DCIT, Hyderabad V. M/s Sukaso Ceracolours Pvt. Ltd., Hyderabad

ITA 757/HYD/2010

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 6231 (ITAT-HYDERABAD)
• Duration Of Justice: 5 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-11-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2000-2001
• Appeal Filed On: 21-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NIVEDITA BISWAS
• Section: 43B; 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A , HYDERABAD BEFORE SHRI G.C. GUPTA, VICE PRESIDENT AND SHRI CHANDRA POOJARI ACCOUNTANT MEMBER ITA NO.620/HYD/2010 ASSESSMENT YEAR 2006-07 THE DCIT, CIRCLE 3(2), RANGE 3, HYDERABAD VS M/S SUKASO CERACOLORS (P) LTD., HYDERABAD (PAN AAECS 1736 N/S-67) (APPELLANT) (RESPONDENT) ITA NO.757/HYD/2010 ASSESSMENT YEAR 2000-2001 THE DCIT, CIRCLE 3(2), RANGE 3, HYDERABAD VS M/S SUKASO CERACOLORS (P) LTD., HYDERABAD (PAN AAECS 1736 N/S-67) (APPELLANT) (RESPONDENT) ITA NO.758/HYD/2010 ASSESSMENT YEAR 2004-05 THE DCIT, CIRCLE 3(2), RANGE 3, HYDERABAD VS M/S SUKASO CERACOLORS (P) LTD., HYDERABAD (PAN AAECS 1736 N/S-67) (APPELLANT) (RESPONDENT) APPELLANT BY : SMT. NIVEDITA BISWAS, DR RESPONDENT BY : SHRI PVSS PRASAD O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER: THESE THREE APPEALS PREFERRED BY THE REVENUE AR E DIRECTED AGAINST THE DIFFERENT ORDERS PASSED BY THE CIT(A) IV, HYDERABAD AND PERTAINS TO THE ASSESSMENT YEARS 2006-07, 2000-01 A ND 2004-05. SINCE ISSUES INVOLVED IN THESE THREE APPEALS ARE COMMON, THEY ARE CLUBBED TOGETHER, HEARD TOGETHER AND DISPOSED OFF VIDE THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. ITA NOS.620, 757 & 758/H/2010 M/S SUKASO CERACOLORS (P) LTD., HYDERABAD 2 2 2. THE FIRST COMMON GROUND IN ALL THE THREE APPE ALS ARE THAT THE CIT(A) ERRED IN NOT APPRECIATING THE LEGISLATIVE IN TENTION IN INSERTING THE PROVISIONS OF SECTION 145A. THE CIT(A) SHOULD HAVE SUSTAINED THE ADDITION ON ACCOUNT OF EXCISE DUTY ON CLOSING STOCK AS THE P ROVISION CREATED TOWARDS EXCISE DUTY PAYABLE ON CLOSING STOCK OF FINISHED GO ODS IS ONLY A CONTINGENT LIABILITY AND NOT AN ASCERTAINED LIABILITY AS ON 31 ST MARCH OF THE ACCOUNTING YEAR. 3. AFTER HEARING BOTH THE PARTIES, WE ARE OF THE OPINION THAT THIS ISSUE WAS CONSIDERED BY THIS TRIBUNAL VIDE ORDER DA TED 6.10.2010 IN ITA NO.676/HYD/2008 IN THE CASE OF M/S SRINI PHARMACEUT ICALS LTD., HYDERABAD WHEREIN THE TRIBUNAL HELD IN PARA 4 AS FO LLOWS: 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFU LLY. WE FIND THAT THE ISSUE OF ALLOWABILITY OF EXCISE DUTY PAYABLE ON CLOSING STOCK IS COVERED IN FAVOUR OF THE ASSESSEE WITH THE DECISION S RELIED UPON BY THE LEARNED COUNSEL FOR THE ASSESSEE CITED SUPRA. IN THIS CASE, THE CIT(A) HAS DIRECTED THE ASSESSING OFFICER TO VERIFY WHETHER THE EXCISE DUTY PAYABLE ON CLOSING STOCK HAS BEEN PAID BEFORE THE DUE DATE OF FILING OF THE RETURN OF INCOME BY THE ASSESSEE COMP ANY AND IN THE CASE THE SAME HAS BEEN PAID AS STIPULATED UNDER THE PROVISO TO SECTION 43B OF THE ACT, THE SAME SHOULD BE ALLOWED AS ADMISSIBLE DEDUCTION. THERE BEING NO MISTAKE IN THE DIRECTION OF THE CIT(A), WE UPHOLD THE SAME AND THE GROUNDS OF THE APPEAL OF TH E REVENUE BEING WITHOUT ANY MERIT, ARE DISMISSED. 4. RESPECTFULLY FOLLOWING THE ABOVE RATIO LAID D OWN BY THIS TRIBUNAL, WE ARE INCLINED TO DISMISS THE GROUND TAK EN BY THE REVENUE ON SIMILAR LINES. 5. THE NEXT GROUND IN ITA NO.757/HYD/2010 IS THA T THE CIT(A) ORDER DIRECTING THE ASSESSING OFFICER TO GIVE CREDI T FOR MAT BEFORE LEVYING INTERESTS U/S 234B AND 234C IS ERRONEOUS IN LAW AS THE AMENDMENT WAS MADE W.E.F. 1.4.2007 RELEVANT TO THE ASSESSMENT YEA R 2007-08. ITA NOS.620, 757 & 758/H/2010 M/S SUKASO CERACOLORS (P) LTD., HYDERABAD 3 3 6. SIMILAR ISSUE WAS CONSIDERED BY THIS TRIBUNAL IN THE CASE OF CHEMPLAST SANMAR LTD. VS. DCIT (2004) 3 SOT 620 (CH ENNAI) WHEREIN IT WAS HELD THAT THE ASSESSEE IS ENTITLED TO ADJUSTMEN T ON MAT CREDIT FIRST, BEFORE CHARGING THE INTEREST U/S 234B & 234C OF THE IT ACT. SIMILAR VIEW WAS TAKEN BY THE HONBLE DELHI HIGH COURT IN THE CA SE OF CIT VS. JINDAL EXPORTS LTD. & OTHERS REPORTED IN 314 ITR 137 (DEL. HC). 7. RESPECTFULLY FOLLOWING THE SAME RATIO LAID DO WN BY THE ABOVE JUDGEMENTS, WE ARE INCLINED TO DISMISS THE GROUND T AKEN BY THE REVENUE. 8. IN THE RESULT, ALL THE THREE APPEALS FILED BY THE REVENUE IN ITA NOS.620, 757 & 758/H/2010 ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT 8.11.2010 SD/- SD/- G.C. GUPTA CHANDRA POOJARI VICE PRESIDENT ACCOUNTANT MEMBER DATED THE 8 TH NOVEMBER, 2010 COPY FORWARDED TO: 1. M/S SUKASO CERA COLORS (P) LTD., 1275, RD. NO.63 A, JUBILEE HILLS, HYDERABAD 2. DCIT, CIRCLE 3(2), RANGE 3, HYDERABAD 3. CIT(A)-IV HYDERABAD. 4. CIT, HYDERABAD 5. THE D.R., ITAT, HYDERABAD. NP