TATA SPONGE IRON LTD,KEONJHAR vs. DCIT, SAMBALPUR

This appeal had originally been disposed off by the Tribunal vide order dated 12.08.2011, wherein the assessee had been granted relief on some of the issues and more specifically in respect of deduction u/s.80IA of the Act regarding captive power plant operated by the assessee, the issue had been held against the assessee. Aggrieved against the order of the Tribunal, the assessee had carried the matter in appeal to the Hon’ble High Court of Orissa in of 2011. The Hon’ble Jurisdictional High Court had in its order dated 31.07.2019 adjudicated the issues of 80IA and had in page 4 of the Hon’ble High Court’s order following the decision of the Hon’ble Gujarat High Court in the case of CIT Vs. Alembic Limited, reported in Manu/GJ/1414/2016 (decided on 20.07.2016), against which SLP had been filed before the Hon’ble Supreme Court bearing SLP No.8070 of 2017, had held that subject to the result of the SLP in the case of Alembic Limited (supra), the issue of deduction u/s.80IA of the Act was held in favour of the assessee. However, the Hon’ble jurisdictional High Court in page 7 of its order further went on to hold that the Tribunal had not considered the issue in its true perspective and only for the adjudication on the factual matrix in terms of the discussion and the adjudication of law as done by the Hon’ble High Court, the matter was remitted to the Tribunal for fresh adjudication. Today, the matter has come up for hearing before the Tribunal.

Shri S.K.Mohapatra, CIT-DR represented on behalf of the revenue and Shri A.K.Sabat & Shri B.K.Mahapatra, CAs, represented on behalf of the assessee.

Ld. AR drew our attention to the assessment order, more specifically at page 5 para 3.5 to para 3.7 at page 6. It was the submission that the ld. AO has denied the assessee the benefit of deduction u/s.80IA of the Act on the two grounds. The first ground being that the assessee has not maintained and produced the separate books of accounts, more specifically separate sets of P&L account and balance sheet in respect of power plant. Second reason is that the assessee had failed to furnish the separate sets of audited profit and loss account in respect of power plant. It is an admitted fact that the audit report in respect of Sponge Iron Plant had been submitted (representing the whole company).

Ld. AR drew our attention to the provisions of Section 80IA of the Act to submit that there was no requirement of maintenance of separate books of accounts under the provisions of Section 80IA of the Act. The ld. AR further drew our attention to page 405 of the paper book which was the copy of the audit report in Form 10CCB being the audit report u/s.80IA of the Act. Ld. AR also drew our attention to page 140 of the paper book which was the copy of the letter dated 11.12.2006 from the assessee to the ACIT, Circle-1(1), Sambalpur, wherein in para 2.3, the audit report in Form 10CCB is specifically mentioned. It was the submission that the audit report in the Form 10CCB had been specifically produced before the AO. It was the submission of the ld. AR that as both the objections of the ld. AO have been met on a factual matrix and on the legal plain, the issue has been held in favour of the assessee by the Hon’ble jurisdictional High Court. Therefore, it was prayed that the issue may be held in favour of the assessee. Further, the ld. AR submitted that, in any case, from the legal point, the Hon’ble jurisdictional High Court has put fetters on the allowances itself to be subject to the outcome of the decision of the Hon’ble Supreme Court in the case of Alembic Limited (supra).

In reply, the ld. CIT-DR vehemently opposed to allowing deduction u/s.80IA of the Act. It was the submission that nothing stopped the