Deputy Commissioner of Income Tax ,Circle-4(1)(2), Bangalore V. M/s Metahelix Life Sciences Limited , Bangalore

MA 131/BANG/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 5762 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 3 month(s) 3 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 07-08-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2012-2013
• Appeal Filed On: 04-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR P V PRADEEP KUMAR
• Keywords: Set aside
• Section: 12

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, BANGALORE BEFORE SHRI. JASON P. BOAZ, ACCOUNTANT MEMBER AND SHRI. PAVAN KUMAR GADALE, JUDICIAL MEMBER [MP NOS. 130 AND 131/BANG/2018 (IN ITA NO S . 1260 AND 1261 /B ANG /201 7 )] (ASSESSMENT YEAR S : 20 12 - 13 AND 2013 - 14 ) ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE - 4(1)(2), BENGALURU. VS. M/S. METAHALIX LIFE SCIENCES LIMITED, PLOT NO.3, KIADB 4 TH PHASE, BOMMASANDRA INDL. AREA, BENGALURU 560 0 99 . APPELLANT RESPONDENT ASSESSEE BY : SHRI. V. SRIDHAR , CA REVENUE BY : DR. P. V. PRADEEP KUMAR, ADDL. CIT DATE OF HEARING : 14 .0 6 .201 9 DATE OF PRONOUNCEMENT : 07 .0 8 .201 9 O R D E R PER JASON P. BOAZ, AM : THESE MISCELLANEOUS APPLICATIONS (MPS) ARE FILED BY REVENUE IN RESPECT OF TRIBUNALS ORDER IN ITA NOS.1260 AND 1261/BANG/2017 DATED 17.01.2018 FOR ASSESSMENT YEARS 2012-13 AND 2013-14. 2. IN THESE MPS, THE PETITIONER / REVENUE HAS SOUGHT RECTIFICATION UNDER SECTION 254(2) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT); CONTENDING THAT CERTAIN MISTAKES APPARENT FROM THE RECORD HAVE CREPT INTO THE ORDERS OF THE TRIBUNAL IN ITA NOS.1260 AND 1261/BANG/2017 DATED 17.01.2018. IN ITS MPS, REVENUE HAS CONTENDED AS UNDER:- MP NOS. 130 AND 131/BANG/2018 (IN ITA NOS.1260 AND 1261/BANG/2017) PAGE 2 OF 5 MP NOS. 130 AND 131/BANG/2018 (IN ITA NOS.1260 AND 1261/BANG/2017) PAGE 3 OF 5 3. WE HAVE HEARD AND CONSIDERED THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. THE BASIC FACTS OF THE MATTER ARE THAT ASSESSEE COMPANY IS ENGAGED IN THE RESEARCH AND DEVELOPMENT OF TECHNOLOGIES RELATED TO CROP IMPROVEMENT AT BANGALORE, HYDERABAD AND OTHER CITIES, IN AN EFFORT TO DEVELOP HIGH QUALITY SEEDS WITH BETTER YIELDS. THE ISSUE FOR CONSIDERATION BEFORE THE TRIBUNAL FOR BOTH THESE ASSESSMENT YEARS 2012-13 AND 2013-14 WAS WHETHER THE ASSESSING OFFICER (AO)IS CORRECT IN RESTRICTING THE ALLOWABLE DEDUCTION UNDER SECTION 35(2AB) OF THE ACT TO THE AMOUNT MENTIONED IN THE DSIR REPORT OR WHETHER THE AO OUGHT TO HAVE DECIDED THE MATTER ON HIS OWN ON THE BASIS OF THE DETAILS OF EXPENDITURE FURNISHED BEFORE HIM BY THE ASSESSEE. AFTER EXAMINING THE RIVAL CONTENTIONS, THE TRIBUNAL IN ITS ORDER DATED 17.01.2018 AT PARA 3.3.6 THEREOF HAS RESTORED THIS ISSUE TO THE FILE OF THE AO FOR EXAMINATION AND VERIFICATION OF THE ASSESSEES CLAIM FOR DEDUCTION UNDER SECTION 35(2AB) OF THE ACT. 4. IN REVENUES AVERMENTS IN THE MPS, IT HAS CITED