M/s. Chamundi Textiles (Silk Mills) Ltd., Sivagangai v. JCIT, Madurai

MA 196/CHNY/2004 | 1996-1997
Pronouncement Date: 26-11-2011 | Result: Dismissed

Appeal Details

RSA Number 19621724 RSA 2004
Bench Chennai
Appeal Number MA 196/CHNY/2004
Duration Of Justice 7 year(s) 4 month(s)
Appellant M/s. Chamundi Textiles (Silk Mills) Ltd., Sivagangai
Respondent JCIT, Madurai
Appeal Type Miscellaneous Application
Pronouncement Date 26-11-2011
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 26-11-2011
Date Of Final Hearing 26-11-2010
Next Hearing Date 26-11-2010
Assessment Year 1996-1997
Appeal Filed On 26-07-2004
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL BENCH C CHENNAI BEFORE SHRI ABRAHAM P. GEORGE ACCOUNTANT MEMBER AN D SHRI GEORGE MATHAN JUDICIAL MEMBER .. M.A. NOS. 195 196 & 197/MDS/2004 (IN ITA NOS. 891/MDS/2000 AND 292 & 293/MDS/2002) ASSESSMENT YEARS : 1995-96 1996-97 & 1997-98 M/S. CHAMUNDI TEXTILES (SILK MILLS) LTD. 8/1 K.V. STREET KOTTAIYUR-630 106 SIVAGANGAI DISTRICT. V. THE JOINT COMMISSIONER OF INCOME TAX SPECIAL RANGE-I MADURAI. (PAN/G.I. NO. 47-019-CY-4598) (APPLICANT) (RESPONDENT) APPLICLANT BY : SHRI S. SRIDHAR RESPONDENT BY : SHRI SHAJI P. JACOB O R D E R PER GEORGE MATHAN JUDICIAL MEMBER : THESE MISCELLANEOUS APPLICATIONS ARE FILED BY THE ASSESSEE AGAINST THE ORDER OF THIS TRIBUNAL IN ITA NOS. 891/MDS/2000 AND 292 & 293/MDS/2002 DATED 18-05-2004 FOR THE ASSESSMENT YEARS 1995-96 1996-9 7 AND 1997-98. 2. SHRI S. SRIDHAR ADVOCATE REPRESENTED ON BEHALF OF THE ASSESSEE AND SHRI SHAJI P. JACOB SR. DR REPRESENTED ON BEHALF OF THE REVENUE. 3. AT THE TIME OF HEARING THE LEARNED AUTHORISED RE PRESENTATIVE SUBMITTED THAT THE TRIBUNAL HAD MADE THE DECISION ON THE MIST AKEN ASSUMPTION OF FACTS THAT THERE WAS LOSS IN ONE OF THE UNITS OF THE ASSE SSEE WHERE IN FACT THERE WAS NO M.A. NOS.195-197/MDS/2004 2 LOSS IN ANY OF THE UNITS. IT WAS THE SUBMISSION TH AT THE ORDER OF THE TRIBUNAL MAY BE RECALLED AND THE ISSUE RE-ADJUDICATED. 4. IN REPLY THE LEARNED DR SUBMITTED THAT THE ISSU E AS RAISED IN THE MISCELLANEOUS APPLICATIONS IS A DEBATABLE ISSUE AND THE COMPUTATION OF DEDUCTION U/S. 80HHC OF THE INCOME-TAX ACT 1961 HAS BEEN DEC IDED BY THE TRIBUNAL. IT WAS SUBMITTED THAT THERE WAS NO MISTAKE IN THE ORDE R OF THE TRIBUNAL WHICH REQUIRED ANY RECTIFICATION. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. IT IS NOTICED THAT THE ISSUE OF DEDUCTION U/S. 80HHC HAS BEEN DECIDED BY THIS TRIBU NAL IN PARA 10 OF ITS ORDER WHEREIN IT HAS BEEN HELD AS FOLLOWS: 10. IN VIEW OF THE ABOVE IT IS VERY CLEAR THAT SE C. 80HHC IS CONTROLLED BY SEC. 80AB. THE GROSS TOTAL INCOME ME ANS THE TOTAL INCOME COMPUTED UNDER THE PROVISIONS OF THE INCOME TAX ACT. THEREFORE MERELY BECAUSE THE ASSESSEE IS HAVING TW O INDEPENDENT AND SEPARATE UNIT IT CANNOT BE SAID TH AT THE ASSESSEE IS ENTITLED TO IGNORE THE LOSS INCURRED IN ONE UNIT WHEN THE ASSESSEE IS ELIGIBLE FOR SET OFF LOSS INCURRED BY ONE UNIT AGAINST THE PROFIT DERIVED IN RESPECT OF THE OTHER UNIT. THEREFORE THE ASSESSEE HAS TO FIRST SET OFF THE LOSS INCURRED BY ONE UNIT AGAINST THE PROFIT OF THE OTHER UNIT. IN OTHER WOR DS WHAT IS ELIGIBLE FOR DEDUCTION UNDER SECTION 80HHC IS AGGRE GATE INCOME OF THE ASSESSEE IN RESPECT OF THE UNITS OF THE ASSE SSEE. THEREFORE THERE IS NO JUSTIFICATION IN THE CLAIM O F THE ASSESSEE THAT THE BANGALORE UNIT SHOULD BE CONSIDERED SEPARA TELY FOR THE PURPOSE OF DEDUCTION UNDER SECTION 80HHC. M.A. NOS.195-197/MDS/2004 3 IN THE SAID ORDER THE TRIBUNAL HAS CATEGORICALLY HE LD THAT THE ASSESSEE HAS TO FIRST SET OFF THE LOSSES INCURRED BY ONE UNIT AGAINST THE PROFIT DERIVED IN RESPECT OF THE OTHER UNIT. IT IS A PRINCIPLE OF LAW WHICH HAS BEE N DECIDED BY THE TRIBUNAL. THIS PRINCIPLE HAS ALSO FOUND APPROVAL BY THE DECISION O F THE HON'BLE SUPREME COURT IN THE CASE OF IPCA LABORATORY LTD. V. DEPUTY COMMI SSIONER OF INCOME-TAX REPORTED IN 266 ITR 521. IF AS PER THE ASSESSEE TH ERE IS NO LOSS IN ANY OF ITS UNITS THEN IT IS IN THE COMPUTATION WHEN GIVING EF FECT TO THE ORDER OF THE TRIBUNAL THAT THE ISSUE WOULD BE CONSIDERED. IN TH E CIRCUMSTANCES WE ARE OF THE VIEW THAT NO ERROR IN THE ORDER OF THIS TRIBUNAL HA S BEEN POINTED OUT BY THE ASSESSEE. THEREFORE THE MISCELLANEOUS APPLICATION S STAND DISMISSED. IN THE CIRCUMSTANCES THE MISCELLANEOUS APPLICATIONS FILED BY THE ASSESSEE STAND DISMISSED. 6. THE ORDER WAS PRONOUNCED IN THE COURT ON 30/11/1 0. SD/- SD/- (ABRAHAM P. GEORGE) (GEORGE MATHAN) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI DATED THE 30 TH NOVEMBER 2010. H. COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE