Ita/253/2013 Of M/S.hotel & Allied Trades Pvt.ltd v. The Deputy Commissioner Of Income Tax, Circle I (1) Ernakulam

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HON'BLE THE CHIEF JUSTICE DR. MANJULA CHELLUR & THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE MONDAY, THE 17TH DAY OF MARCH 2014/26TH PHALGUNA, 1935 ITA.No. 253 of 2013 () ----------------------- ITA. NO.666/COCH/2007 OF INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH....... APPELLANT/RESPONDENT/APPELLANT: ------------------------------------------------------------ M/S.HOTEL & ALLIED TRADES PVT. LTD., C/O.CASINO HOTEL, W/ISLAND, COCHIN-3. BY SRI.JOSEPH MARKOSE, SENIOR ADVOCATE. ADVS. SRI.V.ABRAHAM MARKOS, SRI.BINU MATHEW, SRI.TOM THOMAS (KAKKUZHIYIL), SRI.ABRAHAM JOSEPH MARKOS, SRI.ABRAHAM VARGHESE THARAKAN. RESPONDENT/RESPONDENT/DEPARTMENT: ----------------------------------------------------------------- THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE I (1), ERNAKULAM. BY ADV. SRI.JOSE JOSEPH, SC, INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 17-03-2014, ALONG WITH ITA. NO. 264 OF 2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: rs. ITA.No. 253 of 2013 APPENDIX PETITIONER'S ANNEXURES:- ANNEXURE ACOPY OF THE ASSESSMENT ORDER DATED 15/01/2007. ANNEXURE BCOPY OF THE ORDER PASSED IN THE APPEAL DATED 19/04/2007 OF THE COMMISSIONER OF INCOME TAX (APPEALS)-II. ANNEXURE CCOPY OF THE ORDER DATED 25/10/2012 PASSED BY THE ITAT IN ITA NO.666/COCH/2007. RESPONDENT'S ANNEXURES:- NIL. //TRUE COPY// P.S. TO JUDGE rs. MANJULA CHELLUR, C.J. & A.M.SHAFFIQUE, J. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Income Tax Appeal No.253 & 264 OF 2013 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -Dated this the 17[th] day of March, 2014 JUDGMENT MANJULA CHELLUR, C.J. In these two appeals following substantial questions of law are raised for consideration of this court: 1. Is not deduction under Section 80HHD and 80IBallowable on the basis of the turnover, foreign exchangeearnings and profits of each eligible units instead of onthe basis of total turnover and export earnings in thefacts and circumstances of the case. 2. Whether in the facts and circumstances of the casethe Tribunal is justified in interpreting Section 80HHDand 80 I B to the effect that for the purpose ofcomputation of eligible deduction the profits and gainsof entire business of the Hotel has to be taken intoaccount. 3. Whether in the facts and circumstances of the casethat the Tribunal is justified in sustaining thecomputation made by the authorities in the case ofdetermination of deductions under Section 80HHD and80 IA of the Act. 4. Whether in the facts and circumstances of the casethe Tribunal is justified in holding that the appellant isnot entitled to deduct the carry forward depreciationcomputed under the provisions of the Income Tax Actfrom the book profit computed under Section 115 JB ofthe Act. ITA 253 & 264/13 2. So far as deductions under Sections 80 HHD and 80IBpertaining to very same assessee, in respect of other assessmentyears, came up for consideration in ITA 12 of 2013 and ITA 232/13which came to be disposed of on 9.1.2014 and 7.3.2013 respectively.Therefore, substantial questions of law pertaining to Section 80HHDand 80IB are answered in terms of ITA 12 of 2013 and ITA 232/13. 4. Whether in the facts and circumstances of the casethe Tribunal is justified in holding that the appellant isnot entitled to deduct the carry forward depreciationcomputed under the provisions of the Income Tax Actfrom the book profit computed under Section 115 JB ofthe Act. ITA 253 & 264/13 2. So far as deductions under Sections 80 HHD and 80IBpertaining to very same assessee, in respect of other assessmentyears, came up for consideration in ITA 12 of 2013 and ITA 232/13which came to be disposed of on 9.1.2014 and 7.3.2013 respectively.Therefore, substantial questions of law pertaining to Section 80HHDand 80IB are answered in terms of ITA 12 of 2013 and ITA 232/13. 3. Then coming to deduction of carry forward depreciationcomputed under provisions of Income Tax Act from the book profitunder Section 115JB of the Act, it was not covered by earlier orders.As a matter of fact, Assessing Officer opined that assessee is notentitled to carry forward depreciation amounting to Rs.73,54,058/-,as book profit computed was not tallying with the actual figuresshown in the return. In other words, the brought forward loss as perbooks of account was 'Nil'. Therefore, Assessing Officer opined thatassessee is not liable to carry forward the depreciation. This opinionof Assessing Officer was set aside by the Commissioner of Income Tax(Appeals). When the matter came up for consideration before theAppellate Tribunal, Tribunal was justified in opining that there wasno reason or ground upon which Commissioner of Income Tax ITA 253 & 264/13 (Appeals) could have disturbed the opinion of the Assessing Officer.In other words, he upheld the opinion of the Assessing Officer. Ongoing through the orders of the Assessing Officer and Tribunal, weare of the view, fourth substantial question of law deserves to be heldagainst the appellant assessee confirming the opinion of the Tribunal. sd/-(MANJULA CHELLUR, CHIEF JUSTICE) sd/-(A.M.SHAFFIQUE, JUDGE) jes/17/03/2014 //True copy// PA to Judge