THE JUDICIAL PRONOUNCEMENTS OF THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF TEJAS NETWORKS LTD., VS. DCIT (2015) 60 TAXMANN.COM 309 AND OF THE ITAT HYDERABAD BENCH IN THE CASE OF ECIL VS. ACIT (2012) 28 TAXMANN.COM 280 (HYD TRIB). WE FIND FROM A PERUSAL OF THE IMPUGNED ORDER DATED 17.01.2018 THAT THESE JUDICIAL PRONOUNCEMENTS; NOW CITED BY REVENUE IN THESE MPS; WERE NEVER BROUGHT TO THE NOTICE OF THE TRIBUNAL BENCH IN THE COURSE OF THE HEARING OF THESE APPEALS. CONSIDERATION OF FRESH JUDICIAL PRONOUNCEMENTS AT THE STAGE OF MP IS NOT PERMISSIBLE AS IT RENDERS THE ISSUE DEBATABLE AND THEREFORE CANNOT BE CONSIDERED AS IT IS BEYOND THE SCOPE OF PROCEEDINGS UNDER SECTION 254(2) OF THE ACT. MP NOS. 130 AND 131/BANG/2018 (IN ITA NOS.1260 AND 1261/BANG/2017) PAGE 4 OF 5 5. THE TRIBUNAL IN THE IMPUGNED ORDERS DATED 17.01.2018 FOR ASSESSMENT YEARS 2012-13 AND 2013-14 HAS RELIED ON THE JUDGMENT OF THE HONBLE JURISDICTIONAL HIGH COURT OF KARNATAKA IN THE CASE OF CIT VS. BIOCON LTD., (2015) 375 ITR 306 (KAR) BASED ON WHICH THE TRIBUNAL HELD AT PARA 3.3.6 OF ITS ORDER AS UNDER:- 3.3.6 ., WE ARE OF THE OPINION THAT IN THE INTEREST OF EQUITY AND JUSTICE, THE FINDING OF THE AUTHORITIES BELOW ON THIS ISSUE BE SET ASIDE AND THE ISSUE OF THE ASSESSEE'S CLAIMS FOR DEDUCTION UNDER SECTION 35(2AB) OF THE ACT FOR BOTH ASSESSMENT YEARS 2012-13 AND 201314 BE REMANDED TO THE FILE OF THE ASSESSING OFFICER FOR EXAMINATION AND VERIFICATION OF THE ASSESSEE'S ENTIRE CLAIM THEREUNDER AND ADJUDICATION THEREOF IN ACCORDANCE WITH THE PROVISIONS OF SUB- SECTION (2AB) AFTER AFFORDING ADEQUATE OPPORTUNITY TO THE ASSESSEE OF BEING HEARD IN THE MATTER. WE HOLD AND DIRECT ACCORDINGLY. 6. SINCE THE ASSESSMENTS FOR ASSESSMENT YEARS 2012-13 AND 2013-14 ARE ONLY SET ASIDE TO THE FILE OF THE AO TO EXAMINE / VERIFY THE ASSESSEES CLAIM AND PASS ORDERS IN ACCORDANCE WITH THE PROVISIONS OF SECTION 35(2AB) OF THE ACT, WE ARE OF THE VIEW THAT THE FRESH PLEAS OF REVENUE AND THE JUDICIAL PRONOUNCEMENTS PUT FORTH IN THE AVERMENTS IN THE MPS (SUPRA) CANNOT BE ENTERTAINED IN RECTIFICATION PROCEEDINGS AS CONTEMPLATED UNDER SECTION 254(2) OF THE ACT AS THEY DO NOT CONSTITUTE MISTAKES APPARENT FROM THE RECORD THAT WARRANT RECTIFICATION. IN THAT VIEW OF THE MATTER, WE FIND NO MERIT IN THE AVERMENTS PUT FORTH IN REVENUES MPS FOR ASSESSMENT YEARS 2012-13 AND 2013-14 AND REJECT THE SAME. MP NOS. 130 AND 131/BANG/2018 (IN ITA NOS.1260 AND 1261/BANG/2017) PAGE 5 OF 5 7. IN THE RESULT, REVENUES MISCELLANEOUS APPLICATIONS FOR ASSESSMENT YEARS 2012-13 AND 2013-14 ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 07 TH AUGUST, 2019. SD/- SD/- ( PAVAN KUMAR GADALE ) (JASON P BOAZ) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE : BANGALORE DATED : 07/08/2019 /NS/* COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT(A) - II BANGALORE 4 CIT 5 DR, ITAT, BANGALORE. 6 GUARD FILE BY ORDER ASSISTANT REGISTRAR, ITAT, BANGALORE.