THE VARIOUS AUTHORITIES IN VARIOUS YEARS CONTAINER FREIGHT STATION FACILITIES IS A INLAND PORT & THEREFORE IS A FACILITY WITHIN THE MEANING OF SECTI ON 80IA(4). 3 ITA NO.649 /PUN/2017 A.Y.2013-14 THE ISSUE CAME UP BEFORE YOUR PREDECESSOR FOR AY 20 10-11 AS WELL AS AY 2011-12. THE APPEAL FOR AY 2010-11 HAS BEEN D ECIDED ON 16.01.2015. GROUND NO.4 IN THAT APPEAL PERTAINS TO THE ISSUE BEFORE YOUR GOOD HONORS' & THE SAME IS IDENTICAL TO THAT OF ISSUE IN AY 2011-1 2 (ANNEXURE NO.1). IT IS REGARDING SAME CONTAINER FRI GHT STATION AT J N P T. CONSIDERING THE FOLLOWING DECISIONS THE ISSU E WAS DECIDED IN THE FAVOUR OF ASSESSEE COMPANY. 1. CONTAINER CORPORATION OF INDIA LTD. VS ACIT (2012)3 46 ITR 140 (DEL). 2. ALL CARGO GLOBAL LOGISTIC LTD. VS DCIT 12012) 18 ITR (TRIB) 106 (MUM) (SB). 2. JWC LOGISTIC PARK (P) LTD. 52 TAXRNANN.COM 144. SUBSEQUENT TO THIS EVEN MADRAS HIGH COURT IN THE CA SE OF CIT CHENNAI VS AL LOGISTICS PVT. LTD. REPORTED IN 155 T AXRNANN.COM 283 HAS HELD THAT CONTAINER FRIGHT STATION IS A PART OF INL AND PORT 8T THEREFORE, IS AN INFRASTRUCTURE FACILITY AS DEFINED IN EXPLANATION TO SECTION 80IA(4)(I). COPY ENCLOSED (ANNEXURE NO. 2). THE SAID DECISION VIDE ALLOWING THE APPEAL VIDE PAR A.7 CONSIDERED THE NOTIFICATION ISSUED IN FAVOUR OF THE ASSESSEE W HILE HOLDING THAT CFS (CONTAINER FRIGHT STATION) IS INFRASTRUCTURE FACILI TY. SIMILAR APPROVAL WAS RECEIVED BY ASSESSEE VIDE NOTIFICATION NO. 3/2005 DATED: 04/02/2005 FROM CUSTOM DEPARTMENT. TH E RELEVANT COPIES ARE ENCLOSED FOR YOUR READY REFERENCE. ( ANNEXURE NO. 3) IN AN APPEAL FOR AY 2011-12 DT. 30/04/2015 BEARING NO. 183/14- 15, VIDE PARA NO. 3.2 TO PARA 3.5, CIT APPEALS 7 AG AIN RELYING ON SAME DECISIONS & SAME FACTS ALLOWED THE CLAIM OF ASSESSEE OF DEDUCTI ON U/S 80IA(4). ORDER OF THE TRIBUNAL VERY SAME ISSUE ALSO CAME UP BEFORE THE HON'BLE ITA T PUNE BENCH PUNE IN ASSESSEE'S OWN CASE FOR AY 2008-9 & 2009-10 (APPEAL NO. 819/PN/2013 & APPEAL NO.820/PN/2013) VIDE THE DECIS ION DT. 09/05/2016 THE HON'BLE TRIBUNAL HAS HELD THE VERY SAME ISSUE OF CLAIM U/S.80IA(4) IN FAVOUR OF THE ASSESSEE VIDE PARA NO. 13,14,15,16,17 HAS ALLOWED THE CLAIM OF THE ASSESSEE ON SAME FACTS & I N RESPECT OF SAME WAREHOUSES, TREATING THIS AS INFRASTRUCTURE FACILIT Y. ORDER OF THE HIGH COURT THE ISSUE PERTAINING TO THE FACT THAT WHETHER CONTA INER FRIGHT STATION IS INFRASTRUCTURE FACILITY WITHIN THE MEANI NG OF SEC. 80IA(4) CAME UP BEFORE THE HON'BLE BOMBAY HIGH COURT. VIDE IT AP PEAL NO. 523 OF 2013FR ITA NO.1969 OF 2013. THE HON'BLE HIGH COURT IN THE VERY SAME CASES WHICH WERE EARLIER RELIED UPON BY THE CIT APP EALS AS WELL AS ITAT PUNE, I.E. CONTINENTAL WAREHOUSING CORPORATION & AL L CARBO LOGISTICS LTD. HAS FINALLY HELD THAT THE CONTAINER FRIGHT STATION ARE INLAND PORTS FOR THE PURPOSE OF EXPLANATION (D) BELOW SUB SEC. 4 OF SEC. 80IA(4). WE FURTHER INVITE YOUR ATTENTION TO PARA NO. 47 6T 48 OF THE HON'BLE BOMBAY HIGH COURT DECISION IN WHICH FOLLOWING FINDI NGS HAVE BEEN GIVEN. 