GABRIEL INDIA LTD, v. ADDL CIT RG 5(1),

MA 467/MUM/2010 | 2001-2002
Pronouncement Date: 20-10-2010 | Result: Allowed

Appeal Details

RSA Number 46719924 RSA 2010
Assessee PAN AAACG1994N
Bench Mumbai
Appeal Number MA 467/MUM/2010
Duration Of Justice 2 month(s) 30 day(s)
Appellant GABRIEL INDIA LTD,
Respondent ADDL CIT RG 5(1),
Appeal Type Miscellaneous Application
Pronouncement Date 20-10-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted G
Tribunal Order Date 20-10-2010
Assessment Year 2001-2002
Appeal Filed On 21-07-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH MUMBAI. BEFORE SHRI N.V.VASUDEVAN (JUDICIAL MEMBER) AND SHRI PRAMOD KUMAR(ACCOUNTANT MEMBER) M.A.NO.467/MUM/2010 (I.T.A NO.9140/ MUM/2004) ASSESSMENT YEAR: 2001-02 GABRIEL INDIA LTD. APPELLANT C/O. B.K.KHARE & COMPANY CA 706/708 SHARDA CHAMBERS NEW MARINE LINES MUMBAI-20. PA NO.AAACG 1994 N VS ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 5(2) MUMBAI. RESPONDENT APPELLANT BY: SHRI SUNIL BHANDARI RESPONDENT BY : SHRI R.M.TIWARI O R D E R PER PRAMOD KUMAR: BY WAY OF THIS RECTIFICATION APPLICATION THE APPL ICANT-ASSESSEE HAS INVITED OUR ATTENTION TO AN INADVERTENT MISTAKE ALLEGED TO HAVE CREPT IN OUR ORDER DATED 24 TH OCTOBER 2008. 2. LEARNED COUNSEL FOR THE ASSESSEE POINTS OUT THAT THE TRIBUNAL HAS DISMISSED GROUND NO.3(A)& (B) RAISED BY THE ASSESSEE BY OBSERVING TH AT ISSUES ARE COVERED AGAINST THE ASSESSEE BY ASSESSEES OWN CASE FOR THE ASSESSMENT ORDER 2000-2001. OUR ATTENTION IS DRAWN TO THE FOLLOWING OBSERVATIONS MADE BY THE TRI BUNAL: 14. GROUND NO.3 READS AS UNDER:- (A) THE LEARNED CIT (A) ERRED IN CONFIRMING ADDITION TO THE CLOSING STOCK BY THE EXCISE MODVAT OF ` . 1 53 69 778/-. (B) FURTHER THE LEARNED CIT (A) ERRED IN NOT ALLOWING DEDUCTION OF `.1 70 67 441/- BEING THE EXCISE MODVAT IN OPENING STOCK FOR THE A. Y. 2001-02 WHICH WAS ADDED BACK BY THE A.O. IN THE VALUATION OF CLOSING STOCK FOR THE EARLIER YEAR I.E. A.Y. MA NO.467/M/2010 GABRIEL INDIA LTD . 2 2000-2001 AND THE SAID ADDITION STANDS CONFIRMED BY THE CIT (A)S ORDER FOR THE A.Y. 00-01. (C).. 15. REGARDING GROUND 3(A) & (B) THE LD. COUNSEL FO R THE ASSESSEE FAIRLY STATED THAT THIS PORTION OF THE GROUND DECIDED AGAINST THE ASSE SSEE BY THE DECISION OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR AY 2000-01. AC CORDINGLY WE DISMISS THE SAME. 3. IT IS FURTHER SUBMITTED THAT PURSUANT TO THESE O BSERVATIONS BY THE TRIBUNAL THE ASSESSING OFFICER HAS CONFIRMED THE STAND OF THE LE ARNED CIT (A) AND DECLINED TO GIVE RELIEF IN RESPECT OF THE OPENING STOCK AS ALSO THE CLOSING STOCK. HOWEVER ACCORDING TO THE LEARNED COUNSEL WHAT WAS DECIDED IN AY 2000-2001 WAS THAT A CORRESPONDING ADJUSTMENT IS TO BE ALLOWED IN RESPECT OF THE OPENING STOCK. LEARNED C OUNSEL INVITED OUR ATTENTION TO PARAGRAPH 6 OF TRIBUNALS ORDER DATED 8.8.2008 IN ASSESSEES OWN CASE WHICH WAS FOLLOWED IN THE IMPUGNED ORDER. THE SAID PARAGRAPH IS REPRODUCED B ELOW FOR READY REFERENCE:- WE HAVE HEARD RIVAL SUBMISSIONS AND CONSIDERED THE M CAREFULLY. AFTER CONSIDERING THE SUBMISSIONS PLACED THROUGH CHART FILED DURING T HE COURSE OF HEARING OF THIS APPEAL WE FIND THAT THIS ISSUE IS NOW COVERED BY T HE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF MAHAVIR ALUMINIUM LTD (SU PRA). THE HONBLE COURT WHILE DISMISSING THE APPEAL HAS HELD AS UNDER:- PARAGRAPH 23.13 OF THE GUIDANCE NOTE ON TAX