M/s.PTL Enterprises Ltd, Cochin V. DCIT, Ernakulam

MA 48/COCH/2012

• Counselvise Citation: [2012] 123 COUNSELVISE.COM (IT) 8651 (ITAT-COCHIN)
• Duration Of Justice: 1 month(s) 19 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 27-07-2012
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Next Hearing Date: 20-07-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 07-06-2012
• Court: TRIBUNAL
• Department Lawyers: ABHIMANYU SINGH YADAV
• Assessee Lawyers: V SATHYANARAYANAN

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE S/SHRI N.R.S.GANESAN, JM AND B.R.BASKAR AN, AM M.P. NO. 48/COCH/2012 (ARSG. OUT OF I.T.A. NO. 659/COCH/2010 ASSESSMENT YEAR : 2007-08 M/S. PTL ENTERPRISES LTD., 6 TH FLOOR, CHERUPUSHPAM BLDG., KOCHI-31.[PAN:AABCP 3839N] THE DEPUTY COMMISSIONER OF INCOME-TAX,CIRCLE-4(1), ERNAKULAM. (ASSESSEE -APPLICANT) (REVENUE- RESPONDENT) ASSESSEE BY SHRI V.SATHYANARAYANAN, CA REVENUE BY SHRI ABHIMANYU SINGH YADAV, JR.DR DATE OF HEARING 20/07/2012 DATE OF PRONOUNCEMENT 27/07/2012 O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THE ASSESSEE HAS FILED THIS MISCELLANEOUS PETITION SEEKING RECTIFICATION OF THE ORDER DATED 03-04-2012 PASSED BY THIS BENCH ON THE APPEAL FILED BY THE REVENUE FOR THE ASSESSMENT YEAR 2007-08. 2. THE ASSESSEE HAS POINTED OUT THE FOLLOWING ERROR S IN THE MISCELLANEOUS PETITION CITED ABOVE:- (A) THE TRIBUNAL HAS ERRED IN NOT FOLLOWING THE FI NDING GIVEN BY THE CO-ORDINATE BENCH FOR THE ASSESSMENT YEAR 2003-04. (B) THE TRIBUNAL HAS FAILED TO DISPOSE GROUND NO. 3 RAISED BY THE REVENUE WHICH RELATES TO THE ALLOWABILITY OF THE EXPENSES CLAIME D BY THE ASSESSEE. 3. THE LD. COUNSEL FOR THE ASSESSEE POINTED OUT THA T THE CO-ORDINATE BENCH OF THE TRIBUNAL IN THE ASSESSEES OWN CASE, IN I.T.A. NO. 315/COCH/2006 RELATING TO THE M.P.NO. 48/COCH/ 2012 2 ASSESSMENT YEAR 2003-04, VIDE ITS ORDER DATED 18.1. 207, HAS HELD THAT THE DECISION RENDERED BY THE TRIBUNAL IN THE EARLIER YEARS HAS T O BE FOLLOWED BY THE REVENUE AUTHORITIES SO LONG AS THE EARLIER ORDER OF THE TRI BUNAL IS NOT REVERSED BY THE HONBLE HIGH COURT OF KERALA. HE FURTHER SUBMITTED THAT TH E EARLIER ORDER OF THE HONBLE TRIBUNAL HAS NOT BEEN DISTURBED BY THE HONBLE HIGH COURT OF KERALA, AN HENCE, THE FINDINGS OF THE CO-ORDINATE BENCH OF THE TRIBUNAL O UGHT TO HAVE BEEN FOLLOWED BY THIS BENCH AS FOR THE ABOVE CITED APPEAL. 4. ON THE CONTRARY, THE LD. DR SUBMITTED THAT THE T RIBUNAL HAS TAKEN A CONSCIOUS DECISION AFTER SPECIFICALLY OBSERVING THAT THE QUES TION WHETHER THE ASSESSEE IS HAVING AN INTENTION TO REVIVE ITS BUSINESS ACTIVITY IS A QUES TION OF FACT AND THE SAME IS REQUIRED TO BE CONSIDERED EVERY YEAR ON THE BASIS OF THE FACTS AND CIRCUMSTANCES PREVAILING IN THAT YEAR. THE LD. DR FURTHER POINTED OUT THAT THE TRIB UNAL HAS SPECIFICALLY STATED THAT THE DECISION RENDERED IN THE EARLIER YEARS CANNOT HAVE A BINDING EFFECT IN THE SUBSEQUENT YEARS UNDER SUCH CIRCUMSTANCES. ACCORDINGLY, HE SU BMITTED THAT THE TRIBUNAL HAS TAKEN A CONSCIOUS VIEW AND HENCE, IT CANNOT BE TERMED AS MISTAKE APPARENT FROM RECORD AS PER SEC. 254(2) OF THE ACT. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND CAREFULL Y PERUSED THE RECORD. IN THE IMPUGNED APPEAL, THE TRIBUNAL CONSIDERED THE QUESTI ON VIZ., WHETHER THE ASSESSEE IS HAVING AN INTENTION TO REVIVE ITS BUSINESS ACTIVITI ES AND CONSEQUENTLY, THE INCOME FROM LEASE RENT IS ASSESSABLE UNDER THE HEAD INCOME FROM BUSINESS?. THE TRIBUNAL NOTICED THAT THE FACT THAT THE ASSESSEE HAD LEASED OUT ITS PLANT AND MACHINERY IN THE YEAR 1995 AND UP TO THE YEAR UNDER CONSIDERATION, 12 YEARS HA D PASSED. THE TRIBUNAL ALSO AGREED WITH THE CONTENTION OF THE LD. DR THAT THE ASSESSEE DID NOT BRING ON RECORD ANY MATERIAL TO SHOW THAT IT HAS AN INTENTION OF REVIVING ITS BU SINESS ACTIVITIES. WITH REGARD TO THE DECISION RENDERED BY THE CO-ORDINATE BENCH FOR THE A.Y. 2003-04, IT WAS NOTICED THAT THE CO-ORDINATE BENCH HAD FOLLOWED THE DECISION REN DERED BY THE TRIBUNAL FOR THE ASSESSMENT YEARS 1996-97 AND 1997-98. IN THAT REGA RD, THE TRIBUNAL OBSERVED THAT THE ASSESSEE HAD LEASED OUT THE PLANT AND MACHINERY IN THE YEAR 1995 AND HENCE, WHILE CONSIDERING THE CLAIM OF THE ASSESSEE FOR THE YEARS ENDING 31.3.1996 AND 31.3.97, THE M.P.NO. 48/COCH/ 2012 3 TRIBUNAL DECIDED THE ISSUE IN FAVOUR OF THE ASSESSE E IN VIEW OF THE SHORTER TIME GAP. THE TRIBUNAL HAS FURTHER HELD THAT THE QUESTION WHE THER THE ASSESSEE IS HAVING AN INTENTION TO REVIVE ITS BUSINESS ACTIVITIES IS A QU ESTION OF FACT AND THE SAME HAS TO BE DECIDED EVERY YEAR. ALL THESE DISCUSSIONS SHOW THA T THE TRIBUNAL HAS TAKEN A CONSCIOUS DECISION ON THE IMPUGNED ISSUE. IT IS WELL SETTLED PROPOSITION OF LAW THAT THE VIEW TAKEN BY THE TRIBUNAL CANNOT BE CONSIDERED AS A MISTAKE A PPARENT FROM RECORD. 6. THE LD. DR POINTED OUT THAT THE TRIBUNAL DID NOT CONSIDER OTHER FACTS SUCH AS EXPENSES, SALES TAX REGISTRATION ETC. WHILE ADDRESS ING THE QUESTION AND HAS TAKEN THE DECISION BY CONSIDERING THE FACT OF TIME GAP ONLY, WHICH IS NOT CORRECT. SINCE THIS TRIBUNAL IS DEALING WITH THE MISCELLANEOUS PETITION U/S 254(2) OF THE ACT, WE ARE OF THE VIEW THAT SUCH NEW FACTORS CANNOT BE CONSIDERED AT THIS STAGE. ACCORDINGLY, WE DO NOT FIND ANY MERIT IN THE CONTENTIONS OF THE ASSESSEE O N THIS ISSUE. 7. WITH REGARD TO THE SECOND ISSUE, WE NOTICE THAT THE TRIBUNAL DID NOT ADJUDICATE THE ISSUE OF DEDUCTION OF EXPENSES AGAINST LEASE RE NTAL INCOME. THE LD. DR POINTED OUT THAT THE EXPENSES AS PRESCRIBED U/S. 57 OF THE ACT, SUBJECT TO SEC. 58 CAN BE CONSIDERED FOR DEDUCTION FROM THE LEASE RENTAL INCOME, WHICH W AS ASSESSED UNDER THE HEAD INCOME FROM OTHER SOURCES. SINCE THIS ISSUE REQUIRES EXAM INATION AT THE END OF THE ASSESSING OFFICER, WE RESTORE THIS ISSUE TO THE FILE OF THE A SSESSING OFFICER FOR CONSIDERING THE SAME IN ACCORDANCE WITH THE PROVISIONS OF SEC. 57 A ND 58 OF THE INCOME TAX ACT. THE AO SHOULD PROVIDE NECESSARY OPPORTUNITY OF BEING HE ARD TO THE ASSESSEE. 8. IN THE RESULT, THE MISCELLANEOUS PETITION FILED BY THE ASSESSEE IS PARTLY ALLOWED. PRONOUNCED ACCORDINGLY ON 27 -07-2012 SD/- SD/- (N.R.S.GANESAN) (B.R.BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: KOCHI DATED: 27TH JULY, 2012 M.P.NO. 48/COCH/ 2012 4 GJ COPY TO: 1.M/S. PTL ENTGERPRISES LTD., 6 TH FLOOR, CHERUPUSHPAM BLDG., KOCHI-31. 2.THE DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE-4(1 ), ERNAKULAM. 3. THE COMMISSIONER OF INCOME-TAX (APPEALS)-II, KOC HI 4. THE COMMISSIONER OF INCOME-TAX, KOCHI. 5. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T, COCHIN