×Latest Case Laws on Income Tax by various Income Tax Appellate Tribunals in India
These are the latest case laws decided by various Income Tax Appellate Tribunals (ITAT) of India on Income Tax which have been published recently. The case laws are open for discussion and we invite expert comments from our members on its applicability and effect on relevant issues.
The above captioned appeal is filed at the instance of assessee pertaining to Assessment Year 2011-12 and is directed against the orders of Ld. Commissioner of Income Tax (Appeals)-1 (in short ‘Ld.CIT(A)’], Indore dated 21.3.2016 framed u/s 263 of the Income Tax Act 1961(In short the ‘Act’).
2. Briefly stated facts as culled out from the records are that the assessee is a Pvt. Ltd company engaged in manufacturing and trading of HDPE/PE Woven Sacks and FIBC Jumbo Bags. E-return for Assessment Year 2012-13 filed on 27.9.2012 declaring Nil income after claiming loss for the current year at Rs.3,17,87,340/-. Case selected for scrutiny assessment by way of serving notice u/s 143(2) of the Act. Assessee company was running 3 units namely DTA Division, SEZ Division and Kashipur Division. Income from SEZ Division is exempt u/s 10A(1A) of the Act. Assessee incurred loss in Kashipur Division but while
computing income assessee has first claimed exemption u/s 10A(1A) of the Act and remaining income was used to set off current and brought forward loss. This claim of the assessee allowed by the Ld. A.O on the basis of his understanding of provisions of Income Tax Act and CBDT circulars issued on this issue and documents filed before him. However, Ld. A.O made disallowance u/s 14A of the Act at Rs.61,43,940/- and also made disallowance for interest paid on Income Tax at Rs.15,82,154/- and assessed loss at Rs.2,40,10,826/-. Subsequently Ld. Principle Commissioner of Income Tax assuming jurisdiction u/s 263 of the Act perused the records and observed that the order passed by Ld. A.O u/s 143(3) of the Act dated 30.3.2015 is erroneous and prejudicial to the interest of revenue because it was made without proper enquiry, non application of mind and based on insufficient material.
3. Now the assessee is in appeal challenging the order of Principle Commissioner of Income Tax u/s 263 of the Act for wrongly assuming the jurisdiction even when proper enquiry was made by Ld. A.O. Following grounds have been raised;
“01. That on the facts and in the circumstance of the case the learned Pr. Commissioner of Income tax was wrong in invoking the power of revision u/s 263 of the Income tax Act.
02. That, the learned Pr. Commissioner of Income tax-I, Indore failed to appreciate that the necessary documents pertaining to the claim of deduction under section 10A(lA), interest on income tax and additional depreciation were before the Assessing Officer.
03. That, the learned Assessing Officer after applying his mind and verifying the details and submission of the assessee company allowed deduction under section 10A(lA), interest on income tax and additional depreciation.
04.That the Learned Pr. Commissioner of Income Tax-I without appreciating the submission of the assessee company, treated the assessment order as erroneous and prejudicial to the interest of revenue and passed order under section 263 of the Income Tax.
05.That the assessee company craves leave to add, alter, amend and or delete any grounds of appeal.”
4. Ld. Counsel for the assesse vehemently argued referring to following written submissions given for the grounds raised in these appeals;
“That the assessment order under section 143(3) of the Income Tax Act of the assessee company was completed for the assessment year 2012-13 on 30.03.2015 determining total loss at Rs.24010830/-. That thereafter proceedings under section 263 of the Income Tax Act were initiated considering the assessment order as erroneous and prejudicial to the interest of revenue and show cause notice was issued to the assessee on 25.07.2016.
That the learned Principal Commissioner of Income Tax Act passed the order under section 263 of the Income Tax Act and set aside the assessment order passed under section 143(3) of the Income Tax Act.
That aggrieved by the order passed under section 263 of the Income Tax Act by the learned Principal Commissioner of Income Tax Act, the assessee company has filed appeal before the Honorable Income Tax Appellate Tribunal, Indore Bench, Indore and this is assessee appeal before the honorable bench.That the learned Principal Commissioner of Income Tax Act initiated proceedings under section 263 of the Income Tax Act on the ground of the order passed by Assessing Officer to be erroneous as well as prejudicial to the interest of revenue on account of the failure on the part of the Assessing Officer to make necessary enquiries and passed order under section 263 of the Income Tax Act without appreciating the submission of the assessee company. Sir, we are filing herewith the following submission, which shall go to show that the Assessing Officer did not err while allowing the exemption, because he had fully applied his mind to the facts of the case.