The Commissioner Of Income Tax-Ii v. Amtrex Hitachi Limited

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 1359 of 2008With R/TAX APPEAL NO. 1363 of 2008 ================================================================ THE COMMISSIONER OF INCOME TAX-II VersusAMTREX HITACHI LIMITED ================================================================Appearance:MRS MAUNA M BHATT(174) for the Appellant(s) No. 1MRS SWATI SOPARKAR(870) for the Opponent(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALAand HONOURABLE MR. JUSTICE BHARGAV D. KARIA Date : 28/01/2020 COMMON ORAL ORDER (PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA) 1.These tax appeals under Section 260A of the Income Tax Act, 1961 (for short “the Act, 1961”) are at the instance of the Revenue and is directed against the common order dated 22[nd ]December, 2006 passed by the Income Tax Appellate Tribunal, Ahmedabad Bench “A”, Ahmedabad in the ITA No.1269/Ahd/2003fortheA.Y.1995-96andITA No.22004/Ahd/2003 for the A.Y. 1997-98. 2.Since the questions of law as proposed by the Revenue in both the captioned tax appeals are the same, those were heard analogously and are being disposed of by this common order. 3.Both the tax appeals were ordered to be admitted on the following substantial questions of law; “(A) Whether the Appellate Tribunal is right in law and on facts in confirming the order passed by the CIT (A) allowing the revised claim of deduction u/s.80IA? (B)Whether the Appellate Tribunal is right in law and on facts in confirming the order passed by the CIT (A) deleting the disallowance of consultancy fees of Rs.7,75,000/- paid to M/s. B.B. Electricals?” 4.For the sake of convenience, the Tax Appeal No.1359 of 2008 is treated as the lead matter. 4.1The respondent-assessee had filed its return of income on 13[th] November, 1995 for the A.Y.1995-96, declaring total income at Rs.9,53,140/-. In the said return of income, the assessee had claimed deduction under Section 80IA of the Act, 1961 at Rs.3,22,05,867/-. During the assessment proceedings, the assessee submitted a revised claim of deduction under Section 80IA of the Act, 1961 at Rs.6,30,58,127/-. 4.2The Assessing Officer, vide order dated 27[th] March, 1998 passed under Section 143(3) of the Act, 1961, rejected the revised claim of deduction made by the assessee under Section 80IA and limited it to the original claim of Rs.3,22,05,867/- 4.3The total income as assessed by the Assessing Officer even after inclusion of disallowance of the consulting fees paid to M/s. B.B. Electricals (as capital expenditure) works out to be Rs.314.84 Lakhs. 4.4The assessee, being aggrieved by the assessment order, preferred appeal before the CIT (A), who by an order dated 28[th ]June, 1999, restored the issue of revised claim of deduction to the file of the Assessing Officer for being examined afresh. 4.5It appears that the Assessing Officer passed a fresh assessment order under Section 143(3) read with Section 250, of the Act on 28[th] March, 2002, thereby again rejected the revised claim of deduction made by the assessee. 4.6The assessee went in appeal before the CIT (A). The CIT (A) by an order dated 15[th] January, 2003 directed the Assessing Officer to accept the revised working. 4.7The Revenue, being dissatisfied with the order passed by the CIT (A), preferred appeal before the Income Tax Appellate Tribunal. The Tribunal dismissed the appeals preferred by the Revenue on the ground that as the assessed income is only Rs.314.84 Lakhs, the revised claim made by the assessee would be of no consequence and the objection raised by the Revenue would be academic. 4.8Being dissatisfied with the order passed by the Tribunal, the Revenue has filed these appeals. 4.6The assessee went in appeal before the CIT (A). The CIT (A) by an order dated 15[th] January, 2003 directed the Assessing Officer to accept the revised working. 4.7The Revenue, being dissatisfied with the order passed by the CIT (A), preferred appeal before the Income Tax Appellate Tribunal. The Tribunal dismissed the appeals preferred by the Revenue on the ground that as the assessed income is only Rs.314.84 Lakhs, the revised claim made by the assessee would be of no consequence and the objection raised by the Revenue would be academic. 4.8Being dissatisfied with the order passed by the Tribunal, the Revenue has filed these appeals. 5.It appears from the materials on record that the Tribunal has rightly held that the appeal has become academic in view of the fact that the total income of the assessee for the A.Y. 1995-96 even after inclusion of the disallowance made by the Assessing Officer was Rs.314.84 Lakhs, against which the claim under Section 80IA allowed by the Assessing Officer was at Rs.322.05 Lakhs. The Tribunal also considered that even the CIT (A) has also allowed the revised claim of deduction made by the assessee under Section 80IA of the Act, 1961 at Rs.630.35 Lakhs keeping in mind the fact that the income of the assessee prior to deduction under Section 80IA of the Act was Rs.314.84/-. Lakhs. Therefore, the issue of revised claim made by the assessee of Rs.690.35 Lakhs is of no consequence. 6.Similarly, for the A.Y.1997-98, the assessee's total income prior to deduction under Section 80IA of the Act, 1961 stands assessed at Rs.190.68 Lakhs. However, the eligibility to deduction under Section 80IA stands confirmed by the Assessing Officer at Rs.354.02 Lakhs. Therefore, the consideration of revised claim of Rs.487.39 Lakhs is no consequence as the assessed income is much less than the eligibility under Section 80IA of the Act, 1961. 7. The Tribunal has therefore rightly dismissed both the appeals qua Question (A) on the ground that the same is academic in nature. We, therefore, decline to answer Question (A). 8. With regard to Question (B) pertaining to disallowance of consultancy fees of Rs.7,75,000/- paid to M/s. B.B. Electricals, both, the CIT (A) and the Tribunal have given concurrent findings of fact and, hence, we answer Question (B) being factual in favour of the assessee and against the Revenue. 9. In the result, both the tax appeals fail and are hereby dismissed. (J. B. PARDIWALA, J) (BHARGAV D. KARIA, J)