The DCIT, Circle-4,, Baroda v. M/s. Refoil Earth Pvt.Ltd.,, Baroda

ITA 1773/AHD/2009 | 2006-2007
Pronouncement Date: 30-08-2011 | Result: Dismissed

Appeal Details

RSA Number 177320514 RSA 2009
Bench Ahmedabad
Appeal Number ITA 1773/AHD/2009
Duration Of Justice 2 year(s) 3 month(s) 2 day(s)
Appellant The DCIT, Circle-4,, Baroda
Respondent M/s. Refoil Earth Pvt.Ltd.,, Baroda
Appeal Type Income Tax Appeal
Pronouncement Date 30-08-2011
Appeal Filed By Department
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 30-08-2011
Date Of Final Hearing 29-08-2011
Next Hearing Date 29-08-2011
Assessment Year 2006-2007
Appeal Filed On 28-05-2009
Judgment Text
- 1 - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH B AHMEDABAD BEFORE S/SHRI G. D. AGRAWAL V.P. AND D.K. TYAGI J M DY. CIT CIR-4 BARODA. M/S REFOIL EARTH (P) LTD. 23 AMARDEEP APARTMENT PASHABHAI PARK GOTRI ROAD BARODA. APPELLANT VS. RESPONDENT APPELLANT BY :- SHRI SAMIR TEKRIWAL SR.DR RESPONDENT BY:- SHRI SUNIL H. TALATI AR O R D E R DATE OF HEARING 29/8/2011 DATE OF PRONOUNCEMENT -30.8.2011. PER D.K. TYAGI JUDICIAL MEMBER . THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF LD. CIT(A)-III BARODA. THE REVENUE HAS RAISED FOLLOWIN G GROUNDS IN THIS APPEAL :- (1) THE LD. CIT(A) ERRED IN LAW AND ON FACTS IN TREATIN G THE PRODUCTION OF FULLERS EARTH AS MANUFACTURE AND T HEREBY ALLOWING DEDUCTION U/S 80IB OF THE I.T. ACT 1961 D ESPITE THE FACT THAT IT IS PROCESSING FOR REMOVAL OF IMPURITIE S AND CONTAMINATION FROM THE BASIC RAW MATERIAL FULLERS EARTH BY WASHING AND DRYING BY USING ACID AND THERE IS HARDL Y ANY DIFFERENCE BETWEEN THE INPUT AND OUTPUT AND AS SUCH IT DOES NOT AMOUNT TO MANUFACTURE OF PRODUCTION OF AN ARTICLE O R A THING AS ITA NO.1773/AHD/2009 ASST. YEAR 2006-07 ITA NO.1773/AHD/2009 ASST. YEAR 2006-07 2 CONTEMPLATED FOR ALLOWING BENEFIT OF DEDUCTION U/S 80IB OF THE IT ACT 1961. (2) MOREOVER THE LD. CIT(A) HAS ALSO IGNORED SECTION 80 IB(3)(IV) READ WITH SECTION 11B OF INDUSTRIAL (DEVELOPMENT & REGULATION) ACT 1951 AS AMENDED VIDE S O 857(E) DA TED 10.12.99 AND SINCE THE COST OF MACHINERY IS MORE T HAN 1 CRORE (1 29 11 343/-) THE ASSESSEE IS NOT A SSI UNIT. 2. DURING THE ASSESSMENT PROCEEDINGS THE AO OBSERVE D THAT ASSESSEE HAD CLAIMED DEDUCTION U/S 80IB AMOUNTING TO RS.24 4 0 615. HE FURTHER FOUND THAT IN THE PRECEDING YEAR THE ASSESSEES CLA IM FOR DEDUCTION U/S 80IB WAS DISALLOWED. BEFORE HIM THE ASSESSEE REITER ATED THE SAME ARGUMENTS AS ADVANCED IN THE PRECEDING YEAR. OBSERV ING THAT THE FACTS AND CIRCUMSTANCES OF THE CASE REMAINED THE SAME AS IN P REVIOUS YEAR THE CLAIM OF DEDUCTION WAS DISALLOWED BY THE AO FOR THE REASO NS RECORDED BY HIM IN THE EARLIER YEAR. 3. BEFORE LD. CIT(A) IT WAS CONTENDED BY THE ASSESS EE THAT IDENTICAL HAS BEEN THE SUBJECT MATTER OF THE APPEAL IN EARLIE R YEARS ALSO AND IN ALL THESE YEARS THE ISSUE WAS DECIDED IN FAVOUR OF THE ASSESSEE. IT WAS THEREFORE PRAYED THAT THE EARLIER DECISION MAY BE FOLLOWED IN THIS YEAR. THE LD. CIT(A) OBSERVED THAT IDENTICAL ISSUE WAS CO NSIDERED BY HIS PREDECESSOR IN APPEAL FOR ASST. YEAR 2005-06 AND EA RLIER YEARS. SINCE THE ISSUE HAS BEEN CONSISTENTLY DECIDED IN FAVOUR OF TH E ASSESSEE IN ALL THESE YEARS FOLLOWING THE RATIONALE OF THE APPELLATE ORD ERS OF EARLIER YEARS HE ALSO HELD THAT THE AO WAS NOT JUSTIFIED IN DENYING THE DEDUCTION U/S 80IB. 4. BEFORE US THE LD. COUNSEL OF THE ASSESSEE AT TH E OUTSET SUBMITTED THAT IDENTICAL ISSUE WAS CONSIDERED AND DECIDED IN ASSESSEES OWN CASE FOR ASST. YEAR 2001-02 TO 2005-06 AND THE REVENUES APP EALS HAVE BEEN ITA NO.1773/AHD/2009 ASST. YEAR 2006-07 3 DISMISSED. COPY OF THE ORDER FOR ASST. YEAR 2005-06 HAS BEEN PLACED ON RECORD. 