ACIT, New Delhi v. M/s CLC Corporation, New Delhi

ITA 4779/DEL/2009 | 2000-2001
Pronouncement Date: 30-09-2011 | Result: Allowed

Appeal Details

RSA Number 477920114 RSA 2009
Assessee PAN AAAFC6511G
Bench Delhi
Appeal Number ITA 4779/DEL/2009
Duration Of Justice 1 year(s) 9 month(s) 12 day(s)
Appellant ACIT, New Delhi
Respondent M/s CLC Corporation, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 30-09-2011
Appeal Filed By Department
Order Result Allowed
Bench Allotted B
Tribunal Order Date 30-09-2011
Date Of Final Hearing 23-09-2011
Next Hearing Date 23-09-2011
Assessment Year 2000-2001
Appeal Filed On 18-12-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL [ DELHI BENCH B DELHI ] BEFORE SHRI RAJPAL YADAV JM AND SHRI K. D. RANJAN AM I. T. A. NOS. 4779 & 4781 (DEL) OF 2009 ASSESSMENT YEARS : 2000-01 & 2002-03. ASSTT. COMMISSIONER OF INCOME-TAX M/S. C L C CORPORATION [THROUGH ITS C I R C L E : 22 (1) VS. SUCCESSOR M/S.SPENTE X INDUSTRIES LTD. ] N E W D E L H I. A 60 OKHLA I NDUSTRIAL AREA N E W D E L H I. P A N / G I R NO. AAA FC 6511 G. ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY : SHRI ROHIT GARG ADV.; DEPARTMENT BY : SHRI KRISHNA [CIT] D. R.; O R D E R. PER K. D. RANJAN : THESE APPEALS BY THE REVENUE FOR ASSESSMENT YEARS 2000-01 AND 2002-03 ARISES OUT OF THE ORDER OF THE LD. CIT (APPEALS)-XXIII NEW DE LHI. THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OF FOR THE SAKE OF CONVENIENCE BY THIS CONSOLIDATED ORDER. 2. THE ONLY ISSUE WHICH IS COMMON IN BOTH THE APPEA LS RELATES TO COMPUTATION OF DEDUCTION UNDER SECTION 80-HHC IN RESPECT OF DEPB R ECEIPTS AND UNDER THIRD PROVISO TO SECTION 80-HHC(3) OF THE INCOME TAX ACT 1961 [HERE INAFTER REFERRED TO AS THE ACT]. 2 I. T. A. NOS. 4779 & 4781 (DEL) OF 2009 3. THE GROUNDS OF APPEAL ARE REPRODUCED AS UNDER :- I. T. APPEAL NO. 4779 (DEL) OF 2009 : 1. ON THE FACTS AND ON THE CIRCUMSTANCES O F THE CASE THE LD. CIT (APPEALS) HAS ERRED IN LAW AND ON THE FACTS IN DIRECTING THE ASSESSING OFFICER TO RE-COMPUTED THE DEDUCTION UNDER SECTION 80-HHC AFTER INCLUDING THE PROCEEDS RECEIVED ON TRANSFER OF DEPB; 2. ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE THE LD. CIT (APPEALS) HAS ERRED IN LAW AND ON THE FACTS IN WRONGLY PRESUM ING THE FACT THAT THE ASSESSEE HAS FULFILLED BOTH THE CONDITIONS AS LAID DOWN IN T HE THIRD PROVISO UNDER SECTION 80-HHC(3) OF THE ACT. I. T. APPEAL NO. 4781 (DEL) OF 2009 : 1. ON THE FACTS AND ON THE CIRCUMSTANCES O F THE CASE THE LD. CIT (APPEALS) HAS ERRED IN LAW AND ON THE FACTS IN DIRECTING THE ASSESSING OFFICER TO RE-COMPUTE THE DEDUCTION UNDER SECTION 80-HHC AFTER INCLUDING THE PROCEEDS RECEIVED ON TRANSFER OF DEPB; 2. ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE THE LD. CIT (APPEALS) HAS ERRED IN LAW AND ON THE FACTS IN WRONGLY PRESUM ING THE FACT THAT THE ASSESSEE HAS FULFILLED BOTH THE CONDITIONS AS LAID DOWN IN T HE THIRD PROVISO UNDER SECTION 80-HHC(3) OF THE ACT. 4. IN THESE CASES ITAT DELHI BENCH PASSED ORDER ON 19 TH MARCH 2010 IN ITA. NOS. 4779 (DEL) OF 2009 AND 4781 (DEL) OF 2009 FOR ASSESSMENT YEARS 2000-01 AND 2002-03. THE TRIBUNAL RESTORED THE MATTER TO THE FILE OF THE ASSESSING OF FICER WITH THE DIRECTIONS TO COMPUTE DEDUCTION UNDER SECTION 80-HHC ON THE AMOUNT OF DEPB RECEIPTS AS PER THE DECISION OF THE SPECIAL BENCH IN THE CASE OF TOPMAN EXPORTS VS. INCOME-TAX OFFICE R 318 ITR [AT] 87 (SB) IN ITA. NO. 5769 (MUM.) OF 2006 DATED 11/08/2009. 