ITO, Tiruppur v. Roopa Stream Calendering Works, Tiruppur

ITA 1082/CHNY/2015 | 2010-2011
Pronouncement Date: 31-07-2015

Appeal Details

RSA Number 108221714 RSA 2015
Assessee PAN AADFR6895H
Bench Chennai
Appeal Number ITA 1082/CHNY/2015
Duration Of Justice 2 month(s) 23 day(s)
Appellant ITO, Tiruppur
Respondent Roopa Stream Calendering Works, Tiruppur
Appeal Type Income Tax Appeal
Pronouncement Date 31-07-2015
Appeal Filed By Department
Bench Allotted D
Assessment Year 2010-2011
Appeal Filed On 08-05-2015
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH CHENNAI . ! ' #$ % & ' BEFORE SHRI A.MOHAN ALANKAMONY ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD JUDICIAL MEMBER ./ I.T.A.NO.1082 /MDS./2015 ( / ASSESSMENT YEAR :2010-11) INCOME TAX OFFICER WARD-2(2) TIRUPUR. VS. M /S.ROOPA STEAM CALENDERING WORKS 647/1B TRA GINNING FACTORY COMPOUND PALLADAM ROAD TIRUPUR 641 605. PAN AADFR 6895 H ( () / APPELLANT ) ( %*() / RESPONDENT ) / APPELLANT BY : MR.A.B.KOLI JCIT D.R / RESPONDENT BY : MR.N.VIJAYKUMAR C.A / DATE OF HEARING : 30.07.2015 ! /DATE OF PRONOUNCEMENT : 31.07.2015 + / O R D E R PER A.MOHAN ALANKAMONY ACCOUNTANT MEMBER: THIS APPEAL IS FILED BY THE REVENUE AGGRIEVED B Y THE ORDER DATED 07.01.2015 OF THE LEARNED COMMISSIONER OF I NCOME TAX(A)-3 ITA NO.1062 /MDS/2015 2 COIMBATORE IN APPEAL NO.3A/13-14 PASSED UNDER SEC TION-143(3) READ WITH SECTION 250 OF THE ACT FOR ASSESSMENT Y EAR 2010-11. 2. THE REVENUE HAS RAISED FIVE GROUNDS IN ITS APPE AL HOWEVER THE CRUX OF THE ISSUE IS THAT THE REVENUE IS AGGRIE VED BY THE ORDER OF THE LD. CIT (A) WHO HAD ERRED IN ALLOWING DEDUCTIO N U/S 80-IA OF THE ACT FOLLOWING THE DECISION OF THE HONBLE JURISDICT IONAL HIGH COURT IN THE CASE OF VELAYUDHASWAMY SPINNING MILLS (P) LTD V S. ACIT REPORTED IN 231 CTR (MAD.) 368 THOUGH THE SLP FILED BY THE REVENUE BEFORE THE HONBLE APEX COURT IS PENDING. 3. THE ASSESSEE IS A FIRM ENGAGED IN THE BUSINES S OF GARMENT FINISHING & WIND MILL FILED ITS REVISED RETURN OF INCOME FOR THE ASSESSMENT YEAR 2010-11 ON 11.10.2010 ADMITTING ITS INCOME AS ` 9 59 550/- AFTER AVAILING DEDUCTION OF RS.24 07 223 /- U/S.80-IA OF THE ACT. THE CASE WAS TAKEN FOR SCRUTINY UNDER CASS AND ASSESSMENT U/S.143(3) WAS COMPLETED ON 22.02.2013 WHEREIN THE LD. A.O DISALLOWED THE DEDUCTION U/S. 80-IA OF THE ACT ON W INDMILLS. ITA NO.1062 /MDS/2015 3 3.1. DURING THE COURSE OF ASSESSMENT PROCEEDINGS IT WAS OBSERVED BY THE LD. ASSESSING OFFICER THAT THE ASSESSEE HAD CLAIMED DEDUCTION U/S.80-IA OF THE ACT RELYING UPON THE DECISION OF T HE JURISDICTIONAL HIGH COURT IN THE CASE OF VELAYUDHASWAMY SPINNING M ILLS (P) LTD VS. ACIT REPORTED IN 231 CTR (MAD) 368 [2010]. IN THE D ECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IT WAS HELD AS FO LLOWS:- I) EACH ELIGIBLE UNIT OF THE INDUSTRIAL UNDERTAKIN G HAS TO BE CONSIDERED AS IF SUCH ELIGIBLE BUSINESS WHERE THE ONLY SOURCE OF INCOME OF THE ASSESSEE DURING THE PREVIOUS YEAR RELEVANT TO THE I NITIAL ASSESSMENT YEAR AND TO EVERY SUBSEQUENT ASSESSMENT YEAR UPTO T HE PERIOD PRESCRIBED UNDER THE ACT FOR THE BENEFIT OF SECTION 80IA OF THE ACT. II) THAT THE INITIAL ASSESSMENT YEAR REFERRED TO SE CTION-80-IA(5) OF THE ACT WOULD MEAN THE YEAR IN WHICH THE ASSESSEE OPTS IN SELECTING THE YEAR OF CLAIMING RELIEF U/S.80-IA OF THE ACT. III) THAT THE UNABSORBED DEPRECIATION AND CARRY FO RWARD LOSSES OF THE EARLIER YEARS WHICH HAD ALREADY BEEN SET OFF AGAINS T THE OTHER INCOME ITA NO.1062 /MDS/2015 4 CANNOT BE NOTIONALLY CARRY FORWARD AND TAKEN INTO C ONSIDERATION FOR THE PURPOSE OF COMPUTATION OF DEDUCTION U/S.80-IA O F THE ACT. HOWEVER THE LD. A.O OPINED THAT SINCE THE REVENUE IS IN APPEAL AND THE MATTER IS PENDING BEFORE THE HON. APEX COUR T HE IS JUSTIFIED IN DISALLOWING THE CLAIMED OF DEDUCTION OF ` 24 07 223/- TOWARDS THE WINDMILL DIVISION U/S.80-IA OF THE ACT FOR THE A.Y 2010-11. 4. ON APPEAL BY THE ASSESSEE LD.CIT (A) DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE BY FOLLOWING THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF VELAYUDHASWAMY SPINNING M ILLS (P) LTD VS. ACIT REPORTED IN 231 CTR (MAD) 368 [2010]. 5. BEFORE US THE LD. D.R ARGUED IN SUPPORT OF THE ORDER OF THE LD. ASSESSING OFFICER THOUGH CONCEDE THAT THE ISSUED IS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE JURIS DICTIONAL HIGH COURT IN THE CASE OF VELAYUDHASWAMY SPINNING MILLS (P) LTD VS. ACIT SUPRA . LD. D.R FURTHER SUBMITTED THAT THE LD . ASSESSING OFFICER HAD ARRIVED AT THIS DECISION OUT OF ABUNDANT CAUTIO N BECAUSE THE ITA NO.1062 /MDS/2015 5 REVENUE HAS CARRIED THE MATTER BEFORE THE HONBLE A PEX COURT AND THE MATTER WAS PENDING. THE LD. A.R. ON THE OTHER HAND RELIED ON THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COU RT SUPRA AND PRAYED THAT THE ORDER OF THE LD. CIT(A) MAY BE UPHELD. 6. WE HAVE HEARD BOTH THE PARTIES AND CAREFULLY PE RUSED THE MATERIALS AVAILABLE ON RECORD. FROM THE FACTS OF TH E CASE IT APPEARS THAT THE LD. ASSESSING OFFICER WAS OF THE VIEW THAT SINCE THE REVENUE WAS ON APPEAL AGAINST THE DECISION OF THE HONBLE M ADRAS HIGH COURT IN THE CASE VELAYUDHASWAMY SPINNING MILLS P. LTD (S UPRA) BEFORE THE HONBLE APEX COURT HE NEED NOT FOLLOW THAT DECISIO N. HE DID NOT REALIZE THAT MERE FILING OF THE SLP BEFORE THE APEX COURT IS NOT A VALID GROUND FOR NOT FOLLOWING THE JUDGMENT OF THE HONBL E MADRAS HIGH COURT. FURTHER IT IS NOT THE CASE OF THE REVENUE THAT THE JUDGMENT OF THE HONBLE MADRAS HIGH COURT IN THE CASE VELAYUDHA SWAMY SPINNING MILLS P. LTD (SURPA) IS STAYED BY THE HON BLE APEX COURT. IT IS PERTINENT TO MENTION THAT IN THE ABSENCE OF ANY STAY GRANTED BY THE HONBLE APEX COURT AGAINST THE OPERATION OF THE JUD GMENT OF THE HONBLE MADRAS HIGH COURT ALL THE LOWER JUDICIARIE S AS WELL AS QUASI ITA NO.1062 /MDS/2015 6 JUDICIAL AUTHORITIES ARE BOUND TO FOLLOW THE DECISI ON OF THE HONBLE JURISDICTIONAL HIGH COURT. SINCE THE LD.CIT(A) HAS RIGHTLY FOLLOWED THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COU RT IN THE CASE OF VELAYUDHASWAMY SPINNING MILLS (P) LTD VS. ACIT (SUP RA) AND HELD THE ISSUES IN FAVOUR OF THE ASSESSEE WE DO NOT FIN D IT NECESSARY TO INTERFERE WITH THE ORDER OF THE LD.CIT(A). THEREFOR E WE HEREBY CONFIRM THE ORDER OF THE LD. LD. CIT (A). 7. IN THE RESULT THE APPEAL OF REVENUE IS DISMISSE D. ORDER PRONOUNCED ON 31 ST JULY 2015 AT CHENNAI. SD/- SD/- ( ' #$ % ) ((CHALLA NAGENDRA PRASAD) ( . ) (A.MOHAN ALANKAMONY) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI DATED THE 31 ST JULY 2015. K S SUNDARAM. '#$$ %&$'& /COPY TO: $ 1. /APPELLANT 2. /RESPONDENT 3. $ ($)* /CIT(A) 4. $ ( /CIT 5. &+ $ - /DR 6. $. /GF