ITO v. South West Mining Ltd.

Case Laws Analysis
REFERRED Asstt. CIT v. Jindal Power Ltd. 2016 TaxPub(DT) 3082 (Rai-Trib)
REFERRED Northern Coalfields Ltd. v. Asstt. CIT 2015 TaxPub(DT) 2467 (Jab-Trib)
REFERRED Taparia Tools Ltd. v. Jt. CIT 2015 TaxPub(DT) 1438 (SC)
REFERRED CIT v. ACC Rio Tinto Exploration Ltd. 2010 TaxPub(DT) 1390 (Del-HC)
REFERRED Bikaner Gypsums Ltd. v. CIT 1991 TaxPub(DT) 0658 (SC)
REFERRED CIT v. Katras Jharia Coal Co. Ltd. 1979 TaxPub(DT) 0766 (Cal-HC)
REFERRED CIT v. Amalgamated Jambad Syndicate (P) Ltd. 1979 TaxPub(DT) 0328 (Cal-HC)
REFERRED CIT v. Kirkend Coal Co. 1970 TaxPub(DT) 0355 (SC)

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The Tax Publishers2024 TaxPub(DT) 963 (Bang-Trib) IN THE ITAT BANGALORE BENCH CHANDRA POOJARI, A.M. & MADHUMITA ROY, J.M. ITO v. South West Mining Ltd. ITA No. 457/Bang/2023, C.O. No. 4/Bang/2023 (Arising out of ITA No. 457/Bang/2023) 8 February, 2024 Appellant by: Rakesh Joshi, A.R. Respondent by: Neera Malhotra, D.R. ORDER *Chandra Poojari, A.M.* This appeal by revenue and CO by assessee are directed against the order of NFAC for the assessment year 2011-12 dated 21.4.2023 passed under section 250 of the Income Tax Act, 1961 (in short The Act). The revenue in this appeal raised following ground: Whether the learned Commissioner (Appeals) is justified on the facts of the case and in law, in deleting the addition of Rs. 287.72 Crores claimed towards Mine Development Expenditure under section 37(1) in the computation of income which was not routed through the profit & loss account. 2. The assessee filed the CO by raising the following ground: The learned Commissioner (Appeals) on the facts and circumstances of the case as well as in law, has erred in ignoring that the assessment order was passed under section 143(3) of the Act by the learned assessing officer being barred by statutory time limit, is liable to be set aside and the income returned by the assessee be restored. 3. First, we will take up revenues appeal. Facts of the case are that Assessee is a closely held public company engaged in the business of Mining and raising contract operations, transportation, crushing, screening and other allied activities. Return for assessment year 2011-12 was filed on 26.09.2011 declaring loss of Rs. (-) 2,69,00,84,200. Return was processed under section 143(1) of the Act on 13.01.2012 and refund of Rs. 97,96,340 was issued to Assessee. Assessee had offered income of Rs. 11,09,96,181 during assessment proceedings on amount accrued during the year on extraction of 139740 metric tons of lignite in the Kapurdi and Jalipa lignite mines which was lying at mine head on 31-3-2011 and invoiced in the next financial year upon the finalization of rates by the Regulator RERC (Rajasthan Electricity Regulatory Commission). Assessee had capitalized this receipt in its books in next FY as per accounting policy followed. Evidence filed in support of this included the following:- SUBSCRIBE FOR FULL CONTENT

The Tax Publishers2024 TaxPub(DT) 963 (Bang-Trib)

IN THE ITAT BANGALORE BENCH

CHANDRA POOJARI, A.M. & MADHUMITA ROY, J.M.

ITO v. South West Mining Ltd.

ITA No. 457/Bang/2023, C.O. No. 4/Bang/2023 (Arising out of ITA No. 457/Bang/2023)

8 February, 2024

Appellant by: Rakesh Joshi, A.R.

Respondent by: Neera Malhotra, D.R.

ORDER

Chandra Poojari, A.M.

This appeal by revenue and CO by assessee are directed against the order of NFAC for the assessment year 2011-12 dated 21.4.2023 passed under section 250 of the Income Tax Act, 1961 (in short The Act). The revenue in this appeal raised following ground:

Whether the learned Commissioner (Appeals) is justified on the facts of the case and in law, in deleting the addition of Rs. 287.72 Crores claimed towards Mine Development Expenditure under section 37(1) in the computation of income which was not routed through the profit & loss account.

2. The assessee filed the CO by raising the following ground:

The learned Commissioner (Appeals) on the facts and circumstances of the case as well as in law, has erred in ignoring that the assessment order was passed under section 143(3) of the Act by the learned assessing officer being barred by statutory time limit, is liable to be set aside and the income returned by the assessee be restored.

3. First, we will take up revenues appeal. Facts of the case are that Assessee is a closely held public company engaged in the business of Mining and raising contract operations, transportation, crushing, screening and other allied activities. Return for assessment year 2011-12 was filed on 26.09.2011 declaring loss of Rs. (-) 2,69,00,84,200. Return was processed under section 143(1) of the Act on 13.01.2012 and refund of Rs. 97,96,340 was issued to Assessee. Assessee had offered income of Rs. 11,09,96,181 during assessment proceedings on amount accrued during the year on extraction of 139740 metric tons of lignite in the Kapurdi and Jalipa lignite mines which was lying at mine head on 31-3-2011 and invoiced in the next financial year upon the finalization of rates by the Regulator RERC (Rajasthan Electricity Regulatory Commission). Assessee had capitalized this receipt in its books in next FY as per accounting policy followed. Evidence filed in support of this included the following:-