5. WE FIND THAT IN ASST. YEAR 2005-06 IN ASSESSEES OWN CASE THE TRIBUNAL VIDE ITS ORDER DATED 13.08.2010 IN ITA NO. 1617/AHD/2008 HAD OBSERVED AS UNDER :- 4. ON CONSIDERATION OF THE ABOVE FACTS WE ARE OF THE VIEW THAT THE LD. CIT(A) HAS FOLLOWED HIS EARLIER ORDER DATED 7.2.200 7 FOR EARLIER ASSESSMENT YEARS 2000-01 TO 2004-05 WHEREBY DEDUCTI ON U/S 80IB OF THE IT ACT HAS BEEN ALLOWED TO THE ASSESSEE. THE ORDER OF THE LD. CIT(A) DATED 7.2.2007 ABOVE WAS CHALLENGED BY THE REVENUE IN AP PEAL BEFORE THE TRIBUNAL IN ITA NO. 2008/AHD/2007 TO 2012/AHD/2007 AND THE DEPARTMENTAL APPEALS HAVE BEEN DISMISSED VIDE ORDER DATED 12.02.2010 BY THE TRIBUNAL. THE OPERATIVE PORTION OF THE ORDER OF THE TRIBUNAL HELD AS UNDER :- IN THE CASE OF THE ASSESSEE ALSO END PRODUCE ATTR ACTS EXCISE DUTY AND AS STATED THE END PRODUCT IS HAVING DIFFERENT CHARACTE R AND USE AND HENCE ENTITLED TO DEDUCTION U/S 80IB AS THE ASSESSEE IS ENGAGED IN MANUFACTURING OR PRODUCTION OF DIFFERENT PRODUCT. BY FOLLOWING THE SAME ORDER WE DISMISS THE DEPARTM ENTAL APPEAL. IN VIEW OF THE ABOVE WE UPHOLD THE ORDER OF LD. CI T(A) AND DISMISS THIS GROUND OF THE REVENUE. 6. COMING TO GROUND NO.2 WE FIND THAT THIS DOES NOT ARISE FROM THE ORDERS OF THE LOWER AUTHORITIES. WHEN THIS FACT WAS POINTED OUT TO THE LD. DR IT WAS SUBMITTED THAT THIS GROUND MAY BE TREATED AS ADDITIONAL GROUND. SINCE A LEGAL GROUND CAN BE TAKEN AT ANY STAGE IN V IEW OF THE DECISION OF APEX COURT IN THE CASE OF NATIONAL THERMAL POWER CORPORATION LTD. V. ITA NO.1773/AHD/2009 ASST. YEAR 2006-07 4 CIT (1998) 229 ITR 383 (SC) THIS MAY KINDLY BE ADMITTED AND ADJUDICATED. 7. THE LD. COUNSEL OF THE ASSESSEE ON THE OTHER HAN D VEHEMENTLY OPPOSED THIS SUBMISSION OF THE LD. DR BY SAYING THA T THIS GROUND HAS BEEN TAKEN ON THE BASIS OF THE FACT THAT SINCE THE COST OF MACHINERY OF THE ASSESSEE WAS MORE THAN RS.1 CRORE (RS.1 29 11 343/- ) THE UNIT OF THE ASSESSEE WAS NOT A SSI. FROM WHERE THE REVENUE HAS TAKEN THE FIGURE OF RS.1 29 11 343/- IS NOT CLEAR AS NOWHERE IN THE ASS ESSMENT ORDER OR IN THE ORDER OF LD. CIT(A) THERE IS ANY MENTION OF THIS FI GURE. 8. SINCE NO SATISFACTORY REPLY WAS GIVEN BY THE LD. DR IN THIS RESPECT WE ARE NOT INCLINED TO ADMIT THIS GROUND RAISED BY THE REVENUE AS IT DOES NOT ARISE FROM THE ORDERS OF THE LOWER AUTHORITIES AND THE FACTS RELATING TO THIS GROUND ARE NOT AVAILABLE ON RECORD. SO THIS GR OUND OF REVENUE IS ALSO DISMISSED. 9. IN THE RESULT THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER WAS PRONOUNCED IN OPEN COURT ON 30.8.2011. SD/- SD/- (G. D. AGRAWAL) (D.K. TYAGI) VICE PRESIDENT JUDICIAL MEMBER AHMEDABAD DATED : 30.8.2011. MAHATA/- ITA NO.1773/AHD/2009 ASST. YEAR 2006-07 5 COPY OF THE ORDER FORWARDED TO :- 1. THE ASSESSEE. 2. THE REVENUE. 3. THE CIT(APPEALS)- 4. THE CIT CONCERNS. 5. THE DR ITAT AHMEDABAD 6. GUARD FILE. BY ORDER DEPUTY / ASSTT.REGISTRAR ITAT AHMEDABAD 1.DATE OF DICTATION 29/8/11. 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E DICTATING MEMBER 29/8/11. /OTHER MEMBER. 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S. 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT.. 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR .P.S./P.S 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK .. 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER..