Meghmani Organics Ltd., Ahmedabad V. The ACIT., Circle-4, Ahmedabad

MA 207/AHD/2012

• Counselvise Citation: [2016] 124 COUNSELVISE.COM (IT) 4168 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 7 month(s) 1 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 30-05-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2002-2003
• Appeal Filed On: 29-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NARENDRA SINGH
• Keywords: Retrospective amendment
• Section: 80HHC; 28

Judgement Text

M.A. NO S .206 & 207 /AHD/ 20 1 2 ASSESSMENT Y EAR S : 200 2 - 03 PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL, AHMEDABAD B BENCH, AHMEDABAD [CORAM : PRAMOD KUMAR AM AND RAJPAL YADAV JM ] M.A. NO S .206 & 207 /AHD/2012 (IN I.T.A. NO S . 2 49 & 536 /AHD/ 20 05) ASSESSMENT Y EAR S : 200 2 - 03 MEGHMANI ORGANICS LTD. .... .......... .APPE LLANT 183/184, PHASE II, GIDC VATVA, AHMEDABAD. [ PAN: A ABCM 0644 E ] VS. ASSTT. COMMISSIONER OF INCOME TAX, ............. . RESPONDENT CIRCLE - 4, AHMEDABAD. APPEARANCES BY: S.N. SOPARKAR , FOR THE APPELLANT NARENDRA SINGH , FOR THE RE SPONDENT D ATE OF CONCLUDING THE HEARING : MARCH 4 TH , 201 6 DATE OF PRONOUNCING THE ORDER : MAY 30 TH , 201 6 O R D E R PER PRAMOD KUMAR AM : BY WAY OF TH ESE MISCELLANEOUS APPLICATION S THE ASSESSEE APPELLANT SEEKS RECTIFICATION OF CERTAIN MISTAKES ALLEGED TO HAVE CREPT IN THE ORDER DATED 12 TH JUNE, 2009 PASSED BY THE TRIBUNAL. M.A. NO.206/AHD/2012 2. THE FIRST ISSUE IN THE ORDER, IN WHICH RECTIFICATION IS SOUGH T , IS THIS . IN THE ORIGINAL ORDER, THE FOLLOWING GROUND WAS REMITTED TO THE FI LE OF ASSESSING OFFICER: - 2. LEARNED CIT ( A ) HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT SALE PROCEEDS OF DE PB LICENSE ARE COVERED BY S.28(IIIB) AND CONSEQUENTLY DEDUCTION UNDER SECTION 80HHC OF THE INCOME TAX ACT IS AVAILABLE ONLY TO THE EXTENT OF 90% OF THE SAID DEPB LICENSE. LD. CI T(A) FAILED TO M.A. NO S .206 & 207 /AHD/ 20 1 2 ASSESSMENT Y EAR S : 200 2 - 03 PAGE 2 OF 5 APPRECIATE THAT THE SAID SALE PROCEEDS OF THE DEBP LICENSE ARE COVERED BY 28(IV) OF THE ACT AND THEREFOR E DEDUCTION UNDER SECTION 80HHC OF THE ACT OUGHT TO HAVE BEEN ALLOWED FULLY ON THE SAME. 3. LEARNED C OUNSEL FOR THE APPLICANT, HOWEVER, SUBMITS THAT SUCH AN EXERCISE WILL BE AN EXERCISE IN FUTILITY INASMUCH AS THE VERY STATUTORY AMENDMENT IN THE LIGHT OF WHICH THE RECONSIDERATION WAS REQUIRED, HAS BEEN QUASHED BY HON BLE