Barak Valley Cements Ltd., Kolkata V. D.C.I.T., Cental Circle 3(4) Kolkata, Kolkata

ITSSA 137/KOL/2016

• Counselvise Citation: [2017] 122 COUNSELVISE.COM (IT) 3413 (ITAT-KOLKATA)
• Duration Of Justice: 7 month(s) 13 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 02-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 19-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G HANGSHING
• Assessee Lawyers: HARSH VARDHAN BHARDWAJ
• Section: 132

Judgement Text

1 I.T(SS).A. NOS. 137 TO 141/KOL/2016 BARAK VALLEY CEMENTS LTD. & I.T(SS).A. NOS. 142 TO 147/KOL/2016 CEMENT INTERNATIONAL LTD. & I.T(SS).A. NOS. 148 TO 154/KOL/2016 MEGHALAYA CEMENTS LTD. , B , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA ( ) BEFORE . . , /AND . , ) [BEFORE SHRI A. T. VARKEY, JM & SHRI M. BALAGANESH, AM] I.T(SS).A. NOS. 137 TO 141/KOL/2016 ASSESSMENT YEARS: 2007-08 TO 2011-12 BARAK VALLEY CEMENTS LTD. (PAN:AABCB5691A) VS. DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-3(4), KOLKATA. APPELLANT RESPONDENT & I.T(SS).A. NOS. 142 TO 147/KOL/2016 ASSESSMENT YEARS: 2008-09 TO 2013-14 CEMENT INTERNATIONAL LTD. (PAN:AACCC3329H) VS. DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-3(4), KOLKATA. APPELLANT RESPONDENT & I.T(SS).A. NOS. 148 TO 154/KOL/2016 ASSESSMENT YEARS: 2007-08 TO 2013-14 MEGHALAYA CEMENTS LTD. (PAN:AADCM8079P) VS. DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-3(4), KOLKATA. APPELLANT RESPONDENT DATE OF HEARING 24.07.2017 DATE OF PRONOUNCEMENT 02.08.2017 FOR THE APPELLANT SHRI HARSH VARDHAN BHARDWAJ, FCA FOR THE RESPONDENT SHRI G. HANGSHING, CIT (DR) ORDER PER BENCH: 2 I.T(SS).A. NOS. 137 TO 141/KOL/2016 BARAK VALLEY CEMENTS LTD. & I.T(SS).A. NOS. 142 TO 147/KOL/2016 CEMENT INTERNATIONAL LTD. & I.T(SS).A. NOS. 148 TO 154/KOL/2016 MEGHALAYA CEMENTS LTD. THESE ARE 18 APPEALS PREFERRED BY THE ASSESSEE AGAI NST THE SOLE ISSUE WHEREIN THE LD. CIT(A) HAS CONFIRMED THE ACTION OF THE AO DISALLOWI NG THE RELIEF CLAIMED BY THE ASSESSEE U/S. 80IC OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) ON THE AMOUNT OF REMISSION OF VAT GRANTED BY THE STATE GOVERNMENT . SINCE THE ISSUE IN ALL THE APPEALS ARE IDENTICAL, WE TAKE UP IT(SS)A NO. 148/KOL/2016 FOR AY 2007-08 AS THE LEAD CASE AND THE DECISION OF IT SHALL BE FOLLOWED IN ALL OTHER 17 AP PEALS PREFERRED BY THE ASSESSEE. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS IN THE BUSINESS OF MANUFACTURING AND DEALING IN CEMENT IN ITS FACTORY AT MEGHALAYA. THE RE WAS A SEARCH OPERATION U/S. 132 OF THE ACT AT VARIOUS PREMISES OF THE ASSESSEE INCLUDING I TS FACTORY PREMISES AT MEGHALAYA ON 18 TH AND 19 TH SEPTEMBER, 2012. THE AO NOTED THAT THE CENTRAL GO VERNMENT AND STATE GOVERNMENT IN ORDER TO ENCOURAGE AND DEVELOP INDUST RIES IN THE STATE OF MEGHALAYA, HAS PROVIDED