The DCIT, (OSD)-1, Circle-4, Ahmedabad V. Monarch Dyestuff Industries & Exports Ltd., Ahmedabad

MA 182/AHD/2014

• Counselvise Citation: [2015] 124 COUNSELVISE.COM (IT) 3105 (ITAT-AHMEDABAD)
• Duration Of Justice: 7 month(s) 19 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 19-06-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 19-06-2015
• Assessment Year: 1995-1996
• Appeal Filed On: 31-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B L YADAV

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD (BEFORE SHRI RAJPAL YADAV, J.M. & SHRI ANIL CHATURV EDI, A.M.) M. A. NO. 182/AHD/2014 (IN ITA NO. 672/AHD/2010) (ASSESSMENT YEAR: 1995-96) THE ACIT-CIRCLE-4, AHMEDABAD V/S MONARCH DYESTUFF INDUSTRIES 301, SHAGUN COMPLEX, 93 SWASTIK SOCIETY, B/H ST. XAVIERS LADIES HOSTEL, NAVRANGPURA, AHMEDABAD (APPELLANT) (RESPONDENT) PAN: AABCM8936F APPELLANT BY : SHRI B.L. YADAV, SR. D.R. RESPONDENT BY : SHRI TUSHAR HEMANI, ADVOCATE ( )/ ORDER DATE OF HEARING : 19-06-2015 DATE OF PRONOUNCEMENT : 19 -06-2015 PER SHRI ANIL CHATURVEDI,A.M. 1. THE PRESENT M.A. IS FILED BY THE REVENUE AGAINST TH E ORDER OF TRIBUNAL DATED 30.05.2014 IN RESPECT OF APPEAL IN ITA NO. 672/AHD/ 2010 FOR A.Y. 1995-96. 2. IN THE MISCELLANEOUS APPLICATION, THE REVENUE HAS I NTERALIA SUBMITTED THAT WHILE DECIDING THE APPEAL, THE HONBLE TRIBUNAL HAS NOTED THAT THE ASSESSEE HAD DISCONTINUED ITS MANUFACTURING AND OPERATION AF TER 31.03.1995 AND HAD SURRENDERED THE LICENSE TO THE APPROPRIATE AUTHORIT IES AND HAD NOT OBTAINED M.A NO. 182/A/14 ( IN ITA NO. 672/A/2010) . A.Y. 1995-9 6 2 SUBSEQUENTLY ANY BENEFIT OUT OF THE ADVANCE LICENSE S AND HENCE NO INCOME FROM IT AROSE TO THE ASSESSEE. IT IS SUBMITTED BY T HE REVENUE THAT ON PERUSING THE RECORDS FOR A.Y. 96-97, IT IS NOTICED THAT ASSE SSEE CONTINUED MANUFACTURING ACTIVITIES AND HAD IMPORTED RAW MATER IALS WORTH RS. 15,03,480/- AND ASSESSEE HAD ALREADY DEBITED ITS MA NUFACTURING EXPENSES OF RS. 81,34,106/- TO THE PROFIT AND LOSS ACCOUNT AND IN VIEW OF THE AFORESAID FACTS, THE TRIBUNAL WAS NOT CORRECT IN ALLOWING ASS ESSEES APPEAL AND IT IS THEREFORE PRAYED THAT THERE IS APPARENT MISTAKE IN THE ORDER OF TRIBUNAL WHICH NEEDS TO BE RECTIFIED. 3. BEFORE US, LD. D.R. REITERATED THE SUBMISSIONS MADE IN THE MISCELLANEOUS APPLICATION AND URGED THAT THE ORDER BE RECALLED OR RECTIFIED. LD. A.R. ON THE OTHER HAND SUBMITTED THAT THERE IS NO MISTAKE IN TH E ORDER OF TRIBUNAL. HE FURTHER SUBMITTED THAT THE HONBLE TRIBUNAL HAD DEC IDED THE ISSUE IN THE LIGHT OF DECISION OF HONBLE APEX COURT IN THE CASE OF CI T VS. EXCEL INDUSTRIES LTD. REPORTED IN (2013) 86 CCH 86. HE THEREFORE SU BMITTED THAT IN THE ABSENCE OF ANY APPARENT MISTAKE, THE M.A. OF THE RE VENUE BE DISMISSED. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. IT IS REVENUES CONTENTION THAT THE APPEAL HAS BEEN DECID ED AFTER TAKING INTO CONSIDERATION THE FACT THAT ASSESSEE HAD DISCONTINU ED ITS MANUFACTURING OPERATION AFTER 31.03.1995 AND HAD NOT OBTAINED ANY BENEFIT OUT OF THE ADVANCE LICENSES WHICH IS CONTRARY TO THE FACTS. WE FIND THAT THE TRIBUNAL WHILE DECIDING THE APPEAL OF THE ASSESSEE APART FRO M CONSIDERING THE FACT ABOUT THE DISCONTINUING OF OPERATIONS AFTER 31.03.1 995 AND NOT OBTAINING ANY BENEFIT OUT OF THE ADVANCE LICENSES HAD ALSO RELIED ON THE DECISION OF HONBLE M.A NO. 182/A/14 ( IN ITA NO. 672/A/2010) . A.Y. 1995-9 6 3 SUPREME COURT IN THE CASE OF CIT VS. EXCEL INDUSTRI ES (SUPRA). THE RELEVANT OBSERVATION OF THE TRIBUNAL IS REPRODUCED HEREUNDER FOR READY REFERENCE. 8. CONSIDERING THE FACT THAT THE ASSESSEE HAS DISCO NTINUED ITS MANUFACTURING OPERATIONS AFTER 31.03.1995, SURRENDERED THE LICENS ES TO THE APPROPRIATE AUTHORITIES AND HAS NOT OBTAINED SUBSEQUENTLY ANY BENEFIT OUT OF TH E ADVANCE LICENSES AND ON THESE FACTS APPLYING THE RATIO OF THE AFORESAID DECISION OF HON BLE APEX COURT, WE ARE OF THE VIEW THAT NO INCOME AROSE TO THE ASSESSEE AND THEREFORE NO ADDITION CAN BE MADE ON ACCOUNT OF INCOME ON ADVANCE LICENSE. IN VIEW OF THE AFORES AID FACTS, WE DIRECT THE DELETION MADE ON ACCOUNT OF INCOME ON ADVANCE LICENSES. THUS THIS GROUND OF ASSESSEE IS ALLOWED. 5. WE THUS FIND THAT THE APART FROM THE FACT OF DISCON TINUED BUSINESS, THE TRIBUNAL HAD ALSO RELIED ON THE DECISION OF APEX CO URT. BEFORE US, REVENUE HAS NOT BROUGHT ANY CONTRARY BINDING DECISION IN IT S SUPPORT NOR HAS POINTED AS TO HOW THE RATIO OF THE AFORESAID DECISION WOULD NOT BE APPLICABLE TO THE FACTS OF THE CASE. FURTHER, IT IS A SETTLED LAW TH AT THE POWER OF RECTIFICATION UNDER SECTION 254(2) OF THE INCOME-TAX ACT CAN BE E XERCISED ONLY WHEN THE MISTAKE WHICH IS SOUGHT TO BE RECTIFIED IS AN OBVIO US AND PATENT MISTAKE WHICH IS APPARENT FROM THE RECORD, AND NOT A MISTAK E WHICH REQUIRES TO BE ESTABLISHED BY ARGUMENTS AND A LONG DRAWN PROCESS O F REASONING ON POINTS ON WHICH THERE MAY CONCEIVABLY BE TWO OPINIONS. FUR THER, THE TRIBUNAL CANNOT, IN EXERCISE OF ITS POWER OF RECTIFICATION, LOOK INTO SOME OTHER CIRCUMSTANCES WHICH WOULD SUPPORT OR NOT SUPPORT IT S CONCLUSION SO ARRIVED AT. THE MISTAKE WHICH THE TRIBUNAL IS ENTITLED TO C ORRECT IS NOT AN ERROR OF JUDGMENT BUT A MISTAKE WHICH IS APPARENT FROM THE R ECORD ITSELF. IN THE PRESENT CASE, NO SUCH MISTAKE WAS APPARENT FROM THE RECORD. IN VIEW OF THE AFORESAID FACTS, WE ARE OF THE VIEW THAT SINCE THE REVENUE HAS FAILED TO POINT OUT ANY MISTAKE APPARENT FROM RECORD IN THE ORDER, WE ARE NOT INCLINED TO RECALL THE ORDER OF THE CO-ORDINATE BENCH IN ITA. N O. 672/A/2010 ORDER M.A NO. 182/A/14 ( IN ITA NO. 672/A/2010) . A.Y. 1995-9 6 4 DATED 30.05.2014, THUS THE MISCELLANEOUS APPLICATIO N BEARING NO. 182/A/2014 IS HEREBY DISMISSED. 6. IN THE RESULT, THE MISCELLANEOUS APPLICATION IS DIS MISSED. ORDER PRONOUNCED IN OPEN COURT ON 19 - 06 - 201 5. SD/- SD/- (RAJPAL YADAV) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD. TRUE COPY RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHM EDABAD