LAVINO KAPUR COTTONS P.LTD, MUMBAI v. ITO 3(2)(1), MUMBAI

ITA 1495/MUM/2013 | 2008-2009
Pronouncement Date: 23-04-2014 | Result: Allowed

Appeal Details

RSA Number 149519914 RSA 2013
Assessee PAN AAACL0824C
Bench Mumbai
Appeal Number ITA 1495/MUM/2013
Duration Of Justice 1 year(s) 2 month(s) 1 day(s)
Appellant LAVINO KAPUR COTTONS P.LTD, MUMBAI
Respondent ITO 3(2)(1), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 23-04-2014
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 23-04-2014
Date Of Final Hearing 27-03-2014
Next Hearing Date 27-03-2014
Assessment Year 2008-2009
Appeal Filed On 22-02-2013
Judgment Text
A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH MUMBAI .. ; BEFORE SHRI P.M. JAGTAP AM AND SHRI VIVEK VARMA J M ./ I.T.A. NO.1495 /MUM/2013 ( / ASSESSMENT YEAR : 2008-2009 M/S LAVINO KAPUR COTTONS PVT. LTD. 121/122 MITTAL CHAMBERS NARIMAN POINT MUMBAI 400 021. / VS. INCOME TAX OFFICER 3(2)(1) AAYAKAR BHAVAN MARINE LINES MUMBAI - 400020. ./ PAN : AAACL0824C ( # / APPELLANT ) .. ( $%# / RESPONDENT ) A PPELLANT BY SHRI SURINDER MEHRA R E SPONDENT BY : SHRI M.L. PERUMAL ) * / DATE OF HEARING : 27-03-2014 ) * / DATE OF PRONOUNCEMENT : 23-04-2014 [ / O R D E R PER P.M. JAGTAP A.M . : .. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF LD. CIT(A)-4 MUMBAI DATED 3-1-2013 FOR A.Y. 2008-09. 2. ALTHOUGH THE ASSESSEE HAS ORIGINALLY RAISED GRO UND NO. 1(A) TO (F) GROUND NO. 2 (A) TO (D) AND GROUND NO. 3 (A) TO (D) THE LD. COUNSEL FOR THE ASSESSEE AT THE TIME OF HEARING BEFORE US HAS PRESS ED ONLY GROUND NO. 1(A) AND GR. 1 (B) AND HAS NOT PRESSED THE REMAINING GRO UNDS. THE ORIGINAL GROUNDS PRESSED BY THE LD. COUNSEL FOR THE ASSESSEE READ AS UNDER:- ITA 1495/M/13 2 1(A) THAT THE COMMISSIONER OF INCOME TAX (APPEALS) HAS E RRED IN NOT ACCEPTING THE CLAIM OF THE APPELLANT COMPANY FOR SE TTING OFF THE LOSS OF 100% EXPORT ORIENTED NEW UNIT OF THE APPELLANT COMPANY O F RS. 1 10 14 646/- AGAINST THE OTHER INCOME OF THE APPELLANT COMPANY F ROM BUSINESS AND CAPITAL GAINS. 1(B) THAT IN RESPECT OF THE SAID 100% EXPORT ORIENT ED NEW UNIT STATEMENTS OF COMPUTATION OF INCOME FORM 56G AND ANNEXURE THERET O AND AUDITED BALANCE SHEET AND PROFIT AND LOSS A/C OF THE SAID UNIT WERE ALREADY ON RECORD AND MISTAKENLY THE SAID LOSS WAS NOT SET OFF AGAINST TH E OTHER INCOME OF THE APPELLANT COMPANY. 3. THE ASSESSEE HAS ALSO MOVED AN APPLICATION SEEKI NG ADMISSION OF THE FOLLOWING ADDITIONAL GROUNDS:- THAT THE CARRY FORWARD OF THE BALANCE BUSINESS LOS S OF RS. 54 98 286/- (TOTAL LOSS OF ELIGIBLE UNIT 1 10 14 646/- - 55 16 360 GROSS TOTAL INCOME ASSESSED) MAY PLEASE BE ALLOWED. 4. AS THE ADDITIONAL GROUND RAISED BY THE ASSESSEE IS INCIDENTAL AND INTERLINKED WITH GROUND NO. 1(A) AND 2(B) THE SAME HAS BEEN ADMITTED BY US. THE ADDITIONAL GROUND RAISED BY THE ASSESSEE AS WEL L AS GROUND NO. 1(A) & 2(B) INVOLVE A COMMON ISSUE RELATING TO THE ASSESSEES C LAIM FOR SET OFF OF LOSS OF RS. 1 10 14 646/- RELATING TO ITS 100% EXPORT ORIEN TED NEW UNIT AGAINST THE OTHER INCOME AND THE CONTENTION MAINLY RAISED BY TH E LD. COUNSEL FOR THE ASSESSEE BEFORE US IS THAT THE SAME HAS NOT BEEN CO NSIDERED EITHER BY THE A.O. OR BY THE LD. CIT(A) ON MERIT. 5. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS OBSERV ED THAT THE ASSESSEE COMPANY CARRYING ON THE BUSINESS OF MANUFACTURING OF ABSORBENT COTTON AND FINISHED PRODUCTS FILED ITS RETURN OF INCOME FOR T HE YEAR UNDER CONSIDERATION ON 22ND SEPTEMBER 2008 DECLARING TOTAL INCOME OF R S. 48 38 938/-. DURING THE COURSE OF ASSESSMENT PROCEEDINGS A LETTER DATE D 20 TH SEPTEMBER 2010 WAS FILED BY THE ASSESSEE CLAIMING SET OFF OF LOSS OF RS. 1 10 14 646/- OF ITS 100% EXPORT ORIENTED UNIT AGAINST THE INCOME DECLAR ED UNDER OTHER HEADS. IN THE ASSESSMENT COMPLETED U/S 143(3) OF THE INCOME T AX ACT 1961 VIDE AN ITA 1495/M/13 3 ORDER DATED 21-12-2010 THE A.O. DID NOT CONSIDER O N MERIT THIS CLAIM OF THE ASSESSEE MADE FOR THE FIRST TIME VIDE LETTER DATED 20 TH SEPTEMBER 2010. BEFORE THE LD. CIT(A) IT WAS SPECIFICALLY POINTED OUT ON BEHALF OF THE ASSESSEE THAT ITS CLAIM FOR SET OFF OF LOSS OF THE NEW 100% EXPORT OR IENTED UNIT MADE DURING THE COURSE OF ASSESSMENT PROCEEDINGS VIDE LETTER DATED 20 TH SEPTEMBER 2010 WAS NEITHER ENTERTAINED NOR DEALT WITH BY THE A.O. IN T HE ASSESSMENT ORDER. THE LD. CIT(A) HOWEVER DID NOT ACCEPT THIS CONTENTION OF THE ASSESSEE AND HELD THAT THE CLAIM OF THE ASSESSEE FOR SET OFF OF SAID LOSS COULD NOT BE ENTERTAINED FOR THE FOLLOWING REASON : I) THE ASSESSEE HAS NOT MADE THE CLAIM IN THE RETU RN OF INCOME AND THEREFORE IT IS CLEAR THAT THE REQUIRED DETAILS WE RE ALSO NOT AVAILABLE WITH THE RETURN OF INCOME. II) THERE IS NO EVIDENCE FOR CLAIMING NEW UNIT TO B E 100% EXPORT ORIENTED UNIT AND ACCORDINGLY FOR CLAIMING ANY DEDU CTION ASSESSEE HAS TO FILE THE NECESSARY REPORT FROM THE AUDITOR ALONG WITH OTHER DETAILS WITH THE RETURN OF INCOME WHEREAS A.O. HAS NOT FO UND ANY SUCH DETAILS WITH THE RETURN OF INCOME AND THEREFORE T HERE IS NO DISCUSSION IN THE ASSESSMENT ORDER IN THIS REGARD. III) THE ISSUE RAISED BY THE ASSESSEE IS NOT PURELY A LEGAL ISSUE WHEREAS IT REQUIRES VERIFICATION OF FACTS RELATING TO THE 100% EXPORT ORIENTED UNIT AND THE CLAIM OF LOSS WHEREAS A.O. HAS NOT VERIFIED ANY SUCH DETAILS THEREFORE THE GROUND CANNOT BE ADMIT TED AT THIS STAGE. IV) BY WAY OF SECTION 80A(5) FOR CLAIMING ANY REDUC TION U/S.1OA 10AA 10B AND 1OBA ETC. IT HAS BEEN MADE MANDATORY FOR THE ASSESSEE TO MAKE ANY SUCH CLAIM IN THE RETURN OF INCOME WHE REAS A.O. MADE NO CLAIM WITH REGARD TO THE SAID NEW 100% EXPORT ORIEN TED UNIT IN THE RETURN OF INCOME THEREFORE ANY CLAIM RELATING TO THE SAID UNIT CANNOT BE ENTERTAINED. 