VARIOUS TYPES OF SUBSIDIES AS INCENTIVE. THE AO NOTED THAT THE ASSESSEE HAD CLAIMED VAT REMISSION AS DEDUCTION U/S. 80IC OF THE ACT WHICH, ACCORDING TO THE AO WAS NOT ALLOWABLE AND, THEREFORE, HE DID NOT ACCEDE TO THE CLAIM FOR DEDUCTION U/S. 80IC OF THE ACT. AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL B EFORE THE LD. CIT(A), WHO WAS PLEASED TO CONFIRM THE SAME. AGGRIEVED, THE ASSESSEE IS BE FORE US. 3. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND GONE THROUGH THE RECORDS. WE NOTE THAT IN ASSESSEES OWN CASE IN ITA NO. 255/ GAU/2013 FOR AY 2008-09 AND IN ITA NO. 144/GAU/2012 FOR AY 2008-09 AND IN ITA NO. 145/ GAU/2012 FOR AY 2009-10 VIDE ORDER DATED 19.11.2013 READ ALONG WITH THE CORRIGEN DUM OF EVEN DATE, WHEREIN THE TRIBUNAL HAS HELD THAT REMISSION OF VAT FORMED PART OF THE P ROFIT AND GAINS OF THE ELIGIBLE UNIT AND ALLOWED THE CLAIM OF THE ASSESSEE ON THE ISSUE WHI CH IS ASSAILED BEFORE US IN ALL THE 18 APPEALS. THE TRIBUNAL VIDE PARA 7 OF ITS ORDER HAS HELD AS UNDER: 7. RESPECTFULLY FOLLOWING THE DECISION OF THE HON 'BLE JURISDICTIONAL HIGH COURT, WE ALLOW THE APPEALS OF THE ASSESSEE AND DIRECT THE AO TO ALLOW THE DEDUCTION TO THE ASSESSEE UNDER SECTION 80IC TREATING ALL THE SUBSIDIES RECEIVED TO BE PART OF THE BUSINESS PROFIT AND GAINS FROM THE INDUSTRIAL UNDERTAKING IN ACCORDANCE WITH LAW. THUS , THE GROUNDS TAKEN BY THE ASSESSEE ARE ALLOWED. SO FAR THE APPEALS FILED BY THE REVENUE AR E CONCERNED, WE NOTED THAT BOTH THE ISSUES INVOLVED IN THE APPEALS IN BOTH THE ASSESSMENT YEAR S FILED BY THE REVENUE ARE COVERED BY THE DECISION OF THIS TRIBUNAL IN FAVOUR OF THE ASSESSEE DATED 19.03.2010 AND 05.04.2010 THROUGH 3 I.T(SS).A. NOS. 137 TO 141/KOL/2016 BARAK VALLEY CEMENTS LTD. & I.T(SS).A. NOS. 142 TO 147/KOL/2016 CEMENT INTERNATIONAL LTD. & I.T(SS).A. NOS. 148 TO 154/KOL/2016 MEGHALAYA CEMENTS LTD. WHICH WE HAVE GONE THROUGH. THE ISSUE RELATING TO T HE CENTRAL EXCISE DUTY REFUND IS DULY COVERED BY THE DECISION OF THIS TRIBUNAL IN THE CAS E OF CIT-VS- MEGHALAYA STEELS LTD. WHILE THE DECISION ON THE ISSUE OF VAT/SALES TAX REMISSION IS DULY COVERED BY THE FOLLOWING DECISIONS :- S. NO. ITA NO. DATE OF ORDER ISSUE NAME OF THE ASSE SSEE 1. 46/GAU/2009 19.03.2010 CENTRAL EXCISE REFUND MEG HALAYA STEELS LTD. II. 202/GAU/2008 19.03.2010 CENTRAL EXCISE REFUND S ATYAM ISPAT LTD. III. 50/GAU/2009 05.04.2010 CENTRAL EXCISE REFUND AND VAT REMISSION PLAST INDIA ENTERPRISES PVT. LTD. IV. 43/GAU/2009 05.04.2010 VAT REMISSION G.L. COKE PVT. LTD. V. 58/GAU/2009 05.04.2010 VAT REMISSION JBB LIME IN DUSTRY 8. RESPECTFULLY FOLLOWING THE DECISION OF THIS TR IBUNAL, WE DISMISS THE GROUNDS TAKEN BY THE REVENUE . THEREFORE, WE DISMISS BOTH THE APPEALS FILED BY THE REVENUE. 