M/s. Unitech Ltd., New Delhi V. ACIT, New Delhi

ITA 1014/DEL/2012

• Counselvise Citation: 101420114 RSA 2012
• Duration Of Justice: 1 year(s) 9 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 21-11-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 29-02-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R S MEENA
• Assessee Lawyers: SALIL AGGARWAL; GAUTAM JAIN S; SHALESH GUPTA
• Keywords: Principle of natural justice; Additional evidence; Question of law; Reasonable cause
• Section: 148; 263; 139; 143(3); 80IB; 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH H : NEW DELHI) SMT. DIVA SINGH, JUDICIAL MEMBER AND BEFORE SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.1014/DEL./2012 (ASSESSMENT YEAR : 2008-09) M/S. UNITECH LIMITED, VS. ACIT, CIRCLE 18 (1), 6, COMMUNITY CENTRE, NEW DELHI. SAKET, NEW DELHI. (PAN : AAACU1482H) (APPELLANT) (RESPONDENT) ASSESSEE BY : S/SHRI SALIL AGGARWAL & GAUTAM JAIN, ADVOCATES AND SHRI SHALESH GUPTA, CA REVENUE BY : SHRI R.S. MEENA, CIT DR ORDER PER B.C. MEENA, ACCOUNTANT MEMBER : THIS APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT, DELHI-VI, NEW DELHI DATED 06.02.2012. 2. THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 200 8-09 WAS FILED ON 02.04.2009. THE RETURN WAS FILED BEYOND THE TIME LI MIT SPECIFIED IN SECTION 139(1) OF THE INCOME-TAX ACT, 1961. IN THE RETURN O F INCOME, DEDUCTION U/S 80IB (10) WAS CLAIMED WHICH WAS ALLOWED BY THE ASSE SSING OFFICER WHILE MAKING THE ASSESSMENT U/S 143(3) OF THE INCOME-TAX ACT, 1961 DATED 30.12.2009. CIT INITIATED THE PROCEEDINGS U/S 263 O F THE INCOME-TAX ACT, ITA NO.1014/DEL./2012 2 1961 AND WITHDREW THE DEDUCTION U/S 80IB (10) ALLOW ED BY THE ASSESSING OFFICER OF RS.30,14,60,000/- BY TREATING THE CLAIM AS WRONG IN VIEW OF THE APPLICATION OF SECTION 80AC OF THE INCOME-TAX ACT, 1961. CITS VIEW IS THAT THE PROVISIONS OF SECTION 80AC ARE MANDATORY. NOW, THE ASSESSEE IS IN APPEAL BEFORE US BY TAKING THE FOLLOWING GROUNDS :- 1. THAT ORDER MADE U/S 263 OF THE ACT DATED 6.02.2 012 IS WITHOUT SATISFYING THE STATUTORY PRE-CONDITIONS PRO VIDED UNDER SECTION 263 OF THE ACT I.E. ORDER OF ASSESSMENT UND ER SECTION 143(3) OF THE ACT DATED 30.12.2008 WAS NEITHER ERRO NEOUS AND, NOR PREJUDICIAL TO THE INTEREST OF REVENUE, THUS TH E SAME WAS WITHOUT JURISDICTION AND, DESERVES TO BE QUASHED AS SUCH. 1.1 THAT FINDING OF THE LEARNED COMMISSIONER OF IN COME TAX THAT THE LEARNED ASSESSING OFFICER DID NOT EXAMINE WHETHER DEDUCTION U/S 80IB(IO) OF THE ACT CAN BE CLAIMED IN THE BELATED RETURN AND AS SUCH, ASSESSING OFFICER DID NOT APPLY HIS MIND AND ALLOWED DEDUCTION U/S 80IB(L0) WITHOUT CONSIDERING THE PROVISION OF SECTION 80AC OF THE ACT IS NOT BASED O N CORRECT APPRECIATION OF FACTS AND EVIDENCE ON RECORD AND TH EREFORE, THE FINDING THAT ORDER IS ERRONEOUS IS MISCONCEIVED, MI SPLACED AND UNTENABLE. 1.2 THAT LEARNED COMMISSIONER OF INCOME TAX HAS FA ILED TO APPRECIATE THAT CLAIM OF DEDUCTION U/S 80IB WAS SPE CIFICALLY EXAMINED IN THE COURSE OF ASSESSMENT PROCEEDINGS AN D SPECIFICALLY ALLOWED IN THE ORDER OF ASSESSMENT AND AS SUCH, THERE WAS NO BASIS MUCH LESS VALID BASIS TO CONCLUDE THAT , THE LEARNED ASSESSING OFFICER DID NOT MAKE NECESSARY ENQUIRIES, REGARDING CLAIM OF DEDUCTION AND HENCE, IMPUGNED ORDER MADE B Y OVERLOOKING FACTS IS NOT SUSTAINABLE. 1.3 THAT LEARNED COMMISSIONER OF INCOME TAX HAS FA ILED TO APPRECIATE THAT SINCE THE LEARNED ASSESSING OFFICER HAD FOUND THAT SECTION 80AC OF THE ACT HAD NO APPLICATION TO THE FACTS OF THE APPELLANT COMPANY, THEREFORE THE MERE FACT THAT THE LEARNED COMMISSIONER OF INCOME TAX HELD AN OPINION DIFFEREN T FROM THE OPINION OF LEARNED COMMISSIONER OF INCOME TAX COULD NOT ITA NO.1014/DEL./2012 3 RENDER THE ORDER OF ASSESSMENT TO BE ERRONEOUS, SO AS TO WARRANT INVOCATION ACT. 2 THAT LEARNED COMMISSIONER OF INCOME TAX HAS FURT HER ERRED BOTH IN LAW AND ON FACTS IN DISALLOWING THE C LAIM OF DEDUCTION OF RS.30,14,60,000/- U/S 80IB(L0) OF THE ACT BY RELYING ON PROVISION CONTAINED IN SECTION 80AC OF T HE ACT. 2.1 THAT WHILE MAKING THE AFORESAID DISALLOWANCE, THE LEARNED COMMISSIONER OF INCOME TAX HAS FAILED TO APPRECIATE THAT SECTION 80AC OF THE ACT COULD NOT BE APPLIED ON THE FACTS OF APPELLANT COMPANY AND AS SUCH, DISALLOWANCE MADE IS NOT IN ACCORDANCE WITH LAW. 2.2 THAT THE FINDING THAT SECTION 80AC INCLUDES AL L ASSESSEE, WHATEVER ITS STATUS MAY BE I.E. INDIVIDUAL, HUF, CO MPANY, AOP, BOI, LOCAL AUTHORITY OR ARTIFICIAL JURIDICAL PERSON IS NOT BASED ON CORRECT INTERPRETATION OF STATUTORY PROVISION OF THE ACT AND, THEREFORE UNSUSTAINABLE. 