4 ITA NO.649 /PUN/2017 A.Y.2013-14 1. WHEN THE PROPOSAL TO THE SET UP A CONTAINER FRIGHT STATION HAS BEEN ACCEPTED BY THE GOVERNMENT, THERE IS NO REQUIR EMENT OF EITHER A SPECIFIC AGREEMENT. NOR IT CAN BE SAID BY THE VIRTU E OF ANY CERTIFICATION OF THE JNPT & IT SUBSEQUENT WITHDRAWAL THE POSITION UNDERGOES ANY CHANGE. ONCE THE FACILITY IS NOTHING BUT A INFRASTR UCTURAL FACILITY SET UP & WITHIN THE PRECINCTS OF THE PORT, THEN, CONSIDERI NG & EVEN OTHERWISE HAVING CONSIDERED ITS PROXIMITY TO THE SEA PORT & I TS ACTIVITIES THAT WE HAVE NO DOUBT & IT CAN BE SAFELY CONCLUDED THAT DED UCTION ADMISSIBLE U/S4 OF SEC. 80LA CAN BE CLAIMED BOTH BY ICD'S & CFS'S. 2. ONCE SUCH CONCLUSION IS REACHED, THEN IT IS NOT NEC ESSARY TO REFER ANY OTHER MATERIAL, PARTICULARLY ANY CIRCULARS OF THE B OARD OR OTHER- WISE OR THE CERTIFICATES ISSUED BY THE AUTHORITIES. EVEN TH EIR CONTENTS NEED NOT BE REFERRED TO. THE ISSUE IS, THEREFORE, SQUARELY C OVERED BY THE DECISIONS OF CIT APPEALS IN ITS OWN CASE FOR AY 201 0-11 & 2011-12, BY THE DECISION OF ITAT IN THE ASSESSEE'S OWN CASE FORAY 2008-09 & 2009-10 & ALSO BY HON'BLE BOMBAY HIGH COURT IN THE DECISION REFERRED HEREIN ABOVE. THE CLAIM OF THE ASSESSEE U/ S.80IA(4) BE ALLOWED, AS CLAIMED. 5. THE LD. CIT(APPEALS) AFTER CONSIDERING THE FACTS OF THE CA SE, SUBMISSION OF THE ASSESSEE AND THE ASSESSMENT ORDER HELD AS FOLLOWS: 5.3 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE A ND LAW APPARENT FROM RECORDS. THE APPELLANT/ASSESSEE CLAIMED DEDUCTI ON UNDER 80IA(4) RS.13,93,92,592/-. THE ASSESSEE HAS SET-UP INLAND C ONTAINER DEPOT (ICD) AND CONTAINER FREIGHT STATION(CFS) FOR HANDLING BOU NDED WAREHOUSING FACILITIES ON LEASE HOLD LAND OF SIDCO. THE ICD IS LOCATED AT ABOUT 3 TO 4 KM FROM THE BOUNDARY WALL OF JNPT AND UNIT COMMENCE D IT ACTIVITY IN DECEMBER 2004. NOTIFICATION NO.3 OF 2005 DATED 04/02/2005 FROM MINISTRY OF FINANCE COMMISSIONER OF CUSTOMS (EXPORT) THAT AREA OWNED BY ASSESSEE HAS BEEN RECOGNIZED AS 'CUSTOM AREA'. THE OFFICE OF COMMISSIONER OF CUSTOMS VIDE NOTIFICATION NO.S/15/GE N.2890/04 DATED 28.10.2004 HAS DECLARED THE WAREHOUSES OF THE APPEL LANT AS PUBLIC BOUNDED WAREHOUSES. THE APPELLANT CLAIMED DEDUCTION 80IA(4) AND SUBMITTED REPORT U/S.10CCB. THE APPELLANT RELIED ON THE DECISION OF THE DELHI HIGH COURT IN CASE OF CONTAINER CORPORATION O F INDIA. THE A.O DENIED THE CLAIM OF DEDUCTION OF 80IA(4) OBSERVING THAT BOARDS NOTIFICATION DATED 30/06/2000 RELIED BY THE ASSESSEE HAS BEEN SUBSEQUENTLY WITHDRAWN THROUGH CIRCULAR NO. 10/2005 DATED 16/12/2005. FURTHER THE ASSESSEE HAS REQUESTED JNPT FOR CERTIFICATE TO INDI CATE THAT THE STRUCTURE OF THE ASSESSEE FORMS THE PART OF THE PORT IN JULY 2007 WAS DECLINED OCTOBER 2008 BY J N PT. 5.4 DURING THE APPELLATE PROCEEDINGS THE APPELLAN T RELIED ON THE DECISIONS IN CASE OF (I) CONTAINER CORPORATION OF I NDIA LTD. VS ACIT (2012)346 ITR 140 (DEL)(II) ALL CARGO GLOBAL LOGIST IC LTD. VS DC IT (2012) '18 ITR (TRIB)106 (MUM) (SB)(III) JWC LOGISTIC PARK (P) LTD. 52 TAXMANN.COM 144.