M/s Haryana Agro Industries Corporation Ltd., Panchkula V. ACIT, Circle, Panchkula

ITA 917/CHANDI/2019

• Counselvise Citation: [2022] 107 COUNSELVISE.COM (IT) 0738 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 year(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-07-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 09-06-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRIYANKA DHAR
• Keywords: Set aside
• Section: 36 (1) (iii)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH ‘A’, CHANDIGARH BEFORE SMT.DIVA SINGH, JUDICIAL MEMBER AND SHRI VIKRAM SINGH YADAV, ACCOUNTANT MEMBER ITA No. 917/Chd/2019 (Assessment Year: 2013-14) Haryana Agro Industries Corporation Limited Panchkula बनाम The ACIT Circle, Panchkula थायी लेखा सं./PAN NO: AAACH4686C ITA No. 918/Chd/2019 (Assessment Year: 2014-15) Haryana Agro Industries Corporation Limited Panchkula बनाम The DCIT Circle, Panchkula थायी लेखा सं./PAN NO: AAACH4686C ITA No. 919/Chd/2019 (Assessment Year: 2015-16) Haryana Agro Industries Corporation Limited Panchkula बनाम The ACIT Circle, Panchkula थायी लेखा सं./PAN NO: AAACH4686C ITA No. 920/Chd/2019 (Assessment Year: 2016-17) Haryana Agro Industries Corporation Limited Panchkula बनाम The ACIT Circle, Panchkula थायी लेखा सं./PAN NO: AAACH4686C नधा रती क ओर से/Assessee by : Shri Atul Goyal, C.A राज व क ओर से/ Revenue by : Smt. Priyanka Dhar, Sr. DR स ु नवाई क तार ख/Date of Hearing: 16/06/2022 उदघोषणा क तार ख/Date of Pronouncement: 04/07/2022 आदेश/ORDER Per Bench: These are four appeals filed by the assessee against the respective orders of the Ld. CIT(A), Panchkula dt. 31/03/2019. 2 2. Since the issues involved in all the above appeals are common and appeals were heard together so these are being disposed off by this consolidated order for the sake of convenience and brevity. 3. In ITA No. 917/Chd/2019, the assessee has raised the following grounds: 1. That the Ld. CIT (A) has erred in upholding addition of Interest component of Rs. 1,57,69,932 by applying explanation 8 to Section 43(1) of the Income Tax Act, 1961 which is a definition section and defines actual cost. 2. That the Ld. CIT (A) has erred in upholding addition of Rs. 1,57,69,932 where the appellant had sufficient tax free funds available. 3. That the Ld. CIT (A) has erred in upholding addition of Rs. 1,57,69,932 where there is neither any extension or expansion as provided under proviso to Section 36 (1) (iii) of Income Tax Act 1961. 4. That the Ld. CIT (A) had erred on facts in not considering the material in record regarding the godowns which had already been put to use before 31.03.2012 or during the year under consideration though not Capitalized. 5. That the Ld. CIT appeal has erred in upholding addition of Rs. 1,57,69,932 @ 10.25% on the closing balance and not on the basis of date of addition. 6. That the Ld. CIT appeal has erred in upholding addition of Rs. 1,57,69,932 @ 10.25% whereas the assessee has availed loan from NABARD @ 6.5% of interest for the construction of godowns during the year. 7. That the appellant carves permission to add delete or modify any grounds of appeal before the final disposal of the case. 4. Identical grounds of appeal have been taken in other three appeals. 5. Both the parties fairly submitted that in all four appeals, the matter is squarely covered by the decision of Coordinate Bench in ITA No. 216/Chd/2016 dt. 16/11/2018 wherein the relevant findings are contained in para 10 of the order which read as under: 10. Ground No. 5 : Vide ground No. 5 the assessee has agitated th disallowance of interest expenditure u/s 36(i)(iii) of the Act. The Ld. Counsel for the assessee has submitted that though the loan in question was taken for specific purpose to construct the Godowns, however, the loan amount was used during the year and the assets were put to use i.e; godowns were made functional. The Ld. Counsel for the assessee has further submitted that though the assessee had constructed certain other Godowns, some of which were under construction during the year also, however, the expenditure in relation to those other Godowns was borne by the assessee out of his 3 own surplus funds. So far as the loan taken by the assessee for construction of the Godowns was concerned, that was for specific Godowns and those Godowns (assets) were put to use during the year. That since from the date from which the assets were put to use, the assessee was entitled to claim of interest expenditure. In view of the above contentions, the issue is restored to the file of the Assessing Officer to verify the same after examining the facts and by giving opportunity to the counsel of the assessee to present his case and then decide this issue afresh. In view of above discussions, the appeal of the assessee is treated as partly allowed. 6. Taking into consideration the submission made by both the parties and following the decision of Coordinate Bench in assessee’s own case referred to (supra), the matter is set aside to the file of the AO to examine the same afresh in light of the direction so given by the Coordinate Bench after providing reasonable opportunities to the assessee. 7. In the result, all these appeals are allowed for statistical purposes. Order pronounced in open Court on 04/07/2022. Sd/- Sd/- (DIVA SINGH) (VIKRAM SINGH YADAV) याय क सद य/Judicial Member लेखा सद य/Accountant Member Dated: 04/07/2022 AG आदेश क % त&ल'प अ*े'षत/ Copy of the order forwarded to : 1. अपीलाथ+/ The Appellant 2. %,यथ+/ The Respondent 3. आयकर आय ु -त/ CIT 4. आयकर आय ु -त (अपील)/ The CIT(A) 5. 'वभागीय % त न0ध, आयकर अपील य आ0धकरण, च2डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड फाईल/ Guard File