Itat/148/2021 Of Principal Commissioner Of Income Tax, Central-1, Kolkata v. M/S. Rashmi Metaliks Ltd

OD-43 ORDER SHEETITAT/148/2021IA NO:GA/2/2021IN THE HIGH COURT AT CALCUTTASPECIAL JURISDICTION(INCOME TAX)ORIGINAL SIDE PRINCIPAL COMMISSIONER OF I.T., CENTRAL-1, KOLKATA-VS-M/S. RASHMI METALIKS LTD. BEFORE:HON’BLE JUSTICE T.S. SIVAGNANAMANDHON’BLE JUSTICE HIRANMAY BHATTACHARYYADATE: 7 MARCH 2022. Mr. P.K. Bhowmick, Adv., for appellant/petitioner.Mr. A. Sengupta, Adv., for respondent. The Court: This appeal by the revenue, filed under section 260A of the Income Tax Act, 1961, is directed against the order datedNovember 13, 2019, passed by the Income Tax Appellate Tribunal “B” Bench, Kolkata, in ITA Nos.194 to 197 (Kol) of 2019 relating to theassessment years 2009-2010 to 2012-13. The revenue raised the followingsubstantial questions of law: “(i)Whether on the facts and the circumstances of the caseand in law, the learned Income Tax Appellate Tribunal,Kolkata was justified in allowing deduction under section80IA of the Income Tax Act, 1961 of Rs.17,62,41,550/-for income/profits arising from operation of privaterailway siding exclusively for the benefit of assessee onlyand therefore, it is not an infrastructure facility within themeaning of explanation to section 80IA(4)(I) of theIncome Tax Act, 1961 and explanatory notes to theprovision of the Finance Act, 2007 vide circularno.03/2008, dated 12.03.2008 and the order beingperverse and as such the order of the learned Tribunal isnot sustainable in law?and in law, the learned Income Tax Appellate Tribunal,Kolkata was justified in allowing deduction under section80IA of the Income Tax Act, 1961 of Rs.17,62,41,550/-for income/profits arising from operation of privaterailway siding exclusively for the benefit of assessee onlyand therefore, it is not an infrastructure facility within themeaning of explanation to section 80IA(4)(I) of theIncome Tax Act, 1961 and explanatory notes to theprovision of the Finance Act, 2007 vide circularno.03/2008, dated 12.03.2008 and the order beingperverse and as such the order of the learned Tribunal isnot sustainable in law? (ii)Whether on the facts and the circumstances of the caseand in law, the learned Income Tax Appellate Tribunal,Kolkata was justified in allowing deduction under section80IA of the Income Tax Act, 1961 for railway sidingand in law, the learned Income Tax Appellate Tribunal,Kolkata was justified in allowing deduction under section80IA of the Income Tax Act, 1961 for railway siding whereas from page no.89 of seized document marked asINDA-4, it is observed that the Sr. SCM, ORE, SouthEastern Railway had issued a letter to the assessee relatedto evasion of railway freight and thereby violatingprovisions of law, against claim of deduction undersection 80IA of the Income Tax Act, 1961 and hence theHon’ble Income Tax Appellate Tribunal failed toappreciate the peculiar facts and circumstances of thecase? (iii)Whether on the facts and the circumstances of the caseand in law, the learned Income Tax Appellate Tribunalerred by failing to appreciate the terms and conditions asper agreement entered, whereby there is no specificclause for developing or operating and maintaining ordeveloping, operating and maintaining as per conditionsof deduction under section 80IA of the Act, and whereasvarious Court decisions have held that strictinterpretation of statutes is required for taxdeductions/exemptions and hence the order being ultravires?and in law, the learned Income Tax Appellate Tribunalerred by failing to appreciate the terms and conditions asper agreement entered, whereby there is no specificclause for developing or operating and maintaining ordeveloping, operating and maintaining as per conditionsof deduction under section 80IA of the Act, and whereasvarious Court decisions have held that strictinterpretation of statutes is required for taxdeductions/exemptions and hence the order being ultravires? (iv)Whether on the facts and the circumstances of the caseand in law, the learned Income Tax Appellate Tribunalerred in holding that the assessee is entitled to deductionunder section 80IA of the Act particularly in the light offreight evasion which could have an impact on theagreement with the railways?and in law, the learned Income Tax Appellate Tribunalerred in holding that the assessee is entitled to deductionunder section 80IA of the Act particularly in the light offreight evasion which could have an impact on theagreement with the railways? (v)Whether on the facts and the circumstances of the caseand in law, the learned Income Tax Appellate Tribunalerred in law in giving relief to the assessee only on thebasis of its cancelling the order passed by the PrincipalCommissioner of Income Tax under section 263 of theAct, while the appeal under section 260A has beenpreferred against the very order of the learned Tribunalcancelling the order under section 263 of the Act beforethe Hon’ble High Court?”and in law, the learned Income Tax Appellate Tribunalerred in law in giving relief to the assessee only on thebasis of its cancelling the order passed by the PrincipalCommissioner of Income Tax under section 263 of theAct, while the appeal under section 260A has beenpreferred against the very order of the learned Tribunalcancelling the order under section 263 of the Act beforethe Hon’ble High Court?” We have heard the learned counsel for the parties. The order impugned in a connected appeal of the Appellate Tribunal arose out of anorder giving effect to an order passed under section 263 of the Act. The saidorder passed under section 263 of the Act was appealed against and theTribunal in ITA Nos.813 to 816/Kol/2017 allowed the appeals filed by the assessee by order dated May 2, 2018. The said order was put to challengeby the appellant-revenue in ITAT/75/2021 which was dismissed by thisHon’ble Court by Judgment dated January 31, 2022. In light of the above development, the order impugned before us, passed by the Income Tax Appellate Tribunal “B” Bench, datedNovember 13, 2019, in ITA Nos.194 to 197(Kol) of 2019, for theassessment years 2009-10 to 2012-13, pursuant to orders passed undersection 263 of the Act by dismissing the appeals before the Tribunal, nothingsurvives for consideration by this Court in this appeal. The appeal along with the connected application accordinglystands dismissed. (T.S. SIVAGNANAM, J.) (HIRANMAY BHATTACHARYYA, J.) tk