Deputy Commissioner of Income-tax, Circle-4, Kolkata v. M/s. Assambrook Limited
[Citation -2016-LL-0916-26]

Citation 2016-LL-0916-26
Appellant Name Deputy Commissioner of Income-tax, Circle-4, Kolkata
Respondent Name M/s. Assambrook Limited
Court ITAT-Kolkata
Relevant Act Income-tax
Date of Order 16/09/2016
Assessment Year 2003-04
Judgment View Judgment
Keyword Tags agricultural operation • agricultural income • composite income • interest income
Bot Summary: Commissioner of Income Tax-XII, Kolkata dated 08.10.2013 for the assessment year 2003-04 on the following grounds:- That on the facts and circumstances of the case the ld. CIT(A) has erred in law in deleting the addition of Rs.59,80,000/- on account of cess on green leaf without considering the fact that expenses on account of cess on green leaf is related to 100 agricultural operation and that an SLP is pending before the Hon ble Supreme Court against the decision of the Calcutta High Court in the case of AFT Industries Limited vs.- CIT in the light of which ld. 80HHC without considering the fact that an appeal filed by the revenue against treatment of interest income as part of the composite income in the case of various assesses are pending before the Hon ble High Court, while passing the judgment. Representatives of both the sides have agreed that the issue involved in Ground No. 1 of this appeal of the Revenue is squarely covered in favour of the assessee by the decision of the Hon ble Calcutta High Court in the case of CIT vs.- AFT Industries Limited 270 ITR 167, wherein it was held that in respect of computation of income of tea grown and manufactured, the fiction has been created under which both the agricultural component and the business component of the assessee would be assessed together for the purpose of computing the income under the Act and only after the computation of total income, the apportionment is to be made determining 60 as agricultural income. Counsel for the assessee, even the SLP filed by the Department against the decision of the Hon ble Calcutta High Court in the case of AFT Industries Limited has been dismissed by the Hon ble Supreme Court. We respectfully follow the said decision of the Hon ble Jurisdictional High Court and uphold the impugned order of the ld. Respectfully following the said decision of the Hon ble Apex Court, we Assessment year: 2003-2004 Page 3 of 3 uphold the impugned order of the ld.


Assessment year: 2003-2004 Page 1 of 3 IN INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCH, KOLKATA Before Shri P.M. Jagtap, Accountant Member and Shri S.S. Viswanethra Ravi, Judicial Member I.T.A. No. 63 /KOL/ 2014 Assessment Year: 2003-2004 Deputy Commissioner of Income Tax,..Appellant Circle-4, Ko lkata, Aayakar Bhawan, P-7, Chowringhee Square, Kolkata-700 069 -Vs.- M/s. Assambrook Li mited,.Respondent 1, Shakespeare Sarani, Kolkata-700 071 [PAN: AACCA 4606 M] Appearances by: Shri Ravi Tulsiyan, CA, fo r assessee Shri Debasish Banerjee, JCIT, D.R., for Department Date of concluding th e hearing : September 14, 2016 Date of pronouncing order : September 16, 2016 O R D E R Per Shri P.M. Jagtap, A.M.: This appeal is preferred by Revenue against order of ld. Commissioner of Income Tax (Appeals)-XII, Kolkata dated 08.10.2013 for assessment year 2003-04 on following grounds:- (1) That on facts and circumstances of case ld. CIT(A) has erred in law in deleting addition of Rs.59,80,000/- on account of cess on green leaf without considering fact that expenses on account of cess on green leaf is related to 100% agricultural operation and that SLP is pending before Hon ble Supreme Court against decision of Calcutta High Court in case of AFT Industries Limited vs.- CIT (270 ITR 167) in light of which ld. CIT(A) decided issue in favour of assessee. (2) That on facts and circumstances of case, ld. CIT(A) has erred in law in allowing claim of appellant u/s. 80HHC without considering fact that appeal filed by revenue against treatment of interest income as part of composite income in case of various assesses are pending before Hon ble High Court, while passing judgment. Assessment year: 2003-2004 Page 2 of 3 2. At time of hearing before us, ld. representatives of both sides have agreed that issue involved in Ground No. 1 of this appeal of Revenue is squarely covered in favour of assessee by decision of Hon ble Calcutta High Court in case of CIT vs.- AFT Industries Limited [270 ITR 167], wherein it was held that in respect of computation of income of tea grown and manufactured, fiction has been created under which both agricultural component and business component of assessee would be assessed together for purpose of computing income under Act and only after computation of total income, apportionment is to be made determining 60% as agricultural income. It was further held that when by fiction income is computed as income under Act, all deductions as are available both for agricultural component and for business component of income are to be allowed as natural corollary and, therefore, entire amount paid as cess under Agricultural Income Tax Act is eligible for deduction. As submitted by ld. counsel for assessee, even SLP filed by Department against decision of Hon ble Calcutta High Court in case of AFT Industries Limited (supra) has been dismissed by Hon ble Supreme Court. We, therefore, respectfully follow said decision of Hon ble Jurisdictional High Court and uphold impugned order of ld. CIT(Appeals) giving relief to assessee on this issue. Ground No. 1 of Revenue s appeal is accordingly dismissed. 3. As regards issue involved in Ground No. 2, ld. representatives of both sides have agreed that same is also squarely covered in favour of assessee by decision of Hon ble Supreme Court in case of ACG Associated Capsules Pvt. Limited vs.- CIT [343 ITR 89], wherein it was held that 90% of not gross interest but only net interest, which had been included in profits of business of assessee as computed under head profits and gains of business or profession was deducted under clause (1) of Explanation (baa) to Section 80HHC for determining profits of business. Respectfully following said decision of Hon ble Apex Court, we Assessment year: 2003-2004 Page 3 of 3 uphold impugned order of ld. CIT(Appeals) giving relief to assessee on this issue. Ground No. 2 of Revenue s appeal is accordingly dismissed. 4. In appeal, appeal of Revenue is dismissed. Order pronounced in open Court on September 16, 2016. Sd/- Sd/- (S.S. Viswanethra Ravi) (P.M. Jagtap) Judicial Member Accountant Member Kolkata, 16 t h day of September, 2016 Copies to : (1) Deputy Commissioner of Income Tax, Circle-4, Ko lkata, Aayakar Bhawan, P-7, Chowringhee Square, Kolkata-700 069 (2 ) M/s. Assambrook Li mited, 1, Shakespeare Sarani, Kolkata-700 071 (3) Commissioner of Income Tax (Appeals)-XII, Kolkata; (4) Commissio ner of Income Tax- , (5) Depart ment al Represent ative (6) Guard File By order Assistant Registrar, Income Tax Appellate Tribunal, Kolkata Benches, Kolkata Laha/Sr. P.S. Deputy Commissioner of Income-tax, Circle-4, Kolkata v. M/s. Assambrook Limited
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