Siyaram Metals Pvt. Ltd., JAMNAGAR v. The Assistant Commisioner of Income Tax, JAMNAGAR

ITA 156/RJT/2011 | 2004-2005
Pronouncement Date: 04-10-2013 | Result: Dismissed

Appeal Details

RSA Number 15624914 RSA 2011
Assessee PAN AAECS2779P
Bench Rajkot
Appeal Number ITA 156/RJT/2011
Duration Of Justice 2 year(s) 5 month(s) 13 day(s)
Appellant Siyaram Metals Pvt. Ltd., JAMNAGAR
Respondent The Assistant Commisioner of Income Tax, JAMNAGAR
Appeal Type Income Tax Appeal
Pronouncement Date 04-10-2013
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 04-10-2013
Date Of Final Hearing 03-10-2013
Next Hearing Date 03-10-2013
Assessment Year 2004-2005
Appeal Filed On 21-04-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBULAL; RAJKOT BENCH RAJKOT .. .. BEFORE SHRI T. K. SHARMA JM AND SHRI D. K. S RIVASTAVA AM IT NOS. 156 & 345/RJT/2011AND 335/RJT/2012 / ASSESSMENT YEAR : 2004-05 2008-09 & 2009-10 SIYARAM METALS PVT LTD PLOT NO.12 & 14 NEGHEDI IND. ARIA JAMNAGAR PAN: AAECS 2779 P ( / APPELLANT) THE ASST. COMMISSIONER OF INCOME-TAX CIRCLE-2 JAMNAGAR / RESPONDENT ! ' #$ / ASSESSEE BY SHRI J C RANPURA CA % ! ' #$ / REVENUE BY DR. M L MEENA DR # & ' ! ( / DATE OF HEARING 03.10.2013 ) ! ( / DATE OF PRONOUNCEMENT 04.10.2013 / ORDER .. / T. K. SHARMA J. M. : THESE THREE APPEALS FILED BY THE ASSESSEE ARE AGAINST THREE SEPARATE ORDERS OF T HE CIT(A)-JAMNAGAR FOR THE ASSESSMENT YEARS 2004-05 2008-09 & 2009-10. ALL T HESE APPEALS WERE HEARD ON THE SAME DATE ARGUED BY COMMON REPRESENTATIVE; THEREFORE THESE ARE BEING DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CO NVENIENCE. THE YEAR-WISE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE AS UND ER:- AY 2004-05 1. LD. CIT APPEAL ERRED IN LAW AS WELL AS ON FACT T O CONFIRM THE ORDER OF LD. AO TO RESTRICT DEEMED EXPORTS AT RS.66014070.00 INSTEAD OF RS.141825042.00. HENCE THE SAME MAY BE CONSIDERED A S EXPORTS FOR WORKING THE ELIGIBLE PROFIT U/S 10B. 2. LD. CIT APPEAL ERRED IN LAW AS WELL AS ON FACT T O CONFIRM THE ORDER OF LD. AO TO NOT CONSIDER GENUINE DEEMED EXPORT SALES APPROVED UNDER THE CENTRAL GOVT. DIRECTION AMOUNTING TO RS.1418250 42.00 AS PERMITTED IN CHAPTER 6 & 8 OF EXPORT IMPORT POLICY AS EXPORT AND AS RECEIPT OF NET FOREIGN EXCHANGE EARNINGS. THEREFORE DEEMED EXPORT SALES MADE TO LOCAL IMPORTER AGAINST ADVANCE LICENSE TO OTHER EO US INSTEAD OF DIRECTLY IMPORTING BY SUCH AUTHORIZED IMPORTERS MAY BE TREATED AS ALLOWABLE EXPORT EARNING ENTITLED ON SUCH SALE AS E XEMPTED PROFIT U/S 10B. 3. BASED ON ABOVE APPELLANT REQUEST YOUR HONOR TO E NHANCE PRORATE REBATE UNDER SECTION 10B-80IB. 4. ANY OTHER GROUNDS ARE PRESENTED WITH THE PERMISS ION OF YOUR HONOR AT THE TIME OF HEARING. 156 & 345 OF 11 AND 335-RJT-2012 - SIYARAM METALS PVT LTD 2 AY 2008-09 1. LD. CIT APPEALS JAMNAGAR ERRED IN LAW AS WELL AS ON FACT TO CONFIRM THE ORDER LD ACIT LD. AO WHO HAD ERRED IN LAW AS WE LL AS ON FACT BY NOT ACCEPTING THE GENUINE EXPORT SALES APPROVED UND ER THE CENTRAL GOVT. DIRECTION AMOUNTING TO RS.6 86 38 058.00 AS P ERMITTED IN CHAPTER 6 & 8 OF EXPORT IMPORT POLICY AS EXPORT AND AS RECE IPT OF FOREIGN EXCHANGE. THEREFORE EXPORT SALES MADE TO LOCAL IMPO RTER AGAINST ADVANCE LICENSE AS WELL AS TO OTHER EOU MAY BE TREA TED AS ALLOWABLE EXPORT EARNING ENTITLED ON SUCH SALE AS EXEMPTED PR OFIT U/S 10B. 2. LD. CIT APPEALS JAMNAGAR ERRED IN LAW AS WELL AS ON FACT TO CONFIRM THE ORDER LD. ACIT LD. AO WHO HAD ERRED IN LAW AS W ELL AS ON FACT BY TO RESTRICT THE CLAIM UNDER SECTION 80IB TO RS.4885 689.00 INSTEAD OF ORIGINAL ALLOWABLE RS.52 05 323.00 HENCE THE ELIGIB LE AMOUNT OF RS.5205323.00 BE ALLOWED AS ENTITLED U/S 80B. 3. ARBITRARY DEMAND OF RS.17 20 480.00 MAY BE STAYE D TILL THE DECISION OF THE APPEAL BEFORE YOUR HONOR. 4. INTEREST U/S 234A 234B & 234C TOTALING TO RS.83 3048.00 MAY BE DELETED AS DELAY IN THE ASSESSMENT IS NOT DUE TO TH E ASSESSEE BUT THE DEPARTMENT HAS DELAYED THE ASSESSMENT. 5. PENALTY U/S 271(1)(C) INITIATED BY LDT AO MAY BE DROPPED. 6. ANY OTHER GROUNDS PRESENTED WITH THE PERMISSION OF YOUR HONOR AT THE TIME OF HEARING. AY 2009-10 1. LD. CIT APPEALS ERRED IN LAW AS WELL AS ON FACT TO CONFIRM THE ORDER OF LD. AO WHO HAS NOT CONSIDER GENUINE EXPORT SALES AP PROVED UNDER THE CENTRAL GOVT. DIRECTION AMOUNTING TO RS.11 76 33 63 6.00 AS PERMITTED IN CHAPTER 6 & 8 OF EXPORT IMPORT POLICY AS EXPORT AND AS RECEIPT OF FOREIGN EXCHANGE. THEREFORE EXPORT SALES MADE TO LO CAL IMPORTER AGAINST ADVANCE LICENSE AS WELL AS TO OTHER EOU MAY BE TREATED AS ALLOWABLE EXPORT EARNING ENTITLED ON SUCH SALE AS E XEMPTED PROFIT U/S 10B. 2. LD. CIT APPEALS ERRED IN LAW AS WELL AS ON FACT TO CONFIRM THE ORDER OF LD. AO WHO HAS RESTRICTED THE CLAIM UNDER SECTION 8 0IB TO RS.8659607.00 INSTEAD OF ORIGINAL ALLOWABLE RS.2969 3298.00 HENCE THE ELIGIBLE AMOUNT OF RS.29693298.00 BE ALLOWED AS ENTITLED U/S 10B. 3. ARBITRARY DEMAND OF RS.55 31 350.00 MAY BE STAYE D TILL THE DECISION OF THE APPEAL BEFORE YOUR HONOR. 