DCIT RG 12(2), MUMBAI v. RAJESH DASWANI, MUMBAI

ITA 3021/MUM/2010 | 2004-2005
Pronouncement Date: 30-03-2011 | Result: Allowed

Appeal Details

RSA Number 302119914 RSA 2010
Assessee PAN AADPD1676J
Bench Mumbai
Appeal Number ITA 3021/MUM/2010
Duration Of Justice 11 month(s) 13 day(s)
Appellant DCIT RG 12(2), MUMBAI
Respondent RAJESH DASWANI, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 30-03-2011
Appeal Filed By Department
Order Result Allowed
Bench Allotted D
Tribunal Order Date 30-03-2011
Assessment Year 2004-2005
Appeal Filed On 16-04-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH: MUMBAI BEFORE SHRI R.S. PADVEKAR JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH ACCOUNTANT MEMBER ITA NO.3021/MUM/2010 (ASSESSMENT YEAR: 2004-05) THE DCIT-12(2) ROOM NO.114 AAYAKAR BHAVAN M.K. ROAD MUMBAI -400 020 .REVENUE VS SHRI RAJESH DASWANI 6-1 INDUS COURT-A ROAD CHURCHGATE MUMBAI -400 020 .... ASSESSEE PAN: AADPD 1676 J REVENUE BY: SHRI LAL CHAND ASSESSEE BY: MS VIDHI VIKAM O R D E R PER R.S. PADVEKAR JM IN THIS APPEAL THE REVENUE HAS CHALLENGED THE IMPUG NED ORDER OF THE LD. CIT (A)-23 MUMBAI DATED 19.1.2010 FOR THE A.Y. 2004-05. THE REVENUE AS TAKEN THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW THE LD. CIT (A) BY FOLLOWING THE DECISION OF ITAT MUMBAI SPECIAL BENCH IN THE CASE OF M/S. TOPMAN EXPORTS VS ITO (OSD) 14(2) IN ITA NO.5769/MUM/2006 DATED 11.08.09 FAILED TO APPRECIATE THAT THE ASSESSEE WITH A TURNOVER OF MORE THAN ` ITA 3021/M/2010 SHRI RAJESH DASWANI 2 10.00 CRORES IS NOT ENTITLED FOR DEDUCTION U/S.80HH C IN RESPECT OF DEPB RECEIPTS. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW THE LD. CIT (A) FAILED TO APPRECIATE THAT THE DECIS ION OF ITAT MUMBAI SPECIAL BENCH IN THE CASE OF M/S. TOPMAN EXP ORTS VS. ITO (OSD) 14(2) IN ITA NO.5769/MUM/2006 DATED 11.08 .09 IS NOT ACCEPTED BY THE DEPARTMENT AND FURTHER APPEAL U /S.260A IS BEING FILED BY THE DEPARTMENT. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW THE LD. CIT (A) FAILED TO APPRECIATE THAT THE ENTI RE SALE PROCEEDS OF THE DEPB LICENSE CAN NOT BE TAKEN AS PR OFIT FOR THE COMPUTATION OF DEDUCTION U/S.80HHC IN THE CASE OF THE ASSESSEE WITH A TURNOVER OF MORE THAN ` 10.00 CRORES. 2. WE HAVE HEARD THE PARTIES. THE ASSESSEE IS A EX PORTER OF GARMENTS. THE ASSESSEE CLAIMED THE DEDUCTION U/S.80HHC AMOUNT ING TO ` 51 05 731/-. IT WAS NOTICED BY THE A.O. THAT FOR C LAIMING THE DEDUCTION THE ASSESSEE HAS CONSIDERED THE PROFIT ON THE DEPB LICENSE OF ` 93 42 142/- WHICH WAS CREDITED TO THE PROFIT AND LO SS ACCOUNT. IN VIEW OF THE A.O. AS THE ASSESSEES TURNOVER WAS EXCEEDING ` 10.00 CRORES HENCE THE PROFIT ON ACCOUNT OF ALL DEPB CREDIT CANNOT BE CONSIDERED FOR CLAIMING DEDUCTION U/S.80HHC. THE A.O. RESTRICTED THE DEDUCTION TO ` 23 03 082/-. THE ASSESSEE CARRIED THE ISSUE BEFORE THE LD. CIT (A) AND FOUND FAVOUR AS THE LD. CIT (A) FOLLOWING THE DECIS ION OF THE HONBLE SPECIAL BENCH MUMBAI IN THE CASE OF TOPMAN EXPORTS VS. ITO (OSD) 318 ITR 87 (AT)(SB) AND ALLOWED THE CLAIM. NOW THE REV ENUE IS IN APPEAL BEFORE US. 3. BOTH THE PARTIES AGREED THAT THE DECISION IN THE CASE OF TOPMAN EXPORTS (SUPRA) HAS BEEN REVERSED BY THE HONBLE HI GH COURT OF BOMBAY IN THE CASE OF KALPATRU COLOURS & CHEMICALS LTD. 32 8 ITR 451 IN WHICH ITA 3021/M/2010 SHRI RAJESH DASWANI 3 JURISDICTIONAL HIGH COURT HAS CONSIDERED THE TREATM ENT OF THE DEPB WHILE COMPUTING THE DEDUCTION U/S.80HHC. HENCE TH IS ISSUE NEEDS TO GO BACK TO THE A.O. FOR FRESH ADJUDICATION IN THE L IGHT OF THE PRINCIPLES LAID DOWN IN THE CASE OF KALPATRU COLOURS & CHEMICA LS LTD. (SUPRA). WE ACCORDINGLY WITH THE CONSENT OF BOTH THE PARTIES R ESTORE THE MATTER TO THE FILE OF THE A.O. FOR FRESH ADJUDICATION DE NOVO IN THE LIGHT OF THE PRINCIPLES LAID DOWN IN THE CASE OF KALPATRU COLOURS & CHEMICA LS LTD. (SUPRA). NEEDLESS TO SAY THE A.O. SHOULD GIVE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AS PER THE PRINCIPLES OF NATURAL JUSTICE. 4. IN THE RESULT REVENUES APPEAL IS ALLOWED FOR T HE STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 3 0TH MARCH 2011. SD/- SD/- ( B. RAMAKOTAIAH) ACCOUNTANT MEMBER ( R.S. PADVEKAR ) JUDICIAL MEMBER MUMBAI DATE: 30TH MARCH 2011 COPY TO:- 1) THE APPELLANT. 2) THE RESPONDENT. 3) THE CIT (A) 23 MUMBAI. 4) THE CITXII MUMBAI. 5) THE D.R. D BENCH MUMBAI. BY ORDER / / TRUE COPY / / ASSTT. REGISTRAR I.T.A.T. MUMBAI *CHAVAN ITA 3021/M/2010 SHRI RAJESH DASWANI 4 SR.N. EPISODE OF AN ORDER DATE INITIALS CONCERNED 1 DRAFT DICTATED ON 30.03.2011 SR.PS 2 DRAFT PLACED BEFORE AUTHOR 30.03.2011 SR.PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5 APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6 KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7 FILE SENT TO THE BENCH CLERK SR.PS/PS 8 DATE ON WHICH FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER