Allowed

M/S.Hotel & Allied Trades Pvt.Ltd v. the Deputy Commissioner of Income Tax, Circle I (1) Ernakulam

Kerala HC17 Mar 2014ITA/253/2013

Case brief

AI extract

What is this about?

The High Court addressed questions regarding deductions under Sections 80HHD and 80IB for an assessee. Relying on earlier judgments on the same assessee for the first two queries, the Court held that the Tribunal was justified in disallowing the carry forward of depreciation from book profits under Section 115JB.

What did the court decide?

The appeal was disposed of by holding the fourth question of law against the appellant, confirming the Tribunal's opinion on deduction of depreciation from book profit.

M/S.Hotel & Allied Trades Pvt.Ltd Vs the Deputy Commissioner of… — Income Tax | Kerala HC (2014)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HON'BLE THE CHIEF JUSTICE DR. MANJULA CHELLUR & THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE

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MONDAY, THE 17TH DAY OF MARCH 2014/26TH PHALGUNA, 1935

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ITA.No. 253 of 2013 ()

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----------------------ITA. NO.666/COCH/2007 OF INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH.

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APPELLANT/RESPONDENT/APPELLANT:

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M/S.HOTEL & ALLIED TRADES PVT. LTD., C/O.CASINO HOTEL, W/ISLAND, COCHIN-3.

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BY SRI.JOSEPH MARKOSE, SENIOR ADVOCATE. ADVS. SRI.V.ABRAHAM MARKOS, SRI.BINU MATHEW, SRI.TOM THOMAS (KAKKUZHIYIL), SRI.ABRAHAM JOSEPH MARKOS, SRI.ABRAHAM VARGHESE THARAKAN.

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RESPONDENT/RESPONDENT/DEPARTMENT:

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THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE I (1), ERNAKULAM.

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BY ADV. SRI.JOSE JOSEPH, SC, INCOME TAX

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THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 17-03-2014, ALONG WITH ITA. NO. 264 OF 2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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rs.

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ITA.No. 253 of 2013

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APPENDIX

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PETITIONER'S ANNEXURES:-

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ANNEXURE A COPY OF THE ASSESSMENT ORDER DATED 15/01/2007. ANNEXURE B COPY OF THE ORDER PASSED IN THE APPEAL DATED 19/04/2007 OF THE COMMISSIONER OF INCOME TAX (APPEALS)-II. ANNEXURE C COPY OF THE ORDER DATED 25/10/2012 PASSED BY THE ITAT IN ITA NO.666/COCH/2007.

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RESPONDENT'S ANNEXURES:- NIL.

//TRUE COPY//

P.S. TO JUDGE

rs.

MANJULA CHELLUR, C.J. & A.M.SHAFFIQUE, J.

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- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

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Income Tax Appeal No.253 & 264 OF 2013

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- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 17^th day of March, 2014

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JUDGMENT

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MANJULA CHELLUR, C.J.

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In these two appeals following substantial questions of law are

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raised for consideration of this court:

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1. Is not deduction under Section 80HHD and 80IB allowable on the basis of the turnover, foreign exchange earnings and profits of each eligible units instead of on the basis of total turnover and export earnings in the facts and circumstances of the case.

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2. Whether in the facts and circumstances of the case the Tribunal is justified in interpreting Section 80HHD and 80 I B to the effect that for the purpose of computation of eligible deduction the profits and gains of entire business of the Hotel has to be taken into account.

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3. Whether in the facts and circumstances of the case that the Tribunal is justified in sustaining the computation made by the authorities in the case of determination of deductions under Section 80HHD and 80 IA of the Act.

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4. Whether in the facts and circumstances of the case the Tribunal is justified in holding that the appellant is not entitled to deduct the carry forward depreciation computed under the provisions of the Income Tax Act from the book profit computed under Section 115 JB of the Act.

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ITA 253 & 264/13

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:: 2 ::

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So far as deductions under Sections 80 HHD and 80IB pertaining to very same assessee, in respect of other assessment years, came up for consideration in ITA 12 of 2013 and ITA 232/13 which came to be disposed of on 9.1.2014 and 7.3.2013 respectively. Therefore, substantial questions of law pertaining to Section 80HHD and 80IB are answered in terms of ITA 12 of 2013 and ITA 232/13.

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Then coming to deduction of carry forward depreciation computed under provisions of Income Tax Act from the book profit under Section 115JB of the Act, it was not covered by earlier orders. As a matter of fact, Assessing Officer opined that assessee is not entitled to carry forward depreciation amounting to Rs.73,54,058/-, as book profit computed was not tallying with the actual figures shown in the return. In other words, the brought forward loss as per books of account was 'Nil'. Therefore, Assessing Officer opined that assessee is not liable to carry forward the depreciation. This opinion of Assessing Officer was set aside by the Commissioner of Income Tax (Appeals). When the matter came up for consideration before the Appellate Tribunal, Tribunal was justified in opining that there was no reason or ground upon which Commissioner of Income Tax

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ITA 253 & 264/13

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:: 3 ::

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(Appeals) could have disturbed the opinion of the Assessing Officer. In other words, he upheld the opinion of the Assessing Officer. On going through the orders of the Assessing Officer and Tribunal, we are of the view, fourth substantial question of law deserves to be held against the appellant assessee confirming the opinion of the Tribunal.

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sd/(MANJULA CHELLUR, CHIEF JUSTICE)

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sd/(A.M.SHAFFIQUE, JUDGE)

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jes/17/03/2014

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//True copy//

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PA to Judge

M/S.Hotel & Allied Trades Pvt.Ltd v. the Deputy Commissioner of Income Tax, Circle I (1) Ernakulam

Case brief

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What did the court decide?

M/S.Hotel & Allied Trades Pvt.Ltd v. the Deputy Commissioner of Income Tax, Circle I (1) Ernakulam

Case brief

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What did the court decide?

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