JURISDICTIONAL HIGH COURT. HIS SU BMISSIONS ON THIS POINT ARE AS FOLLOWS : - 4. THE APPLICANT MOST RESPECTFULLY SUBMITS THAT THE ISSUE RESTORED TO THE FILE OF ASSESSING OFFICER TO CONSIDER AMENDMENT BROUGHT IN SECTION 28 & HHC OF THE ACT BY TAXATION LAWS (AMENDMENT) ACT, 2005 WITH RE TROSPECTIVE EFFECT FROM 01/04/1998 (SUPRA) WILL NO LONGER BE RELEVANT IN VIEW OF JUDGMENT RENDERED BY THE HON'BLE GUJARAT HIGH COURT IN AVANI EXPORTS & OTHERS VS CIT (2012) 74 DTR (GUJ) 97 WHEREIN THE JURISDICTIONAL HIGH COURT HAS HELD AMENDMENT VIDE TAXAT ION LAW (AMENDMENT) ACT 2005 TO BE VIOLATIVE OF ARTICLE 14 OF THE CONSTITUTION ON ACCOUNT OF RETROSPECTIVE EFFECT AND IT IS HELD TO BE PROSPECTIVE AND ALSO SUPREME COURT IN TOPMAN EXPORTS V CIT REPORTED AT 342 ITR 49 HAS LAID DOWN THE RATIO THAT ONLY 90% O F THE PROFITS ON SALE OF DEPB LICENSE IS TO BE EXCLUDED AND NOT THE ENTIRE SUM FOR WORKING OUT DEDUCTION U/S 80HHC OF THE ACT. THEREFORE THE ISSUE AS IN GROUND # 2 OF THE APPEAL STANDS COVERED BY JUDGMENT OF THE JURISDICTIONAL HIGH COURT AS WELL APEX COURT IN FAVOUR OF THE APPLICANT HENCE THE ORDER OF ID. CIT (A) DESERVES TO BE QUASHED. 5. THE APPLICANT MOST RESPECTFULLY SUBMITS THAT IN LIGHT OF THE ABOVE MENTIONED JUDGMENTS, THERE IS ERROR APPARENT IN THE IMPUGNED ORDER, AS HELD BY THE APEX COURT IN CIT V SAURASHTRA KUTCH STOCK EXCHANGE LTD.(305 ITR 227) THAT NON - CONSIDERATION OF A JUDGMENT OF THE APEX COURT WOULD ALWAYS CONSTITUTE A MISTAKE APPARENT FROM THE RECORD, REGARDLESS OF THE JUDGMENT BEING RENDERED PRIOR TO OR SUBSEQUENT TO THE ORDER PRONO UNCED TO BE RECTIFIED , THEREFORE THE ORDER OF THE HON'BLE ITAT IS REQUIRES TO BE MODIFIED SO AS THE DEDUCTION U/S 80HHC OF THE ACT AS CLAIMED BE ALLOWED AND DEPARTMENTAL APPEAL BE QUASHED. 4. LEARNED DEPARTMENTAL REPRESENTATIVE DOES NOT MAKE ANY SPECIFIC SUBMISSION IN THIS REGARD, AND SIMPLY RELIES UPON THE S T AND TAKEN BY THE TRIBUNAL IN THE ORDER BEFORE US. M.A. NO S .206 & 207 /AHD/ 20 1 2 ASSESSMENT Y EAR S : 200 2 - 03 PAGE 3 OF 5 5. HAVING HEARD T HE R IVAL SUBMISSIONS, AND HA V IN G PERUSED THE MATERIAL ON RECORD, WE SEE MERITS IN THE PLEA OF THE APPLICANT. ONCE THE RETROSPECTIVE AMENDMENT ITSELF S T ANDS QUASHED BY HON BLE JURISDICTIONAL HIGH COURT, AND THE MATTER HAS REACHED FINALITY AT THAT, THERE CANNOT BE ANY GOOD RE AS ONS TO REMIT THE MATTER FOR FRESH CONSIDERATION BY THE ASSESSING OFFICER IN THE LIGHT OF THE SAID AMENDMENT. T HIS