D.C.I.T Cir - 9(1),kolkata, Kolkata V. M/s ITT Shippping Pvt Ltd, Kolkata

ITA 713/KOL/2019

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 0133 (ITAT-KOLKATA)
• Duration Of Justice: 8 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-12-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 08-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RANU BISWAS
• Assessee Lawyers: ANIKESH BANERJEE
• Keywords: Business expenditure; Speculation loss; Condonation of delay; Set aside
• Section: 143(3); 43(5)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B, BENC H KOLKATA BEFORE SHRI S.S.GODARA, JM &DR. A.L.SAINI, AM ./ITA NO.713/KOL/2019 ( / ASSESSMENT YEAR: 2012-13) DCIT, CIRCLE-9(1), KOLKATA VS. M/S ITT SHIPPING PVT. LTD. 1 ST FLOOR, ROOM NO. 123, 4, FAIRLIE PLACE, STRAND ROAD, KOLKATA- 700001. ./ ./PAN/GIR NO.: AAACI 5499 Q (APPELLANT) .. (RESPONDENT) APPELLANT BY : SMT. RANU BISWAS, ADDL. CIT RESPONDENT BY : SHRI ANIKESH BANERJEE, ADVOCATE / DATE OF HEARING : 31/10/2019 /DATE OF PRONOUNCEMENT : 31/12/2019 / O R D E R PER BENCH: THE CAPTIONED APPEAL FILED BY THE REVENUE, PERT AINING TO ASSESSMENT YEAR 2012-13, IS DIRECTED AGAINST THE ORDER PASSED BY TH E COMMISSIONER OF INCOME TAX (APPEAL)-23, KOLKATA IN APPEAL NO. 10009/CIT(A)-23/ 18-19, WHICH IN TURN ARISES OUT OF AN ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER U/S 143(3) R.W.S 263 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) DATED 22.12.2017. 2. THIS APPEAL FILED BY THE REVENUE IS BARRED BY LI MITATION BY 126 DAYS. THE REVENUE FILED A PETITION FOR CONDONATION OF DELAY R EQUESTING THE BENCH TO CONDONE THE DELAY. WE HAVE HEARD BOTH THE PARTIES ON THIS P RELIMINARY ISSUE AND HAVING M/S ITT SHIPPING PVT. LTD. ITA NO.713/KOL/2019 ASSESSMENT YEAR:2012-13 P PP PA AA AG GG GE EE E | || | 2 22 2 REGARD TO REASONS GIVEN IN THE PETITION FOR CONDONA TION OF DELAY WE CONDONE THE DELAY AND ADMIT THE APPEAL OF THE REVENUE FOR HEARI NG. 3. THE GROUND OF APPEAL RAISED BY THE ASSESSEE ARE AS FOLLOWS: 1. WHETHER THE CIT(A) IS JUSTIFIED IN FACTS AND IN LAW TO ALLOW THE APPEAL OF ASSESSEE AGAINST THE REVISION ASSESSMENT ORDER OF THE ASSESS ING OFFICER DATED 22.12.2017 ON THE MERE GROUND THAT THE HON'BLE ITAT VIDE ITS ORDER DA TED 01.06.2018 HAD ALLOWED THE APPEAL OF THE ASSESSEE AND SET ASIDE THE IMPUGNED O RDER PASSED BY THE LD.PR.CIT-3, KOLKATA ON 08.03.2017 AND NOT VERIFYING THE FACTS A ND CIRCUMSTANCES OF THE CASE? 2. WHETHER THE CIT(A) IS JUSTIFIED IN FACTS AND IN LAW TO DECLARE THE IMPUGNED REVISION ASSESSMENT ORDER OF THE ASSESSING OFFICER DATED 22.12.2017 AS NON-EST WITHOUT CONSIDERING THE FACTS OF THE CASE BASED ON ITS MERI T? 3. WHETHER THE CIT(A) IS JUSTIFIED IN FACTS AND IN LAW TO DECLARE THE IMPUGNED REVISION ASSESSMENT ORDER OF THE ASSESSING OFFICER DATED 22. 12.2017 AS NON-EST AND DELETED THE DISALLOWANCE BY AO ON ACCOUNT OF LOSS ON FORWARD CO NTRACT OF RS.2,34,10,636/- WITHOUT CONSIDERING THE FACT THAT THE FORWARD EXCHANGE CONT RACTS WERE SETTLED OTHERWISE THAN BY ACTUAL DELIVERY, LOSS ON ACCOUNT OF CANCELLATION OF FORWARD EXCHANGE CONTRACT WAS NOT ALLOWABLE BUSINESS EXPENDITURE AS PER SECTION 43(5) ? 4. THAT THE DEPARTMENT CRAVES LEAVE TO ADD, ALTER O R MODIFY ANY GROUNDS OF APPEAL IN THE COURSE OF APPELLATE PROCEEDINGS. 