Income Tax Appellate Tribunal - Ahmedabad
Mitesh Trading Co.,, Dahod vs Assessee on 17 August, 2010
IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD BENCH " C "
Before Shri G.D.AGRAWAL, VICE-PRESIDENT (AZ) and
Shri MUKUL Kr. SHRAWAT, JUDICIAL MEMBER
Date of hearing : 12/08/2010 Drafted on: 17/08/2010
ITA No.928/AHD/2008
Assessment Year : 2001-02
Mitesh Trading Co. Vs. The Income Tax Officer
GIDC Delsar Ward-1, Dahod
Chakaliya Road
Dahod
PAN/GIR No. : AACFM 3875 F
(APPELLANT) .. (RESPONDENT)
Appellant by : Shri Sakar Sharma
Respondent by: Shri K.M. Mahesh Sr. D.R.
ORDER
PER SHRI MUKUL Kr. SHRAWAT, JUDICIAL MEMBER :
This is an appeal at the behest of the Assessee which has emanated from the order of Learned CIT(Appeals)-VI, Baroda dated 02/08/2007 passed for Assessment Year 2001-02.
2. The substantive as also the legal ground which is contested at the outset is ground No.1 in respect of the invocation of the re-opening proceedings u/s.147 of the I.T. Act, 1961. In this regard, the Learned Authorised Representative of the assessee Shri Sakar Sharma has appeared and challenged the jurisdiction of re-opening of assessment. He has argued that the impugned order passed u/s.143(3) r.w.s.147 of the I.T. Act, 1961 dated 25/09/2006 for Assessment Year 2001-02 was bad ITA No.928/Ahd/2008 Mitesh Trading Co., Vs. ITO Asst.Year - 2001-02 -2- in law as held by the Respected ITAT Ahmedabad Bench "C" in assessee's own case for Assessment Year 2000-01 in ITA No.1299/Ahd/2007 order dated 12/03/2010 and the relevant portions (paragraph Nos.2, 13, 14, 15, 16 & 18) are reproduced below:-
"2. The facts of the case are that assessee, a partnership firm, was engaged in the business of processing of udad into Udad dal and was allowed deduction u/s. 80IA w.e.f. Assessment Year 1993-
94. Since then deduction u/s. 80IA is being allowed to the assessee. The character of processing and manufacturing activity of the assessee did not undergo any change. The return of income for A.Y. 2000-01 was filed on 20.10.2000 declaring total income of Rs.4,21,030/-. This case was processed u/s.143 (1) of the Act and subsequently the case was selected for scrutiny and assessment u/s.143(3) was done on 20.3.2003 and income was assessed at Rs.4,76,620/-. Subsequently, the A.O. reopened the assessment by issue of notice u/s.148 (1) dated 24.3.2005 for withdrawing deduction u/s.80IA. The assessee filed return in response to that notice on 15.4.2005 declaring total income of Rs.4,21,030/- being the income declared by it in the return filed on 20.10.2000."
....
"13. Even otherwise, reopening of the assessment is bad on another account also. Once the department has allowed the deduction u/s. 80IA in the earlier assessment years and also in the subsequent assessment years and no action has been taken to reopen or set aside or revise the assessment for these years, even though assessee had pointed out this fact to the department during the course of re-assessment proceedings, then following the rule of consistency the department should have allowed deduction u/s. 80- IA or in the alternative they ought to have taken action in all the years, wherever law permitted, if they thought that conversion of Udad into Udad Dal is not a manufacturing activity within the meaning of section 80IA. Having not done so the A.O. ought to have followed the rule of consistency and ought not to have taken action this year also. The principle of consistency cannot permit the revenue to take a stand contrary to the one accepted by it. (CIT vs. H.P. Cotton Textile Mills Ltd. (2009) 311 ITR 436 (P & H). The ITA No.928/Ahd/2008 Mitesh Trading Co., Vs. ITO Asst.Year - 2001-02 -3- principle of consistency require that the view taken by the department in the preceding years should not be disturbed unless there was a change in the factual and legal position (CIT vs. Malboro Polychem Pvt. Ltd., (2009) 309 ITR -43) wherein it is held as under:-
" Where a fundamental aspect permeating through different assessment years has been found as a fact, one way or the other, and the parties have allowed that position to be sustained by not challenging the order, it would not be at all appropriate to allow the position to be changed in a subsequent year. For the sake of consistency and for the purpose of finality in all litigations, including the litigation arising out of the fiscal statutes, earlier decisions on the same question should not be reopened unless some fresh facts are found in the subsequent year. (CIT vs. Moonlight Builders & Developers- 2008 307 ITR- 197 (Del)."
14. The Revenue had to maintain the consistency for the purpose of finality in all litigation and a decision on the same question would not be reopened unless some new facts were found with material difference in subsequent years. This was observed by Hon'ble Punjab & Haryana High Court in the case of Sood Harvestor (2008) 304 ITR 379 (P&H) and following the decision of Hon'ble S.C. in the case of Radhaswamy Satsang vs. CIT 193 ITR 321 (SC).
15. In view of above reasoning and following the rule of consistency the assessment for the A.Y. 2000-01 ought not to have been reopened as there is no change in facts and legal position.
16. Further, we are of the view that once the conditions laid down for claim of deduction u/s. 80IA were held satisfied when deduction was granted in the first assessment year i.e. A.Y. 1993- 94 then it ought to have been allowed in subsequent years also if there is no change in factual and legal position. This was so observed by the Tribunal in M/s. Parekh Power Corporation (supra) observing on page 16 & 17 as under :-
ITA No.928/Ahd/2008Mitesh Trading Co., Vs. ITO Asst.Year - 2001-02 -4- "The assessee was allowed deduction in A.Ys.1998-99 to 1999- 2000.The conditions as stipulated u/s.80IA have to be complied with in the first year and the assessee has duly complied with these conditions. For this reliance was placed on the decision of the Hon'ble Bombay High Court in the case of CIT v. Tyresoles Concessionaries Pvt. Ltd., 213 ITR 660 (Bom.).
The assessee claimed deduction u/s. 80IA (2)(iv)(b) of the Act as it is located in Industrially Backward state specified in Eighth Schedule. Subsequent to split of original section 80 IA, deduction is now available u./s. 80IB(4) OF THE Act. The assessee commenced the production with effect from 08.08.1997 and, therefore, the first assessment year was A.Y. 1998-99. There had been no reopening or action u/s. 263 for withdrawal of deduction even after making the assessment u/s. 143(3) for A.Y. 2000-01 in which deduction sought was denied. It is a settled proposition of law that the A.O. has no power to withdraw relief without disturbing the relief granted in the earlier years as held in Saurashtra Cement &Chemical Industries Ltd., vs. CIT 123 ITR 669 (Guj.), CIT vs. India Forge & Drop Stampings Ltd. 240 ITR- 208 (Mad) and Glaxo Smithklin Consumer Healthcare Ltd. v.
ACIT 112 TTJ-94 (Chd.)."
...
"18. In view of the above we hold that the reopening of the assessment u/s. 147/148 was bad in law. As a result assessment order framed by the Assessing Officer on 15.03.2006 was illegal and is cancelled. The appeal of the assessee is accordingly allowed."
3. Once on identical facts in assessee's own case the Respected Co- ordinate Bench has taken a view, therefore, considering the entirety of the circumstances and a view already taken, the judicial propriety requires one Bench of the Tribunal to follow another Bench where facts are the same. We find no reason to adopt any other view because on identical facts and circumstances, the aforesaid Respected Co-ordinate Bench has already taken a decision which ought to be followed in the ITA No.928/Ahd/2008 Mitesh Trading Co., Vs. ITO Asst.Year - 2001-02 -5- present appeal. Accordingly, we allow this ground. Since the preliminary issue of jurisdiction goes in favour of the assessee, therefore, rest of the ground need not to be adjudicated upon as held in the case of Rahul Kr.Bajaj reported as 69 ITD 01 (S.B.). We order accordingly.
5. In the result, the appeal of the assessee is allowed.
Order signed, dated and pronounced in the Court on 20/ 08 /2010.
Sd/- Sd/-
( G.D.AGRAWAL ) ( MUKUL Kr. SHRAWAT )
VICE PRESIDENT (AZ) JUDICIAL MEMBER
Ahmedabad; Dated 20/ 08 /2010
T.C. NAIR, Sr. PS
Copy of the Order forwarded to :
1. The Assessee.
2. The Department.
3. The CIT Concerned
4. The ld. CIT(Appeals)-VI, Baroda
5. The DR, Ahmedabad Bench
6. The Guard File.
BY ORDER,
स×याǒपत ूित //True Copy//
(Dy./Asstt.Registrar), ITAT, Ahmedabad