6. THE LD. COUNSEL FOR THE ASSESSEE HAS PLACED BEFO RE US A COPY OF LETTER DTD. 20 TH SEPTEMBER 2010 FILED BEFORE THE A.O. AT PAGE 1 TO 3 OF HIS PAPER BOOK AND A PERUSAL OF THE SAME SHOWS THAT THE SET O FF OF LOSS OF 100% EXPORT ORIENTED UNIT WAS SPECIFICALLY CLAIMED BY THE ASSES SEE AGAINST THE INCOME FROM OTHER HEADS. HE HAS ALSO PLACED ON RECORD A CO PY OF LETTER DTD. 29-6-2010 FILED BEFORE THE A.O. AT PAGE 67 OF HIS P APER BOOK TO SHOW THAT ALL ITA 1495/M/13 4 THE NECESSARY DOCUMENTS IN SUPPORT OF ITS CLAIM FOR LOSS OF NEW 100% EXPORT ORIENTED UNITS WERE FILED BY THE ASSESSEE. 7. IN THE CASE OF NATIONAL THERMAL POWER CORPORATIO N LTD. VS. CIT (1998) 229 ITR 383 (SC) IT WAS HELD BY THE HONBLE SUPREM E COURT THAT THE POWER OF THE TRIBUNAL IN DEALING WITH APPEALS IS EXPRESSED I N THE WIDEST POSSIBLE TERMS U/S 254 OF THE INCOME TAX ACT 1961 AND THERE IS NO REASON WHY THE ASSESSEE SHOULD BE PREVENTED FROM RAISING ANY QUESTION BEFOR E THE TRIBUNAL FOR THE FIRST TIME SO LONG AS THE RELEVANT FACTS ARE ON RECORD. KEEPING IN VIEW THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF NATIONA L THERMAL POWER CORPORATION (SUPRA) AND HAVING REGARD TO THE FACTS OF THE CASE WE ARE OF THE VIEW THAT THE CLAIM OF THE ASSESSEE FOR SET OFF OF LOSS OF NEW 100% EXPORT ORIENTED UNIT AGAINST THE INCOME FROM OTHER HEADS S HOULD BE ENTERTAINED IN THE INTEREST OF JUSTICE AND SINCE NEITHER THE A.O. NOR THE LD. CIT(A) HAS EXAMINED THE SAME ON MERIT IN THE LIGHT OF MATERIAL ALREADY PLACED ON RECORD BY THE ASSESSEE THE MATTER SHOULD GO BACK TO THE A .O. FOR DECIDING THE SAME ON MERIT AFTER NECESSARY VERIFICATION. ACCORDINGLY WE SET ASIDE THE IMPUGNED ORDER OF THE LD. CIT(A) AND RESTORE THE MATTER TO T HE FILE OF THE A.O. FOR DECIDING THE SAME AFRESH AFTER GIVING THE ASSESSEE AN OPPORT UNITY TO SUPPORT AND SUBSTANTIATE ITS CLAIM FOR SET OFF OF LOSS OF THE N EW 100% EXPORT ORIENTED UNIT AGAINST THE INCOME UNDER THE OTHER HEADS IN ACCORDA NCE WITH LAW. 8. IN THE RESULT APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 23 -04-2014. ) 0 1 23-04-2014 ) SD/- SD/- (VIVEK VARMA) (P.M. JAGTAP ) JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; 1 DATED 23-04-2014 ITA 1495/M/13 5 [ .../ RK SR. PS ' #%& '& / COPY OF THE ORDER FORWARDED TO : 1. # / THE APPELLANT 2. $%# / THE RESPONDENT. 3. 4 () / THE CIT(A)4 MUMBAI. 4. 4 / CIT 3 MUMBAI 5. $8 * 8 / DR ITAT MUMBAI A BENCH 6. / GUARD FILE. / BY ORDER % $ //TRUE COPY// / ( DY./ASSTT. REGISTRAR) / ITAT MUMBAI