PANASONIC CARBON INDIA CO. LTD.,CHENNAI V. DCIT, CIRCLE-1, LTU, CHENNAI

ITA 1084/CHNY/2024

AI Insights

The case involves M/s. Panasonic Carbon India Company Ltd., which appealed against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi. The primary issue was the correct application of the tax rate for the Assessment Year 2018-19. The assessee argued for a concessional tax rate of 25%, claiming their gross receipts for the previous year did not exceed Rs. 50 Crores. However, the Assessing Officer and the CIT(A) found that the assessee's gross receipts, including other income, amounted to Rs. 54.91 Crores, thus applying a 30% tax rate. The tribunal agreed with this assessment, noting that excise duty should not be deducted from gross receipts and that all income, including other income, was business income.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 29487 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-11-2024
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 28-08-2024
• Assessment Year: 2018-2019
• Appeal Filed On: 17-04-2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: R. ANITA LD
• Assessee Lawyers: P. UTTAMCHAND JAIN LD
• Keywords: Business income
• Section: 143(3); 154

Judgement Text

" आयकर अपीलीय अिधकरण “सी” Ɋायपीठ चेɄई मŐ। IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, CHENNAI माननीय ŵी महावीर िसंह, उपाȯƗ एवं माननीय ŵी मनोज क ुमार अŤवाल ,लेखा सद˟ क े समƗ। BEFORE HON’BLE SHRI MAHAVIR SINGH, VP AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकरअपील सं./ ITA No.1084/Chny/2024 (िनधाŊरण वषŊ / Assessment Year: 2018-19) M/s. Panasonic Carbon India Company Ltd. 77, Old No.35, 3rd floor, Pottpatti Plaza, Nungambakkam High Road, Chennai-600 034. बनाम / Vs. DCIT Circle-1, LTU, Chennai. ̾थायीलेखासं./जीआइआरसं./PAN/GIR No. AAACI-5679-J (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) अपीलाथŎकीओरसे/ Appellant by : Shri P. Uttamchand Jain (CA) - Ld. AR ŮȑथŎकीओरसे/Respondent by : Ms. R. Anita (Addl.CIT) - Ld. DR सुनवाईकीतारीख/Date of Hearing : 28-08-2024 घोषणाकीतारीख /Date of Pronouncement : 18-11-2024 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2018-19 arises out of the order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 23-02-2024 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 143(3) of the Act on 20-02-2021. The sole grievance of the assessee is application of correct rate of tax. 2. It emerges that the assessee was assessed u/s 143(3) on 20-02- 2021. To seek correction of certain discrepancies, the assessee sought 2 rectification u/s 154 and Ld. AO rectified the computation of income vide order dated 12-10-2023. In this computation, Ld. AO applied tax rate of 30% as against assessee’s claim of 25%. The assessee sought concessional rate on the ground that its gross receipts during previous year (PY) 2015-16 did not exceed Rs.50 Crores, The assessee claimed that its turnover was Rs.49.01 Crores only. However, Ld. AO denied the same. The Ld. CIT(A), upon perusal of Profit & Loss Account, held that assessee’s revenue from operations for the year ending 31-03-2016 were Rs.51.25 Crores. The other income was Rs.5.90 Crores. The gross receipts were Rs.54.91 Crores and therefore, the correct rate of tax would be 30% only. Aggrieved as aforesaid, the assessee is in further appeal before us. 3. The Ld. AR has placed on record a copy of First Schedule of Finance Act, 2018. The rates of tax as prescribed for a company, as per paragraph-E, are as follows: - (i) Where total turnover or the gross receipt in the previous year 2015-16 does not exceed fifty Crores rupees; 25% of the total income Other than that referred to in item (i) 30% of the total income Upon perusal of the same, it could be seen that the prescribed condition for concessional rate of tax of 25% is that the total turnover or the gross receipt in the previous year 2015-16 should not exceed Rs.50 Crores. The relevant financial statements for the year ended 31-03-2016 could be extracted as under: - Particulars Year ended 31-03-2016 Revenue from Operations (Note No.16) 51,25,70,311 Less : Excise Duty 2.24.00,965 Balance 49,01,69,346 Other Income (Note No.17) 5,90,23,856 Total 54,91,93,202 3 4. The argument of Ld. AR is that excise duty should be excluded from gross receipts of the assessee on the ground that it is recoverable from customers and turnover is accounted for on net basis. However, this argument could not be accepted since the expression used is ‘total turnover or gross receipts’. No deduction is intended to be granted. Another noteworthy fact is that the assessee does not have any other source of income except business income. The other income has also been assessed as Business Income only. Therefore, even if the argument of Ld. AR is accepted, the applicable rate would still be 30% since the revenue from operations including other income would exceed Rs.50 Crores. Therefore, correct basic rate as applicable to the assessee would be 30% only. 5. The appeal stand dismissed. Order pronounced on 18th November, 2024. Sd/- Sd/- (MAHAVIR SINGH) (MANOJ KUMAR AGGARWAL) उपाȯƗ / VICE PRESIDENT लेखा सद˟ / ACCOUNTANT MEMBER चेɄई Chennai; िदनांक Dated : 18-11-2024 DS आदेशकीŮितिलिपअŤेिषत/Copy of the Order forwarded to : 1. अपीलाथŎ/Appellant 2. ŮȑथŎ/Respondent 3. आयकरआयुƅ/CIT, Chennai. 4. िवभागीयŮितिनिध/DR 5. गाडŊफाईल/GF "