ACIT 2(2)(2), MUMBAI V. MAULTIPACK SYSTEMS P.LTD, MUMBAI

ITA 795/MUM/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 6716 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 03-02-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: DEVENDRA SHRIMANKAR
• Section: 143(3); 145

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL I BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY , JUDICIAL MEMBER AND SHRI DR. A.L. SAINI , ACCOUNTANT MEMBER ITA NO. 795 / MUM/2017 ( ASSESSMENT YEAR : 20 12 13 ) ASSTT. COMMISSIONER OF INCOME TAX CIRCLE 2(2) (2) , MUMBAI . APPELLANT V/S MAULTIPACK SYSTEMS P. LTD. OMARI INDIA PVT. LTD. ROHIT CHAMBERS, 1 ST FLOOR JANMABHOOMI MARG, FORT MUMBAI 400 001 PAN AAACM3013E . RESPONDENT REVENUE BY : SHRI SAURABH KUMAR RAI ASSESSEE BY : SHRI DEVENDRA SHRIMANKAR DATE OF HEARING 25 .0 6 .2018 DATE OF ORDER 25.06.2018 O R D E R PER SAKTIJIT DEY, J.M. A FORESAID APPEAL BY THE REVENUE IS AGAINST ORDER DATED 22 ND NOVEMBER 2016, PASSED BY THE LEARNED COMMISSIONER (APPEALS) 5 , MUMBAI, FOR THE ASSESSMENT YEAR 2012 13. 2 . THE REVENUE HAS RAISED THE FOLLOWING EFFECTIVE GROUNDS: 1. WHETHER IN THE FACTS AND IN THE CIRCUMSTANCES OF APPEAL THE LEARNED CIT(A) WAS RIGHT TO ALLOW NOTIONAL SUBJUDICE 2 MAULTIPACK SYSTEMS P. LTD. DEDUCTION OF UNUTILIZED CENVAT / SERVICE TAX OF EARLIER YEARS WHEN THE ASSESSEE HAS NOT ACCEPTED THE STAND OF REVENUE IN EARLIER YEARS AND THE LITIGATION IS ON. 2. WHETHER IN THE FACTS AND IN THE CIRCUMSTANCES OF APPEAL THE LEARNED CIT(A) WAS RIGHT TO ALLOW DEDUCTION OF ` 93,88,038 WHEN RETURNED INCOME HAS BEEN ACCEPTED BY THE A.O. IN THE ORDER MADE U/S 143(3) AND THERE IS NO CAUSE FOR APPEAL. 3 . BRIEF FACTS ARE, THE ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF MANUFACTURING OF PACKAGING MACHINES. FOR THE ASSESSMENT YEAR UNDER DISPUTE, ASSESSEE HAD FI LED ITS RETURN OF INCOME ON 29 TH SEPTEMBER 2012, DECLARING TOTAL INCOME OF ` 24,32,87,719. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE STATED THAT WHILE COMPLETING ASSESSMENT FOR ASSESSMENT YEAR 2008 09 AND 2009 10 AND 2010 11, SINCE, ADDITIONS UNDER S ECTION 145A OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT ) WERE MADE ON ACCOUNT OF UNUTILIZED CENVAT CREDIT ON CLOSING STOCK / SERVICE TAX , IN THE IMPUGNED ASSESSMENT YEAR THE ASSESSEE IS ENTITLED TO DEDUCTION OF ` 93,88,038 WHICH HAS BEEN ADDED TO THE RETURNED INCOME BY THE ASSESSEE. THE ASSESSING OFFICER, HOWEVER, DID NOT ACCEPT THE CLAIM OF THE ASSESSEE ON THE REASONING THAT IN EARLIER YEARS ASSESSEE HAS DISPUTED THE ADDITIONS MADE BY THE ASSESSING OFFICER AND TH E DISPUTE IS PENDING BEFORE THE APPELLATE FORUM. ACCORDINGLY , HE PASSED THE ASSESSMENT ORDER UNDER SECTION 143(3) OF THE ACT ACCEPTING THE RETURNED INCOME. ASSESSEE CHALLENGED 3 MAULTIPACK SYSTEMS P. LTD. THE DECISION OF THE ASSESSING OFFICER BEFORE THE FIRST APPELLATE AUTHORITY. 4 . THE LEARNED COMMISSIONER (APPEALS) TAKING NOTE OF THE FACT THAT THE TRIBUNAL WHILE DECIDING THE ISSUE RELATING TO THE ADDITION OF CENVAT CREDIT IN THE EARLIER ASSESSMENT YEARS HAS RESTORED THE MATTER TO THE ASSESSING OFFICER WITH CERTAIN DIRECTION S, DIRECTED THE ASSESSING OFFICER TO FOLLOW THE DECISION OF THE TRIBUNAL. 5 . AT THE TIME OF HEARING, THE LEARNED AUTHORISED REPRESENTATIVE SUBMITTED THAT IN PURSUANCE TO THE DIRECTIONS OF THE TRIBUNAL ASSESSEES CLAIM IN THE EARLIER ASSESSMENT YEARS HAVE BEEN ALLOWED B Y THE ASSESSING OFFICER. THEREFORE, THE DEDUCTION CLAIMED BY THE ASSESSEE IN THE IMPUGNED ASSESSMENT YEAR IS NOT ALLOWABLE. IN THIS CONTEXT, THE ASSESSEE HAS FILED THE FOLLOWING LETTER BEFORE THE BENCH. 