SURESH G. WADHWA, V. JT CIT RG 22(3),

MA 387/MUM/2013

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 1273 (ITAT-MUMBAI)
• Duration Of Justice: 1 month(s) 7 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 04-12-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Assessment Year: 2009-2010
• Appeal Filed On: 28-10-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R K SAHU
• Assessee Lawyers: S C TIWARI

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL I BENCH, MUM BAI . . , , BEFORE SHRI B. R. MITTAL, JM AND SHRI SANJAY ARORA , AM MA NO.387/MUM/2013 (ARISING OUT OF ITA NO. 6395/MUM/2012) ASSESSMENT YEAR 2009-10 SURESH G. WADHWA 429, ARENJA CORNER, SECTOR 17, VASHI, NAVI MUMBAI - 400 706 / VS. JT. COMMISSIONER OF INCOME TAX, RANGE 22(3), MUMBAI ./! ./PAN/GIR NO. AAAPW 0812 A ( ' # /APPELLANT ) : ( $ # / RESPONDENT ) ' # % / APPELLANT BY : SHRI S. C. TIWARI $ # & % / RESPONDENT BY : SHRI R. K. SAHU ' ()* & + / DATE OF HEARING : 22.11.2013 ,-. & + / DATE OF PRONOUNCEMENT : 04 .12.2013 / / O R D E R PER SANJAY ARORA, A. M.: THIS IS A MISCELLANEOUS PETITION BY THE ASSE SSEE-APPELLANT, ARISING OUT OF THE ORDER BY THE TRIBUNAL DATED 02.08.2013 IN HIS CASE FOR TH E ASSESSMENT YEAR (A.Y.) 2009-10. 2.1 OPENING THE ARGUMENTS FOR AND ON BEHALF OF THE ASSESSEE, IT WAS SUBMITTED BY THE LD. AUTHORIZED REPRESENTATIVE (AR), THE ASSESSEES COUNSEL, THAT THE INSTANT APPLICATION MAY BE CONSIDERED MORE AS TOWARD SEEKING A CLARIFIC ATION FROM THE TRIBUNAL, RATHER THAN 2 MA NO. 387/MUM/2013 (A.Y. 2009-10) SURESH G. WADHWA VS. JT. CIT AN AMENDMENT OF ITS ORDER WITH A VIEW TO RECTIFYING A MISTAKE. ADDUCING THE COPY OF THE LETTER BY THE ASSESSING OFFICER (A.O.) DATED 17.10. 2013 ADDRESSED TO THE ASSESSEE, HE CONTINUED THAT THE ASSESSING AUTHORITY HAS, PURSUAN T TO THE TRIBUNALS IMPUGNED ORDER, SOUGHT TO EFFECT AN ADDITION TO THE ASSESSED INCOME FOR A.YS. 2006-07 TO 2011-12. THE RELEVANT YEAR IS A.Y. 2009-10, THE ADDITION TO INCO ME FOR WHICH STANDS CORRECTLY WORKED OUT BY THE AO AT RS.173.52 LACS, AS STATED IN THE L ETTER. THE TRIBUNAL MAY, THEREFORE, ISSUE A CLARIFICATION FOR RESTRICTING THE ADDITION ONLY F OR THAT YEAR. WHEN ASKED TO POINT OUT THE RELEVANT PART OF THE IMPUGNED ORDER, I.E., ON THE B ASIS OF WHICH THE A.O. SEEKS TO DISTURB THE ASSESSED INCOME FOR THE PRECEDING AND THE SUCCE EDING YEARS, HE ADVERTED TO PARA 4.1 THEREOF, WHICH READS AS UNDER: DECISION 4.1 THE A.O. IS ACCORDINGLY DIRECTED TO VERIFY THE AFORE-MENTIONED RATIO OF 40.22% AS WORKED OUT BY THE ASSESSEE, AND APPLY THE SAID PERCENTAGE, I.E., 40%, ASSUMING THE SAME AS CORRECT, TO THE INC REMENTAL WIP FOR THE CURRENT YEAR. THE INCREMENTAL WIP SHALL INCLUDE, IR RESPECTIVE OF THE YEAR OF INCURRING, THE PROPORTION OF BASIC COST, AS REFERRE D TO ABOVE, ATTRIBUTABLE TO THE CURRENT YEAR, AS EXPLAINED ABOVE. WE MAY HASTEN TO ADD THAT BY