PUDUMJEE INDUSTRIES LTD, MUMBAI v. ACIT (osd)-2 city-2, MUMBAI

ITA 5566/MUM/2009 | 2006-2007
Pronouncement Date: 19-01-2011 | Result: Dismissed

Appeal Details

RSA Number 556619914 RSA 2009
Assessee PAN AAACP0487B
Bench Mumbai
Appeal Number ITA 5566/MUM/2009
Duration Of Justice 1 year(s) 3 month(s) 7 day(s)
Appellant PUDUMJEE INDUSTRIES LTD, MUMBAI
Respondent ACIT (osd)-2 city-2, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 19-01-2011
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 19-01-2011
Date Of Final Hearing 10-01-2011
Next Hearing Date 10-01-2011
Assessment Year 2006-2007
Appeal Filed On 12-10-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL 'C' BENCH MUMBAI BEFORE SHRI D.K. AGARWAL JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH ACCOUNTANT MEMBER ITA NO. 5566/MUM/2009 (ASSESSMENT YEAR: 2006-07) M/S. PUDUMJEE INDUSTRIES LTD. ACIT (OSD) 2 60 DR. V.B. GANDHI MARG MUMBAI MUMBAI VS. PAN - AAACP 0487 B APPELLANT RESPONDENT APPELLANT BY: SHRI C.A. GULANIKAR RESPONDENT BY: SHRI SURENDRA KUMAR O R D E R PER B. RAMAKOTAIAH A.M. THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORDER OF THE CIT(A)- II MUMBAI DATED 30.06.2009. ASSESSEE FILED THE APPEAL BELATEDLY BY 38 DAYS. IT WAS SUBMITTED THAT THE LAST DATE FOR FILING THE APP EAL WAS 4 TH SEPTEMBER 2009 AND TWO SETS OF APPEAL PAPERS WERE HANDED OVER TO THE OFFICE CLERK ON 21 ST AUGUST 2009 WITH INSTRUCTIONS TO FILE THE PAPERS I N THE OFFICE OF THE TRIBUNAL. HOWEVER BY MISTAKE THEY WERE DELIVERED I N THE OFFICE OF THE DEPARTMENTAL REPRESENTATIVE. WHEN THIS HAS BEEN NOT ICED THAT THE PAPERS WERE WRONGLY FILED IN DRS OFFICE AND ACKNOWLEDGEME NT HAS NOT COME THEY FOLLOWED IT UP AND NOTICED THAT THEY WERE WRONGLY F ILED AND THE PAPERS WERE RETRIEVED FROM THE OFFICE OF THE DR AND FILED IN TH E REGISTRY OF ITAT ON 12 TH OCTOBER 2009. IN SUPPORT THE ASSESSEE PLACED ON REC ORD THE ACKNOWLEDGEMENT GIVEN BY THE DRS OFFICE ON 21 ST AUGUST 2009. UNDER THESE CIRCUMSTANCES ASSESSEE PRAYED FOR CONDONATION OF DE LAY IN FILING THE APPEAL. AFTER CONSIDERING THE SUBMISSIONS OF THE LEARNED CO UNSEL FOR THE ASSESSEE AND LEARNED D.R. THE DELAY IN FILING THE APPEAL IS CONDONED. 2. ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: - A) DEDUCTION OF EXPORT PROFIT UNDER CLAUSE (IV) OF EXPLANATION TO SECTION 115JB RS.1 75 007/- ITA NO. 5566/MUM/2009 M/S. PUDUMJEE INDUSTRIES LTD. 2 I) IN REGARD TO DEDUCTION OF EXPORT PROFITS OF RS.1 75 02 007/- FOR THE PURPOSES OF AND WITHIN THE MEANING OF CLAUS E (IV) OF THE EXPLANATION TO SECTION 115JB(2) THE LEARNED CIT(A) ERRED IN REJECTING THE SUBMISSIONS & DECISIONS RELIED ON. HE SHOULD HA VE HELD OTHERWISE. II) HAVING REGARD TO JUDICIAL INTERPRETATION AND GL OSS PUT ON PART PROVISIONS OF OTHER SECTION BY REFERRAL INCORPORAT ION AND IN ABSENCE OF INSERTION OF SUBSECTION (1B) OF SECTION 80HHC I N CLAUSE (IV) OF EXPLANATION TO SECTION (2) OF SECTION 115JB THE LE ARNED CIT(A) ERRED IN IMPORTING THE SAID PROVISION IN HOLDING THAT: A) THE SUNSET SUB-SECTION (1B) OF SECTION 80 HHC IS CL EARLY INCORPORATED AS IS EVIDENT FROM THE PHRASEOLOGY TH E AMOUNT OF PROFITS ELIGIBLE