Peacock Apparels (P) Ltd v. Assistant Commissioner Of Income-Tax,Company Circle – 1,Madurai

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 28.03.2022 CORAM : THE HON'BLE MR. JUSTICE R. MAHADEVANAND THE HON'BLE MR. JUSTICE J.SATHYA NARAYANA PRASAD T.C.A.NO.158 OF 2010 Peacock Apparels (P) Ltd.,82, Aruppukottai Road,Madurai – 625 012. ...Appellant Versus Assistant Commissioner of Income-Tax,Company Circle – 1,Madurai. ...Respondent Tax Case Appeal filed under Section 260 (A) of the IncomeTax Act, 1961 against the order of the Income Tax AppellateTribunal 'B' Bench, Chennai in I.T.A.No.8/Mds/08 dated27.11.2009. Against the order of the Commissioner of Income-Tax-1, No.2,V.P.Rathinasamy Nadar Road, Bibikulam, Madurai-625 002 dated28.11.2007 C.No.401/3/2007-2008 PAN/GIR/No. for theAssessment Year 2003-2004 and against the order of the DeputyCommissioner of Income-Tax, Company Circle-I, Madurai, dated15.04.2005 PA.Number AACCP2308P, Company Circle-I, Madurai,Residential Status - Resident for the Assessment year 2003-2004. JUDGMENT (Judgment of the Court was delivered by R.MAHADEVAN, J.) According to the appellant / assessee, they are carrying onbusiness in manufacturing and exporting garments. For theassessment year 2003-04, they filed its return on 31.10.2003, https://hcservices.ecourts.gov.in/hcservices/ admitting an income of Rs.12,77,616/-. After scrutiny of thesame, the assessment was completed on 15.04.2005 under section143(3) of the Income-tax Act, 1961 (in short, 'the Act'),determining the total income at Rs.13,02,616/-. Thereafter,notice under section 263 came to be issued by the Commissionerof Income-tax-I, Madurai, on the premise that while computingthe income, the assessing officer allowed the deduction ofRs.1,27,52,945/- with respect to export of garments, claimed bythe appellant / assessee under section 10B of the Act, however,in the profit and loss account, it was noticed that the businessincome includes other income to the tune of Rs.1,75,917/-(Rs.1,08,797/- towards interest receipts + Rs.67,120/- towardsquota premium), which was not export oriented income to bequalified for deduction under section 10B of the Act. Uponreceipt of the notice, the appellant / assessee through itsauthorised representatives, made its submissions. However, byorder dated 28.11.2007, the Commissioner of Income Tax-I,Madurai, rejected the same and directed the assessing officer toexclude the said sum of Rs.1,75,917/- out of deduction undersection 10B and recompute the total income accordingly.Challenging the said order, the appellant / assessee preferredan appeal before the Income Tax Appellate Tribunal, Chennai 'B'Bench, in ITA No.8/Mds/2008, which was dismissed by order dated27.11.2009, after having held that “it is very well establishedthat there was an error in the order of the Assessing Officer bygranting deduction under section 10B of the Act to the items,which were not eligible and this resulted in prejudice to therevenue and thus, the learned CIT had correctly exercised hisjurisdiction under section 263 of the Act”. Aggrieved over theorder so passed by the Tribunal, the appellant / assessee hascome up with this tax case appeal. 2.On 22.02.2010, this court admitted this appeal on thefollowing substantial question of law: “Whether on the facts and in the circumstances ofthe case, the Tribunal is right in affirming the orderof the revisional authority under section 263 contraryto the decisions of the Apex Court reported in (2000)243 ITR 83 [Malabar Industrial Co. Ltd. v. C.I.T] and(2007) 295 ITR 282 [C.I.T. v. Max India Ltd] andjurisdictional High Court reported in (2007) 294 ITR121 [C.I.T v. Mepco Industries Ltd] especially when theAssessing Officer has adopted a possible view?” 2.On 22.02.2010, this court admitted this appeal on thefollowing substantial question of law: “Whether on the facts and in the circumstances ofthe case, the Tribunal is right in affirming the orderof the revisional authority under section 263 contraryto the decisions of the Apex Court reported in (2000)243 ITR 83 [Malabar Industrial Co. Ltd. v. C.I.T] and(2007) 295 ITR 282 [C.I.T. v. Max India Ltd] andjurisdictional High Court reported in (2007) 294 ITR121 [C.I.T v. Mepco Industries Ltd] especially when theAssessing Officer has adopted a possible view?” 3.When the matter was taken up for hearing on two occasionsviz., 07.03.2022 and 21.03.2022, there was no representationfor the appellant/assessee and hence, the same was directed tobe listed under the caption “For Dismissal” on 28.03.2022 i.e.,today. Accordingly, the case is listed today under the caption, https://hcservices.ecourts.gov.in/hcservices/ “For Dismissal”. However, there is no representation for theappellant/assessee. 4.On the other hand, Mrs.V.Pushpa, learned standing counselappearing for the respondent / Revenue submitted that during thependency of this appeal, the respondent by order dated24.03.2008, has given effect to the order dated 28.11.2007passed by the Commissioner of Income Tax – I, Madurai underSection 263 of the Income-tax Act; and the said order dated24.03.2008 was put to challenge by the appellant/assessee byfiling I.T.A.No.0022/08-09 before the Commissioner of Income Tax(Appeals) – I, Madurai, however, the said appeal ended indismissal on 28.01.2010. In support of her submissions, thelearned counsel produced the copies of the orders so passed bythe authorities concerned, in the form of typed set of papers.Therefore, according to the learned counsel, nothing survivesfor further adjudication in this appeal. 5.In view of the subsequent development as stated above, wedismiss this tax case appeal, leaving the substantial questionof law open for consideration in an appropriate case. No costs. Sd/- Assistant Registrar //True Copy// Sub Assistant Registrar mrr To 1. Income Tax Appellate Tribunal 'B' Bench, Chennai. Chennai. 2. The Assistant Commissioner of Income-Tax, Company Circle – 1, Madurai. Company Circle – 1, Madurai. 3. The Commissioner of Income-Tax-1, No.2, V.P.Rathinasamy Nadar Road, Bibikulam, Madurai-625 002. 4. The Deputy Commissioner of Income-Tax, Company Circle-I, Madurai. Company Circle-I, Madurai. Copy To The Section Officer,VR Section, High Court,Madras. +1cc to Mr.M.Swaminathan, Advocate, S.R.No.20844 T.C.A.No.158 of 2010 AD(CO)PM/22/04/2022