M/S.MALLIKARJUNA RICE INDUSTRIES V. THE INCOME TAX OFFICER

ITTA/82/2006

AI Insights

The case involves M/s. Mallikarjuna Rice Industries, the appellant, contesting an order from the Income Tax Appellate Tribunal, Hyderabad, which sustained the reopening of their assessment under Section 148 of the Income Tax Act, 1961. The appellant argued that the original assessment was completed under Section 143(3) and questioned the validity of the reassessment. Additionally, the case examined whether the reimbursement of Rural Development Cess by the Food Corporation of India, as per the AP Rural Development Cess Act, 1996, should be considered a trade receipt and thus taxable income, especially when the liability to pay cess was not debited to the Profit & Loss Account.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 762840 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 15-02-2023
• Assessment Year: misc
• Other Referred Cases: I.T.T.A.No.128 of 2006
• Laws Referred To: Income Tax Act, 1961, AP Rural Development Cess Act, 1996
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: J V PRASAD
• Assessee Lawyers: A V A KARTIKEYA
• Keywords: Assessment Year; Income Tax; Reopening of assessment; Rural Development Cess
• Section: 148; 143(3); 260A

Judgement Text

"IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD WEDNESDAY ,THE FIFTEENTH DAY OF FEBRUARY TWO THOUSAND AND TWENTY THREE PRESENT THE HON'BLE THE CHIEF JUSTICE UJJAL BHUYAN AND THE HON'BLE SRI JUSTICE N.TUKARAMJI INCOME TAX TRIBUNAL APPEAL NO: 82 OF 2006 Appeal Under Section 260A of the lncome Tax Act, 1961 aggrieved by the order daled 28-07 -2005 of the lncome Tax Appellate Tribunal, Hyderabad Bench B Hyderabad in ITA No. 784 I Hydl 2004 ( Assessment Year 2000-01) preferred against the order of the Commissioner of lncome Tax ( Appeals ) Vl, 1zth Floor, Gagan Vihar , M.J. Road, Hyderabad dated 29-07-2004 in Appeal No. 0194^N-2, NLG / CIT (A) -Vl I 2003 -04 preferred against the order of the Deputy Commissioner ( Appeals ) of lncome Tax and Commissioner of lncome Tax (Appeals ) Vl, Hyderabad. Between: M/s. Mallikarjuna Rice lndustries, Choutuppal Mandal, Nalgonda ...APPELLANT AND The lncome Tax Officer, Ward-2, Nalgonda ...RESPONDENT Counsel for the Appellant: SRl. A. V. A. SIVA KARTIKEYA Counsel for the Respondent: SRI J V PRASAD (SC FOR INCOME TAX) The Court made the following: ORDER .III HON'BLE THE CI]IEF'JUSTTEE UIJA BEIT,Y4N AND ,[HE HON'BLE SRI.JUSTICE N.TU-KABA]UII I.T.T.A.N .82 ot 2006 JTIDGMENT 1P,r tte Hon'bh rtte LttieJJtltLt,, r rjl.tl Btt,,itlt) I Iear< Mr. AV.A.Siva Kanikep, leamed r,)urLsel for the appellant; a r,l It,Ir. J.V.Prasad, leamed Smnding ,li,trnsel, Income Iax Depanr rent for the respondent. 2. l'his rppeal has been preferred by the :rrisessee as rhe ;rppellant un ler Section 260-.4. of the Income 'Iax .r c::, 1961 (briefly 'the Acr' her :inafter) againsr the order dated 28.0)'.llCO:i passed by the Incomr Tax Appellate Tribunal, Hydcra raC Bench ,B, Ilderabad (briefly 'Tribunal' hereinafter) in I.T.A IrIo.784lHp /2004 for the assessmenr year 2CaO-2CO . 3. Thoug r the appeal was admitted on 14 .03.2006, no subsmntial q restion of law was framed. Howeve( [nrm the memo cf appeal, w {ind that appellant has proposed th,: ollcwing two questions as : LLtrstantial questions of law: a) W trher on thc facts and in the circumstances ,rl- the case, lu. l ribr-rnal is right rr sr.staining th,. reop,.r rrg ci 2 t}re assessment under Section 148 of the Income Tax Act, 1961 particula.ly when the onginal assessment was completed under Section 143(3) of the Act ? b) Vhether the amount of Rural Dcvelopment Cess reimbuned by the Food Corporation of India in accordance wifi the provisions of AP.Rural Development Gss Act, 1996 b a trade receipt and is assessable as income when the assessee did not debit the l.iabiliry to paycess to ihe PBrI Account ? 4. Following our decision rendered today in I.T.T'ANo.128 of 2006, we answer this appeal in favour of the assessee and against the revenue. Appeal is accordinglyallowed. No costs. fu a sequel, miscellaneous petitions, pending if aryr, stand closed. 5 Sd/- M. VIJAYA BHASKAR JOINT REGISTRAR //TRUE COPY// To, sEcTloN oFFlcER 1. The lncome Tax Appellate Tribunal, Hyderabad Bench B Hyderabad 2. The Commissioner of lncome Tax ( Appeals ) Vl, 12th Floor, Gagan Vihar M.J. Road, Hyderabad 3. The Deputy Commissioner ( Appeals ) of lncome Tax and Commissioner of lncome Tax (Appeals ) Vl, Hyderabad 4. One CC to SRl. A V A SIVA KARTIKEYA Advocate [OPUC] 5. One CC to SRl. J V PRASAD (SC FOR INCOME TAX) Advocate [OPUC] 6. Two'CD Copies lt J -) HIGH COURT DAfEt.D:151021202 ; JUDGMENT ITTA.ltlo.82 of 200 ALLO'WING THE I1 TA WITH()T]T COSTS -/ ::_---'=-': -. /, - .t i!': \" rrlJ - ..)' o,.l AI Itr i'ri,l ?[?] .80 1 1 L} "