(IV) CIT CHENNAI VS AL LOGISTICS PV T. LTD. REPORTED IN 55 TAXMANN.COM 283. THE APPELLANT FURTHER STATED TH AT THE ITAT PUNE IN CASE OF APPELLANT FOR A.Y.2008-09 AND 2009-10 ALLOW ED THE APPEAL OF THE APPELLANT VIDE ORDER DATED 09/05/2016. THE APPELLANT ALSO SUBMITTED THAT THE APPEAL OF THE APPELLANT HAS BEEN ALLOWED BY THE CIT APPEAL FOR A.Y.201 0-11 AND 2011-12. THE ISSUE HAS ALSO BEEN D ECIDED BY THE BOMBAY HIGH COURT IN CASE OF CONTINENTAL WAREHOUSIN G CORPORATION (NHAVA SHEVA) LIMITED IN ITA NO.523 OF 2013 & 1969 OF 2013 DATED 5 ITA NO.649 /PUN/2017 A.Y.2013-14 21/04/2015 AND ALLOWED THE DEDUCTION UNDER 80IA(4) IN CASE OF CONTAINER FRIGHT STATION (CFS). 5.4.1 THE ITAT IN CASE OF APPELLANT FOR A.Y.2008-09 AND 2009-10 VIDE ITA NO.819, 820, 968 & 969/PN/20'13 DATED 09/05/2016 HAS DECIDED THE APPEAL IN FAVOUR OF APPELLANT ASSESSEE BY OBSERVING THAT: '13. THE GROUND NO. 2 IN THE APPEAL OF THE ASSESSEE FOR ASSESSMENT YEAR 2009-10 RELATES TO DISALLOWANCE OF DEDUCTION RS.4,5 0,17,204/- U/S. 801A(4) OF THE ACT. THE ASSESSEE HAS SET UP INLAND CONTAINER DEPOT (ICD) AND CONTAINER FREIGHT STATION (CFS) FOR HANDLING BO NDED WAREHOUSING FACILITIES ON LEASEHOLD LAND OF SIDCO. THE ICD ESTA BLISHED 16 ITA NOS. 819, 820,968 & 969/PN/2013 BY THE ASSESSEE IS LOCAT ED AT ABOUT 3-4 KMS. AWAY FROM THE BOUNDARY WALL OF JAWAHARLAL NEHR U PORT TRUST AND THE UNIT COMMENCED ITS ACTIVITIES IN DECEMBER, 2004 . THE UNIT IS SAID TO BE MODIFIED UNDER CUSTOMS ACT AS 'CUSTOMS AREA' FOR TH E PURPOSE OF STORAGE, STUFFING, DESTUFFING AND CLEARANCE OF EXPO RT AND IMPORT. THE ASSESSEE CLAIMED DEDUCTION U/S. 80IA(4) IN VIEW OF BOARD'S NOTIFICATION NO. F.NO.205/17/2000/ITA-2 DATED 23-06-2000. THE AS SESSING OFFICER DENIED THE CLAIM OF THE ASSESSEE U/S. 80IA(4) ON TH E GROUND THAT CBDT CIRCULAR DATED 23-06-2000 (SUPRA) HAS BEEN WITHDRAW N W.E.F. 16-12-2005 AND THE BOARD PORT TRUST HAS STATED THAT THE AREA F ROM WHERE ASSESSEE IS OPERATING DOES NOT FORM PART OF THE 'PORT'. IN FIRS T APPEAL THE COMMISSIONER OF INCOME TAX (APPEALS) UPHELD THE FINDINGS OF ASSE SSING OFFICER AND DENIED THE BENEFIT OF DEDUCTION U/ S. 80IA(4) TO TH E ASSESSEE. 14. THE LD. AR OF THE ASSESSEE SUBMITTED THAT THE C ASE OF THE ASSESSEE IS SQUARELY COVERED BY THE DECISION OF CO-ORDINATE BEN CH OF THE TRIBUNAL IN THE CASE OF ACIT VS. JWC LOGISTICS PARK PVT. LTD. ( SUPRA). IN THE SAID CASE THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF RUNNING CONTAINER YARD, INLAND CONTAINER DEPOT (ICD), CONTAINER FREIGHT STA TION (CFS), BONDED WAREHOUSE ETC. THE ICD /CFS OF THE ASSESSEE COMPANY STARTED ITS OPERATIONS IN YEAR 2004. THE ASSESSEE CLAIMED DEDUC TION U/S.80IA(4) IN RESPECT OF ICD / CFS FACILITIES SET UP BY THE ASSES SEE. THE ASSESSING OFFICER REJECTED THE CLAIM OF THE ASSESSEE ON THE G ROUND THAT THE ASSESSEE DID NOT FULFILL THE REQUIRED CONDITIONS AS PRESCRIB ED FOR CLAIMING DEDUCTION U/S. 80IA(4) OF THE ACT. THE ASSESSING OFFICER FURT HER OBSERVED THAT THE ASSESSEE HAS NOT BEEN ABLE TO SHOW ANY AGREEMENT WI TH THE CENTRAL GOVT./STATE GOVT./LOCAL 17 ITA NOS. 819, 820, 968 & 969/PN/2013 AUTHORITY OR ANY OTHER STATUTORY BODY FOR DEVELOPIN G OR DEVELOPING, OPERATING AND MAINTAINING A NEW INFRASTRUCTURE FACI LITY. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE FIRST APPEL LATE AUTHORITY. THE COMMISSIONER OF INCOME TAX (APPEALS) BY FOLLOWING TH E DECISION OF THE MUMBAI SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF M/S. ALL CARGO GLOBAL LOGISTICS LTD. VS. DCIT IN ITA NOS. 5018 TO 5022 & 5059 FOR ASSESSMENT YEARS 2004-05 TO 2009-10 DECIDED ON 06-07-2012 AND THE DECISION OF THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF CONTINE NTAL WAREHOUSING CORPORATION (NHAVA SHEVA) VS. ACIT IN ITA NO. 7055/ MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 DECIDED ON 31- 08-2012 ALLO WED THE CLAIM OF THE ASSESSEE. AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) THE DEPARTMENT FILED APPEAL BEFORE THE TRIBUNAL. TH E GROUND BEFORE THE TRIBUNAL FOR ADJUDICATION WAS: '2. THE ONLY EFFECTIVE GROUND RAISED BY THE REVENUE READS AS UNDER: 'WHETHER THE CIT(A)-I, THANE IS RIGHT IN LAW IN HOLDING THAT THE ASSESSEE IS ENTITLED TO DEDUCTION U/S. 80IA OF THE INCOME TAX ACT, 1961 EVEN THOUGH ACTIVITIES UNDERTAKEN BY THE ASSESSEE DO NOT FALL WITHIN CLAUSE (D) OF THE EXPLANATION TO 80 IA(4) DEFINING THE TERM INFRASTRUCTURE FACILITIES?' 6 ITA NO.649 /PUN/2017 A.Y.2013-14 THE TRIBUNAL DISMISSED THE APPEAL OF THE DEPARTMENT BY HOLDING AS UNDER: '4. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE ASSESSING OFFICER AND THE CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECISIONS CITED BEFORE US. P ROM THE STATEMENT OF FACTS FILED BY THE REVENUE, WE FIND TH E ONLY GRIEVANCE OF THE REVENUE AGAINST THE ORDER OF THE CIT(A) IS T HAT THE ORDER RELIED ON BY THE CIT(A) IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVE SHEVA) LTD. (SUPRA) HAS BEEN CHA LLENGED BY THE REVENUE BEFORE THE HON'BLE HIGH AND THE SAME IS PEN DING. THE LD. DEPARTMENTAL REPRESENTATIVE FAIRLY CONCEDED 18 ITA NOS. 819, 820, 968 & 969/PN/2013 THAT THE ISSUE HAS BEEN DECI DED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE MUMBA I BENCH OF THE TRIBUNAL AND TO KEEP THE MATTER ALIVE THE REVENUE H AS FILED THIS APPEAL SINCE THE DECISION OF THE TRIBUNAL IN THE CA SE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVE SHEVA) LTD. (SUPRA) HAS BEEN CHALLENGED BY THE REVENUE BEFORE THE HON'BLE HIGH C OURT. 4.1 THE LD. COUNSEL FOR THE ASSESSEE FILED THE DECI SION OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF CONTAINER