5. THE ASSESSEE PREFERRED APPEALS BEFORE HONBLE DE LHI HIGH COURT. HONBLE DELHI HIGH COURT VIDE ORDER DATED 18 TH FEBRUARY 2011 SET ASIDE THE MATTER TO THE FILE OF THE TRIBUNAL WITH THE 3 I. T. A. NOS. 4779 & 4781 (DEL) OF 2009 DIRECTIONS TO DECIDE APPEALS ON MERITS AFTER TAKI NG INTO ACCOUNT THE FACTUAL POSITION IN THE CASE. HONBLE DELHI HIGH COURT HAS OBSERVED THAT ITAT DE LHI BENCH HAS SIMPLY FOLLOWED THE DECISION OF ITAT SPECIAL BENCH MUMBAI IN THE CASE OF TOPMAN EXPORTS VS. INCOME-TAX OFFICER (SUPRA). HONBLE BOMBAY HIGH COURT IN THE C ASE OF CIT VS KALPATARU COLOURS & CHEMICALS (2010) 192 TAXMAN 435 (BOM) HAS REVERSED THE DECISION OF SPECIAL BENCH. HONBLE DELHI HIGH COURT IN VIEW OF THESE FACTS HAS SET AS IDE THE MATTER TO THE FILE OF THE TRIBUNAL TO DECIDE THE APPEAL ON MERITS. 6. BEFORE US WHEN THE CASE CAME UP FOR HEARING THE LD. AR OF THE ASSESSEE SUBMITTED THAT THE MATTER MAY BE SET ASIDE TO THE FILE OF THE ASSE SSING OFFICER WITH THE DIRECTIONS TO DECIDE THE ISSUE IN THE LIGHT OF DECISION OF HONBLE BOMBAY HI GH COURT IN THE CASE OF CIT VS KALPATARU COLOURS & CHEMICALS (SUPRA). ON THE OTHER HAND TH E LD. SR. DR SUBMITTED THAT THERE IS NO NEED FOR SETTING ASIDE THE MATTER TO THE FILE OF THE ASS ESSING OFFICER. THE ISSUE MAY BE DECIDED BY THE TRIBUNAL IN THE LIGHT OF DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS KALPATARU COLOURS & CHEMICALS (SUPRA). 7. WE HAVE HEARD BOTH THE PARTIES. WE FIND THAT TH E ISSUE IS NOW COVERED BY THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS KALPATARU COLOURS & CHEMICALS (SUPRA). HONBLE BOMBAY HIGH COURT HAS HELD THAT TH E AMOUNT RECEIVED ON TRANSFER OF DEPB CREDIT INCLUDING FACE VALUE OF DEPB CREDIT WOU LD CONSTITUTE PROFIT OF BUSINESS UNDER SECTION 28(IIID) OF THE ACT. THEREFORE THE ENTIRE AMOUNT OF DEPB HAS TO BE EXCLUDED UNDER CLAUSE (BAA) OF EXPLANATION TO SECTION 80-HHC OF THE ACT. HONBLE BOMBAY HIGH COURT WHILE ARRIVING AT THE DECISION HAS OBSERVED T HAT WHEN SECTION 28(IIID) SPECIFICALLY DEALS WITH THE PROFITS REALIZED ON TRANSFER OF DEPB CREDI T IT WOULD BE IMPERMISSIBLE AS A MATTER OF FIRST PRINCIPLE TO BIFURCATE THE FACE VALUE OF T HE DEPB AND AMOUNT RECEIVED IN EXCESS OF FACE VALUE OF DEPB. SINCE THE ISSUE IS NOW COVERED BY T HE DECISION OF HONBLE BOMBAY IN THE CASE OF CIT VS KALPATARU COLOURS & CHEMICALS (SUPRA ) WE SET ASIDE THIS MATTER TO THE FILE FOR THE ASSESSING OFFICER WITH THE DIRECTIONS TO DE CIDE THE ISSUE RELATING TO EXCLUSION OF DEPB CREDITS INCLUDING PROFITS THEREON AS PER THE DECISI ON OF HONBLE BOMBAY HIGH COURT IN THE CASE 4 I. T. A. NOS. 4779 & 4781 (DEL) OF 2009 OF CIT VS KALPATARU COLOURS & CHEMICALS (SUPRA) AFT ER AFFORDING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD. 8. IN THE RESULT BOTH THE APPEALS FILED BY THE REV ENUE ARE ALLOWED FOR STATISTICAL PURPOSES. THE ORDER PRONOUNCED IN THE OPEN COURT ON : 30 TH SEPTEMBER 2011. SD/- SD/- [ RAJPAL YADAV ] [ K. D. RANJAN ] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : _30 TH SEPTEMBER 2011 . *MEHTA * COPY OF THE ORDER FORWARDED TO : - 1. APPELLANT. 2. RESPONDENT. 3. CIT 4. CIT (APPEALS) 5. DR ITAT NEW DELHI. TRUE COPY. BY ORDER. ASSISTANT REGISTRAR ITAT.