Mamta Silk Mills Pvt.Ltd.,, Surat vs Assessee
- CitationITA No. 2700/Ahd/2011
Ratio decidendi
The rule this decision rests on
Where a jurisdictional High Court has decided a point of law in the assessee's favour and no contrary decision of the jurisdictional High Court or the Supreme Court is shown, the Tribunal is bound to follow that decision and may set aside the lower authorities' order on that point, restoring the issue to the Assessing Officer to give effect to the High Court ruling. Where the assessee's counsel concedes that an issue has been decided against the assessee by the Tribunal in the assessee's own case for an earlier year, and the Revenue does not object, the Tribunal may confirm the addition for the year under appeal, giving only the consequential direction that the closing work-in-progress of the year under appeal becomes the opening work-in-progress of the next year and must be adjusted accordingly. Where the Tribunal has set aside an issue to the Assessing Officer for re-adjudication in the assessee's case for an earlier year, and counsel concedes the same issue arises, the Tribunal may set aside the issue for the year under appeal to the Assessing Officer to be re-adjudicated in accordance with the earlier Tribunal direction, allowing the assessee adequate opportunity of being heard. Where the jurisdictional High Court has held, following a Circular clarifying the statutory amendment, that the eight-year restriction on carry forward and set-off of unabsorbed depreciation has been dispensed with, unabsorbed depreciation of earlier years may be carried forward and set off against income of later years, and the Tribunal is bound to direct the Assessing Officer to allow such carry forward and set-off. Where the assessee's counsel concedes that a disallowance of late payment of employees' contribution to provident fund is governed against the assessee by a decision of the jurisdictional High Court, the Tribunal, following that decision, rejects the ground.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI RAJPAL YADAV, JUDICIAL MEMBER ITA No. 2700/Ahd/2011 िनधा रण वष /Assessment Year: 2008-09 M/s. Mamta Silk Mills P. Ltd., Vs ACIT, K-1286, Surat Textile Market, Range-1, Ring Road, Surat Surat PAN : AABCM 5904 D
अपीलाथ / अपीलाथ / (Appellant) ू यथ यथ / थ / (Respondent)
Assessee(s) by : Shri Mehul Shah, AR Revenue by : Shri Roop Chand, Sr. DR.
सु नवाई क" तार$ख / Date of Hearing : 24/04/2015 घोषणा क" तार$ख / Date of Pronouncement: 15 /05/2015
आदे श/O R D E R
PER G.D. AGRAWAL, VICE PRESIDENT:
This is an appeal filed by the assessee and is directed against the order of the Commissioner of Income-tax (Appeals)-I, Surat dated 15.09.2011 pertaining to Assessment Year 2008-09.
2. Ground No.1 of the assessee's appeal reads as under:-
1. On the facts and circumstances of the case as well as law on the subject, the learned Commissioner of Income-tax (Appeals) has erred in confirming the action of the assessing officer by sustaining addition of Rs.2,88,855/- made by assessing officer on account of Work in Progress.
3. At the time of hearing before us, the ld. Counsel fairly conceded that the issue has decided against the assessee by the ITAT in his own case for Assessment Year 2006-07. Therefore, his limited prayer at the time of hearing of appeal before us was that the direction may be given to increase ITA No. 2700/Ahd/2011 M/s. Mamta Silk Mills Pvt Ltd vs. ACIT AY: 2008-09 2
the opening work-in-progress of the next year. The ld. Departmental Representative has no objection to the issuance of above direction. We, therefore, confirm the addition made by the Assessing Officer in respect of work-in-progress.
4. The closing work-in-progress of this year would be the opening work-in-progress of the next year. Therefore, once the closing work-in- progress of the year under consideration has increased on account of addition made by the Assessing Officer, the consequential effect has to be given in the opening work-in-progress of the next year. We, therefore, direct the Assessing Officer to increase the opening work-in-progress of the next year by the amount of addition sustained in the year under consideration to the closing work-in-progress. Subject to above direction, Ground No.1 of the assessee's appeal is rejected.
5. Ground No.2 of the assessee's appeal reads as under:-
2. On the facts and circumstances of the case as well as law on the subject, the learned Commissioner of Income-tax (Appeals) has erred in confirming the action of the assessing officer by sustaining disallowance of Rs.22,243/- made by assessing officer on account of late payment of employees' contribution to P.F.
6. At the time of hearing before us, the ld. Counsel fairly stated that this issue is against the assessee in view of the decision of Hon'ble Jurisdictional High Court in the case of CIT vs. Gujarat State Road Transport Corporation reported at (2014) 366 ITR 170 (Guj.). Respectfully following the same, we reject the ground No.2 of the assessee's appeal.
7. Ground No.3 of the assessee's appeal reads as under:-
ITA No. 2700/Ahd/2011 M/s. Mamta Silk Mills Pvt Ltd vs. ACIT AY: 2008-09 3
3. On the facts and circumstances of the case as well as law on the subject, the learned Commissioner of Income-tax (Appeals) has erred in confirming the action of the assessing officer by sustaining disallowance of Rs2,40,000/- made by assessing officer on account of director's remuneration.
8. At the time of hearing before us, the ld. Counsel fairly conceded that this issue is set aside by the ITAT to the file of the Assessing Officer for Assessment year 2006-07 vide ITA No.2405/Ahd/2009. He, therefore, requested that this matter may be set aside to the file of the Assessing Officer to be re-adjudicated as per the direction of the ITAT for Assessment Year 2006-07. The ld. Departmental Representative has no objection to this request of the assessee's Counsel. We, therefore, set aside the issue raised in ground No.3 of assessee's appeal to the file of the Assessing Officer and direct him to re-adjudicate this issue as per the direction of the ITAT for Assessment Year 2006-07. Needless to mention that while re-adjudicating the issue, he will allow adequate opportunity of being heard to the assessee.
9. Ground No.4 of the assessee's appeal reads as under:-
4. On the facts and circumstances of the case as well as law on the subject, the assessing officer has erred in disallowing carry forward of unabsorbed depreciation for A.Y. 1996-97 to 2000-01 u/s 32(2) of the I.T. Act.
Although assessee has contested above issue by raising additional ground of appeal in the course of appellate proceedings before learned CIT(A), the learned CIT(A) erred in not admitting the additional ground of appeal.
10. We have heard both the parties and we find that this issue is covered in favour of the assessee by the decision of the Hon'ble Jurisdictional High Court in the case of General Motors India (P). Ltd. v. DCIT, reported in (2013) 257 CTR 123, wherein their Lordships of Hon'ble High Court held as under:
ITA No. 2700/Ahd/2011 M/s. Mamta Silk Mills Pvt Ltd vs. ACIT AY: 2008-09 4
"Depreciation - Carry forward and setting off of unabsorbed depreciation - Effect of amendment of Section 32 by Finance Act 2001 - Issue was whether unabsorbed depreciation pertaining to A.Y. 1997-98 could be allowed to the carried forward and set off after a period of eight years or it would be governed by Section 32 as amended by Finance Act 2001 - Held, Circular No.14 of 2001 clarified that restriction of 8 years for carry forward and set off of unabsorbed depreciation had been dispensed with - Unabsorbed depreciation from A.Y. 1997-98 can be carried forward and set off against income of A.Y. 2006-07 - Assessee's appeal allowed." No contrary decision of Hon'ble jurisdictional High Court or Apex Court is brought to our knowledge. We, therefore, respectfully following the above decision of Hon'ble jurisdictional High Court, set aside the order of the authorities below on this point and restore back the issue to the file of the Assessing Officer. We direct him to allow the carried forward and set off of unabsorbed depreciation in the light of above decision of Hon'ble Jurisdictional High Court.
11. In the result, the assessee's appeal is partly allowed.
Order pronounced in the Court on 15th May, 2015 at Ahmedabad.
Sd/- Sd/-
(RAJPAL YADAV) (G.D. AGRAWAL) JUDICIAL MEMBER VICE-PRESIDENT Ahmedabad; Dated 15/05/2015 Biju T., PS षत Copy आदे श क" ूितिल*प अमे*षत/ of the Order forwarded to : 1. अपीलाथ / The Appellant 2. ू यथ / The Respondent. 3. संबंिधत आयकर आयु- / Concerned CIT 4. आयकर आयु-(अपील) / The CIT(A)
5. *वभागीय ूितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad
6. गाड फाईल / Guard file.
/ BY ORDER, आदे शानु सार
TRUE COPY Dy./Asstt.Registrar) उप/सहायक पंजीकार ( उप/ अिधकरण, अहमदाबाद / आयकर अपीलीय अिधकरण, ITAT, Ahmedabad
This page reproduces a public judgment and a summary of it. It is research material, not legal advice, and it is no substitute for advice from an advocate on your own facts.
Research this judgment with Miss Lucy
Ask what it holds, what has followed it, and what it means for your matter — in plain English, with the citations.
Try Miss Lucy free