C ORPORATION OF INDIA LTD. VS. ACIT REPORTED IN 346 ITR 140 AND SUB MITTED THAT LIE HONBLE HIGH COURT IN THE ABOVE DECISION HAS HELD T HAT THE INCOME OF ICDS IS ELIGIBLE FOR DEDUCTION U/S.80IA(4)(I) OF THE LT. ACT. HE ALSO RELIED ON THE DECISION OF THE MUMBAI BENCH OF THE T RIBUNAL IN THE CASE OF UNITED LINER AGENCIES OF INDIA (PVT) LTD. V S. JCIT AND VICE VERSA ORDER DATED 28-06-2013 FOR A.YRS 2006-07 AND 2009-10 RESPECTIVELY. HE SUBMITTED THAT SINCE THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY VARIOUS DECISIONS OF THE TRIBUNAL AND THE HON'BLE DELHI HIGH COURT, THEREFORE, THE GROUND RAI SED BY THE REVENUE SHOULD BE DISMISSED. SINCE THE LD.CIT(A) WH ILE ALLOWING THE CLAIM OF DEDUCTION U/S.80IA(4) HAS FOLLOWED THE DECISION OF THE' TRIBUNAL, THEREFORE, MERELY BECAUSE THE REVENUE HAS CHALLENGED THE DECISION OF THE TRIBUNAL BEFORE THE HON'BLE HIG H COURT, THE SAME IN OUR OPINION CANNOT BE A GROUND TO TAKE A CO NTRARY DECISION THAN THE VIEW TAKEN BY THE TRIBUNAL CITED (SUPRA). IN THIS VIEW OF THE MATTER, WE UPHOLD THE ORDER OF THE CIT(A) AND T HE GROUND RAISED BY THE REVENUE IS DISMISSED.' 15. WE FIND THAT THE FACTS OF THE CASE OF THE ASSES SEE IS SIMILAR TO THAT OF THE CASE DECIDED BY THE CO-ORDINATE BENCH O F THE TRIBUNAL IN THE CASE OF ACIT VS. JWC LOGISTICS PARK PVT. LTD . (SUPRA). WE OBSERVE THAT THE HON'BLE BOMBAY HIGH COURT IN THE C ASE OF COMMISSIONER OF INCOME TAX VS. CONTINENTAL WAREHOUSI NG CORPORATION (SUPRA) HAS UPHELD THE ORDER OF TRIBUNA L. THE HON'BLE COURT AFTER CONSIDERING THE PROVISIONS OF SECTION 8 0IA(4) OBSERVED: '39 ..WE ARE CONCERNED WITH SUB-SECTION (4) AND A S IT READ AT THE RELEVANT TIME. IT SAYS THAT THIS SECTIO N APPLIES TO ANY ENTERPRISE CARRYING ON THE BUSINESS OF DEVELOPI NG OR OPERATING AND MAINTAINING ANY INFRASTRUCTURE FACILI TY WHICH FULFILLS ALL THE CONDITIONS, NAMELY, IT IS OWNED 19 ITA NOS. 819, 820, 968 & 969/PN/2013 BY A COMPANY REGISTERED IN INDIA OR BY A CONSORTIUM OF SUCH COMPANIES OR BY AN AUTHORITY OR A BOARD OR A CORPORATION OR ANY OTHER BODY ESTABLISHED OR CONSTITUTED UNDER ANY CENTRAL OR STA TE ACT, IT HAS ENTERED INTO AN AGREEMENT WITH THE CENTRAL GOVE RNMENT OR A LOCAL AUTHORITY OR ANY OTHER STATUTORY BODY FO R DEVELOPING OR OPERATING AND MAINTAINING OR DEVELOPI NG, 7 ITA NO.649 /PUN/2017 A.Y.2013-14 OPERATING AND MAINTAINING A NEW INFRASTRUCTURE FACI LITY AND IT HAS STARTED OR STARTS OPERATING AND MAINTAINING THE INFRASTRUCTURE FACILITY ON OR AFTER 1ST DAY OF APRI L, 1995. THE EXPLANATION DEFINES THE INFRASTRUCTURE FACILITY TO MEAN, INTER ALIA,A PORT, AIRPORT, INLAND WATERWAY, INLAND PORT OR NAVIGATIONAL CHANNEL IN THE SEA. THE WORD 'INLAND P ORT' WAS ALWAYS THERE IN CLAUSE (D). WHAT WAS THERE PRIOR TO ITS SUBSTITUTION BY FINANCE ACT OF 2007 WITH EFFECT FRO M 1ST APRIL, 2008, WERE THE WORDS 'OR INLAND PORT'. NOW T HE WORD 'OR' IS DELETED, BUT THE WORDS ARE 'INLAND