M/s Saraswati Dynamics Pvt. Ltd., Roorkee V. ACIT, Haridwar

ITA 847/DEL/2017

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 6584 (ITAT-DEHRADUN)
• Duration Of Justice: 5 year(s) 1 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 13-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RAKESH GUPTA

Judgement Text

I.T.A. Nos. 846 and 847/Del/2017 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “I” NEW DELHI BEFORE SHRI RAMA KANTA PANDA, ACCOUNTANT MEMBER A N D SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER (Through Video Conferencing) आ.अ.सं./I.T.A Nos.846 & 847/Del/2017 िनधाᭅरणवषᭅ/Assessment Years: 2011-12 & 2012-13 M/s. Saraswati Dynamics Pvt. Ltd., C – 7, Industrial Estate, Roorkee – 110 001. बनाम Vs. ACIT, Circle, Haridwar. PAN: AAECS6262M अपीलाथᱮ /Appellant ᮧ᭜यथᱮ/Respondent िनधाᭅᳯरतीकᳱओरसे /Assessee by : Dr. Rakesh Gupta, Advocate; & Shri Somil Agrawal, Adv.; राज᭭वकᳱओरसे /Revenue by : Ms. Poonam Sharma, Sr. D.R. सुनवाईकᳱतारीख/ Date of hearing : 22/12/2021 उ᳃ोषणाकᳱतारीख/Pronouncement on : 21/03/2022 आदेश / O R D E R PER C. N. PRASAD, J. M. : 1. These two appeals were filed by the assessee against the common order of the ld. Commissioner of Income Tax (Appeals), Muzaffar Nagar [hereinafter referred to CIT (Appeals)] dated 3.06.2016 for assessment years 2011-12 and 2012-13. 2. The assessee in its appeals raised the following common grounds:- I.T.A. Nos. 846 and 847/Del/2017 2 “1. On the facts and in the circumstances of the case and in law, the CIT (A) was incorrect and unjustified in : a) Holding that for the purposes of deduction u/s 80 IC, assessment year 2005-2006 was the initial assessment year. b) Holding that the AO had rightly not disallowed 80 IC deduction on AMC/Service charges, duty draw back, interest on FDRs, other interest and interest on refund. c) Holding that AMC/Service charges etc. are not entitled for 80IC deduction since these incomes have not been derived from the eligible business. d) Holding that for the purposes on 80 IC deduction initial assessment year was not 2006-2007 and also could not be assessment year 2006-2007 in any circumstances. 3. Ground Nos. 1 (a), (b) and (d) relates to deduction under Section 80 IC of the Income Tax Act, 1961 (the Act) i.e. whether assessment year 2005-06 is the initial assessment year or 2006-07 is the initial assessment year was in question for the purposes of allowing deduction under Section 80 IC of the Act. 4. The ld. Counsel for the assessee, at the outset, submits that the Tribunal while disposing of the appeal for the assessment year 2010-11 in ITA. No. 3877 (Del) of 2015 dated 20.02.2019 held that the “initial year” for claiming benefit under Section 80 IC of the Act is 2006-07 and assessment year 2010-11 is the 5 th year for claiming the benefit and not 6 th year as held by the Assessing Officer. Therefore, the ld. Counsel submits that Assessing Officer adopting 2005-06 as the initial year and the current assessment year i.e. assessment year 2011-12 as 7 th year for the purpose of allowing deduction under Section 80 IC of the Act is not correct. I.T.A. Nos. 846 and 847/Del/2017 3 5. The ld. Counsel for the Revenue, strongly placed reliance on the order of the ld. CIT (Appeals). 6. Heard rival submissions, perused the orders and the decision of the Tribunal in assessee’s own case for assessment year 2010-11. We observe that the Tribunal while disposing of the appeal of the assessee for the assessment year 2010-11 held that the ‘initial year’ for claiming benefit under Section 80 IC of the Act is 2006-07 and going by that assessment year 2010-11 is 5 th year. Thus, respectfully following the said decision, we hold that the initial year for the purposes of claiming deduction under Section 80 IC of the Act is 2006-07 and not 2005-06. Consequently, the assessment year 2011-12 will be the 6 th year and 2012-13 will be the 7 th year. Accordingly, we direct the Assessing Officer to consider the initial year as 2006-07 and the assessment years under consideration i.e. 2011-12 and 2012-13 shall be 6 th and 7 th year respectively for the purpose of allowing deduction under Section 80 IC of the Act. We order accordingly. 7. Coming to the common ground No. 1(b) [for assessment year 2011-12] and 1(c) [for assessment year 2012-13] in both these appeals, is with respect to deduction under Section 80 IC of the Act on AMC charges, duty draw back, interest on FDRs, other interest and interest on refund. 8. The ld. Counsel for the assessee fairly submitted that the Tribunal while disposing of the appeal for assessment years 2006-07 and 2007-08 in ITA. Nos. 1563 and 4376/Del/2011 dated 26.05.2017 held that assessee is entitled for deduction under Section 80 IC of the Act on the AMC charges. The ld. Counsel for the assessee further submits that for the assessment year 2012-13 the assessee claimed deduction only at 30%, but the ld. Assessing Officer disallowed 100% of the AMC charges, duty draw I.T.A. Nos. 846 and 847/Del/2017 4 back, interest on FDR, other interest etc. Therefore, he submits that, if at all, any disallowance to be made it should be out of 30% deduction claimed by the assessee, but not 100%. 9. The ld. DR strongly placed reliance on the orders of the authorities below. 10. Heard the rival submissions, perused the orders of the authorities below and the decision of the Tribunal in assessee’s own case. On perusal of the order of the Tribunal in assessee’s own case for assessment years 2006-07 and 2007-08, we find that the Tribunal held that AMC charges is income derived from business of the assessee entitled for deduction under Section 80 IC of the Act. Following the said decision, we direct the Assessing Officer to allow deduction under Section 80 IC of the Act in respect of AMC charges received by the assessee. In so far as the duty draw-back, interest on FDR, other interest are concerned, these incomes are not derived from business of the assessee. Hence, we hold that these incomes are not entitled for deduction under Section 80 IC of the Act. 11. In the result, both the appeals of the assessee are partly allowed, as indicated above. Order pronounced in the open court on : 21/03/2022. Sd/- Sd/- (RAMA KANTA PANDA) ( C. N. PRASAD ) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated : 21/03/2022. *MEHTA* I.T.A. Nos. 846 and 847/Del/2017 5 Copy forwarded to 1. Appellant; 2. Respondent; 3. CIT 4. CIT (Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, New Delhi. Date of dictation 14.03.2022 Date on which the typed draft is placed before the dictating member 16.03.2022 Date on which the typed draft is placed before the other member 21.03.2022 Date on which the approved draft comes to the Sr. PS/ PS 21.03.2022 Date on which the fair order is placed before the dictating member for pronouncement 21.03.2022 Date on which the fair order comes back to the Sr. PS/ PS 21.03.2022 Date on which the final order is uploaded on the website of ITAT 21.03.2022 Date on which the file goes to the Bench Clerk 21.03.2022 Date on which the file goes to the Head Clerk The date on which the file goes to the Assistant Registrar for signature on the order Date of dispatch of the order