TIME TECHNOLOGIES LTD, MUMBAI v. ADDL CIT RG 8(3), MUMBAI

ITA 91/MUM/2010 | 2006-2007
Pronouncement Date: 15-09-2010 | Result: Dismissed

Appeal Details

RSA Number 9119914 RSA 2010
Assessee PAN AAACT2783J
Bench Mumbai
Appeal Number ITA 91/MUM/2010
Duration Of Justice 8 month(s) 9 day(s)
Appellant TIME TECHNOLOGIES LTD, MUMBAI
Respondent ADDL CIT RG 8(3), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 15-09-2010
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted E
Tribunal Order Date 15-09-2010
Assessment Year 2006-2007
Appeal Filed On 06-01-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E MUMBAI BEFORE SHRI. N.V. VASUDEVAN (J.M.) AND SHRI. R.K. P ANDA (A.M.) ITA NO.91/MUM/2010 ASSESSMENT YEAR : 2006-2007 TIME TECHNOPLAST LTD. 102 TODI COMPLEX 35 SAKI VIHAR RD. ANDHERI (E) MUMBAI 400 072. PAN : AAACT2783J VS. ADDL. COMM. OF INCOME-TAX RANGE 8(3) MUMBAI (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI. RAKESH JOSHI. RESPONDENT BY : SHRI. HEMANT LAL. O R D E R PER R.K. PANDA A.M. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 17.11.2009 OF THE CIT(A)-XVIII MUMBAI RELATING TO ASSESSMENT YEAR 2006- 2007. 2. GROUND OF APPEAL NO.1 BY THE ASSESSEE READS AS U NDER: ON THE FACT AND CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF ASSESSING OFFICER IN DISALLOWING THE CLAIM OF DEPRECIATION OF ` .1 84 25 448/- WITHOUT CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE. 3 AFTER HEARING BOTH THE SIDES WE FIND THAT THE AS SESSEE IS ENGAGED IN THE BUSINESS OF MANUFACTURING OF PLASTIC DRUMS. T HE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAS NOT CLAIMED DEPRECIAT ION ON UNITS AT BADDI-I AND DAMAN-II WHICH WERE ELIGIBLE FOR DEDUCTION U/S. 80IB. HE NOTED THAT THE DEPRECIATION WAS NOT CLAIMED WITH THE INTENTION TO MAXIMIZE DEDUCTION U/S.80IB IN EARLIER YEARS AND CLAIM DEPRECIATION IN LATER YEARS. HE ACCORDINGLY RECALCULATED THE DEPRECIATION FOR THE IMPUGNED ASSESSMENT YEAR AT ` .11 28 56 520/- AS AGAINST ` .13 12 81 968/- CLAIMED BY THE ASSESSEE. HE ACCORDINGLY DISALLOWED AN AMOUNT OF ` .1 84 25 448/-. ITA NO.91/MUM/2010 A.Y.: 2006-2007 2 4. IN APPEAL THE LEARNED CIT(A) FOLLOWING THE DECI SION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF PLASTIBLEN DS INDIA LTD. V. CIT REPORTED IN 318 ITR 352 CONFIRMED THE ACTION OF THE ASSESSING OFFICER. AGGRIEVED BY SUCH ORDER OF THE CIT(A) THE ASSESSEE IS IN APPEAL HERE BEFORE US. 5. THE LEARNED COUNSEL FOR THE ASSESSEE AT THE OUT SET SUBMITTED THAT THE ISSUE IS DECIDED AGAINST THE ASSESSEE BY THE DECISI ON OF JURISDICTIONAL HIGH COURT IN THE CASE OF PLASTIBLENDS INDIA LTD. (SUPRA ). IN VIEW OF THE ABOVE SUBMISSION OF THE LEARNED COUNSEL FOR THE ASSESSEE THIS GROUND IS DISMISSED. 6. GROUND OF APPEAL NO.2 BY THE ASSESSEE READS AS U NDER: ON THE FACT AND CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW THE LEARNED CIT(A) HAS ERRED NOT ALLOWING SET OFF OF INTER EST PAID AGAINST INTEREST RECEIVED AND IN CONFIRMING THE ACTION OF ASSESSING OFFICER IN TREATING THE INTEREST INCOME (G ROSS) AS INCOME NOT DERIVED FROM THE BUSINESS AND ACCORDINGLY NOT ELIGIBLE FOR DEDUCTION U/S.80IB OF THE I.T. ACT 1961 WITHOUT CONS IDERING THE FACTS & CIRCUMSTANCES OF THE CASE. 6. AFTER