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2010 DIGILAW 727 (KAR)

Commissioner of Income Tax v. K. S. Ramakrishna

2010-06-17

B.V.NAGARATHNA, N.K.PATIL

body2010
JUDGMENT N.K. Patil, J.— This appeal by the Revenue is arising out of the impugned order dated 23rd June 2009 passed in ITA No. 912/Bng/2007 by the Income Tax Appellate Tribunal, Bangalore, for consideration of the following substantial question of law: (i) Whether the Appellate Authorities were correct in holding that in reopened assessments where the assessee's claim Under Section 10B of the Act was declined due to withdrawn of special economic zone status of the assessee by the Development Commissioner, Cochin, the Assessing Officer should consider the allowance Under Section 80HHC of the Act when the assessee had not made such claim in the original return of income and is not permissible in accordance with the law declared by the Apex Court in Commissioner of Income Tax Vs. M/s. Sun Engineering Works (P.) Ltd., AIR 1993 SC 43 ? 2. The facts of the case in brief are, the assessee is a proprietor of M/s. Kays Roses, which has engaged in exports business of cut flowers to United Kingdom, Australia and Netherlands. He has filed his return before the Assessing Officer. The Assessing Officer has taken up the same for scrutiny by issuing notice under Section 143(2). In response to the same, one Sri. B.K. Manjunath, C.A., appeared and his power of attorney was filed on 24.2.2005. After recording reasons for reopening Under Section 147, a notice Under Section 148 dated 11.1.2005 was issued. In response to the said notice, the assessee has given his reply. The assessee has claimed deduction Under Section 10B and also requested that, if Section 10B is not considered, then his request under Section 80HHC may be considered. The Assessing Officer, after analyzing the material available on record, has proceeded to pass the order holding that assessee's request for deduction under Section 80HHC cannot not considered as long as his claim for deduction under Section 10B is not withdrawn by him and finalized the assessment by considering the exemption claimed under Section 10B, by its order dated 23.3.2006. Assailing the correctness of the said order, the assessee had filed an appeal before the First Appellate Authority-the Commissioner of Income Tax (Appeals) VI, Bangalore, in appeal ITA No. 188/DCIT/ CC-2(I)/Bangalore/CIT(A)-VI:2006-07. Assailing the correctness of the said order, the assessee had filed an appeal before the First Appellate Authority-the Commissioner of Income Tax (Appeals) VI, Bangalore, in appeal ITA No. 188/DCIT/ CC-2(I)/Bangalore/CIT(A)-VI:2006-07. The First Appellate Authority, after hearing both sides and after considering the order passed by the Assessing Officer, has allowed the said appeal, holding that the assessee is entitled for the benefit under Section 80HHC and as a matter of fact, he has enclosed Form No. 10CCAC under Section 80HHC and the Assessing Officer has committed an error in not considering the same. Being aggrieved by the order of the First Appellate Authority, the revenue has filed an appeal before the Income Tax Appellate Tribunal, Bangalore Bench-B, Bangalore, ('Tribunal' for short) in ITA No. 912/BNG/2007 for the Assessment Year 2001-2002 and the assessee has also filed cross appeal in ITA No. 967/Bng/2007. The said matters came up for consideration before the Tribunal. The Tribunal, in turn, after going through the orders passed by the authorities below, has dismissed the appeals tiled by the assessee as well as the revenue and confirmed the order passed by the First Appellate Authority, which has directed the Assessing officer to allow the claim of the assessee under Section 80HHC. Being aggrieved by the said order passed by the Tribunal, the revenue herein has presented this appeal, raising the aforesaid substantial question of law along with other reliefs. 3. We have heard the learned Counsel for the appellant and learned Counsel for the respondent at considerable length of time. 4. After having heard the learned Counsel for both the parties and after careful perusal of the orders passed by all the authorities, we do not find any error, much less material irregularity committed by the First Appellate Authority and the Tribunal in considering the reliefs sought by the assessee. As a matter of fact, the First Appellate Authority and the Tribunal, after critical evaluation of the oral and documentary evidence and other material available on file and after affording reasonable opportunity of hearing to both the parties, have recorded concurrent finding of fact, holding that as per the record, the assessee has filed prescribed application form seeking the benefits under Section 80HHC, if his request has not been considered under Section 10B. But this aspect of the matter has not been looked into or considered or appreciated by the Assessing Officer. But this aspect of the matter has not been looked into or considered or appreciated by the Assessing Officer. Both the First Appellate Authority and the Tribunal after considering the materials on record have recorded concurrent finding of fact by assigning cogent reasons and the same is in strict compliance of the relevant provisions of the Act. Therefore, we do not find any justification or good grounds made out by the revenue to interfere in the order passed by the First Appellate Authority and confirmed by the Tribunal. Therefore, interference by this Court is not called for. However, it is needless to clarify that, the Assessing Officer has to consider the claim of the assessee under Section 80HHC in accordance with law. 5. With the above observations, the instant appeal filed by the revenue is dismissed as devoid of merits. 6. In view of the dismissal of the appeal, the substantial question of law raised in this appeal is answered against the revenue.