ACIT,, Patiala v. M/s Paitala Co-op Sugar Mills Limited,, Patiala

ITA 219/CHANDI/2010 | 2006-2007
Pronouncement Date: 15-07-2011 | Result: Dismissed

Appeal Details

RSA Number 21921514 RSA 2010
Assessee PAN AAAAT3399J
Bench Chandigarh
Appeal Number ITA 219/CHANDI/2010
Duration Of Justice 1 year(s) 4 month(s) 19 day(s)
Appellant ACIT,, Patiala
Respondent M/s Paitala Co-op Sugar Mills Limited,, Patiala
Appeal Type Income Tax Appeal
Pronouncement Date 15-07-2011
Appeal Filed By Department
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 15-07-2011
Date Of Final Hearing 29-06-2011
Next Hearing Date 29-06-2011
Assessment Year 2006-2007
Appeal Filed On 25-02-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES B CHANDIGARH BEFORE SHRI D.K.SRIVASTAVA ACCOUNTANT MEMBER AND MS SUSHMA CHOWLA JUDICIAL MEMBER ITA NO. 219/CHD/2010 ASSESSMENT YEAR: 2006-07 THE ACIT CIRCLE VS. M/S PATIALA COOP SUGAR MILL S PATIALA RAKHRA PATIALA PAN NO. AAAAT3399J (APPELLANT) (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY: SHRI N.K.SAINI ORDER PER SUSHMA CHOWLA JM THE APPEAL BY THE REVENUE IS AGAINST THE ORDER OF CIT(A) PATIALA DATED 28.1.2010 RELATING TO ASSESSMENT YEAR 2006-07 AGAINST THE ORDER PASSED UNDER SECTION 143(3) OF THE I.T. ACT 1961. 2. THE REVENUE HAS RAISED THE FOLLOWING EFFECTIVE G ROUNDS OF APPEAL:- 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE CIT(A) HAS ERRED IN DIRECTING THE ASSESSING OFFICER TO ALLOW THE ELECTRICITY AND POWER EXPENSES REQUIRED FOR MAINTENANCE OF INFRASTRUCTURE EVEN WHEN THE ASSESSEE HAD NOT CARRIED OUT ANY MANUFACTURING ACTIVITY DURING THE YEAR UNDER CONSIDERATION AND HENCE THE EXPENSES SO CLAIMED HAD NOT BEEN INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSES OF BUSINESS. 2. IN THE FACTS AND CIRCUMSTANCES THE CIT(A) HAS ERRED IN DIRECTING THE ASSESSING OFFICER TO ALLOW T HE 2 ELECTRICITY AND POWER EXPENSES REQUIRED FOR MAINTENANCE OF INFRASTRUCTURE WITHOUT APPRECIATING THAT THE ASSESSING OFFICER HAD ALREADY ALLOWED 25% OF THE EXPENSES SO CLAIMED FOR RUNNING OF THE OFFIC E. 3. THE ONLY ISSUE RAISED IN THE PRESENT APPEAL IS A GAINST THE DIRECTION OF CIT(A) IN ALLOWING THE ELECTRICITY AND POWER EXP ENSES. DESPITE SERVICE OF NOTICE NONE APPEARED ON BEHALF OF THE ASSESSEE AND WE PROCEED TO DISPOSE OF THE APPEAL AFTER HEARING THE LD. DR AS T HE ISSUE STANDS COVERED BY THE ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE RELATING TO ASSESSMENT YEAR 2005-06. 4. THE BRIEF FACTS RELATING TO THE ISSUE ARE THAT A SSESSEE DERIVES INCOME FROM MANUFACTURING AND SELLING OF SUGAR AND OTHER B Y-PRODUCTS. DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE HAD CLAI MED ELECTRICITY AND POWER EXPENSES OF RS. 23 28 867/-. DURING THE COUR SE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTED THAT DURIN G THE YEAR THE ASSESSEE HAD NOT CARRIED OUT ANY MANUFACTURING ACTI VITY DUE TO ADMINISTRATIVE REASONS. IN LIEU THEREOF THE ASSE SSING OFFICER DISALLOWED 75% OF THE EXPENDITURE BOOKED UNDER THE HEAD ELECTR ICITY AND POWER EXPENSES. THE CIT(A) NOTED THE CONTENTION OF THE A SSESSEE THAT THOUGH THERE WAS NO MANUFACTURING ACTIVITY DURING THE YEAR BUT THE ELECTRICITY WAS USED FOR THE PURPOSES OTHER THAN MANUFACTURING I.E. SALE OF SUGAR RUNNING OF ADMINISTRATIVE OFFICE SUPPLY TO EMPLOYEES COLON Y ETC. THE ASSESSEES CONTENTION WAS THAT IT HAD CLAIMED THE MINIMUM CHAR GES PAYABLE TO THE ELECTRICITY DEPARTMENT. THE CIT(A) ALSO NOTED THAT SIMILAR ISSUE WAS DECIDED IN ASSESSEES OWN CASE RELATING TO ASSESSME NT YEAR 2005-06 VIDE ORDER DATED 29.6.2009 IN ITA NO.. 712/CHD/2008. 3 5. THE LD. DR FOR THE REVENUE HAS FAILED TO BRING O N RECORD ANY CONTRARY FINDINGS TO THE ORDER OF THE CIT(A). 6. IN THE ABSENCE OF THE SAME AND ALSO IN VIEW OF T HE SIMILAR ISSUE BEING DECIDED BY THE TRIBUNAL (SUPRA) IN ASSESSEES OWN CASE RELATING TO ASSESSMENT YEAR 2005-06 WE UPHOLD THE ORDER OF CIT (A) IN ALLOWING THE CLAIM OF THE ASSESSEE ON ACCOUNT OF POWER EXPENSES IN ENTIRETY. THE GROUNDS OF APPEAL RAISED BY THE REVENUE ARE THUS DI SMISSED. 7. IN THE RESULT APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 15H DA Y OF JULY 2011. SD/- SD/- (D.K.SRIVASTAVA) (SUSHMA CHOWLA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 15 TH JULY 2011 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT CHANDIGARH