4. INTEREST U/S 234A 234B & 234C TOTALING TO RS.19 79238.00 MAY BE DELETED AS DELAY IN THE ASSESSMENT IS NOT DUE TO TH E ASSESSEE BUT THE DEPARTMENT HAS DELAYED THE ASSESSMENT. 5. PENALTY U/S 271(1)(C) INITIATED BY LD AO MAY BE DROPPED. 6. ANY OTHER GROUNDS PRESENTED WITH THE PERMISSION OF YOUR HONOR AT THE TIME OF HEARING. 2. AT THE TIME OF HEARING BEFORE US ON BEHALF OF T HE ASSESSEE SHRI J C RANPURA CA APPEARED AND CONTENDED THAT ALL THE APP EALS BE DECIDED ON THE BASIS OF STATEMENT OF FACTS FURNISHED ALONGWITH T HE FORM NO.36 OF ALL THESE 156 & 345 OF 11 AND 335-RJT-2012 - SIYARAM METALS PVT LTD 3 THREE ASSESSMENT YEARS. AS AGAINST THIS DR M L M EENA DR APPEARED ON BEHALF OF THE REVENUE PRODUCED A COPY OF THE DECISI ON OF ITAT RAJKOT BENCH DATED 08.03.2013 IN ASSESSEES OWN CASE FOR THE ASS ESSMENT YEAR 2005-06 IN ITA NO.1063/RJT/2010; WHEREIN ALSO THE ASSESSEE REL IED ON THE STATEMENT OF FACTS FURNISHED WITH THE MEMORANDUM OF APPEAL BUT TRIBUNAL HOLD THAT ASSESSEE DOES NOT SATISFY THE PRIMARY CONDITION OF HAVING EXPORTED SPECIFIED GOODS OUT OF INDIA AND IS THEREFORE NOT ENTITLED TO RELIEF U/S 10B ON THE SOLE BASIS THAT IT HAS SOLD GOODS OF SPECIFIED NATURE TO 100% EOU OR RECEIVED THEIR SALE PROCEEDS IN CONVERTIBLE FOREIGN EXCHANGE. THE LD D EPARTMENTAL REPRESENTATIVE ACCORDINGLY POINTED OUT THAT SINCE THE CONTROVERSY INVOLVED IN THESE APPEALS IS SQUARELY COVERED IN FAVOUR OF THE REVENUE BY THE DE CISION OF THE TRIBUNAL DATED 08.03.2013 IN ASSESSEES OWN CASE FOR THE ASSESSMEN T YEAR 2005-06 IN ITA NO.1063/RJT/2010 (SUPRA) THEREFORE THE VIEW TAKEN BY THE LD CIT(A) BE UPHELD. 3. HAVING HEARD BOTH SIDES WE HAVE CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AS WELL AS THE DECISION OF THE TR IBUNAL DATED 08.03.2013 IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2005-06 IN ITA NO.1063/RJT/2010 (SUPRA). IN THE DECISION OF THE TRIBUNAL DATED 08. 03.2013 IT HAS BEEN HELD THAT THE ASSESSEE IS NOT ENTITLED TO RELIEF U/S 10B UNL ESS THE GOODS OF SPECIFIED NATURE ARE SHOWN TO HAVE BEEN EXPORTED BY THE ASSESSEE OUT OF INDIA AND THE SALE PROCEEDS THEREOF HAVE BEEN RECEIVED IN CONVERTIBLE FOREIGN EXCHANGE WITHIN THE SPECIFIED PERIOD. SINCE THE ASSESSEE DOES NOT SAT ISFY THE PRIMARY CONDITION OF HAVING EXPORTED SPECIFIED GOODS OUT OF INDIA THERE FORE NOT ENTITLED TO RELIEF U/S 10B ON THE SOLE BASIS THAT IT HAS SOLD GOODS OF SPE CIFIED NATURE TO 100% EOU OR RECEIVED THEIR SALE PROCEEDS IN CONVERTIBLE FOREIGN EXCHANGE. THE RELEVANT OBSERVATION IS CONTAINED IN PARAGRAPH 6 OF THE ORDE R DATED 08.03.2013 OF THIS TRIBUNAL WHICH READS AS UNDER:- 6. WE HAVE HEARD BOTH THE PARTIES AND CAREFULLY CON SIDERED THEIR SUBMISSIONS. THE ISSUE UNDER APPEAL IS COVERED AGAI NST TH E ASSESSEE AND IN FAVOUR OF THE DEPARTMENT BY THE ORDER PASSED BY THIS BENCH ON 28-09- 2012 IN ITO V. MONARCH OVERSEAS ITA NO.253/RJT/201 1 RELATING TO ASSESSMENT YEAR 2007-08. RELEVANT PORTION OF THE SA ID ORDER READS AS UNDER:- 6. WE HAVE HEARD BOTH THE PARTIES AND CAREFULLY CO NSIDERED THEIR SUBMISSIONS. IT IS CLEAR ON PLAIN READING OF SUB-SECTION (3) OF 156 & 345 OF 11 AND 335-RJT-2012 - SIYARAM METALS PVT LTD 4 SECTION 10B THAT SECTION 10B APPLIES TO THE UNDERTA KING IF THE SALE PROCEEDS OF ARTICLES OR THINGS OR COMPUTER SOFTWARE EXPORTED OUT OF INDIA ARE RECEIVED IN OR BROUGHT INTO INDIA B Y THE ASSESSEE IN CONVERTIBLE FOREIGN EXCHANGE WITHIN A PERIOD OF SI X MONTHS FROM THE END OF THE PREVIOUS YEAR OR WITHIN SUCH FURTHE R PERIOD AS THE COMPETENT AUTHORITY MAY ALLOW IN THIS BEHALF. IT IS QUITE APPARENT THAT TWO CONDITIONS ARE STIPULATED BY SUB-SECTION ( 3) FOR AVAILING THE RELIEF UNDER SECTION 10B. FIRST CONDITION IS TH AT THE ARTICLES OR THINGS OR COMPUTER SOFTWARE MUST BE EXPORTED OUT O F INDIA WHILE THE SECOND CONDITION IS THAT THE SALE PROCEEDS THER EOF MUST BE RECEIVED IN CONVERTIBLE FOREIGN EXCHANGE WITHIN THE STIPULATED PERIOD. BOTH THE AFORESAID CONDITIONS ARE CUMULATIV E AND THEREFORE BOTH OF THEM HAVE TO BE SATISFIED TOGETHER. MERE RE CEIPT OF CONVERTIBLE FOREIGN EXCHANGE IS NOT SUFFICIENT UNLE SS THE ASSESSEE ALSO ESTABLISHES THAT THE CONVERTIBLE FOREIGN EXCHA NGE SO RECEIVED REPRESENTS SALE PROCEEDS OF ARTICLES OR THINGS OR C OMPUTER SOFTWARE EXPORTED OUT OF INDIA. PLAIN AND SIMPLE MEANING O F THE TERM EXPORTED OUT OF INDIA AS USED IN SECTION 10B(3) W OULD ENTAIL THE TRANSFER OF GOODS OUT OF THE TERRITORY OF INDIA AND THEREFORE THE GOODS MUST PHYSICALLY MOVE OUT OF INDIA. IN OUR CON SIDERED VIEW THE ASSESSEE NEEDS TO SATISFY FIRSTLY THAT IT HAS E XPORTED SPECIFIED GOODS OUT OF INDIA AND THEREAFTER IT HAS ALSO TO SA TISFY THAT THE SALE PROCEEDS THEREOF HAVE BEEN RECEIVED IN CONVERTIBLE FOREIGN EXCHANGE WITHIN THE STIPULATED PERIOD. THE AFORESAI D POSITION IS WELL BROUGHT OUT ON PLAIN READING OF SUB-SECTION (3 ) OF SECTION 10B AND THEREFORE DOES NOT REQUIRE ANY AUTHORITY TO SUP PORT IT. HOWEVER THE JUDGMENT DATED 26.4.2011 OF THE HONBL E ANDHRA PRADESH HIGH COURT IN M/S SWAYAM CONSULTANCY PRIVAT E LTD. V. ITO TAX APPEAL NO.62 OF 2011 AND OF THE HONBLE DELHI H IGH COURT INDIA DEL (P) LTD VS. CIT (2012) 250 CTR (DEL) 344 ARE QUITE APPOSITE. 7. AS EVIDENT FROM THE AFORESAID DISCUSSION RELIEF U/S 10B IS NOT AVAILABLE UNLESS THE GOODS OF SPECIFIED NATURE ARE SHOWN TO HAVE BEEN EXPORTED BY THE ASSESSEE OUT OF INDIA AND THE SALE PROCEEDS THEREOF HAVE BEEN RECEIVED IN CONVERTIBLE FOREIGN EXCHANGE WITHIN THE SPECIFIED PERIOD. THE ASSESSEE APART FROM PLEADING THAT THE GOODS HAVE BEEN SOLD TO 100% E.O. U. HAS PLACED NO MATERIAL ON RECORD TO ESTABLISH THAT THE GOODS OF SPECIFIED NATURE HAVE REALLY BEEN EXPORTED OUT OF I NDIA BY HIM. THE ASSESSEE DOES NOT THEREFORE SATISFY THE PRIMARY CONDITION OF HAVING EXPORTED SPECIFIED GOODS OUT OF INDIA AND IS THEREFORE NOT ENTITLED TO RELIEF U/S 10B ON THE SOLE BASIS THAT I T HAS SOLD GOODS OF SPECIFIED NATURE TO 100% EOU OR RECEIVED THEIR SALE PROCEEDS IN CONVERTIBLE FOREIGN EXCHANGE. IN THIS VIEW OF THE M ATTER THE ORDER OF THE CIT(A) DESERVES TO BE REVERSED AND IS ACCORD INGLY REVERSED. RESULTANTLY THE ORDER OF THE ASSESSING OFFICER IN THIS BEHALF IS RESTORED. 4. WE THEREFORE FOLLOWING THE DECISION OF THE TRI BUNAL DATED 08.03.2013 IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2005-06 IN ITA NO.1063/RJT/2010 (SUPRA) UPHELD THE VIEW TAKEN BY THE LD CIT(A) IN RESPECT OF ALL THE THREE ASSESSMENT YEARS. IN THE RESULT GROUND NOS. 1 TO 3 OF ALL THE APPEALS FILED BY THE ASSESSEE ARE REJECTED. 156 & 345 OF 11 AND 335-RJT-2012 - SIYARAM METALS PVT LTD 5 5. LEVY OF INTEREST U/S 234A 234B AND 234C IS MAND ATORY; THEREFORE GROUND NO.4 OF THE ASSESSEES APPEAL FOR THE ASSESSMENT YE AR 2008-09 AND 2009-10 IS REJECTED. 6. NO APPEAL LIES AGAINST INITIATION OF PENALTY U/S 271(1)(C); THEREFORE GROUND NO.5 OF ASSESSEES APPEAL FOR THE ASSESSMENT YEAR 2 008-09 AND 2009-10 IS REJECTED. 7. IN THE RESULT ALL THE THREE APPEALS FILED BY TH E ASSESSEE ARE DISMISSED. THIS ORDER PRONOUNCED IN OPEN COURT ON THE DATE MEN TIONED HEREINABOVE. SD/- SD/- ( *.$. % D. K. SRIVASTAVA ) ( .$. -. / T. K. SHARMA) $( #/% / ACCOUNTANT MEMBER #/% /JUDICIAL MEMBER /$- 0/1/ ORDER DATE 04.10.2013 /RAJKOT *BT !'# $%'& / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT- SIYARAM METALS PVT LTD PLOT NO.12 & 14 NEGHEDI IND. ARIA JAMNAGAR 2. / RESPONDENT- THE ASST. COMMISSIONER OF INCOME-TAX CIRCLE-2 JAMNAGAR 3. #141 & 5 / CONCERNED CIT-JAMNAGAR 4. & 5 - / CIT (A)-JAMNAGAR 5. 9:; / DR ITAT RAJKOT 6. ;* => / GUARD FILE. /$- #$ / BY ORDER TRUE COPY PRIVATE SECRETARY ITAT RAJKOT