ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE -1, VELLORE V. THE GENERAL MANAGER, M/S. THE VELLORE TIRUVANNAMALAI DISTRICT CO-OP MILK PRODUCERS UNION LIMITED, VELLORE

ITA 978/CHNY/2020

• Counselvise Citation: [2022] 107 COUNSELVISE.COM (IT) 0771 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 7 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-08-2022
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 20-12-2020
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: MBA
• Keywords: Depreciation; Carry forward of business losses; Unabsorbed depreciation; Set aside

Judgement Text

आयकर अपीलीय अिधकरण, ‘ए’ ᭠यायपीठ, चे᳖ई IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH, CHENNAI Įी महावीर ͧसंह, उपाÚय¢ एवं Įी मनोज क ु मार अĒवाल, लेखा सदèय के सम¢ BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENTAND SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.: 978/CHNY/2020 िनधाᭅरण वषᭅ /Assessment Year: 2012-13 The Asst. Commissioner of Income Tax, Circle-1, Vellore vs. M/s. The Vellore Tiruvannamalai District Co-operative Milk Producers Union Ltd, 142, Arcot Road, Sathuvacheri, Vellore – 632 009. PAN: AAAAT 0079R (अपीलाथᱮ/Appellant) (ᮧ᭜यथᱮ/Respondent) अपीलाथᱮ कᳱ ओर से/Appellant by : Shri AR.V. Sreenivasan, Addl.CIT ᮧ᭜यथᱮ कᳱ ओर से/Respondent by : Shri CA Ashok, MBA, ACA स ु नवाई कȧ तारȣख/Date of Hearing : 03.08.2022 घोषणा कȧ तारȣख/Date of Pronouncement : 03.08.2022 आदेश /O R D E R PER MAHAVIR SINGH, VICE PRESIDENT: This appeal by the Revenue is arising out of the order of Commissioner of Income Tax (Appeals)-13, Chennai dated 16.09.2020. The original assessment was framed by the ACIT, Circle-1, Vellore for the assessment year 2012-13 u/s.143(3) of the Income Tax Act, 1961 (hereinafter the ‘Act’) vide order dated 2 ITA No.978/Chny/2020 24.03.2015. Subsequently, rectification order u/s.154 of the Act dated 15.12.2018 was passed by the ACIT, Circle-1, Vellore, wherein the carried forward loss was disallowed. 2. The only issue in this appeal of Revenue is against the order of CIT(A) allowing the business loss to be carried forward for assessment year 2012-13 when the assessment for assessment year 2011-12 was pending. For this, Revenue has raised the following grounds:- 2. Whether observation of the CIT(A) that the Assessing Officer allowed business loss of Rs.1.07 Crore only for the A.Y. 2011-12 without adducing any reason or explanation that the assessee was eligible to carry forward business loss of Rs. 7.02 Crore was correct especially when the Assessing Officer, before completing the assessment for the A.Y. 2011-12, computed the said loss as per letter dated 20.03.2014, which was duly received by the assessee? 3. Whether the CIT(A) was correct in accepting the claim of the assessee with regard to quantum of b/f business loss, especially when the error/difference as per the CIT(A) is so huge without calling for factual report from the Assessing Officer? 4. Whether the CIT(A) is correct in determining the eligible business loss to be carried forward for the A.Y. 2011-12 when the appeal is against the order u/s 154 for the A.Y. 2012-13? 3 ITA No.978/Chny/2020 3. At the outset, it is noticed that this appeal is barred by limitation by 31 days and Revenue has filed affidavit stating the reasons for delay. The ld. Senior DR stated that the order of CIT(A) was received by the ACIT on 21.09.2020 and as per the affidavit of the ACIT, the period under condonation is relating to Covid-19 pandemic. He stated that the Hon’ble Supreme court in Miscellaneous Application No.665 of 2021 vide order dated 23.03.2020 has given directions that the delay are to be condoned during this period 15.03.2020 to 14.03.2021 and they have condoned the delay up to 28.02.2022 in Miscellaneous Application No.21 of 2022 vide order dated 10.01.2022. In term of the directions of Hon’ble Supreme Court, we condone the delay in filing of this appeal by Revenue and admit the appeal for adjudication. 4. At the outset, the ld. Senior DR filed a letter from ACIT, Circle- 1, Vellore to the assessee dated 20.03.2014 for assessment year 2011-12, wherein the depreciation loss and business loss carried forward was nil. Subsequently, after the matter travelled up to Tribunal and the Tribunal set aside the matter for assessment year 2011-12 which is pending assessment by the AO but the CIT(A) in his appellate order giving effect to brought forward business losses and brought forward unabsorbed depreciation losses by observing in 4 ITA No.978/Chny/2020 para 8.1 to 8.7 and finally noted in para 8.6 remarks column as under:- “Appeal dismissed by CIT(A) vide order dated 21.03.2016. On a further appeal by the appellant before ITAT, it was set aside back to the file of the AO by the ITAT on 9.8.16.” Now, the ld. Senior DR stated that unless and until the AO decides the assessment for assessment year 2011-12, the CIT(A) cannot give direction for allowance of carry forward of business losses and unabsorbed depreciation losses. 5. To this proposition, the ld.AR for the assessee fairly agreed and stated that the matter can be remanded back to the file of the AO and once the AO give effect to the order of the Tribunal for assessment year 2011-12 and on that basis the AO will decide the claim of assessee in regard to carry forward of business losses and unabsorbed depreciation losses accordingly. To this proposition, the ld. Senior DR has not objected. 6. After hearing both the sides, we remit this issue back to the file of the AO, who will decide the issue after framing the assessment in lieu of the directions of the Tribunal or giving effect to the order of the Tribunal. Hence, this issue is remitted back to 5 ITA No.978/Chny/2020 the file of the AO and the appeal of the Revenue is allowed for statistical purposes. 7. In the result, the appeal filed by the Revenue is allowed for statistical purposes. Order pronounced in the open court on 3 rd August, 2022 at Chennai. Sd/- Sd/- (मनोज कुमार अᮕवाल) (MANOJ KUMAR AGGARWAL) लेखा सद᭭य /ACCOUNTANT MEMBER (महावीर ᳲसह ) (MAHAVIR SINGH) उपा᭟यᭃ /VICE PRESIDENT चे᳖ई/Chennai, ᳰदनांक/Dated, the 3 rd August, 2022 RSR आदेश कᳱ ᮧितिलिप अᮕेिषत/Copy to: 1. अपीलाथᱮ/Appellant 2. ᮧ᭜यथᱮ/Respondent 3. आयकर आयुᲦ (अपील)/CIT(A) 4. आयकर आयुᲦ /CIT 5. िवभागीय ᮧितिनिध/DR 6. गाडᭅ फाईल/GF.