Income Tax Appellate Tribunal - Chandigarh
Vishal Paper Industries Private Ltd., ... vs Acit, Patiala on 16 March, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL
DIVISION BENCH, CHANDIGARH
BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER
AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER
ITA No.1328/Chd/2012
(Assessment Year : 2009-10)
Vishal Paper Industries Vs. The A.C.I.T.,
Private Limited, Circle Patiala.
Village Khushropur,
Main Road, Patiala.
PAN: AACCV2149L
(Appellant) (Respondent)
Appellant by : Shri Atul Goyal
Respondent by : Shri S.K,. Mittal
Date of hearing : 05.01.2017
Date of Pronouncement : 16.03.2017
O R D E R
PER ANNAPURNA GUPTA, A.M. :
The appeal filed by the Revenue is directed against the order of learned Commissioner of Income Tax (Appeals), Patiala dated 10.10.2012 relating to assessment year 2009-10.
2. The assessee has filed the present appeal aggrieved by the action of the Ld. CIT (Appeals) in upholding the disallowance of interest of Rs.34,16,372/- under proviso to section 36(1)(iii) of the Income Tax Act, 1961 (in short 'the Act') and has raised the following three grounds of appeal in relation to the same: 2
"1. That Learned CIT (Appeals) erred in upholding disallowance of interest of Rs. 5461372/- under proviso to section 36(1) (iii) of Income Tax Act 1961.
2. That Learned CIT (Appeals) failed to appreciate the written submissionsdated19.11.2011 filed before the Assessing Officer as well written submissions filed during the appellate proceedings. The facts and figures given in these replies have not been discussed in the body of the orders of the A.O. as well as Learned CIT(Appeals). These facts and figures have not been controverted by the authorities. The same deserves to be accepted.
3. That disallowance has been made on suppositions and presumptions. The prerequisite for application of proviso to section 36(1)(iii) have been completely ignored."
3. Brief facts relevant to the issue are that during assessment proceedings the Assessing Officer found the assessee had made addition to capital asset amounting to Rs.6,07,41,774/-. He also found that the assessee had raised the secured and unsecured loans amounting to Rs.6,41,81,092/- and Rs.5,26,21,635/- and paid interest amounting to Rs.1,22,44,479/-. The Assessing Officer held that in respect of the major expenses incurred to acquire new asset no evidence of putting them to use had been filed by the assessee and further he found that the company's working capital worked out to be Rs.2,83,97,641/- which was not enough to fund the investment in fixed asset to the tune of Rs.6.07 crores. He, therefore, held that the secured and unsecured loans had been used for making investment in fixed asset. He 3 further found that the total cost of asset under installation amounted to Rs.3,14,67,021/- and, therefore, went on to disallow interest @ 11% thereon amounting to Rs.34,61,372/-.
4. The matter was carried in appeal before the Ld. CIT (Appeals). During the course of hearing before the Ld. CIT (Appeals), the assessee submitted that the impugned issue was covered against it by the decision of the I.T.A.T., Chandigarh Bench in assessee's own case for assessment year 2007-08. The Ld. CIT (Appeals) in view of the above fact and in view of the fact that identical addition had been confirmed in assessment year 2008-09 also upheld the disallowance made and dismissed the assessee's grounds of appeal in this regard.
5. Before us, the Ld. counsel for the assessee argued that the facts in the present case were distinguishable from that in assessment year 2007-08 and, therefore, the issue could not be said to be covered by the order of the I.T.A.T. in that assessment year. At this juncture, it was pointed out to the Ld. counsel for the assessee that as per the order of the Ld. CIT (Appeals), the assessee itself had submitted that the matter was covered against it by the decision of the I.T.A.T. in assessee's own case for assessment year 2007-08. The Ld. counsel for the assessee was pointedly asked at Bar whether such an admission was made before the Ld. CIT (Appeals). To this, the Ld. counsel for the assessee 4 admitted that such an admission had been made before the Ld. CIT (Appeals).
6. The Ld. DR at this juncture pointed out that since the assessee had himself admitted that the issue was covered against it, it could not take totally a divergent stand at this stage before the I.T.A.T.
7. We have heard both the parties and have gone through the orders of the lower authorities. It is not denied that the assessee had admitted before the Ld. CIT (Appeals) that the issue in the present case was covered against it by the order of the I.T.A.T. in assessee's own case in the preceding year i.e. assessment year 2007-08. Even before us, the Ld. counsel for the assessee has admitted to the above submissions made before the Ld. CIT (Appeals). Having said so, we fail to understand what grievance remains with the assessee now, when admittedly the facts of the present case are identical to that in the preceding year. The decision rendered in the preceding year will squarely apply in the present case also and there can be no dispute or two views about that. Further when the assessee himself had admitted before the Ld. CIT (Appeals) that it was a covered matter meaning thereby that the issue and the facts involved therein were identical to that in the preceding year i.e. assessment year 2007-08 and the Ld. CIT (Appeals) following the judgment of the preceding year has decided the issue, there cannot be any grievance remaining with the assessee 5 against the action of the Ld. CIT (Appeals). The Ld. CIT (Appeals) has on the basis of the admission of the assessee itself, which we find, he further verified by asking for the comments of the Assessing Officer on the issue, has decided the appeal accordingly. The action of the Ld. CIT (Appeals) is in consonance with the submissions made by the assessee before him. The assessee, therefore, cannot be aggrieved by the action of the Ld. CIT (Appeals). Moreover, having himself admitted before the Ld. CIT (Appeals) that the facts of the present case were identical and hence covered by the decision of the I.T.A.T. for the preceding year, the Ld. counsel for the assessee cannot now take a complete 'U' turn also and state before us that the facts were distinguishable from that in assessment year 2007-08. This would tantamount to making a false statement before the Ld. CIT (Appeals) misleading him and further stopping him from making further enquiry on the issue, though we find that the Ld. CIT (Appeals) did not solely rely upon the submissions made by the assessee but got the same verified by the Assessing Officer also. Therefore, also we hold that the assessee cannot now make a new case before us by distinguishing the present case with that in assessment year 2007-08.
8. In view of the above, we hold that there is no merit in the grounds raised by the assessee before us and the Ld. CIT (Appeals) has rightly upheld the disallowance 6 following the order of the I.T.A.T. in assessee's own case for assessment year 2007-08, which as per assessee's own submissions and as verified by the Assessing Officer also, was identical on the same set of facts. In view of the above, ground Nos.1, 2 and 3 raised by the assessee are dismissed.
9. In the result, the appeal of the assessee is dismissed.
Order pronounced in the open court.
Sd/- Sd/-
(BHAVNESH SAINI) (ANNAPURNA GUPTA)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Dated : 16 t h March, 2017
*Rati*
Copy to:
1. The Appellant
2. The Respondent
3. The CIT(A)
4. The CIT
5. The DR
Assistant Registrar,
ITAT, Chandigarh