PORT OR NAVIGATIONAL CHANNEL IN THE SEA'. THUS, AN 'INLAND PORT' WAS ALWAYS WITHIN THE CONTEMPLATION OF THE LEGISLATURE AND IT IS TREATED SPECIFICALLY AS A INFRASTRUCTURAL FACILITY. THEREFORE, TO THAT EXTENT MR. DASTUR IS RIGHT IN HIS SUBMISSION.' THE HON'BLE COURT FURTHER AFTER CONSIDERING THE DEC ISION OF HON'BLE DELHI HIGH COURT IN THE CASE OF CONTAINER CORPORATI ON OF INDIA LTD. VS. ASSTT. COMMISSIONER OF INCOME TAX REPORTED AS 346 I TR 140 (DELHI) CONCLUDED AS UNDER: '46. WE HAVE FOUND THAT THERE IS A SPECIFIC REFEREN CE MADE BY THE DELHI HIGH COURT TO THE COMMUNICATION DATED 24TH AP RIL, 2007, FROM THE GOVERNMENT OF INDIA, MINISTRY OF FINANCE, AND DEPARTMENT OF REVENUE. THESE ARE THEN CLASSIFIED AS INLAND POR TS AND CATEGORIZED ACCORDINGLY. THERE IS A FURTHER COMMUNI CATION FROM THE MINISTRY OF COMMERCE AND INDUSTRY AS WELL. WE DO NO T FIND THAT A VIEW DIFFERENT THAN THE ONE TAKEN BY THE DELHI HIGH COURT IS POSSIBLE. BEARING IN MIND THE FACILITIES THAT ARE E XTENDED AND FOR PURPOSES OF LOADING, UNLOADING, STORAGE AND WAREHOU SING OF THE GOODS THAT THE FACILITY IS A INFRASTRUCTURE FACILIT Y. THAT IT HAS EASY ACCESSIBILITY TO THE PORT AND PARTICULARLY THE SEA- PORT GIVES IT CERTAIN ADVANTAGES AND BENEFITS AND WHICH CLEARLY ACCRUE TO THOSE USING THE PORT OR IMPORT AND EXPORT OF CARGO. FURTHER, TH E LOCATION THEREOF IS ALSO A RELEVANT FACTOR AS NOTED. IN SUCH CIRCUMS TANCES, THE RELIANCE BY THE SPECIAL BENCH AND EQUALLY BY THE BE NCH OF THE TRIBUNAL IN THE IMPUGNED ORDERS ON THE DIVISION BEN CH JUDGMENT OF THE DELHI HIGH COURT IS THUS WELL PLACED. 47. WE DO NOT FIND THAT ANYTHING OTHER AND FURTHER THAN THIS MATERIAL IS RELIED. HOWEVER, EVEN THE HIGH COURT OF JUDICATURE AT MADRAS HAS REFERRED IN ITS DIVISION BENCH DECISION TO THE VIEW TAKEN BY THE DELHI HIGH COURT. THE DIVISION BENCH I N PARAGRAPHS 10 AND 12 OF ITS JUDGMENT EXTENSIVELY REFERRED TO T HE TRIBUNAL'S CONCLUSIONS. IT ALSO REFERRED TO THE SPECIAL BENCH DECISION OF THE TRIBUNAL. THUS, WHEN THE PROPOSAL TO SET UP A CFS H AS BEEN ACCEPTED BY THE GOVERNM.ENT, THERE IS NO REQUIREMEN T OF EITHER A SPECIFIC AGREEMENT AS CONTENDED BY MR. SURESH KUMAR . NOR CAN IT BE SAID THAT BY VIRTUE OF ANY CERTIFICATION OF THE JNPT AND ITS SUBSEQUENT WITHDRAWAL THE POSITION UNDERGOES ANY CH ANGE. ONCE THE FACI1ITY IS NOTHING BUT A INFRASTRUCTURAL FACIL ITY SET UP AND WITHIN THE PRECINCTS OF THE PORT, THEN, CONSIDERING AND EVEN OTHERWISE HAVING CONSIDERED ITS PROXIMITY TO THE SE A PORT AND ITS ACTIVITIES THAT WE HAVE NO DOUBT AND IT CAN BE SAFE LY CONCLUDED THAT THE DEDUCTION ADMISSIBLE UNDER SUB-SECTION (4) OF SECTION 80- IA CAN BE CLAIMED BY BOTH THE ICDS AND CFSS.' 16. THE HON'BLE MADRAS HIGH COURT IN THE CASE OF CO MMISSIONER OF INCOME TAX VS. A.L. LOGISTICS (P.) LTD. (SUPRA.) HAS HELD THAT CFS IS PART OF INLAND PORT AND THEREFORE, IS AN INFRASTRUCTURE FACILITY A S DEFINED IN EXPLANATION TO SECTION 80IA(4)(I) OF THE ACT. 8 ITA NO.649 /PUN/2017 A.Y.2013-14 17. IN VIEW OF THE VARIOUS DECISIONS DISCUSSED ABOV E AND THE FACTS OF THE INSTANT CASE WE ACCEPT GROUND NO.2 RAISED IN THE AP PEAL OF THE ASSESSEE FOR ASSESSMENT YEAR 2009-10. THUS, WE HOLD THAT THE ASSESSEE IS ELIGIBLE TO CLAIM DEDUCTION U/S.80IA(4) IN RESPECT OF ICD/CF S SET UP BY THE ASSESSEE. 