HEARING BOTH THE SIDES WE FIND THAT THE A SSESSING OFFICER TREATED THE INTEREST INCOME FROM FIXED DEPOSITS AS INCOME FROM OTHER SOURCES ON THE GROUND THAT THE SAME IS NOT DERIVED FROM INDU STRIAL ACTIVITY. HE ACCORDINGLY HELD THAT SUCH INCOME IS NOT ELIGIBLE FOR DEDUCTION U/S.80IB OF THE I.T. ACT. BEFORE THE CIT(A) IT WAS SUBMITTED THAT THE INTEREST INCOME OF ` .24 51 661/- WAS EARNED ON THE MARGIN MONEY PROVIDE D BY THE COMPANY FOR OPENING LETTER OF CREDIT IN FAVOUR OF THE SUPPL IER FOR IMPORT OF RAW MATERIAL WITHOUT PROVIDING THE MARGIN MONEY. WITHO UT THIS THE ASSESSEE COULD NOT HAVE CARRIED THE BUSINESS. RELYING ON A COUPLE OF DECISIONS IT WAS SUBMITTED THAT THE ASSESSEE IS ENTITLED TO BENEFIT OF DEDUCTION U/S.80IB OF THE I.T. ACT ON SUCH INTEREST INCOME. HOWEVER TH E LEARNED CIT(A) WAS NOT SATISFIED WITH THE ARGUMENTS ADVANCED BY THE ASSESS EE. RELYING ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE O F CIT V. PANDIAN CHEMICALS LTD. [1998] REPORTED IN 233 ITR 497 (MAD.) HE UPHELD T HE ACTION ITA NO.91/MUM/2010 A.Y.: 2006-2007 3 OF THE ASSESSING OFFICER. AGGRIEVED BY SUCH ORDER OF THE CIT(A) THE ASSESSEE IS IN APPEAL BEFORE US. 7. AFTER HEARING BOTH THE SIDES WE FIND THE ISSUE STANDS COVERED AGAINST THE ASSESSEE BY THE DECISION OF HONBLE SUPREME COU RT IN THE CASE OF LIBERTY INDIA V. COMMISSIONER OF INCOME-TAX REPORTED IN 317 ITR 218 (SC). THE HONBLE APEX COURT IN THE SAID DECISION HAS HELD TH AT PROVISIONS OF SEC. 80IB PROVIDES FOR THE ALLOWING OF DEDUCTION IN RESPECT O F PROFITS AND GAINS DERIVED FROM THE ELIGIBLE BUSINESS. THE CONNOTA TION OF THE WORDS DERIVED FROM IS NARROWER AS COMPARED TO THAT OF THE WORDS ATTRIBUTABLE TO. BY USING THE EXPRESSION DERIVED FROM PARLIAMENT INTE NDED TO COVER SOURCES NOT BEYOND THE FIRST DEGREE. 8. SO FAR AS THE ARGUMENTS OF THE LEARNED COUNSEL T HAT NETTING SHOULD BE ALLOWED WE ARE OF THE OPINION THAT THE SAME IS ALS O WITHOUT ANY FORCE IN VIEW OF THE DECISIONS OF THE JURISDICTIONAL HIGH COURT I N THE CASE OF CIT VS. ASIAN STAR P. LTD. REPORTED IN 326 ITR 356 AND IN THE CAS E OF CIT VS. DRESSER RAND INDIA REPORTED IN 323 ITR 429. ACCORDINGLY THIS GROUND OF THE ASSESSEE IS DISMISSED. 9. GROUND OF APPEAL NO.3 READS AS UNDER: ON THE FACT AND CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW THE LEARNED CIT(A) HAS ERRED NOT APPRECIATING THE PROVISIO NS OF SECTION 145A AND CONFIRMED THE ACTION OF THE LEARNED ASS ESSING OFFICER BY MAKING ADDITION TO THE TOTAL INCOME BY VALUE O F CENVAT AMOUNT ON OPENING STOCK OF FINISHED GOODS. 10. THE LEARNED COUNSEL FOR THE ASSESSEE AT THE OU TSET SUBMITTED THAT HE IS NOT PRESSING THIS GROUND FOR WHICH THE LEARNED D R HAS NO OBJECTION. ACCORDINGLY THIS GROUND BY THE ASSESSEE IS DISMISS ED. ITA NO.91/MUM/2010 A.Y.: 2006-2007 4 11. IN THE RESULT APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED ON THIS 15 TH DAY OF SEPTEMBER 2010. SD/- (N.V. VASUDEVAN) JUDICIAL MEMBER SD/- (R.K. PANDA) ACCOUNTANT MEMBER MUMBAI DATED 15 TH SEPTEMBER 2010. JANHAVI COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS)- MUM BAI 4. COMMISSIONER OF INCOME TAX CITY- MUMBAI 5. DEPARTMENTAL REPRESENTATIVE BENCH E MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR ITAT MUMBAI