M/s. Star Delta Transformers Ltd., 2015-16 V. Pr. CIT -1, Bhopal

ITA 100/Ind/2020

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6405 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 6 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-08-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2015-2016
• Appeal Filed On: 14-02-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S.S. MATRI
• Assessee Lawyers: ANIL KUMAR KHABYA
• Keywords: Revision of order; Set aside
• Section: 263; 143(3); 44AB; 73; 20

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE (THROUGH WEB-BASED VIDEO CONFERENCING PLATFORM) ] BEFORE SHRI RAJPAL YADAV, VICE PRESIDENT AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO. 100/IND/2020 / ASSESSMENT YEAR : 2015-16 M/S. STAR DELTA TRANSFORMERS LTD, 92A, INDUSTRIAL AREA, GOVINDPURA, BHOPAL-462023 PAN : AACCS 0399 D VS PR. COMMISSIONER OF INCOME-TAX-1, BHOPAL / (APPELLANT) / (RESPONDENT) ITA NO. 105/IND/2020 / ASSESSMENT YEAR : 2015-16 M/S. BANSAL PATHWAYS PVT. LTD., 3 RD FLOOR, TAWA COMPLEX, BITTAN MARKET, E-5 ARERA COLONY, BHOPAL-462016 PAN : AAECB 7980 M VS PR. COMMISSIONER OF INCOME-TAX-1, BHOPAL / (APPELLANT) / (RESPONDENT) ASSESSEE BY : SHRI ANIL KUMAR KHABYA, AR REVENUE BY : SHRI S.S. MATRI, CIT-DR / DATE OF HEARING : 03/08/2021 / DATE OF PRONOUNCEMENT: 17 /08/2021 / O R D E R PER RAJPAL YADAV, VICE PRESIDENT : THE PRESENT TWO APPEALS ARE DIRECTED AT THE INSTANC E OF SEPARATE ASSESSEES AGAINST THE ORDERS OF THE LEARNED PR. COM MISSIONER OF INCOME-TAX- 1, BHOPAL DATED 27.12.2019 IN THE CASE OF M/S. BANS AL PATHWAYS PVT LTD AND DATED 15.01.2020 IN THE CASE OF M/S. STAR DELTA TRA NSFORMERS LTD., PASSED FOR ASSESSMENT YEAR 2015-16 (FOR BOTH ASSESSEES), UNDER SECTION 263 OF THE INCOME-TAX ACT, 1961. ITA NOS. 100 & 105/IND/2020 STAR DELTA TRANSFORERS LTD & BANSAL PATHWAYS PVT L TD AY : 2015-16 2 2. SINCE COMMON ISSUES ARE INVOLVED IN BOTH THESE A PPEALS; THEREFORE, WE HAVE HEARD THEM TOGETHER AND DEEM IT APPROPRIATE TO DISPOSE OF BY THIS COMMON ORDER. 3. FIRST WE TAKE UP ITA NO.105/IND/2020 IN THE CASE OF M/S. BANSAL PATHWAYS PVT. LTD. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HAS FILED ITS RETURN OF INCOME ON 25.09.2015, DECLARING TOTAL INCOME AT RS.8,810/-. AN ASSESSMENT ORDER WAS PASSED UNDER SECTION 143(3) OF THE ACT ON 18.12.2017, ACCEPTING THE RETURNED INCOME. THE LEARNED COMMISS IONER PERUSED THE ASSESSMENT ORDER AS WELL AS RECORDS AND FOUND THAT THE ASSESSEE DID NOT FILE AUDIT REPORT IN FORM NO.10CCB ALONGWITH RETURN BECA USE 3CA REPORT WAS SIGNED AND VERIFIED BY THE ACCOUNTANT ON 25.09.2015 . THE LEARNED COMMISSIONER FURTHER OBSERVED THAT AS PER PROVISION S OF SECTION 80-IA(7) R.W.S. 44AB OF THE ACT, THE AUDIT REPORT IN FORM NO .10CCB FROM THE CHARTERED ACCOUNTANT WAS REQUIRED TO BE SIGNED AND VERIFIED ON OR BEFORE THE DUE DATE OF FILING OF THE RETURN, I.E. ON OR BE FORE 25 TH SEPTEMBER 2015, FOR CLAIMING DEDUCTION UNDER SECTION 80-IA(4) OF THE AC T. 4. NOW WE TAKE UP THE FACTS FROM THE CASE OF M/S. S TAR DELTA TRANSFORMERS LTD. (ITA NO.100/IND/2020). IN THIS C ASE, THE ASSESSEE HAS FILED ITS RETURN OF INCOME ON 26.09.2015 DECLARING