Balaji Polymers, Silvassa vs Assessee

आयकर अपीलीय अिधकरण, अिधकरण, अहमदाबाद Ûयायपीठ ''C'', अहमदाबाद । IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, "C" BENCH

सव[ौी ौी जी. जी.सी. सी.गुƯा, माननीय उपाÚय¢, उपाÚय¢, एवं अिनल चतुवद ȶ ȣ, ȣ, लेखा सदःय के सम¢ । BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND ANIL CHATURVEDI, ACCOUNTANT MEMBER)

ITA No.2623/Ahd/2009 [Asstt.Year : 2005-2006]

Balaji Polymers बनाम/Vs. ITO, Ward-3 S.No.132/1/4 Vapi. B/h. Prince Plastic Athal, Silvassa Pin : 396 230. ITA No.2211/Ahd/2010 [Asstt.Year : 2006-2007]

ITO, Ward-3 बनाम/Vs. Balaji Polymers Vapi. S.No.132/1/4 B/h. Prince Plastic Athal, Silvassa Pin : 396 230.

(अपीलाथȸ / Appellant) (ू×यथȸ / Respondent)

िनधा[ǐरती कȧ ओर से/ : Assessee by Shri Tushar Hemani राजःव कȧ ओर से/ : Revenue by Shri M.K. Singh, Sr.DR सुनवाई कȧ तारȣख/ : Date of Hearing 8th December, 2014

घोषणा कȧ तारȣख/ : Date of Pronouncement 09-01-2015

आदे श / O R D E R

PER G.C. GUPTA, VICE-PRESIDENT: These appeals by the assessee and the Revenue of the Asstt.Year 2005-06 and 2006-07 are directed ITA No.2623/Ahd/2009 - 2

against the order of the CIT(A). These are being disposed of with this consolidated order.

ITA No.2623/Ahd/2009 - A.Y.2005-06 (Assessee's Appeals)

2. The grounds of the appeal of the assessee are as under:

"1. The ld.CIT(A) has grossly erred in law and the facts in disallowing availability of 80IB deduction of the IT Act, 1961 to the firm on certain assumption.

2. The ld.CIT(A) has disallowed 80IB deduction because of production of small quantity by the firm in the financial year 2003- 04 which is not fair. Start of productions sufficient to satisfy one of the condition of 80IB benefits and production should start before 31.3.2004.

3. The Ld.CIT(A)has not justified the disallowance of 80IB benefits on the ground of factory licence was not obtained by the firm. The factory act is an independent act and benefits of 80IB cannot be denied by taking the shelter of violation of other laws and Acts."

3. The learned counsel for the assessee submitted that the only issue in this appeal of the assessee is regarding claim of deduction under section 80IB of the Act. He submitted that the deduction was disallowed by the Revenue on the plea that the assessee has not secured production license before the commencement of the production. He submitted that the issue is covered in favour of the assessee with the decision of ITAT, Ahmedabad in assessee's own case for the subsequent Asstt.Year 2007-08 and the Revenue's appeal in ITA No.464/Ahd/2011 dated 22/7/2011 wherein the issue is decided in favour of the assessee. He submitted that the assessee is within the territorial jurisdiction of the Hon'ble Bombay High Court, being a unit situated at Silvassa and therefore, the decision of the Hon'ble Bombay High Court on identical facts in CIT Vs. Jolly

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Polymers in ITA(L) No.1622/Ahd/2012 order dated 21.2.2013 is binding on the Ahmedabad Tribunal. The learned DR has relied on the orders of the AO and the CIT(A).

4. We have considered rival submissions and perused the orders of the AO and the CIT(A). We find that the issue of deduction under section 80IB of the Act is covered in favour of the assessee with the decision of the Co-ordinate Bench of the ITAT, Ahmedabad in assessee's own case in subsequent Asstt.Year 2007-08 dated 22.7.2011 (supra) wherein it was held that the assessee has obtained factory license subsequently, and has commenced its activities within the Asstt.Year 2004-05, though not significantly. The Tribunal in this case has followed the decision of the ITAT, Mumbai Bench in ITO Vs. Jolly Polymers in ITA No.2763/Ahd/2010 A.Y.2007-08 dated 18.3.2011 wherein the issue was decided in favour of the assessee. We find that the order of the ITAT, Mumbai in ITO Vs. Jolly Polymers dated 18.3.2011 (supra) has been confirmed by the Hon'ble Bombay High Court in CIT Vs. Jolly Polymers vide order dated 21.2.2013 (supra). It is well settled that since the assessee falls in Silvassa, within the territorial jurisdiction of Hon'ble Bombay High Court, the decision of the Hon'ble Bombay High Court is binding on the ITAT, Ahmedabad, and accordingly, we decide in favour of the assessee and the grounds of the appeal of the assessee are allowed.

ITA No.2211/Ahd/2010 - A.Y.2006-07 (Revenue's appeal)

5. The only ground raised in this appeal of the Revenue is as under:

"1. On the facts and circumstances of the case, and in law, the ld.CIT(A) has erred in deleting the disallowance of deduction u/s.80IB amounting to Rs.21,24,793/-."

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6. Both parties before us submitted that the issue in the Revenue's appeal is identical with the issue of deduction under section 80IB in the assessee's appeal for the earlier Asstt.Year 2005-06. We have considered rival submissions. The facts and circumstances for this Asstt.Year 2006- 07 are identical with the facts of the case of the assessee for earlier Asstt.Year 2005-06. For the reasons recorded while allowing the appeal of the assessee for the earlier Asstt.Year 2005-06, in the foregoing paras of this order, we hold that there is no merit in the ground of appeal of the Revenue, which is accordingly dismissed.

7. In the result, appeal of the assessee for A.Y.2005-06 is allowed and the appeal of the Revenue for A.Y.2006-07 is dismissed.

Order pronounced in Open Court on the date mentioned hereinabove.

Sd/- Sd/- अिनल चतुवȶदȣ / ANIL CHATURVEDI) (अिनल (जी. जी.सी. सी.गुƯा/G.C. GUPTA) लेखा सदःय /ACCOUNTANT MEMBER उपाÚय¢ /VICE-PRESIDENT

Copy of the order forwarded to: 1) : Appellant 2) : Respondent 3) : CIT(A) 4) : CIT concerned 5) : DR, ITAT. BY ORDER

DR/AR, ITAT, AHMEDABAD

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