M/s. Elgi Rubber Company Ltd. Formerly known as M/s.Elgitread (India) Ltd., Coimbatore V. ACIT, Coimbatore

ITA 910/CHNY/2009

• Counselvise Citation: 91021714 RSA 2009
• Duration Of Justice: 2 year(s) 3 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-09-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 05-09-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 08-06-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR I VIJAYAKUMAR

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI [BEFORE DR. O.K. NARAYANAN, VICE-PRESIDENT AND SHRI HARI OM MARATHA, JUDICIAL MEMBER] I.T.A NO.910/MDS/2009 (ASSESSMENT YEAR : 2006-07 ) M/S ELGI RUBBER COMPANY LTD [FORMERLY KNOWN AS M/S ELGITREAD(INDIA) LTD #2000, TRICHY ROAD SINGANALLUR KOVAI 641 005 VS THE ACIT COMPANY CIRCLE I(2) KOVAI [PAN AAACE4565F] (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PHILIP GEORGE, ADVOCATE RESPONDENT BY : DR. I.VIJAYAKUMAR, CIT/DR DATE OF HEARING : 05-09-2011 DATE OF PRONOUNCEMENT : 13-09-2011 O R D E R PER HARI OM MARATHA, JUDICIAL MEMBER: THIS APPEAL OF THE ASSESSEE, FOR ASSESSMENT YEAR 2006-07, IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A) DATED 24.3.2009. 2. THE SOLE ISSUE INVOLVED IN THIS APPEAL IS REGARDING DISALLOWANCE OF DEDUCTION CLAIMED U/S 80IA OF THE A CT. THE FACTS ITA 910/09 :- 2 -: APROPOS THIS ISSUE ARE THAT THE ASSESSEE IS A COMP ANY ENGAGED IN THE MANUFACTURE AND SALE OF TREAD RUBBER. THE COMPANY FILED ITS RETURN OF INCOME FOR ASSESSMENT YEAR 2006-07 ON 21.11.2006 AD MITTING TOTAL INCOME OF ` 11,44,02,647/- AFTER MAKING A CLAIM OF DEDUCTION U /S 80IA AMOUNTING TO ` 38,59,534/-. THE ASSESSMENT WAS COMPLETED U/S 143(3), ON 31.12.2008 AT A TOTAL INCOME OF ` 11,82,62,190/- WHEN ASSESSING OFFICER DISALLOWED THE CLAIM OF DEDUCTIO N MADE U/S 80IA. THE ASSESSEE WAS NOT SUCCESSFUL IN FIRST APPEAL ALS O. IN FACT, THE ASSESSEE HAD SET UP AN UNDERTAKING FOR GENERATION O F POWER FROM OPERATION OF WINDMILL AND THE POWER GENERATED BY TH E ASSESSEE- COMPANY WAS SOLD TO THE ELECTRICITY BOARD. THE ASS ESSEE HAS CLAIMED TO HAVE SET UP THE NEW INDUSTRIAL UNDERTAKING AND A S SUCH, THE INCOME DERIVED THEREFROM HAS BEEN CLAIMED AS DEDUCTION U/S 80IA OF THE ACT. 3. THE SHORT QUESTION BEFORE US IS AS TO WHETHER THE I NCOME GENERATED FROM OPERATION OF WINDMILL FOR CAPTIVE CO NSUMPTION IS EXIGIBLE FOR DEDUCTION U/S 80IA OF THE ACT OR NOT. IT WAS ARGUED THAT THIS ISSUE STANDS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF HON'BLE MADRAS HIGH COURT RENDERED IN THE CASE OF C IT VS M/S TANFAC INDUSTRIES LTD IN TCA NO.475 OF 2008 AFFIRMING THE ORDER OF THE ITAT, CHENNAI, DATED 31.10.2007 IN THE CASE OF ASSESSEE I N I.T.A.NO. ITA 910/09 :- 3 -: 2800/MDS/2005 AND C.O.NO.48/MDS/2007 FOR ASSESSMENT YEAR 1997- 98. APART FROM THIS DECISION, RELIANCE WAS PLACED ON OTHER DECISIONS OF THIS BENCH WHICH ARE CONTAINED IN THE PAPER BOOK OF THE ASSESSEE. ON THE OTHER HAND, THE LD.CIT/DR HAS REFERRED TO TH E OTHER CONTRARY DECISIONS OF THIS VERY BENCH. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. IN VIEW OF THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT I N THE CASE OF M/S TANFAC INDUSTRIES LTD (SUPRA), WHICH HAS GOT A BIN DING EFFECT, WE ARE LEFT WITH NO OPTION BUT TO ALLOW THIS CLAIM OF THE ASSESSEE. THEREFORE, THE ASSESSING OFFICER IS DIRECTED TO GIVE DEDUCTION OF THE AMOUNT OF ` 38,58,534/- TO THE ASSESSEE U/S 80IA OF THE ACT. A CCORDINGLY, THE APPEAL OF THE ASSESSEE STANDS ALLOWED. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT O N 13.09.2011. SD/- SD/- (DR. O.K. NARAYANAN) VICE-PRESIDENT (HARI OM MARATHA) JUDICIAL MEMBER DATED: 13 TH SEPTEMBER, 2011 RD COPY TO: APPELLANT/RESPONDENT/CIT(A)/CIT/DR