AUDIT UNDER SECTION 44AB ISSUED BY THE INSTITUTE OF CHARTERED ACCOUNTS OF IN DIA MADE IT CLEAR THAT WHENEVER ANY ADJUSTMENT IS MADE IN THE VALUATION OF INVENTORY THIS WILL AFFECT BOTH THE OPENING AS WELL AS THE CLOSING STOC K. IF ANY ADJUSTMENT WAS REQUIRED TO BE MADE BY A STATUTE EFFECT SHOULD BE GIVEN TO IT IRRESPECTIVE OF ANY CONSEQUENCES ON THE COMPUTATION OF INCOME FOR T AX PURPOSES. SECTION 145A BEGINS WITH A NON OBSTANTE CLAUSE AND THEREFOR E TO GIVE EFFECT SECTION 145A IF THERE IS A CHANGE IN THE OPENING STOCK AS ON MACH 31 1999 THERE MUST NECESSARILY BE A CORRESPONDING ADJUSTMENT MADE IN THE OPENING STOCK AS ON APRIL 1 1998. THUS THE QUESTION OF DOUBLE D EDUCTION DID NOT ARISE SINCE NO ADJUSTMENT WAS MADE BY THE ASSESSEE IN THE PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDING MARCH 31 1998. IN VIEW OF THE ABOVE FINDINGS OF HONBLE DELHI HIGH COURT WE RESTORE THE ISSUE TO THE FILE OF THE AO TO PASS A FRESH ORDER IN THE LIGHT O F THE DECISION OF HONBLE HIGH COURT AND AFTER AFFORDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 4. IN SHORT LEARNED COUNSELS SUBMISSION IS THAT T HE TRIBUNAL SHOULD MAKE CLEAR IN ITS ORDER THAT IN RESPECT OF REMAINING GRIEVANCE THE A O IS TO GIVE RELIEF BY WAY OF MAKING APPROPRIATE ADJUSTMENT IN THE OPENING STOCK IN TER MS OF TRIBUNALS ORDER 2000-2001 WHICH THE TRIBUNAL HAS FOLLOWED IN THE IMPUGNED ORDER. MA NO.467/M/2010 GABRIEL INDIA LTD . 3 5. LEARNED DEPARTMENTAL REPRESENTATIVE FAIRLY DOES NOT OBJECT THE SUBMISSIONS MADE BY LEARNED COUNSEL FOR THE ASSESSEE. HE SUBMITS TH AT SO FAR AS THE TRIBUNALS DECISION FOR THE ASSESSMENT YEAR 2000-2001 IS CONCERNED WHILE THE G RIEVANCE OF THE ASSESSEE WAS INDEED DISMISSED WHICH WAS SUBJECT TO THE RIDER THAT PROP ORTIONATE ADJUSTMENT IS TO BE MADE IN RESPECT OF THE OPENING STOCK VALUE. HE LEAVES THE MATTER TO THE BENCH. 6. HAVING CONSIDERED THE RIVAL SUBMISSIONS AND HAVI NG PERUSED THE MATERIAL ON RECORD WE SEE SUBSTANCE IN THE PLEA OF THE ASSESSEE. HIS GRIEVANCE IS REASONABLE TO THE EXTENT THAT THE TRIBUNALS ORDER DOES GIVE AN IMPRESSION THAT T HE ENTIRE GRIEVANCE OF THE ASSESSEE IS REJECTED AND THE ORDER OF THE CIT (A) DOES NOT CALL FOR ANY INTERFERENCE WHEREAS A CAREFUL READING OF THE TRIBUNALS ORDER FOR A.Y. 2000-2001 INDEED CALLS FOR ADJUSTMENT TO BE MADE TO THE EXTENT THE SAME IS RELATABLE TO THE OPENING STOCK. IN VIEW OF THE ABOVE SITUATION WE DEEM IT FIT AND PROPER TO CLARIFY THAT THE AO IS RE QUIRED TO GIVE EFFECT TO THE OBSERVATIONS MADE BY THE TRIBUNAL IN THE ORDER FOR A.Y. 2000-200 1 WHICH APPLY MUTATIS-MUTANDIS TO THE PRESENT YEAR AS WELL. WITH THESE OBSERVATIONS WE MODIFY THE IMPUGNED ORDER TO THAT EXTENT. GROUND NO.3(A)&(B) IS RESTORED TO THE FILE OF THE AO FOR GIVING RELIEF IN TERMS OF OBSERVATIONS MADE IN PARA 6 OF THE ORDER FOR THE A. Y. 2000-2001 WHICH APPLIES MUTANDIS- MUTANDIS TO THE PRESENT YEAR AS WELL. 7. IN THE RESULT THE M.A. IS ALLOWED IN THE TERMS INDICATED ABOVE. PRONOUNCED IN THE OPEN COURT ON 20 TH OCTOBER 2010 SD/- (N.V.VASUDEVAN) (JUDICIAL MEMBER) SD/- (PRAMOD KUMAR) (ACCOUNTANT MEMBER) MUMBAI DATED 20 TH OCTOBER 2010 PARIDA COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS)-IX MUMBAI 4. COMMISSIONER OF INCOME TAX-IX MUMBAI 5. DEPARTMENTAL REPRESENTATIVE BENCH G MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR ITAT MUMBAI MA NO.467/M/2010 GABRIEL INDIA LTD . 4