FOR DEDUCTION UNDER SECT ION 80HHC; B) REFERRAL INCORPORATION HAS THE SAME INTENT EXPENSE AND LIMITATION AS OF FICTION; C) TO HOLD THAT DEDUCTION OF EXPORT PROFITS IS AVAILAB LE UNDER CLAUSE (IV) OF EXPLANATION TO SECTION 115JB WHEN IT IS COMPLETELY WITHDRAWN FROM THE ASSESSMENT YEAR 2005- 2006 IS AGAINST LEGISLATIVE INTENT. III) A) HAVING REGARD TO THE PLAIN LANGUAGE OF CLAU SE (IV) OF SECTION 115JB(2) AND IN ABSENCE OF REFERENCE TO SUB SECTION (1B) OF SECTION 80HHC THEREIN THE LEARNED CIT(A) SHOULD HA VE HELD THAT WHEN ASSESSMENT IS COMPLETED UNDER SECTION 115 JB OF THE ACT DEDUCTION OF EXPORT PROFITS WITH REFERENCE TO BOOK PROFITS IS STILL AVAILABLE EVEN AFTER ASSESSMENT YE AR COMMENCING FROM 1 ST APRIL 2005 AND THEREAFTER. B) SO HOLDING DISALLOWANCE OF EXPORT PROFITS WI TH REFERENCE TO BOOK PROFITS OF RS.1 75 02 007/- MAY BE DELETED. 3. AT THE OUTSET THE LEARNED COUNSEL SUBMITTED THAT TH E ISSUE IS TO BE HELD AGAINST HIM AS WAS DONE IN EARLIER ASSESSMENT YEAR BY THE ITAT IN ITA NO. 2766/MUM/2009. IN THE EARLIER YEAR THE ISSUE IS CONSIDERED AGAINST THE ASSESSEE AS UNDER: - 4. AFTER TAKING INTO CONSIDERATION THE SUBMISSIONS WE FIND THAT THE ISSUE HAS BEEN DECIDED BY THE HON'BLE BOMBAY HIGH C OURT IN THE CASE OF AJANTA PHARMA LTD. (SUPRA) AGAINST THE ASSE SSEE. 4.1 THE HON'BLE HIGH COURT AFTER DISCUSSING THE ISS UE IN DETAIL HAVE HELD THAT; .. IS IT POSSIBLE TO CONCEIVE ANY DEGREE OF FAIR NESS AND/OR JUSTICE THAT MAT COMPANIES WHO FOR SOME PERIODS WERE DENIE D THE BENEFIT OF SECTION 80HHC BECAUSE OF THE INTRODUCTION OF SECTI ON 115JB EXPLANATION 1(IV) ARE ENTITLED TO HAVE THEIR ENTIRE EXPORT PROFITS REDUCED. THE OBJECT OF SECTION 115JB OR FOR THAT MATTER SECT ION 115J OR 115 JA ITA NO. 5566/MUM/2009 M/S. PUDUMJEE INDUSTRIES LTD. 3 WAS TO IMPOST TAX ON THOSE COMPANIES WHICH OTHERWIS E CONSIDERING VARIOUS EXEMPTIONS OR DEDUCTIONS AVAILABLE UNDER TH E ACT THROUGH MAKING HUGE PROFIT AND PAYING LARGE DIVIDENDS WERE NOT PAYING ANY TAX. IT IS THEREFORE NOT POSSIBLE TO ACCEPT THE CONSTR UCTION AS SOUGHT TO BE ADVANCED ON BEHALF OF THE ASSESSEE THAT THEY SHOUL D BE TREATED ON A DIFFERENT FOOTING IN COMPUTING EXPORT PROFITS U/S 8 0HCC FOR THE PURPOSE OF SECTION 115JB. VARIOUS DECISIONS HAVE BEEN TAKEN BY THE HON'BLE HI GH COURT AND THEN DECIDED THE ISSUE AGAINST THE ASSESSEE. 4. THE LEARNED COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT EVENTHOUGH THE HON'BLE BOMBAY HIGH COURT DECISION WAS REVERSED BY THE HON'BLE SUPREME COURT IN THE CASE OF AJANTA PHARMA LTD. VS. CIT 327 ITR 305 THE SAME IS NOT APPLICABLE TO THE FACTS OF THE CASE. TH E ISSUE IS TO BE DECIDED AGAINST THE ASSESSEE. IN VIEW OF THE ABOVE SUBMISSI ON THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. 5. IN THE RESULT APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 19 TH JANUARY 2011. SD/- SD/- (D.K. AGARWAL) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI DATED: 19 TH JANUARY 2011 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) II MUMBAI 4. THE CIT II MUMBAI CITY 5. THE DR C BENCH ITAT MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT MUMBAI BENCHES MUMBAI N.P.