25TH JUNE 2018 THE REGISTRAR 'I' BENACH. INCOME TAX APPELLATE TRIBUNAL MUMBAI. SIR, RE: M/S. MULTIPACK SYSTEMS PVT. LTD. (NOW KNOWN AS OMORI INDIA P. LTD) ROHIT CHAMBERS JANMABHOOMI MARG FORT, MUMBAI 400001. PAN AAACM3013E ASSESSMENT YEAR 2012 - 13 SUB : SUBMISSIONS FOR THE APPEAL 4 MAULTIPACK SYSTEMS P. LTD. PLEASE REFER TO THE ITAT APPEAL NO. ITA 95/MUM/2017 FIXED FOR HEARING ON 25/06/2018. IN THIS CONNECTION, WE, ON BEHALF OF OUR ABOVE NAMED CLIENTS HAVE STATE/SUBMIT AS FOLLOWS: IN ALL THE PRECEDING ASSESSMENT YEARS, THE ASSESSING OFFICER HAS MADE ADDITIONS U/S 145A ON ACCOUNT OF UNUTILIZED CENVAT CREDIT AND SERVIC TAX (IE CLOSING STOCK - OPENING STOCK) IN EARLIER YEARS. THE DETAILS OF THE SAME ARE AS UNDER: A.Y. AMOUNT ( ` ) 2006 07 36,99,440 2007 08 14,28,790 2008 09 73,36,290 2009 10 69,94,755 2010 11 94,426 AGAINST THE SAID ADDITION OUR CLIENTS HAD PREFERRED AN APPEAL BEFORE HIGHER AUTHORITIES. IN AY 2012 - 13 IF THE SIMILAR ADDITIONS IS MADE AS IT HAS BEEN YEAR TO YEAR IN THE PAST BY THE DEPARTMENT, THERE IS A DEDUCTION OF RS. 93,88,038/ - TO BE GRANTED TO OUR CLIENTS. ACCORDINGLY OUR CLIENTS HAD DURING THE ASSESSMENT PROCEEDINGS ASKED FOR THE DED UCTION OF RS. 93,88,0387 - ON ACCOUNT OF UNUTILIZED CENVAT CREDIT AND SERVICE TAX. HOWEVER THE ASSESSING OFFICER HAS NOT GRANTED THE DEDUCTION IN THE ASSESSMENT ORDER AT PARA NO. 4 AT PAGE NO. 2 OF THE ORDER STATING THAT 'THE ASSESSEE 'S CONTENTION CANNOT B E ACCEPTED SINCE THE ASSESSEE HAS NOT ACCEPTED THE DEPARTMENTS STAND IN THE EARLIER 'WHICH ARE STILL PENDING AT VARIOUS STAGES'. AS AGAINST THE SAID ORDER FOR AY 2012 - 13, OUR CLIENTS HAD FILED AN APPEAL BEFORE CIT(A). THE LEARNED CIT(A) HAS DIRECTED THE AS SESSING OFFICER TO ALLOW THE DEDUCTION OF RS. 93,88,0387 - ON ACCOUNT OF UNUTILIZED CENVAT CREDIT AND SERVICE TAX. IN AY: 2006 - 07, AY: 2008 - 09, AY: 2009 - 10, THE IT AT HAS SET ASIDE THE MATTER TO THE FILE OF THE AO TO MAKE SIMILAR ADJUSTMENTS TO THE OPENING STOCK, CLOSING STOCK, PURCHASES AND SALES AS WELL. THE SIMILAR STAND HAS BEEN TAKEN BY CIT (A) IN AY: 2007 - 08, AY: 2010 - 11 AND AY: 2011 - 12 AND THEREFORE NO APPEAL HAS BEEN FILED BEFORE IT AT. 5 MAULTIPACK SYSTEMS P. LTD. AS PER THE DIRECTIONS OF HON'BLE ITAT, THE ASSESSING OFFICER H AS PASSED ORDER U/S 143(3) R.W.S. 254 FOR AY 2008 - 09 AND AY 2009 - 10 WHEREIN THE ASSESSING OFFICER HAS DELETED THE ADDITIONS MADE. COPY OF THE ORDERS ARE ENCLOSED HEREWITH. AS THE ADDITIONS MADE U/S 145 A ON ACCOUNT OF UNUTILIZED CENVAT CREDIT AND SERVICE TAX HAS BEEN DELETED IN THE EARLIER YEARS, THEN THE CLAIM FOR DEDUCTION OF RS.93,88,0387 - IN AY 2012 - 13 DOES NOT STAND. THUS THE ABOVE REFERRED DEPARTMENT APPEAL FOR AY 2012 - 13 MAY BE SET ASIDE TO THE FILE OF THE ASSESSING OFFICER AND DIRECTIONS TO BE GIV EN FOLLOWING THE ORDERS OF THE EARLIER YEARS. 6 . IN VIEW OF THE LETTER FILED BY THE ASSESSEE REFERRED TO ABOVE, AND CONSIDERING THE FACT THAT ADDITION OF CENVAT CREDIT IN THE EARLIER ASSESSMENT YEARS HAVE BEEN DELETED BY THE ASSESSING OFFICER BY ACCEPTING ASSESSEES CLAIM, THE DEDUCTION CLAIMED BY THE ASSESSEE IN THE IMPUGNED ASSESSMENT YEAR CANNOT BE ALLOWED. ASSESSING OFFICER IS DIRECTED TO VERIFY THIS FACT AND DECIDE THE ISSUE ACCORDINGLY. 7 . IN THE RESULT, REVENUES APPEAL IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 25.06.2018 SD/ - DR. A.L. SAINI ACCOUNTANT MEMBER SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMBAI, DATED: 25.06.2018 6 MAULTIPACK SYSTEMS P. LTD. 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 (SR. PRIVATE SECRETARY) ITAT, MUMBAI