DCIT CEN CIR 43, V. UNIVERSAL CAPSULES P.LTD,

MA 211/MUM/2011

• Counselvise Citation: [2011] 123 COUNSELVISE.COM (IT) 7299 (ITAT-MUMBAI)
• Duration Of Justice: 6 month(s) 3 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 05-10-2011
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2003-2004
• Appeal Filed On: 01-04-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S K SINGH
• Assessee Lawyers: RONAK G DOSHI
• Section: 80HHC

Judgement Text

1 MA N O.211/M/2011,UNIVERSAL CAPSULES P. LTD. 1 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES A BEFORE SHRI D. K. AGARWAL, J.M. AND SHRI R.K. PANDA , A.M. M.A. NO. 211/MUM/2011 ARISING OUT OF ITA NO. 4501/MUM/2006 ASSESSMENT YEAR 2003-04 DY. COMMISSIONER OF INCOME TAX, CC -43, ROOM NO. 655, 6 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI 400 020. VS. M/S UNIVERSAL CAPSULES PVT. LTD., 1001, DALAMAL HOUSE, NARIMAN POINT, MUMBAI. 21 PAN AAACU0615L APPLICANT RESPONDENT APPLICANT BY SHRI S.K. SINGH RESPONDENT BY SHRI RONAK G. DOSHI DATE OF HEARING 09.09.2011 DATE OF PRONOUNCEMENT 05.10.2011 PER R.K. PANDA, A.M. THE REVENUE THROUGH THIS MISCELLANEOUS APPLICATION REQUESTS THE TRIBUNAL TO PASS APPROPRIATE ORDER SINCE CERTAIN MI STAKES HAVE CREPT IN THE ORDER OF THE TRIBUNAL. THE MISC. APPLICATION FILED BY THE REVENUE READS AS UNDER:- 1. THIS MISCELLANEOUS APPLICATION HAS ARISEN OUT OF I TA NO.4501/M/2006 DATED 09.02.2010 PASSED BY THE ITAT, A BENCH FOR THE A.Y. 2003-04 BETWEEN DCIT, CENTRAL CI RCLE-43, NOW ACIT CENTRAL CIRCLE-42 VS. M/S. UNIVERSAL CAPSULES PVT. LTD. AGAINST THE CIT(A)S ORDER NO. CIT(A) CENTRAL-II/IT 159/DCCC.43/2005-06 DATED 10.07.2006 (COPY OF THE I TATS ORDER IS ENCLOSED). 2. GROUND NO.3 WAS IN RESPECT OF REDUCTION OF 100% OF DEPB ENTITLEMENT FROM PROFITS OF BUSINESS INSTEAD OF 90% AND GROUND NO.5 WAS IN RESPECT OF NOT CONSIDERING THE EXPORT I NCENTIVE IN THE NATURE OF DEPB AS ELIGIBLE FOR DEDUCTION U/S.80HHC. AS PER PARA 2 MA N O.211/M/2011,UNIVERSAL CAPSULES P. LTD. 2 14 OF THE ORDER, THE HON'BLE ITAT REMITTED THE ISSU E TO THE FILE OF A.O. WITH A DIRECTION TO DECIDE THE ISSUE IN THE LI GHT OF SPECIAL BENCH DECISION OF ITAT IN THE CASE OF TOPMAN EXPORT & OTHERS. HOWEVER, THE HON'BLE BOMBAY HIGH COURT HAD REVERSED THE ABOVE MENTIONED ITATS SPECIAL BENCH DECISION VIDE ITS OR DER PRONOUNCED ON 29.06.2010 BY PLACING RELIANCE ON ITS DECISION IN THE CASE OF CIT VS. KALPATARU COLOURS AND CHEMICALS IN INCOME TAX APPEAL (L) NO. 2887 OF 2009. THEREFORE, THE ORD ER OF THE HON'BLE ITAT REQUIRES RECTIFICATION ON THIS ISSUE. 3. GROUND NO.4 WAS IN RESPECT OF NETTING OF INTEREST I NCOME FOR THE CALCULATION OF QUANTUM DEDUCTION U/S.80HHC. AS PER PARA 17 OF THE ORDER, THE HON'BLE ITAT RESTORED THE ISSUE TO T HE FILE OF THE AO FOR EXAMINING THE ISSUE IN THE LIGHT OF THE DECISIO N OF THE DELHI TRIBUNAL SPECIAL BENCH IN THE CASE OF M/S. LALSONS ENTERPRISES 89 ITD 25 (SB) (DEL) AND TO ALLOW DEDUCTION ACCORDI NGLY. HOWEVER, THE CONTENTION OF THE HON'BLE ITAT IS NOT CORRECT I N VIEW OF THE HON'BLE HIGH COURTS DECISION (ITA NO.200 OF 2009) IN CIT-III VS. ASIAN STAR CO. LTD. 4. APPLICANT SUBMITS THAT ABOVE MATER REQUIRE RECONSID ERATION OF BENCH IN THE LIGHT OF ABOVE MENTIONED FACTS AND LEG AL POSITION. 5. APPLICANT YEARNS TO SUBMIT THAT THE HON'BLE BENCH M AY PLEASE CONSIDER THE REQUEST FOR RECTIFICATION BY ADMITTING THIS MISCELL ANEOUS APPLICATION IN THE INTEREST OF EQUITY AND GOOD CONSCIENCE. UNDER ABOVE SAID PREMISES, APPLICANT MOST HUMBLY PR AYS THAT YOUR HONOUR MAY GRACIOUSLY PASS NECESSARY ORDERS AL LOWING THIS MISCELLANEOUS APPLICATION AND OBLIGE. 