2.3 THAT THE LEARNED COMMISSIONER OF INCOME TAX HA S FURTHER ERRED BOTH IN LAW AND ON FACTS IN HOLDING THAT, REQ UIREMENT TO FURNISH RETURN OF INCOME WITHIN THE DUE DATE U/S 80 AC OF THE ACT IS MANDATORY AND, NOT DIRECTORY AND AS SUCH, DISALL OWANCE MADE IS UNJUSTIFIED AND, MISPLACED. 2.4 THAT FURTHER THE LEARNED COMMISSIONER OF INCOM E TAX HAS COMPLETELY AND TOTALLY MISAPPLIED AND MISINTERPRETE D THE JUDGMENT OF APEX COURT IN THE CASE OF MAY GEORGE VS . SPECIAL TEHSILDAR & OR IN CIVIL APPEAL NO. 2255 OF 2006 DAT ED 25.05.2010 AND THEREFORE, DENIAL OF DEDUCTION IS CO NTRARY TO LAW AND UNSUSTAINABLE. 2.5 THAT LEARNED COMMISSIONER OF INCOME TAX HAS AL SO ERRED BOTH IN LAW AND ON FACTS IN HOLDING THAT DECISION O F HON'BLE TRIBUNAL IN THE CASE OF DHIR GLOBAL INDIA (P) LTD R EPORTED IN 133 TTJ 500 (DEL) IS DISTINGUISHABLE BY FAILING TO APPR ECIATE THAT IN THE SAID CASE TOO IT WAS HELD THAT, REQUIREMENT TO FURNISH RETURN OF INCOME WITHIN THE DUE DATE FOR CLAIM OF DEDUCTIO N IS DIRECTORY AND NOT MANDATORY AND AS SUCH, DISALLOWANCE MADE IS INVALID AND CONTRARY TO LAW. ITA NO.1014/DEL./2012 4 2.6 THAT FINDING THAT 'ASSESSEE COULD HAVE FILED E -RETURN WITHOUT PAYMENT OF SELF ASSESSMENT TAX' AND THEREFO RE DISALLOWANCE IS WARRANTED U/S 80AC OF THE ACT IS AL SO MISCONCEIVED, MISPLACED AND UNSUSTAINABLE. 2.7 THAT THE LEARNED COMMISSIONER OF INCOME TAX HA S FAILED TO APPRECIATE THAT THE RETURN FILED BY THE ASSESSEE ON 02.04.2009 COULD NOT BE DISREGARDED TO BE AS NOT FILED U/S 139 (1) OF THE INCOME TAX ACT ON THE FACTS AND IN THE CIRCUMSTANCE S OF THE CASE. 2.8 WITHOUT PREJUDICE THAT THE AFORESAID PROVISION S OF SECTION 80AC WERE INAPPLICABLE IN THE CASE OF A COMPANY AND THAT THE ASSESSING OFFICER WAS SATISFIED THAT THE ASSESSEE C OULD NOT FURNISHED THE RETURN OF INCOME ON OR BEFORE 30.09.2 008 ON ACCOUNT OF GENUINE DIFFICULTY UNDER THIS CIRCUMSTAN CES IT HAD FURNISHED RETURN OF INCOME ON 02.04.2009 AND NOT ON OR BEFORE 30.10.2008. 2.9 THAT THE LEARNED COMMISSIONER OF INCOME TAX AL SO FAILED TO APPRECIATE THAT IT IS NOT THE CASE WHERE THE RET URN OF INCOME WAS NOT FILED BUT WAS A CASE WHERE RETURN OF INCOME WAS BELATEDLY FILED. THE DEDUCTION CLAIMED OF RS.30,14, 60,000/- COULD NOT HAVE BEEN FORGONE AS NO RETURN COULD HAVE BEEN FILED AND COULD NOT HAVE BEEN ACCEPTED WITHOUT PAYING SEL F ASSESSMENT TAX. 2.10 THAT VARIOUS ADVERSE FINDINGS AND OBSERVATION RECORDED IN ORDER U/S 263 OF THE ACT WITHOUT GRANTING OPPORTUNI TY ARE NOT ONLY CONTRARY TO FACTS BUT ALSO LAW AND THEREFORE, UNSUSTAINABLE. IT IS THEREFORE PRAYED THAT, IMPUGNED ORDER MADE UN DER SECTION 263 OF THE ACT DATED 6.02.2012 BE HELD TO B E WITHOUT JURISDICTION AND, FURTHER DISALLOWANCE MADE U/S 80I B(10) OF THE ACT MAY KINDLY BE DELETED AND APPEAL OF THE APPELLA NT COMPANY BE ALLOWED. 3. WHILE PLEADING ON BEHALF OF THE ASSESSEE, LD. AR SUBMITTED THAT A BARE READING OF SECTION 263 OF THE INCOME-TAX ACT, 1961 MAKES IT CLEAR THAT THE PRE- ITA NO.1014/DEL./2012 5 REQUISITE OF EXERCISING OF JURISDICTION BY THE CIT SUO MOTU UNDER THIS SECTION IS THAT THE ORDER OF THE ASSESSING OFFICER MUST BE ERRONEOUS INSOFAR AS IT IS PREJUDICIAL TO THE INTEREST OF REVENUE. THE COMMISS IONER HAS TO BE SATISFIED OF TWIN CONDITIONS, NAMELY, THE ORDER OF THE AO SOUGHT TO BE REVISED IS ERRONEOUS; AND IT IS PREJUDICIAL TO THE INTERESTS O F THE REVENUE. IF ANY OF ONE IS ABSENT THEN THE COMMISSIONER HAS NO JURISDICTION TO INITIATE THE PROCEEDINGS U/S 263 OF THE ACT. THESE PROVISIONS CANNOT BE INVO KED TO CORRECT EACH AND EVERY TYPE OF MISTAKES OR ERRORS COMMITTED BY THE A O. FURTHER, HE SUBMITTED THAT ONCE THE ASSESSING OFFICER HAS ADOPTED A COURS E WHICH IS PERMISSIBLE IN LAW AT THE RELEVANT TIME AND IT HAS RESULTED INTO L OSS OR WHERE TWO VIEWS ARE POSSIBLE AND THE CIT DID NOT AGREE WITH THE VIEW TA KEN BY THE ASSESSING OFFICER THEN THE ORDER CANNOT BE TREATED AS ERRONEO US OR PREJUDICIAL TO THE INTERESTS OF REVENUE UNLESS THE VIEW TAKEN BY THE A SSESSING OFFICER IS UNSUSTAINABLE IN LAW. THE LD. AR SUBMITTED THAT THE ASSESSING OFFICER MADE THE ORDER FOR ASSESSMENT YEAR 2008-09 ON 30.12.2009 . THE ASSESSEE MADE THE CLAIM FOR DEDUCTION U/S 80IB OF THE ACT ON THE PROF IT OF HORIZON PROJECT, GREATER NOIDA WHICH IS EVIDENT FROM PAGE 2 OF THE P APER BOOK. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER ASKED DETAILS SUPPORTED WITH DOCUMENTS ON THE HEARING DATED 30.11.2009 WHICH IS EVIDENT FROM PAGE 78 OF THE PAPER BOOK WHICH IS THE REPLY OF THE ASSESSEE T O THE QUERIES RAISED BY THE ASSESSING OFFICER SUBMITTED ALONG WITH THE DOCUMENT S. THIS REPLY IS DATED ITA NO.1014/DEL./2012 6 07.12.2009. IT IS CLEAR FROM POINT NO.10 OF THE RE PLY THAT THE ASSESSEE HAS SUBMITTED WORKING OF PROFIT ALONG WITH RELEVANT BAC K-UP PAPERS IN RESPECT OF DEDUCTION CLAIMED U/S 80IB IN RESPECT OF THE PROJEC T HORIZON PROJECT ALONG WITH APPROVALS ETC. WHICH WERE ENCLOSED. THUS, THE ASSESSING OFFICER HAS EXAMINED THE CLAIM OF THE ASSESSEE DURING THE PROCE EDINGS U/S 143(3) OF THE ACT. HE FURTHER SUBMITTED THAT WHEN THE ASSESSING O FFICER HAS TAKEN A VIEW THEN THE REVISIONARY AUTHORITY HAS NO JURISDICTION TO INITIATE PROCEEDINGS U/S 263 OF THE ACT, AS HELD BY HONBLE KARNATAKA HIGH C OURT IN THE CASE OF FATIMA BAI VS. ITO REPORTED IN [2009] 32 DTR 243 (K AR). LD. AR ALSO RELIED ON THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF DIRECTOR OF INCOME-TAX VS. JYOTI FOUNDATION REPORTED IN (2013) 357 ITR 388 (DELHI) WHEREIN HONBLE JURISDICTIONAL HIGH COURT HAS HELD THAT REVISIONARY POWER U/S 263 OF THE INCOME-TAX ACT, 1961 IS CONFIRMED BY THE ACT ON THE CIT/DIT WHEN AN ORDER PASSED BY LOWER AUTHORITIES IS ERRONE OUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. ORDERS WHICH ARE PASSED WITHOU T ENQUIRY OR INVESTIGATION IS TREATED AS ERRONEOUS AND PREJUDICIAL TO THE INTE RESTS OF REVENUE, BUT ORDERS WHICH ARE PASSED AFTER ENQUIRY/INVESTIGATION ON THE QUESTION/ISSUE ARE NOT PER SE OR CLEARLY DETAILED AS ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE BECAUSE THE REVISIONARY AUTHORITY FEELS AND OPINES THAT FURTHER ENQUIRY/INVESTIGATION IS REQUIRED OR DEEPER OR FURT HER SCRUTINY IS UNDERTAKEN THEN COMMISSIONER MUST RECORD A FINDING THAT ORDER/ ENQUIRY MADE IS ITA NO.1014/DEL./2012 7 ERRONEOUS. IN THE ASSESSEES CASE, THE ENQUIRIES WE RE CERTAINLY MADE BY THE ASSESSING OFFICER AND IT WAS NOT A CASE OF NO ENQUI RY. THIS FACT IS EVIDENT FROM PAGES 78 TO 80 OF THE PAPER BOOK. SIMILAR VIEW HAS ALSO BEEN UPHELD BY THE HONBLE DELHI HIGH COURT IN THE CASE OF ITO VS. DG HOUSING PROJECTS LIMITED 343 ITR 329. HE FURTHER SUBMITTED THAT TH E ORDER PASSED BY ASSESSING OFFICER SHOULD NOT BE MERE PRE-JUDICIOUS TO THE REVENUE OR A MERE ERRONEOUS VIEW WHICH CAN BE REVISED U/S 263 OF THE INCOME-TAX ACT, 1961. THERE SHOULD BE ADDED ELEMENT OF UNSUSTAINABILITY O F THE ORDER OF ASSESSING OFFICER WHICH CALLS THE COMMISSIONER WITH JURISDICT ION TO ISSUE NOTICE AND PROCEEDED TO MAKE APPROPRIATE ORDERS. THE ISSUE REG ARDING THE PROVISIONS OF SECTION 80AC ARE DIRECTORY OR MANDATORY WAS DEBATAB LE DURING THE RELEVANT PERIOD WHEN THE ASSESSING OFFICER MADE THE ORDER. T HEREFORE, THE VIEW TAKEN BY THE ASSESSING OFFICER WAS SUSTAINABLE AT THAT TI ME. HE ALSO RELIED ON THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. CONTIMETERS ELECTRICALS P. LTD. 317 ITR 249 WHEREIN THE HONB LE JURISDICTIONAL HIGH COURT HAS HELD THAT THE TRIBUNAL HAS ARRIVED AT THE CORRECT CONCLUSION THAT REQUIREMENT OF FILING THE AUDIT REPORT ALONG WITH R ETURN WAS NOT MANDATORY BUT DIRECTORY AND THAT IF THE AUDIT REPORT WAS FILED AT ANY TIME BEFORE PERMITTING THE ASSESSMENT, THE REQUIREMENT OF SECTION 80IA (7) WOULD BE MET. LD. AR ALSO SUBMITTED THAT PROVISIONS GIVING INCENTIVES SH OULD BE LIBERALLY CONSTRUED AS HELD BY VARIOUS JUDGMENTS, NAMELY, CIT VS. PRANO Y ROY 309 ITR 231, ITA NO.1014/DEL./2012 8 BAJAJ TEMPO LTD. VS. CIT 196 ITR 188 (SC) AND GEM GRANITES VS. CIT 271 ITR 322 (SC). LD. AR PLEADED THAT PROVISIONS O F SECTION 80IB ARE INCENTIVES, HENCE TECHNICALITIES OF SECTION 80AC SH OULD NOT COME IN THE WAY. HE ALSO SUBMITTED THAT IN MANY OF THE CASES, THE WO RD SHALL HAD BEEN INTERPRETED AS MAY, THEREFORE, SHALL OCCURS IN SECTION 80AC BE READ AS MAY. THEREFORE, FILING THE RETURN AS PER THE PROV ISIONS OF SECTION 139(1) OF THE ACT WAS ONLY TO BE TAKEN AS DIRECTORY IN NATURE . SUCH VIEW HAS BEEN TAKEN BY VARIOUS BENCHES OF ITAT AND HAS BEEN REAFFIRMED BY HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. CO NTIMETERS ELECTRICALS P. LTD., CITED SUPRA. 4. ON THE OTHER HAND, LD. DR SUBMITTED THAT THERE I S EXPRESSED PROVISION IN THE LAW WHERE THE DEDUCTION IS NOT TO BE ALLOWED UN LESS THE RETURN FURNISHED ON OR BEFORE THE DUE DATE SPECIFIED UNDER SUB-SECTI ON (1) OF SECTION 139 OF THE ACT. THEREFORE, THE ORDER OF THE ASSESSING OFFICER WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE AND THE CIT WAS HAVING ALL THE POWERS TO REVISE THE ORDER OF THE ASSESSING OFFICER. HE FURTH ER SUBMITTED THAT THE POWERS OF COMMISSIONER TO REVISE THE ORDER OF THE ASSESSIN G OFFICER ARE PLENARY. IN THIS CASE, THE ORDER OF THE ASSESSING OFFICER WAS N OT ONLY ERRONEOUS BUT ALSO PREJUDICIAL TO THE INTEREST OF REVENUE, THEREFORE, TWO INGREDIENTS WERE IN CO- EXISTENCE, THEREFORE, THE CIT WAS JUSTIFIED IN INVO KING THE REVISIONAL JURISDICTION. HE FURTHER SUBMITTED THAT ONCE THE EX PRESSED PROVISIONS ARE ITA NO.1014/DEL./2012 9 AVAILABLE IN THE LAW, THERE WAS NO SCOPE FOR ANY DE BATE ON THE ISSUE. THEREFORE, THE ISSUE WAS NOT DEBATABLE AND THE ASSE SSING OFFICER HAS NOT CONSIDERED THE PROVISIONS OF LAW AND THE CIT WAS JU STIFIED IN INVOKING THE PROVISIONS OF SECTION 263 IN THIS CASE. HE FURTHER SUBMITTED THAT VARIOUS DECISIONS RELIED UPON BY THE LD. AR WHERE THE PROVI SIONS OF SECTION 10B(1) HAVE TO BE DIRECTORY RATHER THAN MANDATORY CANNOT B E APPLIED TO THE PROVISIONS OF SECTION 80IB WHEN A CLEAR CUT PROVISION IN THE L AW IS AVAILABLE U/S 80AC OF THE ACT. HE RELIED ON THE ORDER OF THE CIT AND PLEA DED TO SUSTAIN THE SAME. 5. WE HAVE HEARD BOTH THE SIDES ON THE ISSUE. IT IS A WELL SETTLED LAW THAT THE PROVISIONS OF SECTION 263 OF THE INCOME-TAX ACT , 1961 CANNOT BE INVOKED ONLY WHEN THE ORDER OF THE ASSESSING OFFICER IS ERR ONEOUS AS WELL AS PREJUDICIAL TO THE INTEREST OF REVENUE. THIS PROPOS ITION HAS BEEN DECIDED BY HON'BLE SUPREME COURT IN THE CASE OF MALABAR INDUST RIAL CO. LTD. VS. CIT REPORTED IN 243 ITR 83 (SC). THE RELEVANT HEAD NOTE IS REPRODUCED AS UNDER :- A BARE READING OF SECTION 263 OF THE INCOME-TAX AC T, 1961, MAKES IT CLEAR THAT THE PREREQUISITE FOR THE EXERCI SE OF JURISDICTION BY THE COMMISSIONER SUO MOTU UNDER IT, IS THAT THE ORDER OF THE INCOME-TAX OFFICER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. THE CO MMISSIONER HAS TO BE SATISFIED OF TWIN CONDITIONS, NAMELY, (I) THE ORDER OF THE ASSESSING OFFICER SOUGHT TO BE REVISED IS ERRON EOUS; AND (II) IT IS PREJUDICIAL TO THE INTERESTS OF THE REVE NUE. IF ONE OF THEM IS ABSENTIF THE ORDER OF THE INCOME-TAX OFFIC ER IS ERRONEOUS BUT IS NOT PREJUDICIAL TO THE REVENUE OR IF IT IS NOT ERRONEOUS BUT IS PREJUDICIAL TO THE REVENUERECOURS E CANNOT BE HAD TO SECTION 263(1) OF THE ACT. THE PROVISION CANNOT BE INVOKED TO CORRECT EACH AND EVERY TYPE OF MISTAKE O R ERROR COMMITTED BY THE ASSESSING OFFICER, IT IS ONLY WHEN AN ORDER IS ITA NO.1014/DEL./2012 10 ERRONEOUS THAT THE SECTION WILL BE ATTRACTED. AN I NCORRECT ASSUMPTION OF FACTS OR AN INCORRECT APPLICATION OF LAW WILL SATISFY THE REQUIREMENT OF THE ORDER BEING ERRONEOU S. IN THE SAME CATEGORY FALL ORDERS PASSED WITHOUT APPLYING T HE PRINCIPLES OF NATURAL JUSTICE OR WITHOUT APPLICATIO N OF MIND. THE PHRASE 'PREJUDICIAL TO THE INTERESTS OF THE REV ENUE' IS NOT AN EXPRESSION OF ART AND IS NOT DEFINED IN THE ACT . UNDERSTOOD IN ITS ORDINARY MEANING IT IS OF WIDE IMPORT AND I S NOT CONFINED TO LOSS OF TAX. THE SCHEME OF THE ACT IS TO LEVY AND COLLECT TAX IN ACCORDANCE WITH THE PROVISIONS OF THE ACT AND T HIS TASK IS ENTRUSTED TO THE REVENUE. IF DUE TO AN ERRONEOUS OR DER OF THE INCOME TAX OFFICER, THE REVENUE IS LOSING TAX LAWFU LLY PAYABLE BY A PERSON, IT WILL CERTAINLY BE PREJUDICIAL TO T HE INTERESTS OF THE REVENUE. THE PHRASE 'PREJUDICIAL TO THE INTERES TS OF THE REVENUE' HAS TO BE READ IN CONJUNCTION WITH AN ERR ONEOUS ORDER PASSED BY THE ASSESSING OFFICER. EVERY LOSS OF REVENUE AS A CONSEQUENCE OF AN ORDER OF THE ASSESSING OFFIC ER CANNOT BE TREATED AS PREJUDICIAL TO THE INTERESTS OF THE R EVENUE, FOR EXAMPLE, WHEN AN INCOME TAX OFFICER ADOPTED ONE OF THE COURSES PERMISSIBLE IN LAW AND IT HAS RESULTED IN L OSS OF REVENUE, OR WHERE TWO VIEWS ARE POSSIBLE AND THE I NCOME TAX OFFICER HAS TAKEN ONE VIEW WITH WHICH THE COMMISSI ONER DOES NOT AGREE, IT CANNOT BE TREATED AS AN ERRONEOU S ORDER PREJUDICIAL TO THE INTERESTS OF THE REVENUE, UNLESS THE VIEW TAKEN BY THE INCOME TAX OFFICER IS UNSUSTAINABLE I N LAW. IT IS ALSO WELL SETTLED BY HON'BLE SUPREME COURT TH AT WHERE TWO VIEWS ARE POSSIBLE AND THE ASSESSING OFFICER HAS TAKEN ONE VI EW WITH WHICH THE COMMISSIONER DOES NOT AGREE, IT CANNOT BE TREATED A S ERRONEOUS ORDER PREJUDICIAL TO THE INTEREST OF THE REVENUE UNLESS T HE VIEW TAKEN BY THE ASSESSING OFFICER IS UNSUSTAINABLE IN LAW. THE FOLL OWING FACTS OF THIS CASE ARE UNDISPUTED. THE RETURN OF INCOME WAS FILED ON 02.04 .2009 WHEREIN THE DEDUCTION U/S 80IB WAS CLAIMED AND THE PROFITS OF H ORIZON PROJECT, GREATER NOIDA WERE CLAIMED AS EXEMPTED U/S 80IB OF THE INCO ME-TAX ACT, 1961. THE ITA NO.1014/DEL./2012 11 ASSESSEE HAS GOT ITS ACCOUNT AUDITED WHETHER THE AU DITOR HAS MADE A REPORT IN FORM 10CCB AS PER RULE 10BBB FOR THE CLAIM OF ASSES SEE U/S 80IB WHICH IS DATED 25.09.2008 WHICH IS PLACED AT PAGES 5 TO 12 O F THE PAPER BOOK. THUS, THE ASSESSEE WAS ABLE TO GET ITS AUDIT REPORT WITH REGARD TO THE CLAIM OF SECTION 80IB(FORM NO.10CCB ON 25.09.2008). THE CASE WAS SEL ECTED FOR SCRUTINY AND THE ASSESSING OFFICER RAISED VARIOUS QUERIES TO THE ASSESSEE WHICH INCLUDES QUERIES WITH REGARD TO THE CLAIM OF THE AS SESSEE U/S 80IB WHICH IS EVIDENT FROM PAGE NO.79 OF THE PAPER BOOK WHEREIN T HE ASSESSEE HAS SUBMITTED RELEVANT PAPERS IN SUPPORT OF THE CLAIM DEDUCTION U /S 80IB IN RESPECT OF PROJECT HORIZON, GREATER NOIDA ALONG WITH APPROVALS . THUS, THE CLAIM OF THE ASSESSEE HAS BEEN ALLOWED AFTER CONSIDERING THE REP LY OF THE ASSESSEE. THEREFORE, THIS CANNOT BE A CASE WHERE THE CIT CAN INVOKE THE REVISIONAL POWER FOR THE REASON NO ENQUIRY WAS MADE. NOW, THE SECOND ISSUE WHICH IS RAISED IS WHETHER THE TWO VIEWS ARE POSSIBLE AT THE RELEVANT TIME WHEN THE ASSESSING OFFICER MADE THE ORDER WITH REGARD TO THE FILING OF THE RETURN OF INCOME U/S 139(1) WHETHER IT WAS DIRECTORY OR MANDA TORY WAS DEBATABLE. THE PROVISIONS OF SECTION 80AC READ AS UNDER :- 80AC. WHERE IN COMPUTING THE TOTAL INCOME OF AN ASS ESSEE OF THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEA R COMMENCING ON THE 1ST DAY OF APRIL, 2006 OR ANY SUBSEQUENT ASS ESSMENT YEAR, ANY DEDUCTION IS ADMISSIBLE UNDER SECTION 80-IA OR SECTION 80- IAB OR SECTION 80-IB OR SECTION 80-IC [OR SECTION 8 0-ID OR SECTION 80-IE], NO SUCH DEDUCTION SHALL BE ALLOWED TO HIM UNLESS HE FURNISHES A RETURN OF HIS INCOME FOR SUCH ASSESS MENT YEAR ON ITA NO.1014/DEL./2012 12 OR BEFORE THE DUE DATE SPECIFIED UNDER SUB-SECTION (1) OF SECTION 139.] THE PROVISIONS OF SECTION 10B(5) READ AS UNDER :- 10B .. (5) THE DEDUCTION UNDER SUB-SECTION (1) SHALL NOT B E ADMISSIBLE FOR ANY ASSESSMENT YEAR BEGINNING ON OR AFTER THE 1ST DAY OF APRIL, 2001, UNLESS THE ASSESSEE FURNISHES I N THE PRESCRIBED FORM, ALONG WITH THE RETURN OF INCOME, T HE REPORT OF AN ACCOUNTANT, AS DEFINED IN THE EXPLANATION BELOW SUB-SECTION (2) OF SECTION 288, CERTIFYING THAT THE DEDUCTION H AS BEEN CORRECTLY CLAIMED IN ACCORDANCE WITH THE PROVISIONS OF THIS SECTION. IN BOTH THESE PROVISIONS, THE DEDUCTION WAS HELD TO BE NOT ADMISSIBLE UNLESS THE ASSESSEE FURNISHES THE PRESCRIBED FORM ALONG WI TH RETURN OF INCOME OR THE RETURN OF INCOME ON OR BEFORE DUE DATE OF FILING RE TURN. THE ITAT, DELHI BENCH IN THE CASE OF HANSA DALAKOTI VS. ACIT IN ITA NO.3352/DEL/2012 DATED 25.01.2012 HELD AS UNDER :- THE LANGUAGE OF SECTION 80AC AND SECTION 10B(1) IS PARI MATERIA. BOTH OF THESE SECTIONS DEBAR THE ASSESSEE FROM CLAIMING DEDUCTION UNDER SECTION BO-IC AND EXEMPTION UNDER S ECTION 10B, IN A CASE WHERE RETURN OF INCOME IS NOT FILED BY THE ASSESSEE WITHIN THE PRESCRIBED STATUTORY TIME UNDER SECTION 139(1). THE PROVISIONS OF SECTION 10B(1) WERE CONSI DERED BY THE CO-ORDINATE BENCH OF THE TRIBUNAL IN ASSTT. CIT V. DHIR GLOBAL INDUSTRIES (P.) LTD. [2011] 43 SOT 640 / [2010] 8 T AXMANN.COM 208 (DELHI). ACCORDING TO THE FACTS OF THE SAID CAS E, THERE WAS A DELAY OF 1A MONTHS. CONSIDERING THE FACTS THAT TH E PROVISIONS WAS NEW AND THERE WAS REASONABLE CAUSE FOR LATE FIL ING OF THE RETURN, THE TRIBUNAL DIRECTED THE ASSESSING OFFICER TO CONSIDER THE CLAIM OF THE ASSESSEE UNDER SECTION 10B IRRESPE CTIVE OF THE FACT THAT THE RETURN HAS BEEN FILED LATE BY 1A MON THS. ITA NO.1014/DEL./2012 13 THE FACTS OF THE INSTANT CASE ARE ALMOST IDENTICAL. THE ASSESSEE HAD FILED ALL THE NECESSARY DOCUMENTS WHICH WERE SU PPORTING THE CLAIM OF THE ASSESSEE FOR DEDUCTION UNDER SECTION 8 0-IC BEFORE DUE DATE OF FILING THE RETURN. THE DEFAULT OF THE A SSESSEE FOR NOT FILING THE RETURN WAS ONLY A TECHNICAL DEFAULT AS T HE RETURN WAS NOT FILED, BUT SUPPORTING DOCUMENTS WERE FILED. THE REFORE, THE CLAIM OF THE ASSESSEE SHOULD BE CONSIDERED ON MERIT S AND IT SHOULD NOT BE REJECTED FOR THE REASON THAT THE ASSE SSEE DID NOT FILE HER RETURN OF INCOME WITHIN THE PRESCRIBED DATE. IN VIEW OF THE AFOREMENTIONED RATIO OF THE DECISION OF THE TRIBUNA L, THE CLAIM OF THE ASSESSEE UNDER SECTION 80-IC CANNOT BE DENIED S IMPLY FOR THE REASON THAT THE RETURN OF INCOME WAS NOT FILED WITH IN THE DUE DATE AS PRESCRIBED UNDER SECTION 139(1) BY KEEPING IN VIEW THE FACT THAT THE ASSESSEE HAD SUBMITTED THE NECESSARY DOCUMENTS WITH THE DEPARTMENT BEFORE THE DUE DATE OF FILING T HE RETURN AND THE DEFAULT OF THE ASSESSEE WAS ONLY A TECHNICAL DE FAULT. HOWEVER, KEEPING IN VIEW THE FACT THAT THE ASSESSIN G OFFICER HAS NOT EXAMINED THE CLAIM OF THE ASSESSEE ON MERITS AS TO WHETHER OR NOT THE ASSESSEE IS FULFILLING THE CONDITIONS LA ID DOWN IN SECTION 80-IC, THE MATTER IS RESTORED BACK TO THE F ILE OF THE ASSESSING OFFICER TO EXAMINE WHETHER THESE CONDITIO NS ARE SATISFIED BY THE ASSESSEE. THE ITAT BANGALORE BENCH A, IN THE CASE OF M/S. V ANSHEE BUILDERS & DEVELOPERS P. LTD. VS. ITO IN ITA NO.386/BANG/2012 FOR ASSESSMENT YEAR 2008-09 DATED 07.12.2012, AFTER ANALYZING JUDICIAL PRECEDENT ON THE SUBJECT FOR ENTITLEMENT OF DEDUCTION U/S 80IB READ WITH SEC TION 80AC FOR FILING THE RETURN OF INCOME WITHIN THE DUE DATE OF FILING THE RETURN U/S 139 OF THE ACT, HAS HELD AS UNDER :- (1) IN THE CASE OF BAJAJ TEMPO LIMITED V. CIT REPO RTED IN (1992) HAD HELD THAT A PROVISION IN THE TAXING ST ATUTE GRANTING INCENTIVES FOR PROMOTING GROWTH AND DEVELOPMENT SHO ULD BE CONSTRUED LIBERALLY. SINCE A PROVISION INTENDED FOR PROMOTING ECONOMIC GROWTH HAS TO BE INTERPRETED LIBERALLY, TH E RESTRICTION ITA NO.1014/DEL./2012 14 ON IT TOO HAS TO BE CONSTRUED SO AS TO ADVANCE THE OBJECTIVE OF THE PROVISION AND NOT TO FRUSTRATE IT. (2) THE HONBLE JURISDICTIONAL HIGH COURT IN THE CA SE OF UDDEERESWARA MINING INDUSTRIES V. CIT REPORTED IN ( 1993) 204 ITR 550 (KAR) HAD RULED THAT - 5. THERE CAN BE NO DISPUTE ABOUT THE PROPOSITION T HAT THE TERM USED IN A FISCAL LEGISLATION DESCRIBING THE SU BJECTS OF TAXATION ARE TO BE NORMALLY UNDERSTOOD IN THEIR POP ULAR SENSE UNLESS THE LAW ITSELF INDICATES A DIFFERENT A PPROACH. SCIENTIFIC AND TECHNICAL MEANINGS ARE TO BE ATTRIBU TED TO THOSE WORDS ONLY WHEN THE CONTEXT REQUIRES SUCH MEA NINGS TO BE GIVEN. THE NORMAL RULE IS TO GIVE THAT MEANIN G WHICH TO PERSONS ENGAGED IN DEALING WITH THAT SUBJECT MAT TER ATTRIBUTE TO THAT TERM, DESCRIBING THE SUBJECT. IT IS ALSO TRUE THAT A BENEFICIAL PROVISION IN A FISCAL STATURE SHO ULD BE LIBERALLY CONSTRUED TO ADVANCE THE PURPOSE BEHIND T HE LEGISLATION......... (3) THE HONBLE B BENCH OF THE DELHI TRIBUNAL IN THE CASE OF ACIT V. DHIR GLOBAL INDUSTRIAL (P) LTD REPORTED IN (2011) 43 SOT 640 RECORDED ITS FINDING WHICH IS EXTRACTED AS BELOW: A PROVISO HAS BEEN INSERTED DURING THE CURRENT YEA R IN S. 10B(1) WHICH PROVIDES THAT NO DEDUCTION UNDER THIS SECTION SHALL BE ALLOWED TO AN ASSESSEE IF THE RETU RN OF INCOME IS NOT FURNISHED ON OR BEFORE THE DUE DATE S PECIFIED UNDER SUB-SECTION (1) OF S. 139. THIS PROVISO IN S. 10B(1) IS DIRECTORY AND NOT MANDATORY. IN THE PRESENT CASE , THERE WAS ONLY A MARGINAL DELAY OF 1 MONTH INFILLING TH E RETURN OF INCOME. THE RETURN FILED WAS VALID ONE. T HE SAME HAS ALSO BEEN ACCEPTED AS A VALID RETURN BY THE AO. THE REASONABLE CAUSE ATTRIBUTED BY THE ASSESSEE FOR THE DELAY IS THAT NEW PROVISION OF E-FILING OF THE RETURN WAS IN TRODUCED FROM THE CURRENT ASSESSMENT YEAR. THERE WAS SOME PROBLEM UNDER THE NEW PROVISIONS DUE TO WHICH THE D ATE OF FILING THE RETURN HAD BEEN EXTENDED BY THE CBDT FRO M TIME TO TIME AND FROM 31ST OCTOBER 2006, THE SAME WAS EXTENDED TO 30 TH NOVEMBER, 2006. THE NEW PROVISION REGARDING E-FILING OF RETURN WAS INTRODUCED IN THIS FIRST YEAR; THE SOFTWARE DID NOT ACCEPT THE RETURN, IF SE LF- ITA NO.1014/DEL./2012 15 ASSESSMENT TAX WAS NOT PAID. ASSESSEES CASE IS THA T DUE TO SOME FINANCIAL PROBLEMS IT COULD NOT PAY THE SELF- ASSESSMENT TAX ON TIME, AS A RESULT OF WHICH THERE WAS A DELAY IN THE PAYMENT OF TAX AND CONSEQUENT FILING O F RETURN BY ABOUT 1 MONTHS. IT WAS FURTHER CLAIMED THAT SUBSEQUENTLY THE SOFTWARE HAS BEEN MODIFIED AND NOW RETURNS ARE BEING ACCEPTED, EVEN WHEN SELF-ASSESSME NT TAX IS NOT PAID. THESE FACTUAL FACTORS HAVE NOT BEEN DI SPUTED BY THE REVENUE. IN THESE CIRCUMSTANCES, THERE WAS G ENUINE AND VALID REASON FOR THE DELAY IN FILING OF RETURN AND MOREOVER THESE PROVISIONS ARE DIRECTORY AND NOT MANDATORY. ONCE THE VALIDITY OF THE RETURN HAS NOT BEEN QUESTIONED BY THE REVENUE, THE REJECTION OF THE ASS ESSEES CLAIM UNDER S. 10B(1) AT THE THRESHOLD BY THE AO WA S NOT JUSTIFIED. THE ACT DOES NOT PROHIBIT THAT RELIEF IN THIS REGARD WHEN GENUINE HARDSHIP IS FACED CANNOT BE GRA NTED BY APPELLATE AUTHORITY. FURTHER, THE VERY FACT THAT THE ACT ENVISAGES THAT RELIEF REGARDING EXEMPTION SHOULD BE CONSIDERED AND GRANTED WHEN APPLICATION IS MADE AFT ER THE SPECIFIED PERIOD IN CASES OF GENUINE HARDSHIP CLEAR LY INDICATES THAT PROVISION IN THIS REGARD IS DIRECTOR Y AND NOT MANDATORY. HENCE, IN CASE OF GENUINE HARDSHIP THE R ELIEF CAN BE GRANTED BY THE APPELLATE AUTHORITY................................... IN ITS CONCLUSION, THE HONBLE BENCH HAD OBSERVED T HUS - PROVISO FOURTH TO S. 10B(1) WHICH PROHIBITS DEDUCT ION UNDER THIS SECTION IF THE RETURN IS NOT FURNISHED O N OR BEFORE THE DUE DATE SPECIFIED UNDER S. 139(1) IS DI RECTORY AND NOT MANDATORY AND, THEREFORE, RELIEF CAN BE GRA NTED BY THE APPELLATE AUTHORITY IN CASE, THERE WAS GENUINE AND VALID REASON FOR THE MARGINAL DELAY IN FILING OF RE TURN (4) AN IDENTICAL ISSUE TO THAT OF THE PRESENT ONE W AS CONSIDERED BY THE HONBLE B BENCH OF HYDERABAD TR IBUNAL IN THE CASE OF ITO V. SHRI S VENKATAIAH IN ITA NO.984/ HYD/2011 DATED 31.5.2012 FOR THE ASSESSMENT YEAR 2008-09. TH E REVENUE HAD, AMONG OTHERS, APPROACHED THE HONBLE TRIBUNAL WITH THE FOLLOWING RELEVANT GROUNDS: 1. THE ORDER OF THE CIT(A)........................ .................. ITA NO.1014/DEL./2012 16 2. THE CIT (A) ERRED IN ALLOWING THE ADDITIONAL EVIDENCE WITHOUT GIVING A REASONABLE OPPORTUNITY TO THE AO TO EXAMINE THE EVIDENCE WHICH IS IN CONTRAVENTIO N TO THE RULE 46A(3) OF IT RULES 1962; 3. THE CIT (A) OUGHT TO HAVE APPRECIATED THAT THE A O HAD RIGHTLY DISALLOWED THE DEDUCTION CLAIMED U/S 80 IC FOLLOWING THE PROVISIONS OF SECTION 80AC; 4. THE CIT (A) OUGHT TO HAVE HELD THAT THE EXPLANAT ION OFFERED BY THE ASSESSEE WAS NOTHING BUT AN AFTER TH OUGHT AND DEVOID OF ANY MERIT AS NO EFFORT WAS MADE BY HI M TO TAKE RECOURSE U/S 119(2)(B) FOR EXTENSION OF TIME F OR FILING THE RETURN OF INCOME; 5. THE CIT (A) ERRED IN COMING TO A CONCLUSION THAT THE ASSESSEE WAS PREVENTED BY A GENUINE REASON IN F ILING THE RETURN BELATEDLY; & 6. THE CIT (A) OUGHT TO HAVE APPRECIATED THAT THE INTENTION OF THE LEGISLATURE BEHIND INCORPORATING S . 80AC WAS TO IMPOSE STRINGENT GUIDELINES ON THE ASSESSEE WHO CLAIM EXEMPTION OF PROFITS U/S 80IA TO 80IE. (I) TAKING INTO ACCOUNT THE SUBMISSION OF THE ASSES SEE AND THE REBUTTAL OF THE LEARNED D R AS RECORDED IN ITS FIND INGS, THE HONBLE TRIBUNAL HAD DECIDED THE ISSUES AGAINST THE REVENUE. THE RELEVANT PORTIONS OF FINDINGS OF THE HONBLE BE NCH, FOR APPRECIATION OF FACTS, ARE EXTRACTED AS UNDER: 13..........................IN THIS CASE, ADMITTED LY, THE ASSESSEE FILED THE RETURN OF INCOME ON 23.12.2008. THE DUE D ATE FOR FILING THE RETURN OF INCOME U/S 139(1) OF THE ACT F OR THE ASSESSMENT YEAR UNDER CONSIDERATION IN THE CASE OF THE ASSESSEE IS 31.10.2008. AS SUCH, THE RETURN FILED B Y THE ASSESSEE IS BELATED. IN THIS, THE ASSESSEE CLAIMED DEDUCTION U/S 80IC OF THE ACT WHICH WAS DISALLOWED BY THE ASS ESSING OFFICER AS THE RETURN OF THE ASSESSEE WAS NOT FILED WITHIN THE TIME AS PRESCRIBED U/S 139(1) OF THE ACT. THE A SSESSEE HAS GIVEN REASONS FOR DELAY IN FILING THE RETURN OF INCOME THAT THE ASSESSEE WAS PREPARING ITS ACCOUNTS THROUG H ITA NO.1014/DEL./2012 17 COMPUTER AND THE COMPUTER GOT CORRUPTED DUE TO VIRU SES AND IN SPITE OF CONTINUOUS EFFORTS BY THE COMPUTER TECHNICAL PERSONNEL TO RETRIEVE THE DATA IN TIME FO R FILING THE RETURN OF INCOME, PROBLEM PERSISTED IN THE SYST EM. BY TRYING TO RETRIEVE THE DATA FOR 4 DAYS THE REQUIRED DATA COULD NOT BE RETRIEVED AND THE BACKED UP DATA WERE AVAILABLE UP-TO 31 ST JANUARY 2008 IN THE CD AND THE ENTIRE DATA FOR THE TWO MONTHS PERIOD, FEBRUARY AND MARCH, 2008, HAD TO BE RE-ENTERED INTO THE COMPUTER SYSTEM AGAIN. ON PREPARATION OF THE FINAL ACCOUNTS AND FINALIZING OF STATUTORY AUDIT IT TOOK A LITTLE EXTRA TIME THAT RE SULTED IN BELATED FILING OF RETURN OF INCOME. THUS, THERE WAS A DELAY OF 74 DAYS IN FILING THE RETURN OF INCOME WHICH IS BEYOND THE CONTROL OF ASSESSEE. THIS WAS ALSO CONFIRMED BY THE STATUTORY AUDITOR VIDE HIS LETTER DATED 20.3.2011. BEING SO, IN OUR OPINION THERE IS A REASONABLE CAUSE FOR FILI NG THE RETURN OF INCOME BELATEDLY AND THIS IS BEYOND THE C ONTROL OF THE ASSESSEE. WHEN THE SUBSTANTIAL QUESTION OF J USTICE INVOLVED, TECHNICALITIES SHOULD BE IGNORED. FURTHER , WE ARE SUPPORTED BY THE ORDER OF THE TRIBUNAL IN ITA NOS. 1231 & 1199/HYD/2010 IN THE CASE OF DCIT V. M/S. VEGA CONVEYORS & AUTOMATION LIMITED ORDER DATED 31 ST DECEMBER 2010 WHEREIN IN PARA 5 OF THE ORDER, THE TRIBUNAL HELD AS FOLLOWS: 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF THE LOWER AUTHORITIES, AND OT HER MATERIAL AVAILABLE ON RECORD, INCLUDING THE CASE-LA W RELIED UPON BY THE PARTIES. IT IS AN UNDISPUTED FACT THAT THE ASSESSEE IN THE PRESENT CASE HAS FILED THE AUDIT RE PORT IN FORM 10CCB DURING THE COURSE OF RE-ASSESSMENT PROCEEDINGS. THE ISSUE THAT ARISES FOR CONSIDERATIO N IS WHETHER THE ASSESSING OFFICER WAS JUSTIFIED IN DISA LLOWING THE ASSESSEES CLAIM FOR DEDUCTION UNDER S.80IB ON THE GROUND THAT THE AUDIT REPORT IN FORM 10CCB WAS NOT FILED ALONG WITH THE RETURN OF INCOME; OR WHETHER THE CIT (A) WAS CORRECT IN PROCEEDING ON THE BASIS OF FORM 10CC B FILED DURING THE COURSE OF RE-ASSESSMENT PROCEEDING S AND DIRECTING THE ASSESSING OFFICER TO ALLOW THE CLAIM OF THE ASSESSEE FOR DEDUCTION UNDER S. 80IB OF THE ACT. IT IS SETTLED POSITION OF LAW, AS CONSISTENTLY HELD BY VA RIOUS BENCHES OF THIS TRIBUNAL AND AS HELD IN VARIOUS DEC ISIONS ITA NO.1014/DEL./2012 18 REFERRED TO BY THE CIT (A) IN THE IMPUGNED ORDER, T HAT THOUGH FILING OF AUDIT REPORT IN FORM 10CCB IS MAND ATORY AND PRE-REQUISITE FOR DEDUCTION UNDER S. 80IB, NON- FILING OF THE SAME ALONG WITH THE RETURN OF INCOME IS ONLY A CURABLE DEFECT, AND ASSESSEES CLAIM FOR DEDUCTION HAS TO BE CONSIDERED ON ITS MERITS AS SAND WHEN THE DEFECT IS CURED BY FILING FORM 10CCB. WE ARE FORTIFIED IN THI S BEHALF BY THE DECISION OF THE JURISDICTIONAL HIGH C OURT IN THE CASE OF HEMSONS INDUSTRIES (SUPRA), RELIED UPON BY THE LEARNED COUNSEL FOR THE ASSESSEE. IT IS CONTENDED B Y THE LEARNED DEPARTMENTAL REPRESENTATIVE THAT THE ASSESS EES CLAIM FOR DEDUCTION UNDER S. 80IB CAN BE ENTERTAINE D AND EXAMINED ON MERITS, WHEN THE AUDIT REPORT IS FILED BEFORE THE COMPLETION OF ASSESSMENT, WHICH HAS NOT