TOTAL INCOME AT RS.2,05,50,430/-. AN ASSESSMENT ORDER WAS FRAMED U NDER SECTION 143(3) OF THE ACT ON 08.11.2017 DETERMINING THE TAXABLE INCOM E OF THE ASSESSEE AT RS.2,18,87,400/-. IN THIS CASE ALSO THE ASSESSEE H AD CLAIMED DEDUCTION UNDER SECTION 80-IA OF THE ACT AND THE LEARNED COMMISSION ER, AFTER PERUSAL OF THE RECORDS, FORMED AN OPINION THAT AUDIT REPORT IN FOR M NO.10CCB WAS NOT FILED ALONGWITH THE RETURN, I.E. WITHIN THE DUE DAT E OF FILING OF THE RETURN. THEREFORE, IN THE OPINION OF THE LEARNED COMMISSION ER, THE ASSESSMENT ORDERS IN BOTH THE CASES WERE ERRONEOUS AND CAUSE P REJUDICE TO THE INTEREST ITA NOS. 100 & 105/IND/2020 STAR DELTA TRANSFORERS LTD & BANSAL PATHWAYS PVT L TD AY : 2015-16 3 OF THE REVENUE. HE ACCORDINGLY ISSUED SHOWCASE NOT ICE UNDER SECTION 263 OF THE INCOME-TAX ACT. BOTH THE ASSESSEES HAVE APPRI SED LEARNED COMMISSIONER THAT THE FILING OF THE REPORT ALONGWIT H RETURN OR DUE DATE OF FILING OF THE RETURN IS A DIRECTORY CONDITION. IF THE AUDIT REPORT IS BEING FILED DURING THE ASSESSMENT PROCEEDINGS OR EVEN AT APPELL ATE STAGE, THEN IT WILL BE CONSTRUED AS SUFFICIENT COMPLIANCE. IT WAS FURTHER STATED THAT BOTH THE ASSESSEES HAVE FILED THE REPORT DURING THE ASSESSME NT PROCEEDINGS AND AFTER PERUSAL OF THESE DOCUMENTS, LEARNED ASSESSING OFFIC ER HAS GRANTED THE DEDUCTION TO BOTH THE ASSESSEES; SO, HOWEVER THE LE ARNED COMMISSIONER, WITHOUT MAKING ANY ANALYSIS OF THE SUBMISSIONS, JUS T SET ASIDE THE ASSESSMENT ORDER IN BOTH THE CASES AND DIRECTED THE ASSESSING OFFICER TO MAKE DE NOVO ASSESSMENTS. 5. WITH THE ASSISTANCE OF LEARNED REPRESENTATIVES, WE HAVE GONE THROUGH THE RECORD CAREFULLY. THERE IS NO DISPUTE WITH REG ARD TO THE PROPOSITION THAT FROM NO.10CCB IS REQUIRED TO BE FILED BY AN ASSESSE E FOR CLAIMING DEDUCTION UNDER SECTION 80-IA(4) OF THE ACT. THE DISPUTE IS THAT WHETHER SUCH REPORT IS MANDATORILY REQUIRED TO BE FILED ALO NGWITH RETURN OR IT IS DIRECTORY CONDITION WHICH CAN BE FULFILLED DURING T HE ASSESSMENT PROCEEDINGS. THE ASSESSEE, IN THE CASE OF M/S. BAN SAL PATHWAYS PVT. LTD., FILED ITS WRITTEN SUBMISSION BEFORE THE LEARNED COM MISSIONER WHEREIN IT RELIED UPON LARGE NUMBER OF DECISIONS IN WHICH IT H AS BEEN PROPOUNDED THAT FILING OF THE AUDIT REPORT IS A DIRECTORY CONDITION AND IT CAN BE FILED DURING THE ASSESSMENT PROCEEDINGS. THE WRITTEN SUBMISSION FILED BY THE ASSESSEE BEFORE THE LEARNED COMMISSIONER READS AS UNDER:- RE: PROCEEDING U/S 263- ASS.YR. 2015-16- YOUR NOTI CE DT.2-12-2019 MAY IT PLEASE YOUR HONOUR:- 1. AT THE OUTSET IT IS DENIED THAT THE A.O. HAS E RRED IN ALLOWING CLAIM OF DEDUCTION U/S 80IA(4) IN THE ORIGINAL ASSESSMENT . THE ASSESSEE HAS FILED ITA NOS. 100 & 105/IND/2020 STAR DELTA TRANSFORERS LTD & BANSAL PATHWAYS PVT L TD AY : 2015-16 4 AUDIT REPORT IN FORM 10CCB DURING THE COURSE OF PRO CEEDING OF ASSESSMENT BEFORE PASSING OF ORDER OF ASSESSMENT. THE REQUIREM ENT OF FILING OF AUDIT REPORT IN FORM 10CCB AT THE TIME OF TILING OF RETUR N IS ONLY A DIRECTORY CONDITION AND NOT MANDATORY CONDITION. NOW IN THE C ATENA OF DECISIONS OF APEX COURT AS WELL AS VARIOUS HIGH COURTS AND JURIS DICTIONAL TRIBUNAL IT HAS BEEN HELD THAT DEDUCTION U/S 