OVERSEAS PLYMERS PRIVATE LIMITED , MUMBAI V. COMMISSIONER OF INCOME TAX-57 , MUMBAI

ITA 7239/MUM/2018

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 3687 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2012-2013
• Appeal Filed On: 18-12-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CHANDRA VIJAY
• Keywords: Transfer pricing
• Section: 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL J BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA NO. 7239 / MUM . /201 8 ( ASSESSMENT YEAR : 20 12 13 ) OVERSEAS P O LYMERS PVT. LTD. A 41, VENMAR HOUSE, MIDC ROAD NO.2 ANDHERI EAST, MUMBAI 400 093 PAN AAACV1895M . APPELLANT V/S ASSTT . COMMISSIONER OF INCOME TAX CIRCLE 10 (3) (1 ) , MUMBAI . RESPONDENT ITA NO. 6659 /MUM./201 8 ( ASSESSMENT YEAR : 2011 12 ) OVERSEAS P O LYMERS PVT. LTD. A 41, VENMAR HOUSE, MIDC ROAD NO.2 ANDHERI EAST, MUMBAI 400 093 PAN AAACV1895M . APPELLANT V/S ASSTT. COMMISSIONER OF INCOME TAX CIRCLE 10(3)(1), MUMBAI . RESPONDENT ASSESSEE BY : MS. HIRALI DESAI REVENUE BY : SHRI CHANDRA VIJAY DATE OF HEARING 1 1 .02.2021 DATE OF ORDER 24.02.2021 O R D E R PER SAKTIJIT DEY. J.M. 2 OVERSEAS PLYMERS PVT. LTD. THE CAPTIONED APPEAL S HA VE BEEN FILED BY THE ASSESSEE CHALLENGING TWO SEPARATE ORDERS , BOTH DATED 11 TH SEPTEMBER 2018 , PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) 57, MUMBAI, FOR THE ASSESSMENT YEAR S 2011 12 AND 2012 13. 2. GROUNDS NO.1, 2 AND 3 OF BOTH THE APPEALS ARE IDENTICAL EXCEPT THE VARIANCE IN THE FIGURES AND THEY RELATE TO TRANSFER PRICING ISSUES. 3. AT THE OUTSET, THE LEARNED COUNSEL FOR THE ASSESSEE , ON INSTRUCTIONS , SUBMITTED THAT DUE TO SMALLNESS OF THE AMOUNT INVOLVED, THE ASSESSEE WOULD NOT LIKE TO PRESS THESE GROUNDS. CONSI DERING THE AFORESAID SUBMISSION OF LEARNED COUNSEL FOR THE ASSESSEE, GROUNDS NO.1, 2, AND 3 IN BOTH THE APPEALS ARE DISMISSED AS NOT PRESSED. HOWEVER, THE ISSUES RAISED IN THESE GROUNDS ARE KEPT OPEN FOR ADJUDICATION IN CASE THEY ARISE IN ASSESSEES CASE IN FUTURE. 4. BESIDES THE AFORESAID GROUNDS, BY WAY OF LETTER DATED 13 TH OCTOBER 2020, THE ASSESSEE HAS RAISED GROUND N O.4 AS ADDITIONAL GROUND IN BOTH THE APPEALS CONCERNING NON GRANT OF DEDUCTION FOR EDUCATION CESS AND SECONDARY AND HIGHER EDUCATION CESS ON THE INCOME TAX PAID FOR THE RELEVANT ASSESSMENT YEARS. 5. THE ISSUE RAISED IN THE ADDITIONAL GROUND BEING A PURELY LEGAL ISSUE WHICH CAN BE DECIDED WITHOUT INVESTIGATING INTO FRESH FACTS, WE ARE INCLINED TO ADMIT THE ADDITIONAL GROUND. 3 OVERSEAS PLYMERS PVT. LTD. 6. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED MATERIAL ON RECORD. IT IS THE CONTENTION OF THE ASSESSEE THAT EDUCATION CESS AND SECO NDARY AND HIGHER EDUCATION CESS HAS TO BE ALLOWED AS DEDUCTION WHILE COMPUTING THE INCOME FROM BUSINESS AND PROFESSION. 7. THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS OPPOSED THE AFORESAID CONTENTION OF THE LEARNED COUNSEL FOR THE ASSESSEE. 8. AS WE FIND, IN CASE OF SESA GOA LTD. V/S JCIT, [2020] 117 TAXMAN.COM 96 (BOM.), THE HON'BLE JURISDICTIONAL HIGH COURT HAS HELD THAT EDUCATION CESS AND HIGHER AND SECONDARY EDUCATION CESS ARE LIABLE FOR DEDUCTION WHILE COMPUTING INCOME UNDER THE HEAD PROFIT AND GAIN FROM BUSINESS OR PROFESSION. THE SAME VIEW HAS BEEN EXPRESSED BY THE HONBLE RAJASTHAN HIGH COURT IN CHAMBAL FERTILIZERS AND CHEMICALS LTD. V/S JCIT, ITA NO.52/2018, JUDGMENT DATED 31TH JULY 2018. IN FACT, IN ASSESSEES OWN CASE IN ASSESSMENT YEAR 2013 14 VIDE ITA NO.6754/MUM./2018, DATED 17 TH DECEMBER 2020, THE TRIBUNAL FOLLOWING T HE AFORESAID JUDICIAL PRECEDENTS HAS ALLOWED DEDUCTION OF EDUCATIONAL CESS AND HIGHER AND SECONDARY EDUCATION CESS FROM THE INCOME COMPUTED UNDER THE HEAD PROFIT & GAINS OF BUSINESS O R PROFESSION. IN VIEW OF THE AFORESAID BINDING JUDICIAL PRECEDENTS, WE DIRECT THE ASSESSING OFFICER TO ALLOW DEDUCTION OF EDUCATION CESS AND SECONDARY AND HIGHER EDUCATION CESS FROM THE INCOME COMPUTED UNDER 4 OVERSEAS PLYMERS PVT. LTD. THE HEAD PROFIT AND GAIN OF BUSINESS OR PROFESSI ON. THIS GROUND IS ALLOWED IN BOTH THE APPEALS. 9. IN THE RESULT, APPEALS ARE PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 24.02.2021 SD/ - RAJESH KUMAR ACCOUNTANT MEMBER SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMB AI, DATED: 24.02.2021 COPY OF THE ORDER FORWARDED TO : (1) THE ASSESSEE; (2) THE REVENUE; (3) THE CIT(A); (4) THE CIT, MUMBAI CITY CONCERNED; (5) THE DR, ITAT, MUMBAI; (6) GUARD FILE . TRUE COPY BY ORDER PRADEEP J. CHOWDHURY SR. PRIVATE SECRETARY ASSISTANT REGISTRAR ITAT, MUMBAI