M/s Zee Laboratories, Paonta Sahib V. DCIT, Shimla

ITA 952/CHANDI/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8934 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-12-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2013-2014
• Appeal Filed On: 30-08-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Keywords: Initiation of penalty proceedings

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH,CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS.ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NO. 952/CHD/2016 ASSESSMENT YEAR : 2013-14 M/S ZEE LABORATORIES, VS THE DCIT, 47, INDUSTRIAL AREA, CIRCLE, GONDPUR, PAONTA SAHIB. SHIMLA. PAN: AAAFZ3536G (APPELLANT) (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY : SHRI MANJIT SINGH DATE OF HEARING : 06.12.2016 DATE OF PRONOUNCEMENT : 06.12.2016 O R D E R PER BHAVNESH SAINI,JM THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF LD. CIT(APPEALS) SHIMLA DATED 20.07.20 16 FOR ASSESSMENT YEAR 2013-14 CHALLENGING THE DISALLOWANC E OF DEDUCTION UNDER SECTION 80IC OF THE INCOME TAX ACT AND ISSUE OF NOTICE UNDER SECTION 271(1)(C) OF THE ACT. 2. DURING THE ASSESSMENT PROCEEDINGS, IT WAS NOTICE D BY THE ASSESSING OFFICER THAT ASSESSEE STARTED ITS MANUFACTURING ACTIVITIES W.E.F. 18.04.2005 I.E. DUR ING THE FINANCIAL YEAR 2005-06 AND HAD BEEN CLAIMING DEDUCT ION UNDER SECTION 80IC OF THE INCOME TAX ACT FROM ASSESSMENT YEAR 2006-07 WHICH WAS THE FIRST YEAR OF CLAIM OF DEDUCTION UNDER SECTION 80IC OF THE INCOME TAX 2 ACT. THE ASSESSEE HAS CLAIMED 100% DEDUCTION UNDER SECTION 80IC OF THE ACT UPTO THE ASSESSMENT YEAR 20 10- 11. IN FINANCIAL YEAR 2010-11 RELEVANT FOR ASSESSM ENT YEAR 2011-12, THE ASSESSEE HAD MADE SUBSTANTIAL EXPANSION IN THE PLANT AND MACHINERY AND STARTED CLAIMING 100% DEDUCTION UNDER SECTION 80IC OF THE A CT, TREATING THE ASSESSMENT YEAR 2011-12 AS INITIAL YEA R AGAIN AND TREATING IT TO BE 1 ST YEAR OF CLAIM OF DEDUCTION UNDER SECTION 80IC OF THE ACT. THE ASSESSING OFFICER NOT ICED THAT SINCE ASSESSEE CLAIMED 100% DEDUCTION UNDER SECTION 80IC OF THE ACT FOR FIRST FIVE YEARS FROM ASSESSMENT YEAR 2006-07 TO 2010-11, IT WAS ENTITLED FOR CLAIM OF DEDUCTION UNDER SECTION 80IC @ 25% FOR THE 8 TH YEAR. AFTER DETAILED DISCUSSION IN THE ASSESSMENT O RDER, ASSESSING OFFICER RESTRICTED THE CLAIM OF DEDUCTION UNDER SECTION 80IC OF THE ACT AT 25% AS AGAINST 100% CLAI MED BY THE ASSESSEE. 3. THE LD. CIT(APPEALS) NOTED THAT THE SAID ISSUE H AS ALREADY BEEN ADJUDICATED UPON BY JURISDICTIONAL ITA T CHANDIGARH BENCH IN THE CASE OF M/S HYCRON ELECTRON ICS VS ITO ( REPORTED IN 41 ITR (CHD) 486 IN WHICH IT W AS HELD THAT, ASSESSEE IS ENTITLED TO ONLY 25% OF THE DEDUCTION DURING THE PRESENT YEAR BECAUSE ASSESSEE HAD ALREADY AVAILED THE PERIOD OF FULL DEDUCTION @ 100% IN EARLIER FIVE YEARS I.E. FROM ASSESSMENT YEARS 2004- 05 TO 2008-09. THE LD. CIT(APPEALS) REPRODUCED THE ORDER OF 3 THE TRIBUNAL IN THE IMPUGNED ORDER AND DISMISSED TH IS GROUND OF APPEAL OF THE ASSESSEE. 4. AS REGARDS INITIATION OF PENALTY PROCEEDINGS UND ER SECTION 271(1)(C) OF THE ACT, LD. CIT(APPEALS) NOTE D THAT IT IS PREMATURE AND DISMISSED THIS GROUND OF APPEAL OF THE ASSESSEE. 5. NONE APPEARED FOR THE ASSESSEE DESPITE NOTIFYING THE DATE OF HEARING. THE LD. DR CONTENDED THAT ISSUE I S COVERED AGAINST THE ASSESSEE BY ORDER OF ITAT CHAND IGARH BENCH IN THE CASE OF M/S HYCRON ELECTRONICS (SUPRA) . 6. IN THIS VIEW OF THE MATTER, WE ARE OF THE VIEW T HE ISSUE OF DEDUCTION UNDER SECTION 80IC OF THE INCOME TAX ACT IS COVERED AGAINST THE ASSESSEE BY ORDER OF ITA T CHANDIGARH BENCH IN THE CASE OF M/S HYCRON ELECTRON ICS (SUPRA). INITIATION OF PENALTY PROCEEDINGS IS INDEP ENDENT AND DISTINCT PROCEEDINGS AND CANNOT BE RAISED IN TH E QUANTUM PROCEEDINGS. THESE GROUNDS OF APPEAL OF TH E ASSESSEE ARE, ACCORDINGLY, DISMISSED. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- ( ANNAPURNA GUPTA) (BHAVNESH SAINI ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 6 TH DECEMBER, 2016. POONAM COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. THE CIT,DR ASSISTANT REGISTRAR, ITAT/CHD