DIRECTING SO, WE ARE NOT IN ANY MANNER ADVOCATING O R ENDORSING THE SAID METHOD FOR CONSISTENT APPLICATION, BUT ONLY PROVIDI NG FOR A REASONABLE BASIS FOR ALLOCATION OF INCOME ON THE PROJECT SAI STHAAN FOR THE CURRENT YEAR IN THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE. NEED LESS TO ADD, THE INCOME AS FINALLY ASSESSED ON THIS PROJECT SHALL BE GIVEN DUE CREDIT OF WHILE DETERMINING THE PROFIT ON THE PROJECT FOR THE TERMI NAL YEAR. THE ASSESSEES GROUND NO. 1 IS ANSWERED ACCORDINGLY, AND THE ASSES SEE GETS PART RELIEF. 2.2 THE LD. DEPARTMENTAL REPRESENTATIVE (D.R.) WOUL D, ON THE OTHER HAND, DISPUTE THE ASSESSEES PRAYER AFORE-SAID. THE DECISION BY THE T RIBUNAL, AS A READING OF THE RELEVANT PARA (4.1) WOULD SHOW, IS CLEAR AND EXPLICIT AND, T HUS, WARRANTS NO RECTIFICATION OR CLARIFICATION. IF THE REVENUES ACTION IS NOT BORNE OUT BY OR THE IMPUGNED ORDER, THE SAME COULD BE CHALLENGED BY THE ASSESSEE FOLLOWING THE R ECOURSE AVAILABLE UNDER LAW. WHERE AND TO THE EXTENT IN EXCESS OF THE MANDATE OF THE O RDER, THE SAME IS LIABLE TO BE STRUCK DOWN. THE ASSESSEE CANNOT, HOWEVER, BY URGING FOR O R IN THE GARB OF SEEKING A CLARIFICATION, PRE-EMPT THE REVENUES PREROGATIVE AND RIGHT IN APPLYING OR GIVING EFFECT TO THE SAID ORDER. IT IS CERTAINLY OPEN FOR THE REV ENUE TO APPLY ANY FINDING BY THE TRIBUNAL, 3 MA NO. 387/MUM/2013 (A.Y. 2009-10) SURESH G. WADHWA VS. JT. CIT WHICH CANNOT BE OUSTED AT THE THRESHOLD ON THE GROU ND THAT THE SAME IS IN RELATION TO A YEAR DIFFERENT FROM THE YEAR UNDER CONSIDERATION, W HICH IS WHAT THE ASSESSEES OBJECTION IN SUM AND SUBSTANCE IS. RELIANCE, IN SUPPORT OF HI S ARGUMENTS, WAS MADE BY HIM ON A NUMBER OF DECISIONS, AS: - CIT V. EARNEST EXPORTS LTD . [2010] 323 ITR 577 (BOM) - CIT V. RAMESH ELECTRIC & TRADING CO . [1994] 203 ITR 497 (BOM) - HYCONS INFRASTRUCTURE (INDIA) LTD. V. DY. CIT [2013] 36 TAXMANN.COM 92 (MUM) - REUTERS LIMITED CONSTRUCTION HOUSE V. JT. CIT [2012] ITR (TRIB) 48 (MUM) 3. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATER IAL ON RECORD. 3.1 ON PRINCIPLE, WE ARE IN FULL AGREEMENT WITH THE REVENUES STAND AS PROJECTED AND ARGUED BY THE LD. DR. WE SAY SO AS BOTH THE PARTIES HAVE AN INHERENT RIGHT TO SUBJECT AN APPELLATE ORDER TO AN INTERPRETATIVE PROCESS, SO TH AT SUPPLYING AN INTERPRETATION IN THE RECTIFICATION PROCEEDINGS IN THE NAME OF ISSUING A CLARIFICATION WOULD AMOUNT TO VIOLATING THE SAID RIGHT; THE CORRECTNESS OR OTHERW ISE OF THE INTERPRETATION TAKEN BEING EVEN OTHERWISE LIABLE TO BEING CONTESTED BY THE OPPOSITE PARTY UNDER THE REGULAR APPELLATE PROCEDURE. AT THE SAME TIME, HOWEVER, WHERE AN ORDER IS CLEAR AND UNAMBIGUOUS, READING IT IN A MANNER INCONSISTENT THEREWITH OR DE HORS ITS CLEAR LANGUAGE WOULD DEFINITELY CALL FOR INTERFERENCE. THIS IS AS THE SAME COULD RESULT IN A PREJUDICE BEING CAUSED BY ONE PARTY TO ANOTHER. EVEN IF NOT FALLING