×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.
These appeals are filed by the revenue against the order of the Commissioner of Income Tax (Appeals) [CIT(A)]-3, Visakhapatnam dated 17.05.2018 and cross objections are filed by the assessee for the A.Y.2011- 12 to 2014-15. Since the facts involved in all these appeals are identical, the appeals are clubbed, heard together and disposed off in a common order for the sake of convenience as under:
2. We first take up the appeal for the A.Y. 2011-12 and extract the facts from the said assessment record The assessee is engaged in the business of stevedoring, transportation and warehousing, filed it’s return of income for the A.Y.2011-12 hrough e-filing on 29.09.2011 declaring total income of Rs.3,77,21,730/- after claiming the deduction of Rs.3,68,28,209/- u/s 80IA of the Income Tax Act, (in short ‘Act’). The assessment was completed u/s 143(3) in this case on total income of Rs.7,59,49,939/-. In the assessment made u/s 143(3), the AO disallowed deduction claimed by the assessee u/s 80IA of the Act. During the assessment proceedings, the AO observed that the assessee has claimed deduction u/s 80IA of the Act for an amount of R.3,68,28,209/- for operating and maintenance of the infrastructure facility i.e. Container Freight Station (CFS). The AO called for the explanation of the assessee as to why the deduction claimed u/s 80IA should not be disallowed for not having satisfied the conditions laid downu/s 80IA, i.e., not having an agreement with the Central Government or State Government or local authorities. Similarly, the AO was also of the view that CFS is not a port for the purpose of claiming the deduction u/s 80IA(4) and relied on Board Circular No.10/2005 dated 16.12.2005 and Circular No.793 dated 23.06.2000. The assessee filed explanation stating that the assessee had established a CFS at Mulagada, Mindi, Visakhapatnam for import and export of freight Necessary permission was accorded by Ministry of Commerce and Industry, the Department of Commerce Division, Govt. of India vide letter No.16/6/2001-Infra-I dated 22.10.2001. The assessee also has produced the copy of the said approval letter and subsequent letter dated 11.06.2004 and the letter of intent till 31.07.2004 before the AO. The Commissioner of Customs, Visakhapatnam Port Area has also declared the CFS area of the assessee company as ‘customs area’ for storage of container goods imported through Visakhapatnam Port and for stuffing of export cargo and destuffing of import cargo exported / imported through Visakhapatnam Port vide notification No.1/2004-Cus dated 21.06.2004. Subsequently, the Commissioner of Customs vide notification of cargo, imported and exported through its Container Freight Station. A public notice was also issued to that effect vide notice No.29/2004 dated 12.06.2004. The assessee submitted all the necessary evidences, copies of
the letters with regard to eligibility for deduction u/s 80IA and argued that the CFS is treated as infrastructure and entitled for deduction/s 80IA(4) of the Income Tax Act. The assessee also relied on the decision of Hon’ble Income Tax Settlement Commission in the assessee’s own case. The AO, not being convinced with the explanation of the assessee disallowed the deduction u/s 80IA for the reason that the assessee has not entered into an agreement with Govt. of India or State or local authority for the purpose of developing the infrastructure. The AO further held that the assessee does not fall under the purview of ‘Inland Port’ and also made observation that CFS is not an extension of Port. The Ld.AO did not follow the decision of Income Tax Settlement Commission (ITSC) on the ground that the Department has not accepted the decision of ITSC and filed writ petition before the Hon’ble High Court, Chennai, challenging the decision of Settlement Commission. Accordingly, disallowed the deduction claimed