4. BRIEF FACTS QUA THE ISSUE ARE THAT IN THE INSTAN T CASE, ORIGINAL ASSESSMENT WAS COMPLETED U/ S 143(3) OF THE ACT ON 24.02.2015. THE REAFTER, DURING REVENUE AUDIT, A SPOT MEMO WAS ISSUED ON 19.08.2015 BY THE ASST. A UDIT OFFICER, ITRA-01, RAISING THE OBJECTION THAT A SUM OF RS. 2,34,10,63 6/- WAS DEBITED TO THE PROFIT AND LOSS ACCOUNT BEING LOSS OF FORWARD CONTRACT WHICH S HOULD NOT BE ALLOWED AS BUSINESS EXPENSES. SUBSEQUENTLY, AN ORDER U/S 263 W AS PASSED BY LD. PCIT ON 08.03.2017 SETTING ASIDE THE ORDER PASSED BY ASSESS ING OFFICER WITH A DIRECTION TO REFRAME THE ASSESSMENT AFRESH TAKING INTO ACCOUNT T HE OBJECTIONS RAISED BY REVENUE AUDIT PARTY. THEREAFTER, ASSESSING OFFICER PASSED CONSEQUENTIAL ORDER TO GIVE EFFECT THE ORDER OF LD. PCIT AND DISALLOWED RS . 2,34,10,636/-. 5. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A) WHO HAS ALLOWED THE APPEAL OF THE ASSESSEE OBSERVING THE FOLLOWING: M/S ITT SHIPPING PVT. LTD. ITA NO.713/KOL/2019 ASSESSMENT YEAR:2012-13 P PP PA AA AG GG GE EE E | || | 3 33 3 THIS APPEAL IS INSTITUTED AGAINST THE CONSEQUENTIA L ASSESSMENT ORDER, PASSED BY THE ASSESSING OFFICER ON 22.12.2017 U/S 143(3) READ WITH THE SECTION 263, IN RESPONSE TO THE ORDER PASSED U/S 263 BY THE PR. CIT -3 ,KOLKATA ON 08.03.2017. IN THIS CASE , IT HAS BEEN STATED THAT THE ORDER U/ S 263 OF PR. CIT-3, KOLKATA HAS BEEN ALLOWED BY HON'BLE ITAT IN ITA NO. 1014/KOL/20 17 DATED 01.06.2018 WHEREIN IT HAS BEEN HELD AS UNDER: ' HENCE THE ISSUE IS QUESTION IS COVERED BY A DECISION OF COORDINATE BENCH OF THE TRIBUNAL . WE R ESPECTFULLY FOLLOWING THE SAME AS NO CONTRARY JUDGEMENTS HAVE BEEN BROUGHT TO OUR NOTICE BY THE LD. CIT DR. HENCE EVEN ON MERITS THE LOSS IN QUESTION IS ALLOWA BLE AS A NORMAL BUSINESS LOSS DURING THE YEAR AND THIS LOSS IS NOT ' SPECULATIVE LOSS ' IN VIEW OF THE ABOVE DISCUSSION WE ALLOW THIS APPEAL OF THE ASSESSEE AND SET ASIDE THE IMPUGNED ORDER PASSED BY THE LD. PR. CIT PASSED U/S 263 OF THE ACT ON 08.03.2017. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D 1 ' IN VIEW OF THE APPELLATE ORDER PASSED BY HON'BLE IT AT ON 01.06.2018 THE ORDER PASSED U/S 263 ON 08.03.2017 OF THE PR. CIT, KOLKAT A DOES NOT SURVIVE. ACCORDINGLY, THE CONSEQUENTIAL ORDER PASSED BY THE ASSESSING OFFICER ON 22.12.2017 BECOMES WITHOUT JURISDICTION AND VOID AB INITIO. 6. WE NOTE THAT THE ORDER PASSED BY THE LD. PCIT U/ S 263 DOES NOT SURVIVE AS THE HONBLE ITAT, KOLKATA BENCH IN ITA NO. 1014/KOL/201 7 ORDER DATED 1.06.2018 HAS QUASHED THE ORDER U/S 263 OF THE ACT. THEREFORE , THE CONSEQUENTIAL ORDER PASSED BY THE ASSESSING OFFICER IN PURSUANCE OF THE ORDER U/S 263 OF THE ACT BECOMES WITHOUT JURISDICTION AND INFRUCTUOUS AND H ENCE THE LD. CIT(A) HAS RIGHTLY ALLOWED THE APPEAL OF THE ASSESSEE. THAT BEING SO, WE DECLINE TO INTERFERE IN THE ORDER PASSED BY THE LD. CIT(A), HIS ORDER ON THIS I SSUE IS HEREBY UPHELD AND THE GROUNDS OF APPEAL RAISED BY THE REVENUE IS DISMISSE D. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS D ISMISSED. ORDER PRONOUNCED IN THE COURT ON 31.12 .2019 SD/- ( S.S.GODARA ) SD/- (A.L.SAINI) / JUDICIAL MEMBER / ACCOUNTANT MEMBER /KOLKATA; / DATE: 31/12/2019 ( SB, SR.PS ) M/S ITT SHIPPING PVT. LTD. ITA NO.713/KOL/2019 ASSESSMENT YEAR:2012-13 P PP PA AA AG GG GE EE E | || | 4 44 4 COPY OF THE ORDER FORWARDED TO: 1. DCIT, CIRCLE-9(1), KOLKATA 2. M/S ITT SHIPPING PVT. LTD. 3. C.I.T(A)- 4. C.I.T.- KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. 6. GUARD FILE. TRUE COPY BY ORDER ASSIST ANT REGISTRAR ITAT, KOLKA TA BENCHES