Everbright Granites, Vellore V. ACIT, Vellore

MA 21/CHNY/2011

• Counselvise Citation: [2011] 123 COUNSELVISE.COM (IT) 6316 (ITAT-CHENNAI)
• Duration Of Justice: 1 month(s) 6 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 08-04-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 08-04-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 02-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B SRINIVAS
• Assessee Lawyers: A MAHESH
• Section: 80HHC

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH C CHENNAI (BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER) .. M.P. NO. 21/MDS/2011 (IN I.T.A. NO. 2369/MDS/2007) ASSESSMENT YEAR : 2004-05 M/S EVER BRIGHT GRANITES, MADRAS BANGALORE HIGHWAY, SATIYAMANGALAM VILLAGE & POST, VELLORE. PAN : AAAFE1498E (PETITIONER) V. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE I, VELLORE. (RESPONDENT) & I.T.A. NO. 2369/MDS/2007 ASSESSMENT YEAR : 2004-05 THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE I, VELLORE. (APPELLANT) V. M/S EVER BRIGHT GRANITES, MADRAS BANGALORE HIGHWAY, SATIYAMANGALAM VILLAGE & POST, VELLORE. (RESPONDENT) ASSESSEE BY : SHRI A. MAHESH REVENUE BY : SHRI B. S RINIVAS O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : M.P. NO. 21/MDS/2011 IN THIS MISCELLANEOUS PETITION, GRIEVANCE OF THE AS SESSEE IS THAT THIS TRIBUNAL HAD DECIDED THE REVENUE APPEAL EX PARTE, RELYING ON A M.P. NO. 21/MDS/11 I.T.A. NO. 2369/MDS/07 2 DECISION OF THE SPECIAL BENCH IN THE CASE OF ACIT V . ROGINI GARMENTS 294 ITR (AT) 15 (SB) (MAD.). AS PER THE ASSESSEE, ON DATE ON WHICH THE TRIBUNAL DECIDED THE APPEAL, THERE WAS A DECISI ON OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SCM CREATI ONS V. ACIT (2008) 304 ITR 319 (MAD) WHICH WAS CLEARLY IN FAVOUR OF TH E ASSESSEE. ACCORDING TO ASSESSEE, BECAUSE THE APPEAL WAS DECID ED EX PARTE , THE ABOVE MENTIONED DECISION OF HON'BLE JURISDICTIO NAL HIGH COURT COULD NOT BE BROUGHT TO THE ATTENTION OF THE TRIBUN AL. ASSESSEE ALSO STATED THAT IT HAD SENT A REQUEST FOR ADJOURNMENT B Y TELEGRAM ON 9.6.2008 DESPITE WHICH THE TRIBUNAL HAD GONE AHEAD WITH HEARING. 2. WHEN THE MISCELLANEOUS PETITION WAS CALLED UP FO R HEARING, LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE APPEAL HAD BEEN DECIDED EX PARTE WITHOUT CONSIDERING THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SCM CREATI ONS (SUPRA). THUS, IT WAS ARGUED THAT THE ORDER OF THE TRIBUNAL REQUIR ED A RECALL. FURTHER, AS PER THE LEARNED COUNSEL, IN VIEW OF THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SCM CREATI ONS (SUPRA), REVENUES APPEAL HAD TO BE DISMISSED AS WELL. 3. PER CONTRA, LEARNED D.R. SUBMITTED THAT THERE WA S A SUBSEQUENT DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN TH E CASE OF M/S M.P. NO. 21/MDS/11 I.T.A. NO. 2369/MDS/07 3 GENERAL OPTICS (ASIA) LTD. V. DCIT 315 ITR 400 (MAD .) WHEREIN THE HON'BLE JURISDICTIONAL HIGH COURT HELD IN FAVOUR OF REVENUE. 4. SHORT FACTS GIVING RISE TO THE MISCELLANEOUS PET ITION ARE THAT THE REVENUE HAD FILED APPEAL BEFORE THIS TRIBUNAL ASSAI LING AN ORDER OF THE CIT(APPEALS) DIRECTING A.O. TO ALLOW DEDUCTION UNDER SECTION 80HHC OF THE INCOME-TAX ACT, 1961 (HEREINAFTER CALL ED THE ACT) TO THE ASSESSEE WITHOUT REDUCING ITS CLAIM UNDER SECTI ON 80-IB OF THE ACT. THIS TRIBUNAL RELYING ON THE DECISION OF SPEC IAL BENCH IN THE CASE OF ROGINI GARMENTS (SUPRA) HELD IN FAVOUR OF R EVENUE. ASSESSEE WAS NOT REPRESENTED AT THE TIME OF HEARING . 