Income Tax Appellate Tribunal - Chennai
Acit, Chennai vs Mohan Breweries & Distilleries Ltd., ... on 9 January, 2019
आयकर अपील य अ धकरण, 'बी' यायपीठ, चे नई।
IN THE INCOME TAX APPELLATE TRIBUNAL
'B' BENCH: CHENNAI
ी एन.आर.एस. गणेशन, या यक सद य एवं ी इंटूर रामा राव, लेखा सद य के सम&
BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND
SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER
आयकर अपील सं./ITA No.1293/Chny/2017
नधा'रण वष' /Assessment Year: 2003-04
Asst. Commissioner of Income Tax, Vs. M/s. Mohan Breweries &
Central Circle-2(1), Distilleries Ltd.,
Chennai Rayala Towers, 2nd Floor,
158, Anna Salai,
Chennai - 600 002.
[PAN: AAAVM 2415L]
(अपीलाथ*/Appellant) (+,यथ*/Respondent)
अपीलाथ* क- ओर से/ Appellant by : Mrs. Sri Shanmugapriya, JCIT
+,यथ* क- ओर से /Respondent by : Shri Saroj Kumar Parida,
Advocate
सन
ु वाई क- तार ख/Date of Hearing : 11.12.2018
घोषणा क- तार ख /Date of pronouncement : 09.01.2019
आदे श / O R D E R
PER INTURI RAMA RAO, ACCOUNTANT MEMBER:
This is an appeal filed by the Revenue directed against the Order of the Commissioner of Income Tax (Appeals)-8, Chennai ('CIT(A)' for short) dated 21.03.2017 for the Assessment Year (AY) 2003-04.
2. The Revenue raised the following grounds of appeal:
1. The order of the learned Commissioner of Income Tax (Appeals) is erroneous on facts of the case and in law.ITA No.1293/Chny/2017 (AY: 2003-04)
M/s. Mohan Breweries & Distilleries Ltd.
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2. The learned CIT(A) erred in allowing the assesseë's appeal against the order passed on 24.11.2009 by the Assessing officer u/s 143(3) of the IT Act , read with order of Hon'ble ITAT, for the AY 2003-04 in the case of the assessee for statistical purposes.
2.1 The ld.CIT(A) ought to have appreciated that his direction to the Assessing Officer to re-compute the income of the assessee for A.Y. 2003-04 amounts to setting aside the assessment, a power which is not available to the ld.CIT(A) from 01.06.2001.
2.2 Having directed the Assessing Officer to follow the directions given in the order dated 08.02.2008 in ITA No. 1360 & 1361/Mds/2007 of the Hon'ble ITAT, the d.CIT(A) ought to have appreciated that the Assessing officer passed the order dated 24.11.2009 u/s 143(3) of the IT Act , read with order of Hon'ble ITAT, for the AY 2003-04 in this case following the directions contained in the said order of the Hon'ble ITAT.
2.3 The Id. CIT(A) ought to have appreciated that the Hon'ble ITAT vide its order dated 08.02.2008, had remitted the issue to the file of the Assessing officer, only to find out whether the assessee had been allowed deduction u/s 43B in the year in which the liability to sales tax accrued and if the assessee had not claimed the deduction the same should be allowed on the basis of actual payment.
2.4 The learned CIT(A) ought to have appreciated the finding of the Assessing officer in para 5 of page 2 of the assessment order dt. 24.11.2009 that neither the assessee had disallowed and added the payments u/s 43B of the IT Act in the computation of total income for the A.Ys 1995-96 to 1997-98 in which liability to sales tax accrued nor had the assessing officer disallowed such amount u/s 43B of the IT Act and hence the assessee is not eligible for allowance in the A Y 2003-04 on actual payment.
2.5 Having regards to the facts of the case that the directions of the Hon'ble ITAT have already been carried out by the Assessing Officer in his order u/s 143(3) of the IT Act dt. 24.11.2009 for AY 2003-04, the ld.CIT(A) ought to have upheld the action of the Assessing Officer in negating the claim of the assessee for deduction u/s 43B of IT Act.
3. For these grounds and any other ground including amendment of grounds that may be raised during the course of the appeal proceedings, the order of learned CIT(Appeals) may be set aside and that of the Assessing Officer be restored.
3. The brief facts of the case are that the respondent is a company incorporated under the provisions of Companies Act, 1956. It is engaged ITA No.1293/Chny/2017 (AY: 2003-04) M/s. Mohan Breweries & Distilleries Ltd.
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in the business of manufacture and sale of Indian made Foreign Liquor.
The return of income for the AY 2003-04 was filed on 01.04.2003 declaring total income of Rs. 29,28,28,000/-. Against the said return of income, the assessment was completed by the Assessing Officer u/s.
143(3) of the Income Tax Act, 1961 (for short 'the Act') vide order dated 28.03.2006. After set off of brought forward unabsorbed depreciation loss of Rs. 29,28,28,000/- the income was assessed at Nil. Subsequent to the completion of the assessment, the respondent assessee-company filed a letter 12.04.2006 seeking rectification of the assessment order on the ground that the claim made per deduction of sale tax for payment of income tax u/s. 43B. During the course of assessment proceedings was not considered by the Assessing Officer. The said rectification petition was rejected by the AO.
4. Being aggrieved, the order of the Assessing Officer, the respondent-assessee preferred an appeal before the ld. CIT(A), who allowed the same. Then, the Revenue carried the matter to the Tribunal. The Tribunal vide order dated 08.02.2008 in ITA Nos. 1360 & 1361/Mds/2007 set aside the issue to the AO with a direction to verify the whether the sales tax liability was allowed as deduction in the year of accrual of liability and to allow the same as a deduction in the year of ITA No.1293/Chny/2017 (AY: 2003-04) M/s. Mohan Breweries & Distilleries Ltd.
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payment of sale tax, in case it was not allowed as a deduction in the year of accrual of liability.
5. Pursuant to the order of the Tribunal, the AO passed the consequential order dated 24.11.2009 rejecting the claim of the respondent on the ground that the appellant neither disallowed voluntarily the provision per sale tax u/s. 43B of the Act in the AYs. 1995- 1996, 1996-97 & 1997-98 nor the AO made any disallowance u/s. 43B(3) of the Act and the claim for deduction u/s. 43B of the Act was made only after the conclusion of the assessment proceedings, which is a new claim, which cannot be admitted under proceedings of the s. 154 of the Act.
6. Being aggrieved by the consequential order passed, the appellant carried the matter to the ld. CIT(A), who vide impugned order has set aside the matter to the AO again. Being aggrieved, the order of remand, the Revenue is in appeal before us in the present appeal.
7. It is contended that the order of remand by the ld. CIT(A) is against the plain provisions of the Act as the provision of s. 250 of the Act does not empower ld. CIT(Appeals) to remand any matter to the AO. It is further contended that when the AO rendered a categorical finding that the liability had not accrued in the earlier years, the question of ITA No.1293/Chny/2017 (AY: 2003-04) M/s. Mohan Breweries & Distilleries Ltd.
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disallowance in the earlier years does not arise and therefore, allowing the same on the payment basis u/s. 43B of the Act does not arise, the remand to the AO is unwarranted.
8. On the other hand, the ld. Authorized Representative supported the order of ld. CIT(A).
9. We have heard the rival contentions and perused the material on record. The only issue involved in the present appeal is whether the order of remand by ld. CIT(A) to the AO to verify the accrual of liability in the earlier years and allowed the same as deduction in the year of payment of sale tax u/s. 43B of the Act is valid in law or not. We find that the directions of the ld. CIT(A) are only in consonance with the direction of the Tribunal in the earlier round of proceedings. Further, it is not the case of Revenue that claim was made subsequent to the conclusion of original assessment proceedings. Noting was brought on record by the Revenue to controvert the clear finding by the ld. CIT(A) that the claim for the deduction of the sales tax on payment basis was made during the course of original assessment proceedings. Thus, we do not find any illegality in the order of remand of ld. CIT(A) to the AO. ITA No.1293/Chny/2017 (AY: 2003-04)
M/s. Mohan Breweries & Distilleries Ltd.
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10. In the result, the appeal filed by the Revenue is dismissed.
Order pronounced on the 09th day of January, 2019 in Chennai.
Sd/- Sd/-
(एन.आर.एस. गणेशन) (इंटूर रामा राव)
(N.R.S. GANESAN) (INTURI RAMA RAO)
या यक सद य/JUDICIAL MEMBER लेखा सद य/ACCOUNTANT MEMBER
चे नई/Chennai,
3दनांक/Dated: 09th January, 2019.
EDN, Sr. P.S
आदे श क- + त4ल5प अ6े5षत/Copy to:
1. अपीलाथ*/Appellant 4. आयकर आयु7त/CIT
2. +,यथ*/Respondent 5. 5वभागीय + त न ध/DR
3. आयकर आयु7त (अपील)/CIT(A) 6. गाड' फाईल/GF