STRICTLY WITHIN THE SC OPE OF SECTION 254(2), THE SAME, IN OUR CLEAR VIEW, IS WITHIN THE PURVIEW OF THE INHERENT P OWERS OF THE TRIBUNAL, OR ANY APPELLATE AUTHORITY FOR THAT MATTER. TOWARD THIS, WE MAY DRAW ON THE DECISION BY THE HONBLE APEX COURT IN THE CASE OF HONDA SIEL POWER PRODUCTS LTD. VS. CIT [2007] 295 ITR 466 (SC), AS WELL AS ON THE LEGAL MAXIM TO THE EFFECT THAT NO CO URT OR TRIBUNAL SHALL BY ITS ACTION OR NON- ACTION, AS THE CASE MAY BE, CAUSE ANY PREJUDICE TO EITHER PARTY BEFORE IT. NOT ISSUING A CLARIFICATION IN THE MATTER, WHERE WARRANTED IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WOULD IN OUR VIEW BE A CASE OF SUCH NON-ACTION. 4 MA NO. 387/MUM/2013 (A.Y. 2009-10) SURESH G. WADHWA VS. JT. CIT 3.2 COMING TO THE FACTS OF THE CASE, THE IMPUGNED O RDER IS ORGANIZED UNDER BROAD HEADINGS, VIZ. ARGUMENTS (PARA 2); FINDINGS (PARA 3); AND DECISION (PARA 4). PARA 4.1 OF THE TRIBUNALS ORDER IS THE ONLY PARAGRAPH CONTAINI NG ITS DIRECTIONS IN RESPECT OF THE PROJECT SAI STHAAN. WE ARE CLEARLY UNABLE TO SEE AS TO HO W THE SAID PARA (REPRODUCED HEREINBEFORE) COULD POSSIBLY BE READ TO DISTURB THE ASSESSED INCOME, I.E., APART FROM THE CURRENT YEAR AND, OF COURSE, THE TERMINAL YEAR INAS MUCH AS IT STANDS CLARIFIED THAT ANY ADDITION FOR THE CURRENT YEAR WOULD STAND TO BE GIV EN CREDIT FOR IN DETERMINING THE INCOME FOR THE TERMINAL YEAR. WHILE THE LD. DR WOULD CONTE ND OF THERE BEING NO NEED FOR ISSUING ANY CLARIFICATION AND, AS SUCH, FOR ANY INTERFERENC E, WE, IN VIEW OF THE AFORESAID LETTER BY THE A.O. TO THE ASSESSEE PROPOSING TO REVISE THE IN COME AS PER THE TRIBUNALS DIRECTIONS, CLARIFY THAT THERE IS NOTHING IN PARAGRAPH 4.1 OF T HE TRIBUNALS ORDER THAT MAY BE CONSTRUED AS IMPLYING A DIRECTION FOR COMPUTING THE INCOME FR OM THAT PROJECT FOR ANY YEAR OTHER THAN THE CURRENT YEAR, I.E., APART FROM THE CONSEQU ENTIAL EFFECT FOR THE TERMINAL YEAR. 3.3 IN SUM, WE MAY CLARIFY THAT NO FINDING OR DIREC TION QUA THE PROJECT SAI STHAAN FOR ANY YEAR OTHER THAN THE CURRENT YEAR, SAVE THE TERM INAL YEAR, AND THAT TOO TO THE EXTENT OF ALLOWING A CORRESPONDING ADJUSTMENT FOR THE INCOME AS FINALLY ASSESSED FOR THE CURRENT YEAR, HAS BEEN GIVEN BY THE TRIBUNAL. WE HOLD ACCOR DINGLY. 4. IN THE RESULT, THE ASSESSEES MISCELLANEOUS APPL ICATION IS TREATED AS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON DECEMBER 04, 2013 SD/- SD/- (B. R. MITTAL) (SANJAY ARORA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER ' * MUMBAI; 0( DATED :04 .12.2013 ).(../ ROSHANI , SR. PS !'#$ %$&' / COPY OF THE ORDER FORWARDED TO : 1. ' # / THE APPELLANT 2. $ # / THE RESPONDENT 3. ' 1 ( ' ) / THE CIT(A) 5 MA NO. 387/MUM/2013 (A.Y. 2009-10) SURESH G. WADHWA VS. JT. CIT 4. ' 1 / CIT CONCERNED 5. 4)56 $ (78 , ' + 78. , ' * / DR, ITAT, MUMBAI 6. 6 9: ;* / GUARD FILE ' / BY ORDER, (/') * (DY./ASSTT. REGISTRAR) , ' * / ITAT, MUMBAI