The Commissioner Of Income Tax, Patiala v. M/S. Ganesh Steel Indus., Mandi Gobindgarh

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH I.T.R. No. 254 of 1995 DATE OF DECISION: 8.7.2009 The Commissioner of Income Tax, Patiala Versus M/s. Ganesh Steel Indus., Mandi Gobindgarh ..........Applicant ..........Respondent CORAM:- HON'BLE MR. JUSTICE ADARSH KUMAR GOEL HON'BLE MRS. JUSTICE DAYA CHAUDHARY Present:-Mr. Rajesh Katoch, Advocatefor the applicant. Mr. Pankaj Jain, Advocatefor the respondent. **** ADARSH KUMAR GOEL, J. (Oral) 1.The Income Tax Appellate Tribunal, Chandigarh Bench,Chandigarh has referred following question of law for opinion of this Court,arising out of its order dated 8.1.1992 in ITA No. 142/Chandi/87, for theassessment year 1982-83:- “Whether, on the facts and in the circumstances of thecase, the Appellate Tribunal was right in law incancelling the order passed under Section 263 of theIncome Tax Act by the Commissioner of Income Tax?” 2.The assessee is running a rolling mill and claimed investmentallowance in respect of weight bridge under Section 32-A of the IncomeTax Act, 1961 (in short, 'the Act'), which was allowed by the assessingauthority. Against the order of assessment, appeal of the assessee was I.T.R. No. 254 of 1995 decided. Thereafter, the Commissioner of Income Tax invoked hisjurisdiction under Section 263 of the Act and set aside the assessmentorder and directed the Assessing Officer to re-examine the claim of theassessee and give reasons for the allowance. Appeal of the assesseewas, however, allowed by the Tribunal following its earlier order in the caseof Yash Pal Garg & Company (P) Limited, ITA No. 724/Chandi/87, forassessment year 1982-83 dated 7.1.1992, annexed as Annexure 'C' to thestatement of the case, without examining the objection of the revenue thatinvestment allowance was not admissible on the weigh bridge, in view ofClause (b) of sub Section 2 of Section 32-A of the Act, as the weigh bridgewas not machinery or plant used in manufacture or production of an articleor thing nor it is used for the purpose of business of generation orproduction of electricity. 3.The Tribunal held that once order of assessment had beenappealed against, the same could not have been thereafter subjected torevision under Section 263 of the Act. 4.We have heard learned counsel for the parties. 5.Learned counsel for the revenue submits that there wereearlier two views on the subject and in the clarificatory amendment in theyear 1989, it was provided that power under Section 263 of the Act couldbe exercised even if an order of assessment had been subject matter ofappeal. The amendment was, on its terms, retrospective and covers everyappeal, which may have been filed on or before or after 1.6.1988 and, thus,the present case was covered by the said amendment. This amendmentwas not noticed by the Tribunal. He also relies upon the judgment ofHon'ble the Supreme Court in Commissioner of Income Tax Vs. ShriArbuda Mills Ltd. (1998) 231 ITR 50 and judgment of Bombay High Courtin Commissioner of Income Tax Vs. Ratilal Bacharilal and sons (2006)282 ITR 457 (Bom), taking the same view. 6.This position could not be disputed by learned counsel for the revenue. 7.In view of above, the question referred is answered in favour ofthe revenue and against the assessee. The order of the Tribunalcancelling the order of CIT under Section 263 of the Act, on the ground thatsince the order of assessing authority had been subject matter of appeal,the same could not be subject matter in revision under Section 263 of theAct, is held to be erroneous. 8.Reference is disposed of accordingly. (ADARSH KUMAR GOEL) JUDGE July 08, 2009pooja (DAYA CHAUDHARY)JUDGE Note:-Whether this case is to be referred to the Reporter .......Yes/No