18. IN THE RESULT, THE APPEAL OF THE ASSESSEE IN IT A NO.819/PN/2013 FOR THE ASSESSMENT YEAR 2008-09 IS PARTLY ALLOWED FOR S TATISTICAL PURPOSES AND THE APPEAL OF THE ASSESSEE IN ITA NO.820/PN/201 3 FOR ASSESSMENT YEAR 2009-10 IS PARTLY ALLOWED. 5.4.2 THE BOMBAY HIGH COURT IN THE CASE OF CIT-II, THANE VS. CONTINENTAL WAREHOUSING CORPORATION (NHAVA SHEVA) LTD. REPORTED IN 374 ITR 645 ( BOM.) HAS HELD THAT: SECTION 80-IA OF THE INCOME TAX ACT,1961-DEDUCTION - PROFITS AND GAINS FROM INFRASTRUCTURE UNDERTAKING (INFRASTRUCTU RE FACILITY)- WHETHER CFS IS AN INLAND PORT AS IT CARRIES OUT FUN CTIONS OF WAREHOUSING, CUSTOMS CLEARANCE AND TRANSPORT OF GOO DS FROM ITS LOCATION TO SEA-PORT AND VICE VERSA BY RAIL OR BY TRUCKS IN CONTAINERS - HELD, YES - WHETHER ICDS CAN ALSO BE C ONSIDERED TO BE INLAND PORTS - HELD, YES - WHETHER ONCE FACILITY IS NOTHING BUT A INFRASTRUCTURAL FACILITY SET UP WITHIN PRECINCTS OF PORT, THEN, HAVING CONSIDERED ITS PROXIMITY TO SEA-PORT AND ITS ACTIVI TIES, IT CAN BE SAFELY CONCLUDED THAT DEDUCTION ADMISSIBLE UNDER SU B-SECTION (4) OF SECTION 80-IA CAN BE CLAIMED BY BOTH ICDS AND CFSS - HELD, YES [PARAS 44 & 47]' 5.4.2.1 THE DECISION OF THE BOMBAY HIGH COURT HAS B EEN CHALLENGED BY THE DEPARTMENT AND SLP HAS BEEN ADMITTED BY THE HON ORABLE SUPREME COURT REPORTED IN REPORTED 235 TAXMANN 568. THE SUP REME COURT HAS OBSERVED AS: 'SECTION 80-IA OF THE INCOME-TAX ACT, 1961 - DEDUCT IONS - PROFITS AND GAINS FROM INFRASTRUCTURE UNDERTAKINGS (INFRASTRUCTURE FA CILITY) - HIGH COURT BY IMPUGNED ORDER HELD THAT ICDS AND CFSS ARE INFRASTR UCTURAL FACILITY ENTITLED TO DEDUCTION UNDER SUB-SECTION (4) OF SECT ION 80-IA - WHETHER SPECIAL LEAVE PETITION FILED AGAINST IMPUGNED ORDER WAS TO BE GRANTED - HELD, YES [IN FAVOUR OF REVENUE] ' 5.4.3 THE ISSUE OF CONTAINER FRIGHT STATION (CFS) IS PART OF IN LAND PORT AND ELIGIBLE FOR DEDUCTION UNDER 80IA(4) BEEN INFRA STRUCTURE FACILITY HAS BEEN HELD BY THE MADRAS HIGH COURT. THE JURISDICTIO NAL BOMBAY HIGH COURT HAS ALSO ALLOWED THE DEDUCTION UNDER 80IA(4) TO CFS IN CASE OF CONTINENTAL WAREHOUSING CORPORATION LTD. WHEREIN THE REJECTION OF ISSUE OF CERTIFICATE BY THE JNPT HAS ALSO BEEN CONSIDERED. IN CASE OF TH E APPELLANT JNPT HAS DECLINED TO ISSUE CERTIFICATE THAT WAREHOUSING OF T HE ASSESSEE IS PART OF THE PORT. THE SLP AGAINST THE ORDER OF THE BOMBAY HIGH COURT HAS BEEN ADMITTED BY THE SUPREME COURT. THEREFORE THE ISSUE HAS NOT YET BEEN SETTLED AND OUTCOME OF THE APPEALS MAY CHANGE ON DE CISION OF THE APEX COURT ON THE ISSUE. THE JURISDICTIONAL ITAT AS ALLO WED THE APPEAL OF THE ASSESSEE FOR A.Y.2008-09 AND 2009-10 ON IDENTICAL F ACTS. THE ITAT HAS CONSIDERED THE ALL THE FOUR DECISIONS RELIED UPON B Y THE APPELLANT WHILE DECIDING THE APPEAL OF THE APPELLAN T FOR A.Y.2008-09 AND 2009-10. 5.5 RESPECTFULLY FOLLOWING THE DECISION CONTINENTAL WAREHOUSING CORPORATION LTD. (SUPRA) OF THE JURISDICTIONAL HIGH COURT AND DECISION OF THE ITAT IN CASE OF APPELLANT FOR A.Y.2008-09 AND 2009- 10 THE DEDUCTION UNDER 9 ITA NO.649 /PUN/2017 A.Y.2013-14 SECTION 80IA(4) BECOMES ALLOWABLE TO THE APPELLANT. ACCORDINGLY, GROUND NO.1 OF THE APPEAL IS ALLOWED. 6. WE HAVE PERUSED THE CASE RECORDS AND HAVE GIVEN TH OUGHTFUL CONSIDERATION TO THE JUDICIAL PRONOUNCEMENTS PLACED BEFORE US. WE OBSERVE THAT LD. CIT(APPEALS) IN HIS DETAILED ORDER HAS PROVIDED RE LIEF TO THE ASSESSEE ON THE ISSUE OF DEDUCTION U/S.80IA(4) OF THE ACT ON THE BASIS OF DECISION BY THE PUNE BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEARS 2008- 09 AND 2009-10 WHEREIN THE TRIBUNAL HAS RULED IN FAVOUR OF THE ASSESSEE ALLOWING THE CLAIM OF DEDUCTION U/S.80IA(4) OF THE ACT. WE FURT HER OBSERVE THAT THE LD. AR AT THE TIME OF HEARING HAS PLACED BEFORE US THE COPY OF ORDE R PASSED BY THE PUNE BENCH OF THE TRIBUNAL IN ITA NO.1014/PUN/20 15 FOR THE ASSESSMENT YEAR 2011-12 AGAIN IN ASSESSEES OWN CASE WHERE THE TRIBUNAL HAS FOLLOWED ITS OWN ORDER FOR ASSESSMENT YEAR 2008-09 AND 2009-10 IN T HE CASE OF ASSESSEE AND PROVIDED RELIEF TO THE ASSESSEE. THEREFORE, R ELIEF GRANTED BY THE LD. CIT(APPEALS) TO THE ASSESSEE ON THE ISSUE ARE NOT ON LY COVERED BY THE ASSESSEES OWN CASE FOR ASSESSMENT YEARS 2008-09 AND 2009-10 AS WELL BUT ALSO FOR ASSESSMENT YEAR 2011-12. WE DO NOT FIND ANY INFIR MITY WITH THE FINDINGS OF THE LD. CIT(APPEALS) AND RELIEF PROVIDED TO THE AS SESSEE HEREIN IS SUSTAINED. 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON 28 TH DAY OF FEBRUARY, 2019. SD/- SD/ - ANIL CHATURVEDI PA RTHA SARATHI CHAUDHURY ACCOUNTANT MEMBER JUDICIAL MEMBER / PUNE; / DATED : 28 TH FEBRUARY, 2019. SB 10 ITA NO.649 /PUN/2017 A.Y.2013-14 !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT (APPEALS)-7, PUNE. 4. THE CIT-6, PUNE. 5. '#$ %%&' , ( &' , )*+ , / DR, ITAT, B BENCH, PUNE. 6. $,- ./ / GUARD FILE. // TRUE COPY // (0 / BY ORDER, %1 &+ / PRIVATE SECRETARY ( &' , / ITAT, PUNE. 11 ITA NO.649 /PUN/2017 A.Y.2013-14 DATE 1 DRAFT DICTATED ON 26 .0 2 .2019 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 26 .0 2 .201 9 SR.PS/PS 3 DRAFT PROPOSED AND PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/JM 5 APPROVED DRAFT COMES TO THE SR. PS/PS SR.PS/PS 6 KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7 DATE OF UPLOADING OF ORDER SR.PS/PS 8 FILE SENT TO BENCH CLERK SR.PS/PS 9 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 10 DATE ON WHICH FILE GOES TO THE A.R 11 DATE OF DISPATCH OF ORDER