DCIT, Circle - 4, Kolkata, Kolkata v. M/s. SSK Exports Ltd., Kolkata

ITA 1440/KOL/2010 | 2002-2003
Pronouncement Date: 11-07-2011 | Result: Dismissed

Appeal Details

RSA Number 144023514 RSA 2010
Assessee PAN AADCS8046E
Bench Kolkata
Appeal Number ITA 1440/KOL/2010
Duration Of Justice 11 month(s) 29 day(s)
Appellant DCIT, Circle - 4, Kolkata, Kolkata
Respondent M/s. SSK Exports Ltd., Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 11-07-2011
Appeal Filed By Department
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 11-07-2011
Assessment Year 2002-2003
Appeal Filed On 13-07-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : KOLKATA [ . . . . . . . . . . . . . .. . ! ! ! ! ' ' ' ' ] [BEFORE HONBLE SHRI B. R. MITTAL JM & HONBLE SHRI S.V. MEHROTRA AM] #$ #$ #$ #$ / I.T.A NO. 1440/KOL/2010 %& '() %& '() %& '() %& '()/ // / ASSESSMENT YEAR : 2002-03 DY. COMMISSIONER OF INCOME TAX -VS.- M/S. SSK EXPORTS LIMITED CIRCLE-4 KOLKATA. KOLKATA [PAN : AADCS 8046 E] [ + + + + /APPELLANT ] ]] ] [ ./+ ./+ ./+ ./+ / // / RESPONDENT ] ]] ] + + + + / FOR THE APPELLANT : SHRI S.K. ROY ./+ ./+ ./+ ./+ / FOR THE RESPONDENT : NONE 0 /ORDER . . . . . .. . ! ! ! ! ' ' ' ' PER S. V. MEHROTRA A. M. THE DEPARTMENT HAS PREFERRED THIS APPEAL FOR ASSES SMENT YEAR 2002-03 AGAINST ORDER OF LD. CIT(A)-IV KOLKATA DATED 03.08.2009. 2. THE EFFECTIVE GROUND OF APPEAL RAISED BY THE DEP ARTMENT READS AS UNDER :- THAT LD. CIT(A) HAS ERRED IN LAW AS WELL AS ON FA CTS IN DELETING THE ADDITION OF RS.8 86 430/- BEING CESS ON GREEN LEAF ONLY IN VIEW OF THE DECISION OF HONBLE CALCUTTA HIGH COURT PRONOUNCED IN THE CASE OF AFT INDUSTRIES LTD. [270 ITR 167] WITHOUT CONSIDERING THAT THE REVENUE HAS FILED SLP AGAINST THAT ORDER AND FINALITY IN THIS CASE HAS NOT YET ARRIVED. 3. NONE APPEARED ON BEHALF OF THE ASSESSEE NOR THER E IS APPLICATION FOR ADJOURNMENT. WE DECIDED TO DISPOSE OF THE APPEAL AFTER HEARING THE LD. DEPARTMENTAL REPRESENTATIVE AND ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE-CO MPANY IN THE RELEVANT ASSESSMENT YEAR CARRIED OUT THE BUSINESS OF CULTIVATION MANUFACTUR ING AND SALE OF TEA AND ALSO PURCHASED TEA FROM THE MARKET THAT WAS EXPORTED. ASSESSING OFFICER NOT ICED THAT ASSESSEE HAD DEBITED AN AMOUNT OF RS.8 86 430/- ON ACCOUNT OF CESS ON GREEN LEAVES IN THE PROFIT & LOSS ACCOUNT. ASSESSING OFFICER ITA NO. 1440/KOL/2010 2 OBSERVED THAT HONBLE GUWAHATI HIGH COURT IN JOREHA T GROUP OF CASES REPORTED IN 226 ITR 622 HAD HELD THAT THIS EXPENDITURE WAS TOTALLY AGRICULT URAL IN NATURE AND IT SHOULD HAVE BEEN ALLOWED AS A DEDUCTION @ 100% UNDER THE AGRICULTURAL INCOME-TA X. HENCE NECESSARY COROLLARY WAS THAT THE SAME COULD NOT BE ALLOWED AS A DEDUCTION UNDER THE CENTRAL INCOME TAX ACT. ASSESSING OFFICER DID NOT ACCEPT THE ASSESSEES CONCLUSION OBSERVING AS UNDER :- IN REPLY THE ASSESSEE SUBMITTED THAT THE DISALLOWA NCE IN EARLIER YEARS ON THE SAME ISSUE HAS BEEN DELETED BY ITAT IN A NUMBER OF CASES AND HENCE IN THE INSTANT ASSESSMENT YEAR THE SAME SHOULD NOT BE ADDED BACK. THE CONTENTION OF THE ASSESSEE IS NOT ACCEPTABLE SINCE THE DECISION OF THE ITAT HAS NOT BEEN ACCEPTED BY THE DEPARTMENT FILING APPE AL U/S. 260A BEFORE KOLKATA HIGH COURT AND IN VIEW OF THE FACT THAT DE PARTMENTAL SLP HAS BEEN ADMITTED BEFORE THE SUPREME COURT IN THIS SAME ISSUE THE ISSUE IS NOT FINAL AND SETTLED. MORE SO THE ISSUE IN QUESTION IS A LEGAL ISSUE AND NOT A MATTER OF FACT AND THUS IN ORDER TO MAINTAIN JUDICI AL CONSISTENCY AN AMOUNT OF 8 86 430/- ON ACCOUNT OF CESS ON GREEN LEAVES IS ADDED BACK. LD. CIT(A) DELETED THE ADDITION AFTER CONSIDERING T HE FOLLOWING SUBMISSIONS OF THE ASSESSEE :- THE AR OF THE APPELLANT HAS DRAWN MY ATTENTION TO THE JUDGMENT PRONOUNCED BY HONBLE SUPREME COURT OF INDIA IN THE CASE OF ASSAM CO. LTD. VS. STATE OF ASSAM 248 ITR 567. IN THE SAID JUDGMENT IT HAS BEEN PRONOUNCED THAT THE STATE GOVERNMENT HAS NO RIGHT TO CONSIDER ASSAM CESS ON GREEN LEAF FOR COMPUTING AGRICULTURAL INCOME TAX. FURTHER IT WAS ALSO HELD THAT AGRICULTURAL INCOME TAX OFFICER HAS TO CONSIDER ONLY THE 60% OF THE COMPOSITE INCOME COMPUTED BY THE INCOME TAX OFFICER. THE AR OF THE A PPELLANT ALSO DRAWS MY ATTENTION TO THE JUDGMENT OF HONBLE I.T.A.T. KOLK ATA BENCH IN THE CASE OF BISHWANATH TEA CO. LTD. V. JCIT. 4. WE HAVE CONSIDERED THE SUBMISSIONS OF THE LD. DE PARTMENTAL REPRESENTATIVE AND HAVE PERUSED THE RECORDS OF THE CASE. FROM THE GROUNDS R AISED BY THE DEPARTMENT WE FIND THAT THIS ISSUE IS CONCLUDED BY THE DECISION OF HONBLE CALCUTTA HI GH COURT IN THE CASE OF CIT VS. A.F.T. INDUSTRIES LTD. [2004] 270 ITR 167 (CAL.) WHEREIN I T HAS BEEN HELD AS UNDER :- IN RESPECT OF COMPUTATION OF INCOME OF TEA GROWN A ND MANUFACTURED A FICTION HAS BEEN CREATED UNDER WHICH BOTH THE AGRICULTURAL COMPONENT AND THE BUSINESS COMPONENT OF THE INCOME WOULD BE ASSESSED TOGETHER FOR THE PURPOSE O F COMPUTING THE INCOME UNDER THE ACT AND ONLY AFTER THE COMPUTATION OF THE TOTAL INC OME THE APPORTIONMENT IS TO BE MADE DETERMINING 60 PER CENT. AS AGRICULTURAL INCOME. WH EN BY FICTION THE INCOME IS COMPUTED AS AN INCOME UNDER THE ACT ALL DEDUCTIONS AS ARE A VAILABLE BOTH FOR THE AGRICULTURAL COMPONENT AND FOR THE BUSINESS COMPONENT OF THE INC OME ARE TO BE ALLOWED AS A NATURAL COROLLARY. THEREFORE THE ENTIRE AMOUNT PAID AS CES S UNDER THE AGRICULTURAL INCOME-TAX ACT IS ELIGIBLE FOR DEDUCTION. ITA NO. 1440/KOL/2010 3 RESPECTFULLY FOLLOWING THE DECISION OF HONBLE CAL CUTTA HIGH COURT IN THE CASE OF A.F.T. INDUSTRIES LIMITED DEPARTMENTAL APPEAL IS DISMISSE D. 10. IN THE RESULT APPEAL OF THE DEPARTMENT IS DISM ISSED. 0 0 0 0 '1 '1 '1 '1 2 1% 3 4 2 1% 3 4 2 1% 3 4 2 1% 3 4 5' 5' 5' 5' ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH JULY 2011. SD/- SD/- [ . . . . . . . . ] [ . . . . . .. . ! ! ! ! ' ' ' ' ] [ B. R. MITTAL ] [ S.V. MEHROTRA ] JUDICIAL MEMBER ACCOUNTANT MEMBER D ATED : 11 TH JULY 2011. 0 6 .7 87(/ COPY OF THE ORDER FORWARDED TO: 1. + /APPELLANT : DY. COMMISSIONER OF INCOME TAX CIRCL E-4 P-7 CHOWRINGHEE SQUARE 8 TH FLOOR KOLKATA-700 069. 2 ./+ / RESPONDENT : M/S. SSK EXPORTS LIMITED 37 SHAKE SPEARE SARANI KOLKATA-700 001 . 3. 0 - % / CIT 4. 0% ()/ CIT(A) KOLKATA. 5. '3 .%/ DR KOLKATA BENCHES KOLKATA [/7 ./ TRUE COPY] 0%1/ BY ORDER #A /ASSTT REGISTRAR [KKC 'BC %DA E' /SR.PS]