5. WE HAVE PERUSED THE ORDERS AND HEARD THE RIVAL C ONTENTIONS. WE FIND THAT AS ON THE DATE WHEN THE TRIBUNAL GAVE THIS DECISION, I.E. ON 13 TH JUNE, 2008, THE JUDGEMENT OF HON'BLE JURISDICTIONA L HIGH COURT IN THE CASE OF SCM CREATIONS (SUPRA) WAS ALREADY AV AILABLE. THE DECISION IN THE CASE OF SCM CREATIONS (SUPRA) WAS G IVEN BY THE HON'BLE JURISDICTIONAL HIGH COURT ON 6 TH MARCH, 2008. NON CONSIDERATION OF THE DECISION OF HON'BLE JURISDICTI ONAL HIGH COURT IS DEFINITELY A MISTAKE WHICH IS APPARENT ON THE RECOR D. HON'BLE JURISDICTIONAL HIGH COURT HAD, IN THE CASE OF SCM C REATIONS (SUPRA), HELD THAT RELIEF UNDER SECTION 80-IA OF THE ACT COU LD NOT BE DEDUCTED FROM THE PROFITS AND GAINS OF BUSINESS BEFORE COMPU TING RELIEF UNDER M.P. NO. 21/MDS/11 I.T.A. NO. 2369/MDS/07 4 SECTION 80HHC OF THE ACT AND THEREFORE, THE ISSUE W AS SQUARELY COVERED BY THIS DECISION. NO DOUBT, THERE IS A SUB SEQUENT DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF GE NERAL OPTICS (ASIA) LTD. (SUPRA) WHICH WENT IN FAVOUR OF REVENUE, BUT, THE SAID DECISION OF HON'BLE JURISDICTIONAL HIGH COURT HAD COME ON 22 ND DECEMBER, 2008 WHICH IS AFTER THE DATE OF DECISION OF THIS TR IBUNAL. THEREFORE, WE ARE RECALLING THE ORDER OF THIS TRIBUNAL AND PRO CEED TO DISPOSE OF THE APPEAL. THUS THE MISCELLANEOUS PETITION OF THE ASSESSEE IS ALLOWED. I.T.A. NO. 2369/MDS/2007 6. WE FIND THAT THE ISSUE INVOLVED HAD AGAIN COME U P BEFORE THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CI T V. MRF LTD. IN T.C.A. NO.1020/2009 DATED 27.10.2009 WHEREIN AFTER CONSIDERING ITS OWN DECISION IN THE CASE OF SCM CREATIONS (SUPRA) A S ALSO VARIOUS OTHER DECISIONS OF OTHER HIGH COURTS AND APEX COURT , IT WAS HELD THAT THE LAW LAID DOWN IN SCM CREATIONS (SUPRA) COULD BE TAKEN AS A VIEW ACCEPTED BY THE DEPARTMENT. IT IS NOTED THAT THE A SSESSMENT YEAR INVOLVED IN THE CASE OF MRF LTD. (SUPRA) WAS ASSESS MENT YEAR 2004- 05. SUBSEQUENT TO THIS, SAME VIEW HAS BEEN TAKEN B Y THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT V. CHO LA TEXTILES LTD. 304 ITR 256 (MAD.) ALSO. EVEN WHEN THERE ARE CONFLICTI NG DECISIONS OF M.P. NO. 21/MDS/11 I.T.A. NO. 2369/MDS/07 5 JURISDICTIONAL HIGH COURT, WE ARE BOUND TO FOLLOW T HE DECISION WHICH WENT IN FAVOUR OF ASSESSEE, ESPECIALLY SO SINCE THE DECISION IN THE CASE OF SCM CREATIONS (SUPRA) WAS FOLLOWED BY THE J URISDICTIONAL HIGH COURT IN DECISIONS SUBSEQUENT TO GENERAL OPTICS (AS IA) LTD. (SUPRA). WE ARE, THEREFORE, OF THE OPINION THAT REVENUES AP PEAL DOES NOT HAVE ANY MERITS. ASSESSING OFFICER IS DIRECTED TO COMPUTE THE DEDUCTION OF THE ASSESSEE UNDER SECTION 80HHC OF TH E ACT WITHOUT REDUCING THE DEDUCTION AVAILABLE TO IT UNDER SECTIO N 80-IB OF THE ACT, AS ALREADY DIRECTED BY THE CIT(APPEALS). 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE S TANDS DISMISSED. 8. TO SUMMARIZE THE RESULTS, THE MISCELLANEOUS PETI TION OF THE ASSESSEE IS ALLOWED WHEREAS THE APPEAL OF THE REVEN UE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT AFTER CONCLUSION OF HEARING ON THE EIGHTH DAY OF APRIL, 2011. SD/- SD/- (HARI OM MARATHA) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 8 TH APRIL, 2011. KRI. COPY TO: PETITIONER/APPELLANT/RESPONDENT/CIT(A)/CIT /D.R./ GUARD FILE