TaxTMI 
TaxTMI 
2025 (4) TMI 985
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....ssessment order?" 2. "Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) is right to derive the unfounded conclusion that the impugned order u/s. 154 of the Act was passed by the AO on a matter already decided by the CIT(A) on an earlier date when such is not the case and the rectification order u/s. 154 carried out by the AO was on a matter not in dispute before the CIT(A) in such earlier order?" 3. "Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) is right to unilaterally presume that the impugned order passed u/s. 154 of the Act imposed upon the earlier dated order of the CIT(A) the AO's intent to modify the decision made in such earlier order, while also simultaneously seeking to conclude that the passing of such earlier order by the CIT(A) would invalidate the statutory jurisdiction and/or time frame mandated to pass such order of rectification?" 4. "Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) was justified in allowing the profit of Thermal Power Plant as deduction u/s 80IA without appreciating provision of Section 80IA(12A) of the Income Tax Act, 196....
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....ermal Power Plants amounting to Rs. 16,41,59,884/-. The AO had also observed that the claim was made by the assessee u/s 80IA(12) of the Act. He further held that with the insertion of sub-section (12A) in section 80IA, the assessee's claim u/s 80IA(12) was a mistake apparent from record. He therefore, rejected the claim of the assessee u/s. 80IA, amounting to Rs. 16,41,59,884/-. 4. In the subsequent appeal before the ld.CIT(A),the assessee contented that during the course of assessment proceedings, the appellant had furnished detailed submissions in respect of claim made u/s. 80IA of the Act in respect of power generating undertakings (Thermal Power Plants) and Railway undertakings. Based on the submission so made, the claim for deduction u/s 80IA for TPP as well as Rail Systems was examined in detail during the course of regular assessment proceedings. The ld.AO passed order under section 143(3) of the Act dated 10.03.2014. In the order, he has discussed at length in para 9 (Page 6 onwards) regarding deduction claimed under Chapter VIA. The claim of the assessee in respect of TPP had been allowed at Rs. 16,37,54,164/- after adding back an amount of Rs. 3,86,538/- towards a....
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....A) for AY 2010-11, allowed the claim made under the provisions of section 80IA in respect of Rail System Undertaking. 4.2 Based on above facts, it was pleaded that the allowability of claim under section 80IA has been already considered by the predecessor AO as well as the CIT(A). Carrying out of rectification under section 154, therefore, tantamounts to review of own order or change of opinion and cannot be considered as mistake apparent from record. Hence the order passed under section 154 of the Act is bad in law. In this case, reliance was also placed on various case laws i.e.Beena Rahul Mishra vs CIT & others (185 ITR 361), T.S. Balram ITO v. Volkart Brothers & Others (82 ITR 50) (SC),Khatau Junkar Ltd. vs K.S. Pathania [1992] 196 ITR 55 (Bom),Satish Kumar Aggarwal v. Deputy Commissioner of Income-tax [2012] 20 taxmann.com 172 (Delhi ITAT) and Additional CIT v. Chemical Limes (149 ITR 325) (Raj).Based on the above decisions, it is stated that the proposed action to withdraw the claim under section 80IA cannot be classified as a mistake apparent from records. 4.4. It was also pleaded that it is logical to presume that the claim was examined thoroughly by the predecessor A....
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....n this Tribunal had passed an elaborate order after due consideration of provisions of Section 80IA (12A) of the Act and granted deduction u/s. 80IA of the Act to the successor company. For the sake of brevity, the elaborate observations made by this Tribunal on merits is not reproduced hereunder. Hence, even on merits, the assessee is entitled for deduction u/s. 80IA of the Act in the facts and circumstances of the instant case. Accordingly, the ground Nos. 1-4 raised by the assessee are allowed." 5.5 Thus, respectfully following the Hon'ble Tribunal's decisions in the case of appellant on identical issue for earlier years the grounds 1, 2 & 4 of the appellant are upheld. 6.1 In ground no. 3, the appellant has contended that once the claim has been allowed by the Ld. CIT (A) the same cannot be rectified subsequently by the AO. 6.2 I have gone through the order dated 18.05.2017 of the Ld. CIT (A). It is noted that while disposing of the ground related to claim of deduction u/s 80IA of the Act in respect of Rail systems, the Ld. CIT (A) has briefly decided the matter as under: "14. Ground no. 9 Vide this office appeal order dated 21.4.2017 in appe....
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....f the assessee in the appellate order. Therefore. the assessment order having been merged in the appellate order, it could not be rectified subsequently. As per the provisions of section 154 of the Act, rectification of mistake (1) with a view to rectifying any mistake apparent from the record an income- tax authority referred to, in section 116 may- "(a) amend any order passed by it under the provisions of this Act; (b) amend any intimation sent by it under sub- section (1) of section 143, or enhance or reduce the amount of refund granted by it under that sub- section.] (1A) Where any matter has been considered and decided in any proceeding by way of appeal or revision relating to an order referred to in sub- section (1), the authority passing such order may, notwithstanding anything contained in any law for the,, time being in force, amend the order under that sub- section in relation to any matter other than the matter which has been so considered and decided.] (2) Subject to the other provisions of this section, the authority concerned-- (a) may make an amendment under sub- section (1) of its own motion, and (b) shall make such amendment for ....
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.... vs Asstt. Cit Cc-1(4), Mumbai on 21 February, 2023 in ITA No. 1303/Mum/2021 for A.Y.2010-11 has deleted similar disallowance. 7.3 It may also be stated here that the coordinate bench has exhaustively dealt with the issue in hand in its order in the case of the assessee Ultratech Cement Ltd, Mumbai vs Dcit Cen Cir 1(4), Mumbai on 14 December, 2021 in ITA NOs. 1412, 2461,2462, 2872, 2873 &3764/MUM/2018 C.O.NOs. 130, 118 & 155/MUM/2019 for various assessment years including the year under consideration. More specifically in Assessee's Appeal - ITA No. 1413/Mum/2018(AY) 2011-12 the issue was analysed in great detail before allowing the claim of deduction u/s 80IA(12A).The relevant ground and the decision rendered therein are extracted below for ready reference as under: "1. Grounds raised by the assessee are as under: 1) On the facts and in the circumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) has erred in upholding the disallowance u/s 80IA amounting to Rs. 82,61,81,708 for Rail Systems and Rs. 18,91,43,054 for Power Plants. He erred in holding that in respect of Rail Systems and Power Plants transferred from Samruddhi Cem....
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.... disallowed the claim of the assessee in respect of these Rail systems and power undertakings inherited by the assessee from SCL under the scheme of amalgamation, invoking the provisions of sub- section (12A) of Section 80-IA. In this regard, the AO relied on the Memorandum explaining the provisions of Finance Bill, 2007. 26. The LD CIT(A) upheld the view taken by the AO and noted that amendment provision brought in by the Finance Act, 2007 is free from any ambiguity and pursuant to such amendment, deduction under section 80IA becomes impermissible for the amalgamated company in respect of the undertakings inherited under the scheme of amalgamation.. 28. The Ld AR took us through the provisions of sub-section (1) and submitted that the benefit of tax holiday, as envisaged u/s. 80IA, is attached to an 'undertaking' and not to the 'owner'. Accordingly, it was emphasized that the change in ownership has no impact on the availability of deduction in the hands of the successor company.............. 30. According to the Ld AR of the assessee, sub-section (12) was introduced merely with the intention to put to rest the divergent views taken by th....
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............. The Scheme has sanction of the High Court of Bombay as well as High Court of Gujarat. Hence, once the scheme of amalgamation of SCL with the assessee has received the approval of the Hon'ble High Courts, conferring the right upon the assessee company to continue to claim deduction u/s. 80-IA in respect of the eligible undertakings for the residual period, the tax authorities cannot deny the deduction in contempt of the order of Hon'ble High Court. 39. In the rejoinder, the Ld AR of the assessee submitted that the interpretation of CBDT is contrary to the plain reading of sub-section (12) or (12A), as also the explanatory memorandum to the Finance Bill, 1999 by which sub-section (12) was introduced in the statute and Finance Bill, 2007 by which sub-section (12A) was introduced in the statute. It was further argued that Circulars issued by CBDT are not binding either on the assessee or on the Courts/ Tribunals for the purpose of interpretation of law especially when the language used in the statute is plain and unambiguous. Reliance was placed in this regard on the Supreme Court Ruling in the case of Ratan Melting & Wire Industries (Civil Appeal No.4022 of ....
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.... curtailed the rights of the amalgamating company or demerged company by disenabling them to claim any benefit in the year of amalgamation/demerger. 76. In the backdrop of above discussion let us now examine the provisions of sub-section (12A) and its applicability to the present case. Sub- section (12A) was inserted by the Finance Act, 2007 w.e.f. 01.04.2008. It reads as follows: "(12A) Nothing containing sub-section (12) shall apply to an enterprise or undertaking which is transferred in the scheme of amalgamation or demerger on or after the 1st day of April, 2007". 77. Notes on clauses to the Finance Act, 2007 explains it as follows: "It is proposed to insert sub-section (12A) so as to provide that nothing contained in sub-section (12) shall apply to any undertaking or enterprise which is transferred in a scheme of amalgamation or demerger on or after the 1st day of April, 2007". 78. The Notes on clauses simply reiterated what has been stated in sub-section (12A). The memorandum explaining the provisions of the Finance Bill 2007, which has been relied upon by the AO as well as LD CIT(A) states as under: "Tax benefit u/s 80-IA....
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....ection 80IA. As discussed above, various Courts have confirmed the availability of benefit of tax holiday claims (although under different sections) and allowed to the successor even prior of specific provisions of sub-section (12) in section 80IA of the IT Act. 83. Looking from another angle, since the provisions of sub-section (12) were disabling in nature, as it disentitled an amalgamating company or a demerged company from claiming deduction in the year of amalgamation or demerger, the insertion of sub-section (12A) merely negated the effect of sub-section (12) and cured the disability created under sub-section (12) of section 80IA of the IT Act. .......... 88. In our view, therefore, the clarification provided in the circular for insertion of sub-section (12A) cannot be extended beyond what is unambiguously stated in the provisions of the IT Act. Sub-section (12A) simply states that from a particular date i.e. 31 March 2007 the provisions of sub-section (12) shall not apply in the specified situations. There cannot be any other meaning to such simple provision of the IT Act. 93. While we reject the contention of the Revenue that intention of the legi....