Chain Sys (India) Pvt. Ltd., CHENNAI V. DCIT, CHENNAI

ITA 791/CHNY/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 1059 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 5 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-09-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2006-2007
• Appeal Filed On: 31-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S VIJAYAPRABHA
• Assessee Lawyers: G BASKAR
• Keywords: Reopening of assessment
• Section: 10B

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI . . . , . !'# ! , % !& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NO.791/CHNY/2017 ( )( / ASSESSMENT YEAR : 2006-07 M/S CHAIN SYS (INDIA) PVT. LTD., 85, PONNIAMMAN NAGAR, AYANAMBAKKAM, CHENNAI - 600 095. PAN : AACCC 0304 N V. THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE -1(1), CHENNAI - 600 006. (+,/ APPELLANT) (-.+,/ RESPONDENT) +, / 0 / APPELLANT BY : SHRI G. BASKAR, ADVOCATE -.+, / 0 / RESPONDENT BY : MS. S. VIJAYAPRABHA, JCIT 1 / 2% / DATE OF HEARING : 14.08.2018 3') / 2% / DATE OF PRONOUNCEMENT : 12.09.2018 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -5, CHENNAI, D ATED 17.02.2017 AND PERTAINS TO ASSESSMENT YEAR 2006-07. 2. SHRI G. BASKAR, THE LD.COUNSEL FOR THE ASSESSEE, SUBMITTED THAT THE ASSESSEE CLAIMED DEDUCTION UNDER SECTION 10B OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). ACCORDING TO THE L D. COUNSEL, THE ASSESSING 2 I.T.A. NO.791/CHNY/17 OFFICER FOUND THAT THE ASSESSEE IS NOT ELIGIBLE FOR DEDUCTION UNDER SECTION 10B OF THE ACT. WHILE CHALLENGING THE ORDER OF THE ASSESSING OFFICER BEFORE THE CIT(APPEALS), ACCORDING TO THE LD. COUNS EL, THE ASSESSEE MADE ALTERNATIVE CLAIM UNDER SECTION 10A OF THE ACT . THE CIT(APPEALS) REJECTED THE CLAIM OF THE ASSESSEE ON THE GROUND TH AT THE ALTERNATIVE CLAIM OF DEDUCTION UNDER SECTION 10A OF THE ACT WAS NOT MADE IN THE RETURN OF INCOME. ACCORDING TO THE LD. COUNSEL, WH EN THE ASSESSEE IS ELIGIBLE FOR DEDUCTION UNDER SECTION 10A OF THE ACT , NOTHING WRONG IN EXAMINING THE CLAIM OF THE ASSESSEE IF THE CONDITIO NS WERE OTHERWISE SATISFIED. MOREOVER, THE APEX COURT FOUND THAT THE POWER OF THIS TRIBUNAL IS NOT IMPUGN TO ADMIT ADDITIONAL GROUNDS. ACCORDI NG TO THE LD. COUNSEL, THE MATTER MAY BE REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER FOR RECONSIDERATION. 3. ON THE CONTRARY, MS. S. VIJAYAPRABHA, THE LD. DE PARTMENTAL REPRESENTATIVE, SUBMITTED THAT THE ASSESSEE CANNOT MAKE ANY FRESH CLAIM AFTER REOPENING OF ASSESSMENT AS HELD BY THE APEX COURT IN THE CASE OF CIT V. SUN ENGINEERING WORKS PVT. LTD. (199 2) 198 ITR 297. MOREOVER, ACCORDING TO THE LD. D.R., THE CLAIM WAS NOT MADE IN THE RETURN OF INCOME, THEREFORE, THE CIT(APPEALS) HAS RIGHTLY CONFIRMED THE ORDER OF THE ASSESSING OFFICER. 3 I.T.A. NO.791/CHNY/17 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSMENT WAS REOPENED ONLY FOR THE PURPOSE OF RE-EXAMINING THE C LAIM OF THE ASSESSEE UNDER SECTION 10B OF THE ACT. WHEN THE ASSESSING O FFICER EXAMINED THE CLAIM UNDER SECTION 10B OF THE ACT, THE ASSESSEE MA DE ALTERNATIVE CLAIM UNDER SECTION 10A OF THE ACT BEFORE THE CIT(APPEALS ) IN RESPECT OF THE VERY SAME INCOME. THIS TRIBUNAL IS OF THE CONSIDER ED OPINION THAT WHEN THE ISSUE OF EXEMPTION UNDER SECTION 10B OF THE ACT WAS EXAMINED BY THE ASSESSING OFFICER IN THE REOPENED ASSESSMENT, I N RESPECT OF THE VERY SAME INCOME, THE ASSESSEE CAN MAKE ALTERNATIVE CLAI M UNDER SECTION 10A OF THE ACT. THEREFORE, THE JUDGMENT OF APEX CO URT IN SUN ENGINEERING WORKS PVT. LTD. (SUPRA) SUPPORTS THE CA SE OF THE ASSESSEE. MOREOVER, AS RIGHTLY SUBMITTED BY THE LD.COUNSEL F OR THE ASSESSEE, THIS TRIBUNAL CAN ENTERTAIN THE CLAIM EVEN THOUGH THE SA ME WAS NOT MADE IN THE RETURN OF INCOME. 5. WHEN THE ASSESSEE CLAIMS EXEMPTION UNDER SECTION 10B OF THE ACT IN THE RETURN OF INCOME AND IT WAS REJECTED AFT ER REOPENING OF ASSESSMENT, THE ALTERNATIVE CLAIM MADE BY THE ASSES SEE UNDER SECTION 10A OF THE ACT NEEDS TO BE EXAMINED, HENCE, THE MAT TER HAS TO BE REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER. ACCORDINGLY, THE ORDERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE ALTERNATIVE CLAIM OF DEDUCTION UNDER SECTION 10A OF THE ACT IS REMITTED BACK TO THE FILE OF THE 4 I.T.A. NO.791/CHNY/17 ASSESSING OFFICER. THE ASSESSING OFFICER SHALL RE- EXAMINE THE MATTER IN THE LIGHT OF THE MATERIAL THAT MAY BE FILED BY THE ASSESSEE AND THEREAFTER DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW, AFT ER GIVING A REASONABLE OPPORTUNITY TO THE ASSESSEE. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 12 TH SEPTEMBER, 2018 AT CHENNAI. SD/- SD/- (. !'# ! ) ( . . . ) (A. MOHAN ALANKAMONY) (N.R.S. GANESAN) % / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 5 /DATED, THE 12 TH SEPTEMBER, 2018. KRI. / -267 87)2 /COPY TO: 1. +, /APPELLANT 2. -.+, /RESPONDENT 3. 1 92 () /CIT(A)-5, CHENNAI-34 4. PRINCIPAL CIT-1, CHENNAI. 5. 7: -2 /DR 6. ( ; /GF.