Case Law Details
Owens Corning India Pvt. Ltd. Vs ACIT (ITAT Mumbai)
The appeal was filed by the assessee against the order dated 28.09.2021 passed by the Commissioner of Income Tax (Appeals)-57, Mumbai, under Section 250 of the Income Tax Act, 1961, for Assessment Year (AY) 2014-15.
The appeal came up for hearing pursuant to the order dated 03.02.2023 of the coordinate bench of the Income Tax Appellate Tribunal (ITAT), which had recalled its earlier order dated 24.08.2022, limited to the adjudication of Ground No. 1 raised by the assessee.
At the outset, the assessee submitted that it had filed a declaration in Form No. 8 under Section 158A of the Income Tax Act. The assessee stated that an identical question of law was already pending before the jurisdictional High Court in its own case for AY 2004-05. It therefore requested the Tribunal to pass an appropriate order under Section 158A(3). In support of its claim, the assessee placed on record the declaration in Form No. 8 and the High Court’s order dated 05.03.2013 in its appeal.
Ground No. 1 in the present appeal challenged the disallowance of ₹20,14,928, representing the amortised amount of the premium paid for acquiring lease rights over a plot of land. The assessee contended that the amortised amount was deductible while computing its total income and sought deletion of the disallowance and recomputation of its income.
The Tribunal noted that the substantial question of law admitted by the jurisdictional High Court in the assessee’s appeal for AY 2004-05 concerned whether the Tribunal had erred in confirming the denial of deduction of the annualised write-off of the amount paid to the Maharashtra Industrial Development Corporation (MIDC) for permitting the use of land for a period of 95 years.
The Departmental Representative fairly agreed that the issue involved in the present appeal for AY 2014-15 was identical to the question of law pending before the jurisdictional High Court for AY 2004-05.
Accepting the assessee’s claim under Section 158A, the Tribunal disposed of the appeal without awaiting the final decision of the High Court, in accordance with Section 158A(4) of the Act. It directed the Assessing Officer to apply the final decision on the question of law in the other case to the relevant assessment year when it attained finality.
Accordingly, Ground No. 1 of the assessee’s appeal was allowed for statistical purposes.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
The present appeal has been filed by the assessee challenging the order dated 28/09/2021, passed under section 250 of the Income Tax Act, 1961 (“the Act”) by the learned Commissioner of Income Tax (Appeals)–57, Mumbai, [“learned CIT(A)”], for the assessment year 2014–15.
2. The present appeal has been listed for hearing before us pursuant to the order dated 03/02/2023, passed by the coordinate bench of the Tribunal in M/s Owens Corning India Pvt. Ltd vs ACIT, M.A. no. 254/Mum./2022 (in ITA no. 1932/Mum./2021, for the assessment year 2014-15), whereby, the earlier order dated 24/08/2022, passed under section 254(1) of the Act was recalled limited to the adjudication of ground no.1 raised in assessee’s appeal.
3. During the hearing, at the outset, the learned Authorised Representative (“learned AR”) submitted that the assessee has filed a declaration in Form no.8, invoking provisions of section 158A of the Act stating that a similar question of law is pending before the Hon’ble jurisdictional High Court in assessee’s own case, for the assessment year 2004–05. The learned AR accordingly prayed that a suitable order under section 158A(3) of the Act be passed in respect of the present appeal. The declaration in Form no.8 as well as the order dated 05/03/2013 passed by the Hon’ble jurisdictional High Court in assessee’s appeal being ITA No. 2445 of 2011 are placed on record by the learned AR.
4. We find that in the present appeal, the assessee has, inter-alia, raised the following grounds:-
“1.0 Re: Disallowance of amortisation of the premium paid for the leasehold land of Rs. 20,14,928:
1.1 The Commissioner of Income-tax (Appeals) has erred in confirming the disallowance of Rs.20,14,928/- being the amortised amount of the premium paid for acquiring lease rights over a plot of land.
1.2 The Appellant submits that considering the facts and circumstances of its case and the law prevailing on the subject, the said amount amortised is deductible while computing its total income and the action of the Assessing Officer in this respect is not in accordance with law and the Commissioner of Income-tax (Appeals) ought to have held as such.
1.3 The Appellant submits that the Assessing Officer be directed to delete the disallowance so made by him and to re-compute its total income accordingly.”
Owens Corning India Pvt. Ltd. ITA no.1932/Mum./2021
5. On the other hand, the substantial question of law admitted by the Hon’ble jurisdictional High Court in assessee’s appeal, being ITA No. 2445 of 2011, vide order dated 05/03/2013, reads as under:-
“(b) Whether on the facts and in the circumstances of the case, the Tribunal erred in confirming the denial of the claim for deduction of Rs.20,16,264/-being annualized write off of the amount paid to Maharashtra Industrial Development Corporation (MIDC) in consideration for permitting user of its land for a period of 95 years?”
6. Learned Departmental Representative fairly agreed with the submission of the assessee that the issue involved in the present appeal for the assessment year 2014-15 is identical to the question of law pending before the Hon’ble jurisdictional High Court for the assessment year 2004–05.
7. In view of the above, we accept the claim of the assessee under section 158A of the Act. We dispose off the present appeal without awaiting for the final decision on the question of law in other case, as per the provisions of section 158A(4) of the Act. We further direct the Assessing Officer that when the decision on the question of law in the other case becomes final, it shall be applied to the relevant assessment year.
8. In the result, ground no.1 raised in assessee’s appeal is allowed for statistical purposes.
Order pronounced in the open Court on 27/06/2023
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