4. THE LD. AR OF THE ASSESSEE BROUGHT TO OUR NOTICE THAT THE DEPARTMENTAL APPEAL I.E. ITA NO. 130/GAU/2012, ITA NO.05/GAU/2013 AND ITA NO . 302/GAU/2013 WERE DISMISSED WHICH WERE FILED BY THE REVENUE AGAINST THE LD. CIT (A)S ORDER ALLOWING RELIEF TO ASSESSEE ON VAT REMISSION ISSUE, WHICH WE NOTE FROM COPY OF THE ORDER ENCLOSED FROM PAGES 1 TO 8 OF THE PAPER BOOK. WE ALSO NOTE THAT IN ITA NO. 21 85/KOL/2014 FOR AY 2010-11 WHICH WAS AN APPEAL FILED BY THE REVENUE, THE TRIBUNAL FOLLOW ING THE EARLIER ORDERS DISMISSED GROUND NO. 2 OF THE DEPARTMENT AS AGAINST THE RELIEF GIVEN BY THE LD. CIT(A) IN RESPECT OF CENTRAL EXCISE DUTY REFUND AND VAT REMISSION. WE ALSO TAKE NOTE THAT IN ACIT VS. G. L. COKE PVT. LTD., THE COORDINATE BENCH OF GAUHATI ITAT IN ITA NO. 43/GAU/2009 VIDE PARA 6.1 HAS HELD AS UNDER: 6.1. THE ONLY DIFFERENCE BETWEEN THE CENTRAL EXCI SE REFUND AND THE VAT REMISSION IS THAT IN THE CENTRAL EXCISE REFUND, THE ASSESSEE IS SUPPOSED TO PAY FIRST AND GET BACK WHATEVER HE HAS PAID. ON THE OTHER HAND, IN VAT REMISSION, THE ASS ESSEE WILL COLLECT 100% OF THE SALES TAX WHEREAS HE IS SUPPOSED TO PAY ONLY 1% OF THE SAME T O THE EXCHEQUER. THEREFORE, THE OBSERVATIONS MADE BY US IN RESPECT OF CENTRAL EXCIS E REFUND ARE SQUARELY APPLICABLE EVEN TO THE VAT REMISSION ALSO. KEEPING IN VIEW OF THIS FI NDING, WE FIND NO INFIRMITY IN THE ORDERS OF THE LD. CIT(A) ON THIS ISSUE. HENCE, WE CONFIRM TH E SAME. 5. IN THE LIGHT OF THE AFORESAID RATIO LAID DOWN BY THE TRIBUNAL IN ASSESSEES OWN CASE AND THAT OF IDENTICAL CASES, WE ARE OF THE CONSIDER ED OPINION THAT THE VAT REMISSION IS AKIN TO THE ISSUE OF CENTRAL EXCISE REFUND WHICH HAS ALR EADY BEEN SETTLED IN THE CASE OF M/S. MEGHALAYA STEELS LTD., SUPRA, AND ON THE AFORESAID REASONING GIVEN BY THE TRIBUNAL IN THE 4 I.T(SS).A. NOS. 137 TO 141/KOL/2016 BARAK VALLEY CEMENTS LTD. & I.T(SS).A. NOS. 142 TO 147/KOL/2016 CEMENT INTERNATIONAL LTD. & I.T(SS).A. NOS. 148 TO 154/KOL/2016 MEGHALAYA CEMENTS LTD. CASE OF M/S. G. L. COKE PVT. LTD., SUPRA, WE CONCUR AND ALLOW THE DEDUCTION U/S. 80IC OF THE ACT CLAIMED BY THE ASSESSEE IN RESPECT TO THE VAT R EMISSION. THEREFORE, WE ALLOW ALL THE APPEALS OF THE ASSESSEE. 6. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE A RE ALLOWED. 7. ORDER IS PRONOUNCED IN THE OPEN COURT ON 02.08.2 017 SD/- SD/- (M. BALAGANESH) (ABY. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 2 ND AUGUST, 2017 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1. APPELLANT BARAK VALLEY CEMENTS LTD., MEGHALAYA CE MENTS LTD. & CEMENT INTERNATIONAL LTD., C/O V. N. PUROHIT & CO., DIAMOND CHAMBERS, UNIT-III, 4 TH FLOOR, SUIT NO. 4G, 4, CHOWRINGHEE LANE, KOLKATA-7 00 016. 2 RESPONDENT DCIT, CENTRAL CIRCLE-3(4), KOLKATA. 3. THE CIT(A), KOLKATA 4. 5. CIT , KOLKATA. DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, SR. PVT. SECRETARY