Ita/67/2011 Of The Commissioner Of Income Tax, Cochin v. M/S.apollo Tyres Ltd., Kochi

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE P.R.RAMACHANDRA MENON & THE HONOURABLE MR.JUSTICE N.ANIL KUMAR TUESDAY ,THE 05TH DAY OF MARCH 2019 / 14TH PHALGUNA, 1940 ITA.No. 67 of 2011 [AGAINST THE ORDER IN ITA 252/2007 of I.T.A.TRIBUNAL,COCHIN BENCH[ APPELLANT: THE COMMISSIONER OF INCOME TAX-I, COCHIN. BY ADVS.SRI.P.K.R.MENON,SENIOR COUNSEL, GOI(TAXES)SRI.JOSE JOSEPH, SC, FOR INCOME TAXSRI.CHRISTOPHER ABRAHAM RESPONDENT: M/S.APOLLO TYRES LTD., 6TH FLOOR, CHERUPUSHPAM BUILDINGS,SHANMUGHAM ROAD, KOCHI-682 031. BY ADVS.SRI.BINU MATHEWSRI.B.J.JOHN PRAKASHSRI.JOSEPH KODIANTHARA (SR.)SRI.MATHEWS K.UTHUPPACHANSRI.TERRY V.JAMESSRI.TOM THOMAS (KAKKUZHIYIL)SRI.V.ABRAHAM MARKOSSRI.V.B.UNNIRAJSRI.JOSEPH MARKOSE (SR) THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 05.03.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: :-2-: I.T.A.NO.67 OF 2011 J U D G M E N T P.R.RAMACHANDRA MENON,J: This appeal preferred by the Revenue arise fromthe verdict passed by the Income Tax Appellate Tribunal,Cochin Bench in I.T.A.No.252/Coch/2007 dated 5.10.2010 inrespect of the assessment year 2001-2002. 2. The questions suggested by the Revenue as involving substantial questions of law are in the following terms:- “1. Whether, on the facts and in the circumstances ofthe case, the Tribunal is right in law ininterfering with the addition of Rs.4,66,20,000/-being the amount withdrawn from InvestmentFluctuation Reserve' for writing off provision forreduction in the value of GPEL by debit to P/Laccount for computing the book profit under Section115 JB?the case, the Tribunal is right in law ininterfering with the addition of Rs.4,66,20,000/-being the amount withdrawn from InvestmentFluctuation Reserve' for writing off provision forreduction in the value of GPEL by debit to P/Laccount for computing the book profit under Section115 JB? 2. Whether, on the facts and in the circumstances ofthe case is not the provision for the above amountin the nature of a liability as envisaged in clause(c) of the Explanation below Sec.115JB(2)?the case is not the provision for the above amountin the nature of a liability as envisaged in clause(c) of the Explanation below Sec.115JB(2)? 3. Whether, in the light of the amendment by way ofclause (i) to Explanation to Section 115JBintroduced by Finance Act 2009 with retrospectiveeffect from ¼/2001 does the decision of the SupremeCourt in HCL (305 ITR 409) hold the field and theITAT is justified in relying on the same?”clause (i) to Explanation to Section 115JBintroduced by Finance Act 2009 with retrospectiveeffect from ¼/2001 does the decision of the SupremeCourt in HCL (305 ITR 409) hold the field and theITAT is justified in relying on the same?” 3. When the matter was admitted on 12.7.2011, notice was served on all the questions. Today when the matter istaken up for final hearing, learned counsel for the revenuesubmits that the proceedings involved in the present caseare more related to the computation of book profit in terms :-3-: of Section 115JB of the Income Tax Act whereby certainadjustments could be effected which originally was notgranted but permitted to be effected by passing arectification order. The Learned counsel points out thatthe basic issue in respect of the very same assessment yearis already under challenge in the appeal filed by theRevenue as I.T.A.No.68/2011 in respect of the assessmentfinalised under Section 143(3) of the Income Tax Act andthis being the position, without prejudice to the rightsand liberties of the appellant/revenue to pursue I.T.A.No.68/2011, I.T.A.No.67/2011 could be closed. :-3-: of Section 115JB of the Income Tax Act whereby certainadjustments could be effected which originally was notgranted but permitted to be effected by passing arectification order. The Learned counsel points out thatthe basic issue in respect of the very same assessment yearis already under challenge in the appeal filed by theRevenue as I.T.A.No.68/2011 in respect of the assessmentfinalised under Section 143(3) of the Income Tax Act andthis being the position, without prejudice to the rightsand liberties of the appellant/revenue to pursue I.T.A.No.68/2011, I.T.A.No.67/2011 could be closed. On going through the pleadings and proceedings,we find that the course suggested by the learned StandingCounsel is correct and sustainable. Accordingly, we closethis I.T.A. without prejudice to the contention taken bythe Revenue in I.T.A.No.68/2011 preferred in respect of thevery same assessment year (2001-02). sd/- P.R.RAMACHANDRA MENON, JUDGE sd/- MBS/ N.ANIL KUMAR,JUDGE