The ITO, Ward-1(2),, RAJKOT-GUJARAT v. Udyog Bharti,, GONDAL

ITA 387/RJT/2014 | 2008-2009
Pronouncement Date: 20-10-2016 | Result: Allowed

Appeal Details

RSA Number 38724914 RSA 2014
Bench Rajkot
Appeal Number ITA 387/RJT/2014
Duration Of Justice 2 year(s) 4 month(s) 7 day(s)
Appellant The ITO, Ward-1(2),, RAJKOT-GUJARAT
Respondent Udyog Bharti,, GONDAL
Appeal Type Income Tax Appeal
Pronouncement Date 20-10-2016
Appeal Filed By Department
Order Result Allowed
Bench Allotted DB
Tribunal Order Date 20-10-2016
Date Of Final Hearing 19-10-2016
Next Hearing Date 19-10-2016
Assessment Year 2008-2009
Appeal Filed On 13-06-2014
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT [CONDUCTED THROUGH E COURT AT AHMEDABAD] BEFORE SHRI RAJPAL YADAV JUDICIAL MEMBER AND SHRI AMARJIT SINGH ACCOUNTANT MEMBER ./ ITA.NO.387 AND 388/RJT/2014 / ASSTT. YEAR: 2008-2009 AND 2009-10 ITO WARD - 1(2) RAJKOT. VS UDYOG BHARTI NR. CHORDI DARWAJA GONDAL DIST. RAJKOT GUJARAT. ! / (APPELLANT) '# ! / (RESPONDENT) REVENUE BY : SHRI ARVIND N. SONTAKKE SR.DR ASSESSEE BY : SHRI D.M. RINDANI AR / DATE OF HEARING : 19/10/2016 / DATE OF PRONOUNCEMENT: 20/10/2016 $%/ O R D E R PER RAJPAL YADAV JUDICIAL MEMBER: PRESENT TWO APPEALS ARE DIRECTED AT THE INSTANCE OF THE REVENUE AGAINST SEPARATE ORDERS OF THE LD.CIT(A) DATED 26.3.2014 PA SSED FOR THE ASSTT.YEARS 2008-09 AND 2009-10. 2. GROUNDS OF APPEAL TAKEN BY THE REVENUE READ AS U NDER: ASSTT.YEAR 2008-09 1. THE LEARNED CIT(A)-JAMNAGAR HAS ERRED IN LAW AND ON FADS IN DELETING THE INTEREST RECEIVED ON INVESTMENT OF SUR PLUS FUND IN BANK FIXED DEPOSIT AND BOND OF RS. 30 01 372/- 2. THE LEARNED CIT(A) OUGHT TO HAVE UPHELD THE ORDER O F THE ASSESSING OFFICER. ITA NO.387/RJT/2014 2 IT IS THEREFORE PRAYED THAT THE FINDINGS GIVEN IN THE ORDER OF THE LD. CIT(A) MAY BE DISMISSED/DELETED AND THAT OF THE ASS ESSING OFFICER BE RESTORED. ASSTT.YEAR 2009-10 1. THE LEARNED CIT(A)-JAMNAGAR HAS ERRED IN LAW AND ON FADS IN DELETING THE INTEREST RECEIVED ON INVESTMENT OF SUR PLUS FUND IN BANK FIXED DEPOSIT AND BOND OF RS.43 17 187/- 2. THE LEARNED CIT(A) OUGHT TO HAVE UPHELD THE ORDER O F THE ASSESSING OFFICER. IT IS THEREFORE PRAYED THAT THE FINDINGS GIVEN IN THE ORDER OF THE LD. CIT(A) MAY BE DISMISSED/DELETED AND THAT OF THE ASS ESSING OFFICER BE RESTORED. 3. WITH THE ASSISTANCE OF THE LD.REPRESENTATIVES W E HAVE GONE THROUGH THE RECORD CAREFULLY. IT EMERGES OUT FROM THE RECORD T HAT AGAINST THE ASSESSMENT ORDERS DATED 14.12.2010 AND 31.10.2010 PASSED IN TH E ASSTT.YEARS 2008-09 AND 2009-10 APPEALS WERE FILED BEFORE THE LD.CIT(A) WHICH WERE ADJUDICATED BY THE LD.CIT(A) VIDE ORDERS DATED 29.6.2011 AND 30 .8.2012 IN THE ASSTT.YEARS 2008-09 AND 2009-10 RESPECTIVELY. DISS ATISFIED WITH ORDERS OF THE LD.CIT(A) REVENUE WENT IN APPEAL BEFORE THE TRIBUN AL VIDE ITA NO.350/RJT/2011 AND 569/RJT/2012. THE ASSESSEE HAS FILED CROSS OBJECTIONS BEARING NO.58/RJT/2011 AND 42/RJT/2012 IN THE ASSTT .YEARS 2008-09 AND 2009- 10 RESPECTIVELY. THESE APPEALS AND COS. HAVE BEEN DECIDED BY THE TRIBUNAL VIDE ORDER DATED 27.4.2012 AND 24.1.2013. THE ASSE SSEE AT THE TIME OF FIRST ROUND OF APPELLATE PROCEEDINGS BEFORE THE TRIBUNAL HAS FILED A DECLARATION IN FORM NO.8 UNDER SECTION 158A(1) OF THE INCOME TAX A CT 1961 R.W.R.16 OF THE INCOME TAX RULES 1962. ACCORDING TO THE UNDERTAKI NG IT WAS PLEADED BY THE ASSESSEE THAT SINCE IDENTICAL ISSUE IS INVOLVED IN EARLIER YEARS I.E. THE ASST.YEARS 2004-05 AND 2006-07 THE TRIBUNAL HAS DE CIDED THE ISSUE IN FAVOUR ITA NO.387/RJT/2014 3 OF THE ASSESSEE AND THE DISPUTE IS PENDING BEFORE T HE HONBLE HIGH COURT. ORDERS OF THESE ASSESSMENT YEARS CAN BE FOLLOWED IN THE PRESENT YEARS. 4. BASICALLY THE ASSESSEE HAS CLAIMED EXEMPTION UN DER SECTION 10(23B) OF THE INCOME TAX ACT. THIS CLAIM OF THE ASSESSEE IS FOR THE ASSTT.YAR 2004-05 AND 2006-07. CONSIDERING THE STAND OF THE ASSESSEE IN DECLARATION SUBMITTED IN FORM NO.8 UNDER SECTION 158A(1) OF THE ACT THE TRIBUNAL HAS DISMISSED THE APPEAL OF THE REVENUE. HOWEVER IN THE COS. TH E ASSESSEE HAS PLEADED THAT IT IS ENJOYING REGISTRATION UNDER SECTION 12AA AND IT HAS RAISED ALTERNATE PLEA BEFORE THE LD.CIT(A) THAT ITS INCOME DESERVES TO BE COMPUTED AS PER SECTION 11 OF THE INCOME TAX ACT. THIS ALTERNATE P LEA HAS NOT BEEN ADJUDICATED BY THE LD.CIT(A) IN BOTH THE YEARS. TH E TRIBUNAL ACCEPTED THIS CONTENTION OF THE ASSESSEE AND REMITTED THIS ISSUE TO THE FILE OF THE CIT(A) FOR ADJUDICATION. BY WAY OF THESE IMPUGNED ORDERS THE LD.CIT(A) HAS ADJUDICATED THE ISSUE RAISED IN THE COS. IF WE SEE THE GROUNDS OF APPEAL RAISED BY THE REVENUE IN THIS BACKGROUND THEN THESE GROU NDS ARE NOT EMERGING OUT FROM THIS PROCEEDING. THEY ARE RELATED TO MAIN GRO UND. NEVERTHELESS WE ARE CALLED UPON TO ADJUDICATE WHETHER LD.CIT(A) HAS ERR ED IN OBSERVING THAT INCOME OF THE ASSESSEE DESERVES TO BE COMPUTED FOR GIVING BENEFIT OF SECTION 11 OF THE INCOME TAX ACT OR NOT. A PERUSAL OF THE ASSESSMENT ORDER IN THE ASSTT.YEAR 2008-09 WOULD INDICATE THAT THOUGH THE A SSESSEE HAS NOT CLAIMED COMPUTATION OF ITS INCOME BY GIVING BENEFIT OF SECT ION 11 BECAUSE ASSESSEE HAS BEEN HARPING UPON THE EXEMPTION AVAILABLE UNDER SECTION 10(23B) OF THE INCOME TAX ACT. HOWEVER THE ASSESSEE HAS POINTED OUT TO THE AO THAT IT IS ENJOYING THE BENEFIT OF SECTION 12AA. CONSIDERING THIS FACT WE ARE OF THE OPINION THAT IT IS THE DUTY OF THE AO TO COMPUTE TR UE INCOME OF THE ASSESSEE ON WHICH TAXES CAN BE LEVIED LEGITIMATELY. THIS ALTER NATE PLEA IS BEING RAISED FOR THE REASON THAT IN CASE EXEMPTION UNDER SECTION 10( 23B) IS NOT ADMISSIBLE TO ITA NO.387/RJT/2014 4 THE ASSESSEE THEN ITS INCOME OUGHT TO BE COMPUTED BY TAKING COGNIZANCE OF THE FACT THAT 12A REGISTRATION IS AVAILABLE TO THE ASSESSEE AND IT IS ENTITLED TO THE BENEFIT OF SECTION 11. WE FIND THAT ON THIS AS PECT THOUGH THE LD.CIT(A) HAS ALLOWED THE APPEAL OF THE ASSESSEE BUT THERE I S NO INQUIRY AT THE END OF THE AO. IN PRINCIPLE WE CONCUR WITH THE LD.FIRST APPE LLATE AUTHORITY BUT WE SET ASIDE BOTH THE ORDERS AND RESTORE THIS ISSUE TO THE FILE OF THE AO. WE DIRECT THE LD.AO TO CONSIDER THIS ASPECT AFTER RECEIVING ORDER OF THE HONBLE HIGH COURT ON THE APPEALS OF THE REVENUE FOR THE ASSTT.YEAR 20 04-05 AND 2006-07 WHOSE EFFECT HAS TO BE GIVEN IN THESE YEARS ALSO BY VIRT UE OF SUBMISSIONS MADE BY THE ASSESSEE IN FORM NO.8 UNDER SECTION 158A(1) OF THE ACT. IN CASE THE DECISION OF THE HONBLE HIGH COURT GOES AGAINST THE ASSESSEE THEN THE LD.AO SHALL RE-DETERMINE THE TAXABLE INCOME OF THE ASSESS EE AFTER EXAMINING VARIOUS CLAIMS AND CONDITIONS ENUMERATED UNDER SECTION 11 O F THE INCOME TAX ACT 1961. IN OTHER WORDS HE WILL RE-COMPUTE THE INCOM E OF THE ASSESSEE IN ACCORDANCE WITH LAW AFTER GIVING BENEFIT OF SECTION 11 OF THE INCOME TAX ACT BECAUSE IT IS ENJOYING THE REGISTRATION UNDER SECTI ON 12AA OF THE ACT. THIS PROCEDURE IS TO BE FOLLOWED IN BOTH THE YEARS. FOR STATISTICAL APPEALS OF THE REVENUE ARE ALLOWED. 5. IN THE RESULT APPEALS OF THE REVENUE ARE ALLOWE D FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE COURT ON 20 TH OCTOBER 2016 AT AHMEDABAD. SD/- SD/- (AMARJIT SINGH) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 20/10/2016