DCIT, CHENNAI v. M/s. ABI Showatech [India] Ltd., CHENNAI

ITA 246/CHNY/2011 | 2003-2004
Pronouncement Date: 18-11-2011 | Result: Dismissed

Appeal Details

RSA Number 24621714 RSA 2011
Assessee PAN AABCA8160B
Bench Chennai
Appeal Number ITA 246/CHNY/2011
Duration Of Justice 9 month(s) 3 day(s)
Appellant DCIT, CHENNAI
Respondent M/s. ABI Showatech [India] Ltd., CHENNAI
Appeal Type Income Tax Appeal
Pronouncement Date 18-11-2011
Appeal Filed By Department
Order Result Dismissed
Bench Allotted D
Tribunal Order Date 18-11-2011
Date Of Final Hearing 14-11-2011
Next Hearing Date 14-11-2011
Assessment Year 2003-2004
Appeal Filed On 14-02-2011
Judgment Text
N THE INCOME TAX APPELLATE TRIBUNAL BENCH D CHENNAI BEFORE SHRI N. S. SAINI ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN JUDICIAL MEMBER .. I.T.A. NO. 246/MDS/2011 ASSESSMENT YEAR : 2003-04 THE DEPUTY COMMISSIONER OF INCOME-TAX COMPANY CIRCLE-I(1) CHENNAI. V. M/S. ABI SHOWATECH (INDIA) LTD. NO 67 CHAMIERS ROAD CHENNAI-600028. [PAN : AABCA8160B) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI K.E.B. RENGARAJAN JR. STANDING COUNSEL RESPONDENT BY : SHRI K. SRINIVASAN CA DATE OF HEARING : 14-11-2011 DATE OF PRONOUNCEMENT : 18-11-2011 O R D E R PER GEORGE MATHAN JUDICIAL MEMBER : THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE LEARNED CIT(APPEALS)-III CHENNAI IN ITA NO. 799/09-10 DATE D 12-11-2010 FOR THE ASSESSMENT YEAR 2003-04. 2. SHRI K.E.B. RENGARAJAN JR. STANDING COUNSEL REPR ESENTED ON BEHALF OF THE REVENUE AND SHRI K. SRINIVASAN CA REPRESENTED ON B EHALF OF THE ASSESSEE. I.T.A. NO.246/MDS/2011 2 3. IN THE REVENUES APPEAL THE REVENUE HAS RAISED THE FOLLOWING GROUNDS : 1) THE ORDER OF THE LEARNED CIT(A) IS CONTRARY TO THE LAW AND FACTS OF THE CASE. 2) THE LEARNED CIT(A) HAS ERRED IN DIRECTING THE ASSESSING OFFICER TO SET OFF THE LOSSES OF THE 10B UNIT AGAINST THE PROFITS OF THE NON-10B UNIT. 2.1) IT IS SUBMITTED THAT IN THIS CASE THE ORDER U/S 143(3) WAS PASSED EXCLUDING THE LOSSES OF 10B UNIT FROM TH E TOTAL TURN OVER AND THE LD. CIT(A) VIDE ORDER DT. 20.9.2006 CO NFIRMED THE ORDER OF THE AO HOLDING THAT THE LOSSES FROM SUCH U NITS ARE REQUIRED TO BE CARRY FORWARD ONLY VERTICALLY TO BE SET OFF AGAINST THE PROFITS OF THE SAME UNIT. IN THE CONCLUDING PA RT OF THE ORDER THE LD. CIT(A) STATED THAT ONCE THE INCOME UNDER T HESE EXEMPTED UNITS DO NOT FORM PART OF THE TOTAL INCOME OF THE ASSESSEE AS A CONSEQUENCE THE LOSSES OF SUCH UNIT S CAN ALSO NOT BE CONSIDERED WHILE COMPUTING TOTAL INCOME OF OTHER UNITS OF THE ASSESSEE. 2.2) IT IS SUBMITTED THAT ON FURTHER APPEAL THE HON'BLE ITAT REMITTED BACK THE ISSUE TO THE FILE OF THE ASS ESSING OFFICER FOR FRESH CONSIDERATION IN THE LIGHT OF JUDGEMENTS BY THE HON. TRIBUNAL IN THE CASES OF BHARAT INDUSTRIES LTD. (20 05) TTJ (MUMBAI) (TM) 1166 AND MIND TREE CONSULTING (P) LTD . (2006) 102 TTJ (BANG) 691. 2.3) IT IS FURTHER SUBMITTED THAT THE HON. JURISD ICTIONAL TRIBUNAL DID NOT PRONOUNCE ANY JUDGEMENT ON THE ISS UE UNDER CONSIDERATION BUT ONLY DIRECTED THE ASSESSING OFFIC ER TO DECIDE THE ISSUE AFRESH IN THE LIGHT OF THE SAID DECISIONS. I.T.A. NO.246/MDS/2011 3 2.4) IT IS SUBMITTED THAT WHERE THE SAID DECISION OF THE HON'BLE TRIBUNALS HAVE NOT BEEN ACCEPTED BY THE REV ENUE AND FURTHER APPEAL HAVE BEEN PREFERRED THE AO WAS TO D ISALLOW THE CLAIMS. 3. FOR THESE AND OTHER GROUNDS THAT MAY BE ADDUCE D AT THE TIME OF HEARING IT IS PRAYED THAT THE ORDER OF THE LEARNED CIT(A) BE SET ASIDE AND THAT OF THE ASSESSING OFFIC ER BE RESTORED. 4. IT WAS SUBMITTED BY THE LEARNED DR THAT ORIGINAL LY THE ISSUE HAD BEEN RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR R E-ADJUDICATION OF THE ISSUE EXCLUDING THE LOSSES OF 10-B UNIT AGAINST THE PROFI TS OF THE NON-10B UNIT. IT WAS THE SUBMISSION THAT IN THE SET ASIDE PROCEEDINGS THE AS SESSING OFFICER HAD FOLLOWED HIS EARLIER ORDER AND ON APPEAL THE LEARNED CIT(A) BY F OLLOWING THE DECISION OF THE THIRD MEMBER DECISION IN THE CASE OF NAVIN BHARAT I NDUSTRIES LTD. V. DEPUTY COMMISSIONER OF INCOME-TAX(2005) 92 TTJ (MUMBAI)(TM ) 1166 AND MINDTREE CONSULTING (P) LTD. V. ASSISTANT COMMISSIONER OF IN COME-TAX (2006) 102 TTJ (BANG) 691 HAD HELD THE ISSUE IN FAVOUR OF THE ASSESSEE. IT WAS THE SUBMISSION THAT THE ORDERS OF THE TRIBUNAL WERE SUBJECT MATTER OF APPEA LS BEFORE THE HON'BLE HIGH COURT. IT WAS THE SUBMISSION THAT THE ORDER OF THE LEARNED CIT(A) WAS LIABLE TO BE REVERSED. 5. IN THE LEARNED AUTHORISED REPRESENTATIVE SUBMITT ED THAT OTHER THAN THE DECISION OF THE TRIBUNAL THE HON'BLE HIGH COURT OF BOMBAY IN THE CASE OF HINDUSTAN I.T.A. NO.246/MDS/2011 4 UNILEVER LTD. REPORTED IN 325 ITR 102 HAD ALSO DECI DED THE ISSUE IN FAVOUR OF THE ASSESSEE. HE VEHEMENTLY SUPPORTED THE ORDER OF THE LEARNED CIT(A). 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. AS I T IS NOTICED THAT THE ISSUE IN THE APPEAL IS NOW SQUARELY COVERED BY THE DECISION OF THE THIRD MEMBER IN THE CASE OF NAVIN BHARAT INDUSTRIES LTD. REFERRED TO SUPRA AS ALSO THE DECISION OF THE HON'BLE HIGH COURT OF BOMBAY IN THE CASE OF HINDUST AN UNILEVER LTD. REFERRED TO SUPRA THE FINDING OF THE LEARNED CIT(A) ON THIS IS SUE STANDS CONFIRMED. IN THE CIRCUMSTANCES THE APPEAL OF THE REVENUE STANDS DIS MISSED. 7. THE ORDER WAS PRONOUNCED IN THE COURT ON 18/11/2 011. SD/- SD/- (N. S. SAINI) (GEORGE MATHAN) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI DATED THE 18 TH NOVEMBER 2011. H. COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE