M/s.Punalur paper Mills Ltd, Kollam V. DCIT, Kollam

MA 68/COCH/2012

• Counselvise Citation: [2012] 123 COUNSELVISE.COM (IT) 9664 (ITAT-COCHIN)
• Duration Of Justice: 5 month(s) 17 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 14-12-2012
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Next Hearing Date: 07-12-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 27-06-2012
• Court: TRIBUNAL
• Department Lawyers: S VIJAYAPRABHA
• Assessee Lawyers: C PANKAJAKSHAN

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. 68/COCH/2012 (ARSG. OUT OF I.T.A. NO. 177/COCH/2010) ASSESSMENT YEAR : 2005-06 M/S. PUNALUR PAPER MILLS LTD., PUNALUR, KOLLAM DISTT. [PAN: AADCP 2570Q] THE DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE-1, KOLLAM. (ASSESSEE -APPLICANT) (REVENUE-RE SPONDENT) ASSESSEE BY SHRI C. PANKAJAKSHAN, CA. REVENUE BY SMT. S. VIJAYAPRABHA, JR. DR DATE OF HEARING 07/12/2012 DATE OF PRONOUNCEMENT 14/12/2012 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 2005-06. 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 2004-05. (B) THE TRIBUNAL HAS MENTIONED THE PERIOD OF DISCON TINUANCE OF BUSINESS AS 30 YEARS, WHICH IS AGAINST THE PREVAILING FACTS. 3. WITH REGARD TO THE FIRST ISSUE, THE LD. COUNSEL FOR THE ASSESSEE POINTED OUT THAT THE CO-ORDINATE BENCH OF THE TRIBUNAL IN THE ASSESS EES OWN CASE, IN I.T.A. M.P.NO. 68/COCH/ 2012 2 NO.556/COCH/2009 RELATING TO THE ASSESSMENT YEAR 20 04-05, VIDE ITS ORDER DATED 19.07.2011, HAS HELD THAT THE DECISION RENDERED BY THE TRIBUNAL IN THE EARLIER YEARS HAS TO BE FOLLOWED BY THE REVENUE AUTHORITIES SO LONG A S THE EARLIER ORDER OF THE TRIBUNAL IS NOT REVERSED BY THE HONBLE HIGH COURT OF KERALA. HE FURTHER SUBMITTED THAT THE EARLIER ORDER OF THE HONBLE TRIBUNAL HAS NOT BEEN DISTURBE D BY THE HONBLE HIGH COURT OF KERALA, AN HENCE, THE FINDINGS OF THE CO-ORDINATE B ENCH OF THE TRIBUNAL OUGHT 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 THERE WAS TEMPORARY LULL IN THE BUSINESS ACTIVITY OF THE ASSESSEE IS A QUEST ION 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, SHE S UBMITTED THAT THE TRIBUNAL HAS TAKEN A CONSCIOUS VIEW AND HENCE, IT CANNOT BE TERM ED 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 THERE WAS A TEMPORARY LULL IN THE BUSINESS ACTIVITY OF THE ASSE SSEE AND CONSEQUENTLY, WHETHER THE INCOME FROM LEASE RENT IS ASSESSABLE UNDER THE HEAD INCOME FROM BUSINESS OR NOT? 6. THE TRIBUNAL HAD SPECIFICALLY MENTIONED THAT T HE QUESTION WHETHER THE DISCONTINUANCE OF BUSINESS ACTIVITY OF THE ASSESSEE EITHER DUE TO TEMPORARY LULL OR OTHERWISE IS A QUESTION OF FACT AND THE SAME IS R EQUIRED TO BE CONSIDERED ON THE BASIS OF FACTS AND CIRCUMSTANCES PREVAILING IN THAT YEAR. THE TRIBUNAL FURTHER OBSERVED THAT THE DECISION RENDERED BY THE TRIBUNAL IN THE EARLIE R YEARS (ON THE QUESTION OF FACT) CANNOT HAVE BINDING EFFECT IN SUBSEQUENT YEARS. T HE TRIBUNAL DID NOT ACCEPT THE CONTENTIONS OF THE LD A.R THAT THE STEPS WERE BEING TAKEN TO REVIVE THE BUSINESS WITHIN SIX MONTHS, SINCE HE DID NOT SUBSTANTIATE THOSE CON TENTIONS WITH ANY MATERIAL. ALL THESE M.P.NO. 68/COCH/ 2012 3 DISCUSSIONS SHOW THAT THE TRIBUNAL HAS TAKEN A CONS CIOUS 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 APPARENT FROM RECORD. 7. THE LD. AR SUBMITTED THAT THE NEW PROMOTERS H AVE TAKEN OVER THE COMPANY ON THE BASIS OF MOU ENTERED WITH THE GOVT OF KERALA ON 27- 02-2011. AFTER CLEARING ALL THE LIABILITIES, THE MAJOR PORTION OF ERECTION/INSTALLA TION WORK OF MACHINERY AND ELECTRICAL SUB-STATION HAS BEEN COMPLETED BY THAT DATE. SINCE THIS TRIBUNAL IS DEALING WITH THE MISCELLANEOUS PETITION U/S 254(2) OF THE ACT, WE AR E OF THE VIEW THAT SUCH NEW FACTS CANNOT BE CONSIDERED AT THIS STAGE. ACCORDINGLY, W E DO NOT FIND ANY MERIT IN THE CONTENTIONS OF THE ASSESSEE ON THIS ISSUE. 8. WITH REGARD TO THE SECOND ISSUE, WE FIND THAT TH ERE WAS AN ERROR IN MENTIONING THE PERIOD OF DISCONTINUANCE OF BUSINESS ACTIVITY A S 30 YEARS IN PARAGRAPH 6 AND PARAGRAPH 7 OF THE ORDER. ACCORDINGLY THE PERIOD I S MODIFIED AS 20 YEARS WHERE EVER IT OCCURS IN PARAGRAPH 6 AND 7 OF THE ORDER. 9. IN THE RESULT, THE MISCELLANEOUS PETITION FILED BY THE ASSESSEE IS PARTLY ALLOWED. PRONOUNCED ACCORDINGLY ON 14- 12-2012 SD/- SD/- (N.R.S.GANESAN) (B.R.BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: KOCHI DATED: 14TH DECEMBER, 2012 GJ COPY TO: 1. M/S. PUNALUR PAPER MILLS LTD., PUNALUR, KOLLAM D ISTT. 2.THE DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE-1, KOLLAM 3. THE COMMISSIONER OF INCOME-TAX (APPEALS)-I, TRIV ANDRUM. 4. THE COMMISSIONER OF INCOME-TAX, TRIVANDRUM. M.P.NO. 68/COCH/ 2012 4 5. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T, COCHIN