WAS A PPROVED BY HON BLE SUPREME COURT IN THE CASE OF CIT VS. AVAN I EXPORTS [(2015) 58 T AXMAN N .COM 100 (SC) ]. ACCORDINGLY, GROUND NO.2 BEING ALLOW E D FOR STATISTICAL PURPOSES IS NOTHING BUT A MISTAKE APPARENT ON R E CO R D. THE FACT THAT HON BLE HIGH COURT S JUDGEMENT WAS, SUBSEQUENT TO THE P A SSING OF OUR ORDER, DOES NOT MAKE A DIFFERENCE AS IS THE SETTLED LEGAL POSITION IN THE LIGHT OF HON BLE SUPREME COURT S JUDGEMENT IN THE CASE OF CIT VS . SAURASHTRA KUTCH STOCK EXCHANGE LIMITED [305 ITR 227]. ACCORDING LY, GRIEVANCE OF THE ASSESSEE IS UPHELD AND GROUND NO.2 OF THE REVENUE S APPEAL IS, THEREFORE, DISMISSED, AND, TO THAT EXTENT, TRIBUNAL S ORDER DATED 12 TH JUNE, 2009 STANDS MODIFIED. 6. AS FOR THE SECOND ISSUE R AISED IN THIS RECTIFICATION PETITION, THE RE CTIFICATION PETITION SATES AS FOLLOWS : - 6. THAT THE HON'BLE TRIBUNAL PROCEEDED TO DISMISS GROUND NO. 6 RAISED BY THE APPLICANT AS IN PARA 62/63 ON PAGE 41 OF THE IMPUGNED ORDER: - 62. GROUND NO. 6 OF ASSESSEE'S APPEAL READS AS UNDER: - 'THE LEARNED CIT(A ) HAS ERRED IN LAW AND ON FACTS IN NOT APPRECIATING THAT S. 80IA OF THE ACT IS AN INDEPENDENT SECTION AND DEDUCTION CLAIMED THEREIN DOES NOT AFFECT THE RIGHT TO CLAIM DEDUCTION UNDER ANY OTHER SECTIONS. THE LEARNED CIT (A) OUGHT TO HAVE ALLOWED DEDUCTION U NDER SECTION 80HHC AS WELL 80IA OF THE ACT ON THE GROSS TOTAL INCOME' '63. WE HAVE CONSIDERED AND DECIDED THE SAME ISSUE IN GROUND NO. 4 IN ASSESSEE'S APPEAL FOR ASSESSMENT YEAR 2001 - 02 (SUPRA) IN PARAGRAPH NOS. 14 TO 17 OF THIS ORDER WHEREIN WE HAVE DIS MISSED THE GROUND OF APPEAL OF THE ASSESSEE. FOR THE SAME REASONS, WE DISMISS THE GROUND OF APPEAL OF THE ASSESSEE FOR THIS ASSESSMENT YEAR ALSO.' M.A. NO S .206 & 207 /AHD/ 20 1 2 ASSESSMENT Y EAR S : 200 2 - 03 PAGE 4 OF 5 7. IT IS RESPECTFULLY SUBMITTED THAT THE HON'BLE BOMBAY HIGH COURT IN ASSOCIATED CAPSULES PVT. LTD. V DCIT @ 332 ITR 42 HAS TAKEN A VIEW IN FAVOUR OF THE ASSESSEE. IN THAT CASE, IT WAS HELD BY THE HON'BLE BOMBAY HIGH COURT THAT THE TRIBUNAL WAS NOT RIGHT IN HOLDING THAT AS PER SECTION 80 - IA (9) OF THE INCOME TAX ACT, 1961, THE AMOUNT OF PROFIT ALLOWED AS DEDUCTION U/S 80 - IA (9) OF THE INCOME TAX ACT, 1961 HAS TO BE REDUCED FROM THE PROFITS OF THE BUSINESS OF THE UNDERTAKING WHILE COMPUTING DEDUCTION UNDER ANY OTHER SECTION UNDER CHAPTER VI - A OF THE INCOME TAX ACT, 1961. HON'BLE BOMBAY HIGH COURT HAS A LREADY CONSIDERED THE