BEEN DO NE IN THE PRESENT CASE, SINCE THE AUDIT REPORT WAS FILED ONLY DURING THE COURSE OF RE-ASSESSMENT PROCEEDINGS INIT IATED BY THE ASSESSING OFFICER, WHICH CANNOT END UP GIVIN G ADDITIONAL DEDUCTIONS/BENEFITS TO THE ASSESSEE. WE DO NOT FIND MERIT EVEN IN THIS CONTENTION OF THE LEARNED DEPARTMENTAL REPRESENTATIVE. IN THE CASE OF HEMSONS INDUSTRIES (SUPRA) BEFORE THE JURISDICTIONAL HIGH C OURT, OF ONE OF THE YEARS UNDER APPEAL BEFORE HONBLE HIGH C OURT, VIZ., ASSESSMENT YEAR 1979-80, AUDIT REPORT WAS FIL ED DURING THE COURSE OF RE-ASSESSMENT PROCEEDINGS AND IN RESPONSE TO THE SHOW-CAUSE NOTICE UNDER S. 148 ISSU ED BY THE ASSESSING OFFICER. IN THIS VIEW OF THE MATTER, RESPECTFULLY FOLLOWING THE DECISION OF THE JURISDIC TIONAL HIGH COURT CITED ABOVE, AMONG OTHERS, WE FIND NO JUSTIFICATION TO INTERFERE WITH THE ORDER OF THE CI T (A). WE ACCORDINGLY UPHOLD THE SAME AND REJECT THE GROUNDS OF THE REVENUE IN THIS APPEAL. 14. IN OUR OPINION, IN VIEW OF THE ABOVE DISCUSSION , THE CLAIM OF THE ASSESSEE CANNOT BE DENIED ON TECHNICAL ITIES WHEN THE ASSESSEE IS LEGALLY OTHERWISE ENTITLED FOR DEDUCTION. AS SUCH, WE ARE INCLINED TO DISMISS THE APPEAL FILED BY THE REVENUE AS DEVOID OF MERIT. 7. CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE I SSUE AS DELIBERATED UPON IN THE FORE-GOING PARAGRAPHS AND A LSO IN CONFORMITY WITH THE RULINGS OF THE HONBLE SUPREME COURT, THE HONBLE JURISDICTIONAL HIGH COURT AND ALSO THE FIND INGS OF THE ITA NO.1014/DEL./2012 19 HONBLE BENCHES OF DELHI AND HYDERABAD TRIBUNALS CI TED SUPRA, WE ARE OF THE CONSIDERED VIEW THAT S. 80AC OF THE A CT WHICH PROHIBITS DEDUCTION U/S 80IB IF THE RETURN IS NOT F URNISHED ON OR BEFORE THE DUE DATE SPECIFIED U/S 139(1) OF THE ACT IS ONLY DIRECTORY AND NOT MANDATORY, PROVIDED THERE WAS REA SONABLE CAUSE FOR FILING OF RETURN OF INCOME BELATEDLY. THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE O F CIT VS. CONTIMETERS ELECTRICALS P. LTD. (317 ITR 249 (DELHI)) IN ITS OR DER DATED 2 ND DECEMBER, 2008 HAS HELD AS UNDER :- THE COMMISSIONER ISSUED A NOTICE UNDER SECTION 263 OF THE INCOME-TAX ACT, 1961 STATING THAT THE ASSESSEE WAS NOT ENTITLED TO THE DEDUCTION UNDER SECTION 80-IA AS THE ASSESSE E DID NOT FULFIL THE CONDITION LAID DOWN IN SECTION 80-IA(7). THEREFORE HE HELD THAT ASSESSMENT COMPLETED BY THE ASSESSING OFF ICER WAS PREJUDICIAL TO THE INTEREST OF THE REVENUE. THE COM MISSIONER CANCELLED THE ASSESSMENT AND DIRECTED THE ASSESSING OFFICER TO COMPLETE THE ASSESSMENT AS PER LAW. IN AN APPEAL FI LED BY THE ASSESSEE, THE TRIBUNAL HELD THAT THE PROVISIONS OF SECTION 80- IA(7) WERE NOT MANDATORY AND WERE MERELY DIRECTORY. ON APPEAL : HELD, DISMISSING THE APPEAL, THAT THE TRIBUNAL ARRIVED AT THE CORRECT CONCLUSION THAT THE REQUIREMENT OF FILING T HE AUDIT REPORT ALONG WITH THE RETURN WAS NOT MANDATORY BUT DIRECTO RY AND THAT IF THE AUDIT REPORT IS FILED AT ANY TIME BEFORE THE FR AMING OF THE ASSESSMENT, THE REQUIREMENT OF SECTION 80-IA(7) WOU LD BE MET. THE TRIBUNAL WAS ALSO RIGHT IN HOLDING THAT THE COM MISSIONER DID NOT EVEN CALL FOR ANY EXPLANATION OF THE ASSESS EE AND THE ISSUE OF FULFILLMENT OF THE CONDITIONS OF SECTION 8 0-IA HAD NOT BEEN PART OF THE SHOW-CAUSE NOTICE. THEREFORE, IT C OULD NOT FORM THE BASIS FOR REVISION OF THE ASSESSMENT ORDER UNDE R SECTION 263. NO SUBSTANTIAL QUESTION OF LAW AROSE. IN THIS CASE, THE ORDER OF ASSESSING OFFICER IS DAT ED 30.12.2009. FOR THE PURPOSE OF REVISION U/S 263 OF THE ACT, THE LEGAL P OSITION AT THE TIME OF PASSING ITA NO.1014/DEL./2012 20 THE IMPUGNED ORDER BY THE ASSESSING OFFICER IS TO B E CONSIDERED AND NOT THE LEGAL POSITION AT THE TIME OF FILING THE RETURN OF INCOME OR AFTER THE FINALIZATION OF ASSESSMENT. THE FACTS OF THE CASE CLEARLY ESTABL ISHES THAT AT THE TIME OF PASSING THE ASSESSMENT ORDER, TWO VIEWS WERE POSSIB LE WITH REGARD TO THE CLAIM OF DEDUCTION U/S 80IB IN VIEW OF PROVISIONS O F SECTION 80AC. THE ASSESSING OFFICER HAS ADOPTED ONE OF THE COURSES PE RMISSIBLE IN LAW AT THE RELEVANT TIME. IT IS WELL ESTABLISHED LAW THAT WHE RE TWO VIEWS WERE POSSIBLE AND ASSESSING OFFICER HAD TAKEN ONE VIEW AND IF CIT DO NOT AGREE WITH IT THEN HE CANNOT INVOKE PROVISIONS OF SECTION 263 OF THE A CT TO REVISE THE A.O.S ORDER. THEREFORE IN OUR CONSIDERED VIEW, THE CIT WA S NOT JUSTIFIED IN INVOKING THE PROVISIONS OF SECTION 263 OF THE ACT IN THIS CA SE. THE APPEAL OF THE ASSESSEE IS ALLOWED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN OPEN COURT ON THIS 18 TH DAY OF DECEMBER, 2013. SD/- SD/- (DIVA SINGH) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 18 TH DAY OF DECEMBER, 2013/TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A) 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.