2. THE LD. D.R. REFERRING TO THE ABOVE MISC. APPLIC ATION SUBMITTED THAT SO FAR AS THE ISSUES RELATING TO REDUCTION OF 100% OF DEPB ENTITLEMENT FROM PROFITS OF BUSINESS INSTEAD OF 90% AND NON-CONSIDERATION OF EX PORT INCENTIVES IN THE NATURE OF DEPB AS ELIGIBLE FOR DEDUCTION U/S 80HHC ARE CONCERNED, THE SAME IS COVERED IN FAVOUR OF THE REVENUE BY THE LATEST D ECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. KALPATARU COLOURS AND CHEMICALS REPORTED IN 328 ITR 451. 3 MA N O.211/M/2011,UNIVERSAL CAPSULES P. LTD. 3 2.1 AS REGARDS THE ISSUE OF NETTING OFF OF INTEREST INCOME IS CONCERNED HE SUBMITTED THAT THE TRIBUNAL HAD RESTORED THE ISSUE TO THE FILE OF THE A.O. TO ALLOW DEDUCTION IN THE LIGHT OF THE DECISION OF SPE CIAL BENCH OF ITAT IN THE CASE OF LALSONS ENTERPRISES REPORTED IN 89 ITD 25 (SB). HOWEVER, IN VIEW OF THE SUBSEQUENT DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. ASIAN STAR CO. LTD. (ITA NO. 200 OF 2009), THE A.O. SHOULD BE DIRECTED TO DECIDE THE ISSUE IN THE LIGHT OF THE LATEST DECISION OF TH E HONBLE JURISDICTIONAL HIGH COURT. 3. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER H AND, SUBMITTED THAT IF THE PLEA OF THE DEPARTMENT THAT ORDER OF THE TRIBUNAL H AS TO BE RECALLED ON THE BASIS OF SUBSEQUENT DECISION OF THE HONBLE JURISDI CTIONAL HIGH COURT, THEN, SO MANY ORDERS HAVE TO BE RECALLED. THEREFORE, THE PL EA OF THE REVENUE SHOULD NOT BE ENTERTAINED. RELYING ON THE DECISION OF THE TRIB UNAL REPORTED IN 84 ITD48 AND THE DECISION OF THE HONBLE MADRAS HIGH COURT I N THE CASE OF SREE PALANIAPPA TRANSPORTS VS. CIT REPORTED IN 111 TAXMA N 450, HE SUBMITTED THAT THE M.A. FILED BY THE REVENUE SHOULD BE DISMISSED. 4. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY B OTH THE SIDES, PURSUED THE ORDERS OF THE ASSESSING OFFICER AND THE CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECISIONS CITED BEFORE US. WE FIND THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF KALPATARU COLOURS AND CHEMICALS (SUPRA) HAS REVERSE D THE DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF TOPMAN EXPORTS & OTHERS. SIMILARLY THE RATIO LAID DOWN BY THE SPECIAL BENCH IN THE CASE OF LALSONS ENTERPRISES (SUPRA) HAS BEEN REVERSED BY THE HONBL E JURISDICTIONAL HIGH COURT IN THE CASE OF ASIAN STARS REPORTED IN 326 ITR 56. IT HAS BEEN HELD BY VARIOUS JUDICIAL DECISIONS INCLUDING THE DECISION OF HONBL E SUPREME COURT IN THE CASE OF ACIT VS. SAURASHTRA KUTCH STOCK EXCHANGE LTD. 30 5 ITR 227 THAT IF THE ORDER PASSED BY THE TRIBUNAL IS NOT IN CONFORMITY W ITH THE JUDGMENT OF THE HONBLE SUPREME COURT OR THAT OF THE HONBLE JURISD ICTIONAL HIGH COURT 4 MA N O.211/M/2011,UNIVERSAL CAPSULES P. LTD. 4 RENDERED PRIOR TO OR SUBSEQUENT TO THE IMPUGNED ORD ER, THE SAME CONSTITUTES A MISTAKE APPARENT ON RECORD CAPABLE OF RECTIFICATION U/S 254(2) OF THE ACT. WE, THEREFORE, ARE OF THE OPINION THAT A MISTAKE HAS CR EPT IN THE ORDER OF THE TRIBUNAL IN SO FAR AS THE GROUNDS OF APPEAL NO. 3, 4 & 5 OF THE APPEAL WHICH REQUIRES RECTIFICATION. THE VARIOUS DECISIONS RELI ED ON BY THE LD. COUNSEL FOR THE ASSESSEE ARE NOT APPLICABLE SINCE THOSE ARE RENDERE D PRIOR TO THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF SAURASHTRA KUT CH STOCK EXCHANGE LTD. (SUPRA). WE, THEREFORE, RECALL THE ORDER OF THE TR IBUNAL FOR THE LIMITED PURPOSE OF DECIDING GROUND NO. 3, 4 & 5 OF THE APPEAL FILED BY THE ASSESSEE. THE REGISTRY IS DIRECTED TO FIX THE HEARING OF THE APPE AL IN NORMAL COURSE. THE MISC. APPLICATION FILED BY THE REVENUE IS ACCORDINGLY ALL OWED. 5. IN THE RESULT, THE MISC. APPLICATION FILED BY TH E REVENUE IS ALLOWED. ORDER PRONOUNCED ON 05.10.2011. SD/- SD/- (D. K. AGARWAL) (R.K. PANDA) JUDICIAL MEMBER ACCOUNTANT M EMBER MUMBAI, DATED 05.10.2011. RK COPY TOTHE APPELLANT 1. THE RESPONDENT 2. THE CIT(A) - CONCERNED, MUMBAI 3. THE CIT, CONCERNED, MUMBAI 4. THE DR BENCH, A 5. MASTER FILE TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR ITAT, MUMBAI