THE COMMISSIONER OF INCOME TAX V. M/S/ PUNJAB COMM LTD MOHALI

ITA/227/2003

AI Insights

The case involves multiple appeals by the Commissioner of Income-tax, Chandigarh-II against M/s Punjab Communication Ltd. concerning the disallowance of a deduction under Section 80-I for the expansion of its DTL unit. Initially, the deduction was allowed under Section 143(1)(a) but was later disallowed under Section 143(1)(b) read with Section 154. The CIT(A) reversed this disallowance, which was upheld by the Tribunal. The revenue's subsequent appeals were dismissed by the Tribunal on merits, referencing a Supreme Court decision. The High Court dismissed the current appeals based on the acceptance of the Tribunal's earlier decision by the department.

• Counselvise Citation: [2006] 140 COUNSELVISE.COM (IT) 697179 (HC-CHANDIGARH)
• Appeal Type: Others
• Pronouncement Date: 27-10-2006
• Assessment Year: misc
• Other Referred Cases: Commissioner of Income-Tax, West Bengal-I v. Indian Aluminium Co. Ltd. (1977) 108 ITR 367
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Assessee Lawyers: S K GARG
• Keywords: CIT(A); Deduction; Expansion; Income Tax; ITAT; Reconstruction; Splitting; DTL Unit
• Section: 143(3); 154; 143(1)(a); 143(1)(b); 80-I

Judgement Text

"IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. I.T.A. Nos.227, 228, 229, 230 & 231 of 2003 Date of decision: 27.10.2006 The Commissioner of Income-tax, Chandigarh-II. ---Appellant Vs. M/s Punjab Communication Ltd., Mohali. -----Respondent CORAM:- HON'BLE MR JUSTICE ADARSH KUMAR GOEL HON'BLE MR JUSTICE RAJESH BINDAL Present: Mr. S.K. Garg Narwana, Advocate for the appellant. ----- ORDER: These appeals have been preferred by the revenue against the order of the Income Tax Appellate Tribunal, Chandigarh dated 17.02.2003 in I.T.A. Nos. 228/Chandi/2000, 514/Chandi/1999, 514/Chandi/1999, 517/Chandi/1999 and 519/Chandi/1999 in respect of the assessment years 1996-97, 1992-93, 1992-93, 1994-95 and 1995-96 respectively proposing following questions of law:- “1. Whether on the facts and in the circumstances of the case, the ITAT was right in law in rejecting the appeal of the revenue filed against the order of the CIT(A) in respect of order passed u/s 143(1)(b)/154 before deciding the appeal of the revenue on merit already filed against the order of CIT(A) in respect of order u/s 143(3) for the assessment years 1992-93. 2. Whether on the facts and in the circumstances of the case, the ITAT was right in law in stating that the revenue may consider the issue afresh u/s 143(1)(b) read with Section 154 of the Act for the year under consideration if the issue is decided by the Hon’ble ITAT on merits in favour of the revenue, whereas Section 143(1)(b), which was a procedural section, stands deleted by the Finance Act, 1999 w.e.f. 1.6.99.” I.T.A. Nos.227, 228, 229, 230 & 231 of 2003 The assessee claimed deduction under Section 80-I for expansion of its DTL unit which was allowed under Section 143(1)(a) of the Income-tax Act, 1961 (for short, “the Act”), but was later disallowed under Section 143(1)(b) read with Section 154 of the Act. It was observed that the expansion of the project was nothing but reconstruction and splitting of the existing business. This was done following disallowance for the earlier years. The CIT(A) allowed the claim following its order for the assessment year 1992-93. The Tribunal upheld the view of the CIT (A). The Tribunal observed that revenue’s appeal against the order of CIT(A) allowing the claim on merits was pending and if the same was allowed, the issue could be reconsidered. Learned counsel for the revenue has today filed a copy of letter dated 4/23.10.2006 of the Deputy Commissioner of Income-tax Circle 5(1), Chandigarh to the effect that the appeals of the revenue have been dismissed by the Tribunal on merits also relying upon judgment of the Hon’ble Supreme Court in Commissioner of Income-Tax, West Bengal-I v. Indian Aluminium Co. Ltd. (1977) 108 ITR 367 and the department has accepted the said order. The letter is taken on record as Mark-‘X’. In view of above, these appeals are dismissed. ( ADARSH KUMAR GOEL ) JUDGE October 27, 2006 ( RAJESH BINDAL ) ashwani JUDGE Pag e num I.T.A. Nos.227, 228, 229, 230 & 231 of 2003 This order will dispose of I.T.A. Nos.227, 228, 229, 230 & 231 of 2003. However, facts have been taken from I.T.A. No.227 of 2003. Pag e num "