80IA(4) AND OTHER SIMILAR DEDUCTIONS CANNOT BE DENIED IF THE AUDIT REPORT HAS BEEN FILED DURING THE COURSE OF ASSESSMENT PROCEEDING. GOING ONE STEP FORWARD, IT H AS BEEN HELD THAT THE AUDIT REPORT CAN BE FILED EVEN AT APPELLATE STAGE A S THE APPEAL PROCEEDING IS CONTINUATION OF ASSESSMENT PROCEEDING. RELIANCE IS PLACED ON THE FOLLOWING DECISIONS:- (I) CIT VS. M/S FORTUNA FOUNDATION ENGINEERS & CONSULTA NT PVT. LTD (SC) ITA 73 OF 2010 (II) CIT VS. L.M. SINGHVI, 289 ITR 425 (RAJ) (III) CIT VS. KAMANI REALTORS (P) LTD TC(A) NO. 730 OF 20 14 DT. 22-12-2014 (IV) M/S LANCER FOOD PRODUCTS DELHI VS. ITO (1TAT NEW DE LHI) ITA 4133/DEL/2016 (V) M/S M.P. RAJYA VAN VIKAS NIGAM LTD VS. DCI T 60 1TD 39(INDORE) THE ORDER OF ASSESSMENT PASSED BY THE A.O. CANNOT B E CONSIDERED AS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INT EREST OF REVENUE IN VIEW OF ABOVE JUDICIAL PRONOUNCEMENTS. THE DEDUCTION HAS BE EN ALLOWED BY THE A.O. AFTER PROPERLY EXAMINING FACTS OF THE CASE. TO REAC H TO A FINDING THAT THE ORDER PASSED BY THE ASSESSING OFFICER IS ERRONEOUS AND PR EJUDICIAL TO THE INTERESTS OF REVENUE WITHIN THE MEANING OF SECTION 263 OF THE ACT TWIN CONDITIONS NEED TO BE SATISFIED FOR INVOKING SUCH A POWER U/S 263, WHICH ARE: (A) THE ORDER OF THE ASSESSING OFFICER SOUGHT TO BE REVISED IS ERRON EOUS; AND (B) IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. THE PR OVISIONS OF SECTION 263 CANNOT BE INVOKED TO CORRECT EACH AND EVERY TYPE OF MISTAKE OR ERROR COMMITTED BY THE ASSESSING OFFICER. THE ORDER OF TH E ASSESSING OFFICER CANNOT BE TERMED PREJUDICIAL WHEN THE A.O. HAS PASS ED ORDER TAKING INTO ACCOUNT CORRECT INTERPRETATION OF LAW. IN VIEW OF ABOVE, KINDLY DROP THE PROCEEDINGS U/S 2 63. 6. ON DUE CONSIDERATION OF THE ABOVE FACTS AND CIRC UMSTANCES OF THE CASE, WE ARE OF THE VIEW THAT THE LEARNED ASSESSING OFFICER HAS NOT COMMITTED ANY ERROR IN GRANTING THE DEDUCTION TO BO TH THE ASSESSEES. THE ASSESSEES HAVE DULY COMPLIED WITH THE CONDITIONS AS CONTEMPLATED I N ITA NOS. 100 & 105/IND/2020 STAR DELTA TRANSFORERS LTD & BANSAL PATHWAYS PVT L TD AY : 2015-16 5 SECTION 80-IA(7) OF THE ACT, I.E. TO FILE THE AUDIT REPORT IN FORM NO.10CCB. THESE REPORTS HAVE BEEN FILED DURING THE ASSESSMENT PROCEEDINGS AND THE ASSESSING OFFICER HAS THE BENEFIT OF GOING THROUGH THESE DOCUMENTS; THEREFORE, THE ASSESSMENT ORDERS CANNOT BE BRANDED AS ERRONEOUS. THE LEARNED COMMISSIONER HAS NOT JUSTIFIED IN TAKING AC TION AGAINST BOTH THE ASSESSEES. WE, THEREFORE, QUASH THE IMPUGNED ORDER S PASSED UNDER SECTION 263 OF THE ACT IN THE RESPECTIVE CASE OF EACH ASSES SEE AND ALLOW BOTH THE APPEALS OF THE ASSESSEES. 7. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEES ARE ALLOWED. ORDER PRONOUNCED IN THE COURT ON _17 TH AUGUST 2021 AT AHMEDABAD. SD/- SD/- SD/- SD/- (MANISH BORAD) (RAJPAL YADAV) ACCOUNTANT MEMBER VICE-PRESIDENT AHMEDABAD, DATED 17 /08/2021 *BT / COPY OF THE ORDER FORWARDED TO : 1. ! / THE APPELLANT 2. '# ! / THE RESPONDENT. 3. $%$&' # # ( / CONCERNED CIT 4. # # ( ) ( / THE CIT(A)- 5. +,# &' , # # &' , ./ /DR,ITAT, INDORE, 6. ,01 2 / GUARD FILE. / BY ORDER, TRUE COPY 3# $. (ASSTT. REGISTRAR) # # &' ITAT, INDORE