M/s Universal Print O Pack, Solan v. DCIT, Circle , Parwanoo

ITA 1104/CHANDI/2017 | 2013-2014
Pronouncement Date: 28-11-2017 | Result: Dismissed

Appeal Details

RSA Number 110421514 RSA 2017
Assessee PAN AABFU8813G
Bench Chandigarh
Appeal Number ITA 1104/CHANDI/2017
Duration Of Justice 4 month(s) 25 day(s)
Appellant M/s Universal Print O Pack, Solan
Respondent DCIT, Circle , Parwanoo
Appeal Type Income Tax Appeal
Pronouncement Date 28-11-2017
Appeal Filed By Assessee
Tags No record found
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 28-11-2017
Last Hearing Date 21-11-2017
First Hearing Date 21-11-2017
Assessment Year 2013-2014
Appeal Filed On 03-07-2017
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCHB CHANDIGARH BEFORE SMT. DIVA SINGH JUDICIAL MEMBER AND DR. B.R.R. KUMAR ACCOUNTANT MEMBER ITA NO.1104/CHD/2017 (ASSESSMENT YEAR : 2013-14) M/S UNIVERSAL PRINT O PACK VS. DCIT VILL-KISHANPURA TEHSIL NALAGARH CIRCLE PARWANOO SOLAN PAN: AABFU8813G (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI PARIKSHIT AGGARWAL DEPARTMENT BY : SHRI. MANJIT SINGH DATE OF HEARING : 21.11.2017 DATE OF PRONOUNCEMENT : 28/11/2017 O R D E R PER DR.B.R.R.KUMAR A.M . : THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) SHIMLA DATED 20/05/2017. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. THAT ON THE FACTS CIRCUMSTANCES AND LEGAL POSIT ION OF THE CASE THE WORTHY CIT(A) IN APPEAL NO. IT/235/15-16 DATED 20.0 5.2017 HAS ERRED IN PASSING THAT ORDER IN CONTRAVENTION OF THE PROVISIONS OF SE CTION 250(6) OF THE INCOME TAX ACT 1961. 2. THAT ON THE FACTS CIRCUMSTANCES AND LEGAL POSIT ION OF THE CASE THE WORTHY CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE A CTION OF LD. AO WHEREBY HE RESTRICTED THE CLAIM OF DEDUCTION U/S 80-IC TO RS. 35 73 608/- AS AGAINST CORRECTLY CLAIMED BY THE APPELLANT AT RS. 1 42 94 432/- AND T HEREBY MADE ADDITION OF RS. 1 07 20 824/- BY ERRONEOUSLY HOLDING THAT THE APPEL LANT IS ELIGIBLE FOR DEDUCTION U/S 80IC @ 25% ONLY OF ELIGIBLE PROFIT IN THE 6 TH YEAR & ONWARDS AND NOT @ 100% AS CLAIMED BY THE APPELLANT EVEN WHEN THE APPELLANT HA D CARRIED OUT SUBSTANTIA] EXPANSION AND NO FAULT THEREIN WAS FOUND. 3. GROUND NO. 1 IS GENERAL IN NATURE. 2 4. THE ISSUE INVOLVED IN THE PRESENT APPEAL PERTAIN S TO RESTRICTION OF DEDUCTION CLAIMED UNDER SECTION 80IC AT THE RATE O F 100% ON ACCOUNT OF SUBSTANTIAL EXPANSION UNDERTAKEN. 5. BRIEF FACTS RELEVANT TO THE CASE ARE THAT THE AS SESSEE STARTED ITS MANUFACTURING ACTIVITY/OPERATION ON 31/07/2006 AND INITIAL ASSESSMENT YEAR FOR CLAIM OF DEDUCTION U/S 80IC OF THE ACT WAS A.Y. 200 708. THE ASSESSEE CLAIMED DEDUCTION U/S 80 IC TO THE EXTENT OF 100% OF THE EL IGIBLE PROFITS FOR 5 YEARS PERIOD STARTING FROM A.Y.200708 TO A.Y. 201112. DURING A SSESSMENT PROCEEDINGS FOR THE IMPUGNED YEAR THE AO NOTICED THAT THE ASSESSEE FIRM HAD AGAIN CLAIMED HUNDRED PERCENT DEDUCTION OF ITS ELIGIBLE PROFITS ON ACCOUNT OF HAVING CARRIED OUT SUBSTANTIAL EXPANSION IN F.Y. 200910. THE ASSE SSING OFFICER FOR DETAILED REASONS MENTIONED IN THE ASSESSMENT ORDER HELD THA T THE ASSESSEE WAS ELIGIBLE FOR DEDUCTION U/S 80IC ONLY AT THE RATE OF 25% AS AGAINST THE CLAIM OF 100% MADE BY THE ASSESSEE. 6. THE MATTER WAS CARRIED IN APPEAL BEFORE THE LD. CIT(APPEAL) WHO DISMISSED THE ASSESSEES APPEAL AND RESTRICTED THE DEDUCTION CLAIMED TO 25% OF THE PROFITS RELYING UPON THE JUDGEMENT OF THE CHAN DIGARH BENCH OF THE ITAT IN THE CASE OF M/S HYCRON ELECTRONICS VS ITO IN ITA NO . 