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08-03-2019, Micro Turners, Section 80IC, 80-IA, Tribunal Delhi

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2 months 1 week ago #8765 by amit
Section - 80IC, 80-IA
Order Date - 08-03-2019
Favouring - Revenue Partly allowed for statistical purposes
Court - Tribunal Delhi
Appellant - DCIT
Respondent - Micro Turners
Citation - 319Taxpundit212
Appeal No. - ITA No.-2181/Del/2016
Asstt. Year - 2012-13



The present appeal has been filed by the assessee assailing the correctness of the order dated 5.2.2016 of CIT(A) Rohtak pertaining to 2012-13 assessment year on the following grounds :-

1. “The CIT(A) has erred in Law and facts in deleting the addition of Rs. 3,55,16,810/- made by the AO on account of disallowance of expenses of taxable unit after reallocation without considering the Low NP of taxable units as compared to the exempt ones also audit expenses were only debited in one taxable unit.

2. The CIT(A) has erred in Law and facts in deleting the addition of Rs. 9,71,51,832/- made by the AO on account of disallowance on restictiion the deduction u/s 80IC by not considering the latest decision of M/s. Hycron Electronics V/s ITO in the ITA No. 798/CHD/2012 dated 29.05.2015 where in the case of M/s. Tirupati LPG Industries v/s DCIT had been already considered.”

3. Ld. CIT DR has sought time on the ground that paper book is required to be filed by the Revenue. Shri Gautam Jain, Advocate appearing on behalf of the assessee submitted that the issue is fully covered in favour of the assesee by decisions of the Apex court and the orders of the ITAT consistently, accordingly the departmental request for time was objected to. A pass over was given so that the Ld. CIT(A) DR may familiarize herself with the facts and consider the feasibility of the assessee’s objects to the grant of time. In the second round when the appeal came up for hearing the Ld. AR sought permission to elaborate the facts subject to the leave of the CIT(DR). The Ld. CIT DR posed no objection.

4. The Ld. AR Referring to the issue raised to ground No. 1 by the Revenue invited attention to the discussion in the assessment order made by the AO in para 5. Inviting attention to unnumbered page 3 of the assessment order he submitted that the assessing officer observed that the expenses are debited mainly to the taxable units and same is not in commensuration with the turnover of the units. Vide questionnaire dated 3.12.2014, the assesee was asked to justify the low NP in taxable units as compared to exempted units & why the expenses are quite high in some of the units with details. It was submitted that the assessee was noted made the submissions on 22.12.2014 & 21.1.2015 vide written replies noticed. Inviting attention to the order of the CIT(A) it was submitted that the CIT(A) has granted relief holding that the AO has not brought any factual evidence of discrepancy on record and has made an addition on a conjectural basis without proving any falsity in the claim. The noticed that the issue was a subject matter of consideration before the ITAT over the years. Attention was invited to order dated 20th December, 2016 for the immediate preceding assessment year i.e 2011-12 assessment in ITA No. 2028/Del/2016 copy of which has been filed and made available at pages 24 to 29. It was submitted that the specific issue was discussed. Similarly attention was invited to order dated 17th March, 2018 copy available at page 50 to 56 for 2011-12 assessment year wherein identical claim was repulsed by the ITAT. Similarly, in 2008-09; 2009-10 and 2010-11 assessment years the ITAT orders dated 15.2.2013, 19.7.2013 and 9.8.2016 in ITA No. 4569/Del/2011, ITA No. 2134/Del/2012, ITA No. 2369/Del/2014 respectively dismissed the departmental appeals on similar issues. Copies of these orders it was submitted is available at pages 1 - 7, 8 -14 and 15-23. In the said background it was his submission that there is no merit in the departmental appeal. It was his submission that it is evident from record that there is no change in the facts and circumstances.

5. Addressing the second issue raised by the Revenue in the present appeal attention was invited to the decision of the Apex Court in the case of CIT vs. Classic Binding Industries 407 ITR 429 (SC) (copy available at pages 62-66). Inviting specific attention to para 29 of the said decision and the chart of synopsis filed on the issue it was his submission that aassessee’s case is fully covered by the said decision.

6. Ld. CIT(DR) confronted with the orders of the ITAT in the context of the facts as noted in the orders of the AO and the CIT(A) and the decision of the Apex Court in the case of CIT vs. Classic Binding Industries respectively submitted that reliance is placed upon the assessment order. However no infirmity on fact or position of law was cited. The request for time consequently was withdrawn and for the two departmental grounds she relied upon the assessment order. However, no contrary fact or argument was brought to the notice of the Bench.

7. We have heard the rival submissions and perused the material available on records. We find qua the first issue wherein the assessee has placed reliance on the following orders of the ITAT the issue stands covered in assessee’s favour:

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