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Income Tax Appellate Tribunal, HYDERABAD BENCHES : BENCH “A” HYDERABAD
Before: SHRI A. MOHAN ALANKAMONY & SHRI S.S. GODARA
For Assessee: Mohd. Afzal, AR For Revenue: Shri Ashok Kardam, D.R. Date of Hearing : 27/09/2021 Date of Pronouncement : 2010/2021 O R D E R PER S.S. GODARA, J.M.
These assessee’s three appeals for Assessment Years 2010-11 to 2012-13 arise against the CIT(A)-11, Hyderabad’s separate orders; all dated 31st January, 2019 passed in case nos. 395, 397 & 398/2018-19 involving proceedings u/s 143(3) r.ws. 153A and r.w.s. 263 of the Income Tax Act, 1961 [the Act for short]. Heard both the parties. Case file perused.
It emerges at the outset with the able assistance coming from both the sides that the assessee’s former twin appeals ITA 737 and 738/Hyd//2019 involving sec. 143(3) rws 153A r.w.s. 263 proceedings of the Act deserve to be allowed since the same have no legs to stand as this tribunal’s co-ordinate to 739/Hyd/2019 AYs: 2010-11 to 2012-13 Krishnapatnam Port Company Ltd., Hyd’bad. bench order dated 22.07.2021 in its batch of appeals ITA 899 to 901/Hyd/17 and ITA 1083 to 1086/Hyd/17 quashing the corresponding sec.153A assessment(s) dated 31.03.2015 as not sustainable in law since not based on any incriminating material found or seized during the course of search. We thus hold that the impugned round of consequential assessment in furtherance to the Pr.CIT’s sec.263 revision action assumed against sec.143(3) r.w.s. 153A assessment(s) herein dated 31st March, 2015 vide his order dated 27.03.2017 have to be accepted. These two appeals ITA Nos. 737 and 738/Hyd/19 succeed therefore.
Next comes the assessee’s last appeal ITA 739/Hyd/2019 for A.Y. 2012- 13 raising following substantive grounds.
Learned Commissioner of Income Tax (Appeals) -11 [CIT(A)] has erred on facts and in law. 2.(a) Learned CIT(A) has erred in not granting relief in regard to exemption of dividend income of Rs. 11,675/ - claimed u/s 10(35) of Income Tax Act. (b) Learned CIT (A) is not correct in holding that since the assessment order u/s 143(3) r.w.s. 153A is the subject matter of revision, he cannot grant relief. (c) Learned CIT(A) has failed to note that in the appellate order passed u/s 250 of the IT Act against the assessment order his predecessor held that denial of exemption claimed u/s 10(35) is not correct. There has been no appeal by the Department against the relief granted by Learned CIT(A). Issue of exemption has become final. 3.(a) Learned CIT(A) has erred in not granting relief in regard to treatment of sale proceeds of scrap of Rs. 4,98,777/- added in the assessment order u/s 143(3) r.w.s. 153A holding that it is not derived from business and therefore not eligible for deduction u/ s. 80 IA(4) of the IT Act. (b) Learned CIT (A) is not correct in holding that since the assessment order u/s 143(3) r.w.s. 153A is the subject revision, he cannot grant relief. (c) In the appellate order passed u/s 250 of the IT Act in appeal against the assessment order u/s. 143(3) rws 153A his predecessor held that the income ITA Nos. 737 to 739/Hyd/2019 AYs: 2010-11 to 2012-13 Krishnapatnam Port Company Ltd., Hyd’bad.
from scrap is derived from infrastructure business and is eligible for deduction u/s. 80 IA (4). There has been no appeal by the Department against the relief and the issue has become final.
4. Learned CIT(A) is not justified in not granting relief in regard to the adjustment by way of addition of provision for bad & doubtful debt for purposes of Sec. 115 JB, as the AO himself accepted the stand of the assessee in that regard, after due consideration, in the original assessment, though subjected to revision.
5. For these and any other grounds that may be raised during appeal proceedings it is prayed that the additions made of (a). Provision of bad & doubtful debts u/s 115 JB, (b). Income from scrap as income from other sources and (c). Denial of exemption u/s. 10(35) of dividend income, be deleted.
We are informed during the course of hearing that the tribunal’s foregoing common order (supra) has restored the assessee’s identical 2nd and 3rd substantive grounds back to the Assessing officer for his afresh adjudication in view of the detailed supportive evidence coming from the taxpayer’s side. We thus adopt the very course of action herein as well and accept assessee’s 2nd and 3rd substantive grounds for statistical purposes in the very terms.
Lastly comes the assessee’s 4th substantive ground regarding provision of bad and doubtful debts addition amounting to Rs. 19,68,10,177/- for the purpose of sec.115 JB MAT computation. Both the learned representatives inform us during the course of hearing that the earlier coordinate bench order herein above had upheld sec. 263 revision in ITA 901/Hyd/17 on the ground that the assessee could not prove to have simultaneously reduced the impugned sum from the loans and advances on the asset side of the balance sheet as per Explanation I(i) of sec. 115 JB in light of hon’ble Gujarat high court’s Full Bench decision in CIT vs. Vodafone SR Co. Ltd. Dated 04.08.2017. The assessee’s only argument before us is that it has very well complied with the impugned statutory condition. to 739/Hyd/2019 AYs: 2010-11 to 2012-13 Krishnapatnam Port Company Ltd., Hyd’bad.
The Revenue on the other hand has supported the impugned MAT adjustment. Faced with this situation, we deem it appropriate to restore the instant remaining issue(s) as well back to the Assessing officer for his afresh factual verification subject to the condition that assessee shall file all relevant details; at its own risk and responsibility, within three effective opportunities. This last appeal ITA 739/Hyd/19 is accepted for statistical purposes.
To sum up, assessee’s former twin appeals ITA 737 and 738/Hyd/2019 are allowed and third appeal ITA 739/Hyd/19 is allowed for statistical purposes in foregoing terms. A copy of this common order be placed in the respective case files. Pronounced in Open Court on 20th October, 2021.