798/CHD/2012 AND OTHER RELATED CASES. 7. AGGRIEVED BY THE SAME THE ASSESSEE HAS NOW COME UP IN APPEAL BEFORE US. 8. DURING THE COURSE OF HEARING BEFORE US LD. COUN SEL RELIED ON THE SUBMISSIONS MADE BEFORE THE LD. CIT(A) WHILE THE SR . DR ARGUED THAT THE ISSUE WAS COVERED AGAINST THE ASSESSEE BY THE DECISION O F THE CHANDIGARH BENCH OF THE ITAT IN THE CASE OF M/S HYCRON ELECTRONICS VS ITO IN ITA NO. 798/CHD/2012 AND OTHER RELATED CASES. 3 9. WE HAVE HEARD BOTH THE PARTIES AND ALSO PERUSED THE ORDERS OF THE AUTHORITIES BELOW. FACTS EMERGING IN THE PRESENT C ASE AND WHICH ARE RELEVANT FOR ADJUDICATING THE ISSUE AT HAND ARE THAT THE ASS ESSEE CAME INTO EXISTENCE AND COMMENCED ITS MANUFACTURING ACTIVITY/OPERATION ON 31/07/2006 WAS ELIGIBLE TO CLAIM DEDUCTION OF 100% OF ITS PROFITS U/S 80IC OF THE INCOME TAX ACT 1961 AND HAD CLAIMED THE SAME FOR FIVE YEARS F ROM A.Y 2007-08 TO A.Y 2011- 12. FURTHER IT IS NOT DISPUTED THAT THE ASSESSEE UN DERTOOK SUBSTANTIAL EXPANSION OF ITS UNDERTAKING IN F.Y. 2009-10 AND ON ACCOUNT OF THE SAME CLAIMED DEDUCTION AGAIN @ 100% OF ITS ELIGIBLE PROFITS WHICH HAS BEEN DENIED TO IT RESTRICTING THE SAME TO 25% OF THE PROFITS WHICH HAS BEEN CHALLE NGED BEFORE US. 10. WE HAVE GONE THROUGH THE ORDER OF THE LD CIT(A) AND FIND NO INFIRMITY IN THE SAME. THE ISSUE OF QUANTUM OF DEDUCTION AVAILAB LE TO NEW UNDERTAKINGS WHICH CAME INTO EXISTENCE AFTER 01.07.2003 AND WHI CH HAVE ALREADY CLAIMED DEDUCTION OF 100% OF THEIR ELIGIBLE PROFITS FOR THE STATUTORILY SPECIFIED PERIOD OF FIVE YEARS ON SUBSTANTIAL EXPANSION OF THE SAID UN DERTAKING HAS BEEN DEALT WITH BY THE ITAT CHANDIGARH BENCH IN THE CASE OF M/S HYC RON ELECTRONICS (SUPRA).THE HONBLE BENCH IN THE SAID ORDER AFTER DEEPLY ANALY ZING THE PROVISIONS OF SECTION 80IC HAS CATEGORICALLY HELD THAT THE BENEFIT OF C LAIMING 100% DEDUCTION OF PROFITS ON UNDERTAKING SUBSTANTIAL EXPANSION IS NOT AVAILABLE TO NEW UNDERTAKINGS SET UP AFTER 01.07.2003. IT HAS BEEN CATEGORICALLY HELD BY THE ITAT THAT THERE CAN BE ONLY ONE INITIAL ASSESSMENT YEAR FOR THE PURPOSE OF CLAIMING DEDUCTION @ 100% OF PROFITS U/S 80IC OF THE ACT. IT HAS ALSO B EEN HELD THAT AS PER SECTION 80IC ELIGIBLE UNDERTAKINGS SET UP IN SPECIFIED AR EAS OF THE STATE OF HIMACHAL PRADESH ARE NOT ENTITLED TO CLAIM DEDUCTION @ 100% OF THE PROFITS BEYOND A PERIOD OF FIVE YEARS. 11. THE LD CIT(A) WE FIND HAS CORRECTLY APPRECIATE D THE FACTS OF THE PRESENT CASE AND APPLIED THE AFORESAID DECISION OF THE ITA T TO RESTRICT THE DEDUCTION 4 CLAIMED BY THE ASSESSEE U/S 80IC @ 25% OF THE PROFI TS SINCE UNDISPUTEDLY THE ASSESSEE COMMENCED BUSINESS OPERATIONS AFTER 01.07. 2003 I.E. ON 31 . 07.2006 AND HAD ALREADY CLAIMED DEDUCTION OF 100% OF ITS PR OFITS FOR FIVE YEARS FROM A.Y 2007-08 TO A.Y 2011-12 . THE LD CIT(A) HAS CORRECTLY HELD THAT THE ASSESSEE WAS NOT ENTITLED TO CLAIM DEDUCTION @ 100% OF ITS PROFI TS IN THE IMPUGNED YEAR ON ACCOUNT OF HAVING UNDERTAKEN SUBSTANTIAL EXPANSION IN F.Y 2009-10 IN VIEW OF THE DECISION OF THE CO-ORDINATE BENCH OF ITAT CHAN DIGARH IN THE CASE OF M/S HYCRON ELECTRONICS (SUPRA). 12. IN VIEW OF THE SAME WE FIND NO MERIT IN THIS GR OUND OF APPEAL RAISED BY THE ASSESSEE AND THE SAME IS THEREFORE DISMISSED. 13. THE APPEAL OF THE ASSESSEE THEREFORE STANDS D ISMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (DIVA SINGH) (DR. B.R.R. KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 28/11/2017 AG COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. THE CIT 5. THE DR