DECISION OF SPECIAL BENCH OF THE TRIBUNAL RENDERED IN THE CASE OF CIT VS . ROGINI GARMENTS 108 ITD 49 (CHE)(SB). THIS VIEW OF THE HON'BLE BOMBAY HIGH COURT HAS ALSO BEEN FOLLOWED BY THE HON'BLE KARNATAKA HIGH COURT IN CIT V MILLIPORE I NDIA PVT. LTD. @ 341 ITR 219. SINCE NOW THE JUDGEMENTS OF TWO DIFFERENT HIGH COURTS ARE AVAILABLE ON THIS ISSUE, DECISION OF SPECIAL BENCH OF THE TRIBUNAL IS NO MORE RELEVANT AND APPLICABLE TO THE FACTS OF THE CASE. 8. THE HON'BLE TRIBUNAL RELYING UPO N DECISION OF SPECIAL BENCH IN DISMISSING THE APPEAL FILED BY THE APPELLANT WHEN JUDGMENTS OF TWO HIGH COURTS RENDERED AFTER CONSIDERING RATIO OF THE SPECIAL BENCH DECISION BEING AGAINST THE PRINCIPLE OF JUDICIAL HIERARCHY WOULD CONSTITUTE MISTAKE APPARENT ON RECORD THAT REQUIRES TO BE MODIFIED. 7. THERE IS NO DISPUTE THAT THESE JUDICIAL PRECEDENTS WHICH ARE REFERRED TO BY THE LEARNED COUNSEL, ARE DECISIONS SUBSEQUENT TO PASSING OF THE ORDER BEFORE US AND THAT THE MATTER HA S NOT ATTAINED FINALITY INASMUC H AS DECISIONS ARE FROM NON JURISDICTIONAL HIGH COURTS, AND THERE IS NO WORD ON THE ISSUE FROM H ON BLE JURISDICTIONAL HIGH COURT. WE ALSO UNDERSTAND THAT THE MA T TER IS PENDING BEFORE H ON BLE JURISDICTIONAL HIGH COURT FOR AD JUDICATION IN A PPEAL AGAIN S T THI S VERY ORDER. UNDER THESE CIRCUMSTANCES, IN OUR CONSIDERED VIEW, IT IS NOT OPEN TO US TO LINKER WITH THE TRIBUNAL S ORDER , AT THIS STAGE. 8. O N SECOND ISSUE THUS , RECTIFICATION PETITION IS REJECTED. 9. I N THE RESULT, MA N O.206/AHD/2012 IS PARTLY ALLOWED. M.A. NO .207 /AHD/2012 10. AS FOR THE M.A. NO.207/AHD/2012 , THE ISSUE IS THE SAME A DISCUSSED IN PARAGRAPH NOS. 2 TO 5 ABOVE IN M . A . NO.206/ A HD/2012. LEARNED REPRESENTATIVES M.A. NO S .206 & 207 /AHD/ 20 1 2 ASSESSMENT Y EAR S : 200 2 - 03 PAGE 5 OF 5 HAVE FAIRLY AGREED THAT THE SAME DECISIONS , AS ON M . A . N O.206/AHD/2012 , WILL AMPLY HERE AS WELL. ACCORDINGLY , TO THIS EXTENT, THE RECTIFICATION IS UPHELD. 11. IN THE RESULT, M . A . NO.207/AHD/2 012 IS ALLOWED. 12. TO SUM UP, WHILE M.A. NO.206/AHD/2012 IS PARTLY ALLOWED, M . A . , NO.207/AHD/2012 IS ALLOWED. PRONOUNCED IN THE OPEN COURT TOD AY ON 30 TH DAY OF MAY, 2016. SD/ - SD/ - RAJPAL YADAV PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) DATED: THE 30 TH DAY OF MAY , 2016. PBN/* COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) CI T (4) CIT(A) (5) DR (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD