Jain Irrigation Systems Ltd., Jalgaon V. Asstt.CIT,Cir.2, Jalgaon, Jalgaon

ITA 1319/PUN/2007

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 59985 (ITAT-PUNE)
• Duration Of Justice: 4 year(s) 3 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-01-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2000-2001
• Appeal Filed On: 10-10-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K SINGH
• Keywords: Revised return
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI I C SUDHIR, JUDICIAL MEMBER AND SHRI G.S. PANNU, ACCOUNTANT MEMBER ITA NO. 1319/PN/2009 (ASSTT. YEAR: 2000-01) JAIN IRRIGATION SYSTEMS LTD., .. APPELLANT JAIN FIELDS, N. H. NO 6, BHAMBORI, JALGAON PAN AAACJ 7163Q VS. ASSTT. COMMISSIONER OF INCOME-TAX, .. RESPONDEN T CIR. 2, JALGAON APPELLANT BY : SHRI NIKHIL PATHAK RESPONDENT BY : SHRI S K SINGH DATE OF HEARING : 23.01.2012 DATE OF PRONOUNCEMENT : 30.01.2012 ORDER PER G.S. PANNU, A.M : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-II, NASHIK DATED 22. 8.2007 WHICH, IN TURN, HAS ARISEN FROM ORDER DATED 31.3.2003 PASSED BY T HE ASSESSING OFFICER, UNDER SECTION 143(3) OF THE INCOME-TAX ACT, 1961 (IN SH ORT THE ACT), PERTAINING TO THE ASSESSMENT YEAR 2000-01. 2. THE SOLITARY GROUND IN THIS APPEAL RELATES TO THE C LAIM OF THE ASSESSEE FOR DEDUCTION OF EXPENSES AMOUNTING TO RS 2,74,49,170/- . BRIEFLY PUT, THE CLAIM HAS NOT BEEN ENTERTAINED BY THE ASSESSING OFFICER AS WELL AS BY THE COMMISSIONER OF INCOME-TAX (APPEALS) ON THE GROUND THA T IT WAS MADE ONLY DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND IT WAS NEI THER CLAIMED IN THE RETURN OF INCOME AND NOR BY WAY OF FILING A REVISED R ETURN OF INCOME. BRIEFLY PUT THE FACTS ARE THAT ASSESSEE IS A COMPANY ENGAGED IN THE BUSI NESS OF MANUFACTURE OF IRRIGATION SYSTEM, SPRINKLERS SYSTEM, P VC PIPES AND FITTINGS ETC. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSE SSEE SUBMITTED THAT IT HAS NOT CLAIMED DEDUCTION FOR PRIOR PERIOD EX PENSES AMOUNTING TO RS 2,74,49,170/- IN THE RETURN OF INCOME. IT WAS EXPLAIN ED THAT SUCH EXPENSES WERE LIABLE TO BE ALLOWED IN THIS YEAR, THOUGH NOT CL AIMED IN THE RETURN OF INCOME. THE ASSESSING OFFICER, WITHOUT GOING INTO THE MER ITS OF THE CLAIM, DENIED THE PLEA OF THE ASSESSEE ON THE GROUND THAT THE SAME WAS NOT CLAIMED IN THE RETURN OF INCOME. THE COMMISSIONER OF INCOME-TAX (APPEALS), FOLLOWING THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. V. CIT 284 ITR 323 (SC) HAS ALSO SUSTAINED THE ACTION OF T HE ASSESSING OFFICER BY OBSERVING THAT A FRESH CLAIM FOR EXPENDITURE COULD B E ENTERTAINED AT THE TIME OF ASSESSMENT ONLY BY WAY OF A REVISED RETURN OF INCOME WHICH, IN THE PRESENT CASE, WAS NOT DONE. ACCORDINGLY, THE ASSESSEES CLAIM WAS NOT E NTERTAINED AND NOT BEING SATISFIED WITH THE ORDER OF COMMISSIONER OF INCOME-TAX (APPEALS), ASSESSEE IS IN APPEAL BEFORE US. 3. BEFORE US, LEARNED COUNSEL FOR THE ASSESSEE HAS ASSAILE D THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) BY POINTING OU T THAT THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF GOETZE ( INDIA) LTD. (SUPRA) DOES NOT PUT ANY FETTERS ON THE POWERS OF THE APPELLATE AU THORITIES TO ADMIT A FRESH CLAIM WHICH WAS HITHERTO NOT CLAIMED IN THE RETURN OF I NCOME AND, THEREFORE, THE COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN NOT A DMITTING THE CLAIM OF THE ASSESSEE. IT WAS POINTED OUT THAT THE ASSESSEE HAD FURN ISHED COMPLETE FACTUAL POSITION WITH REGARD TO THE CLAIM AND THE SAME WAS A PART OF RECORD AND, THEREFORE, THE COMMISSIONER OF INCOME-TAX (APPEA LS) WHO ENJOYS PLENARY POWERS OF AN ASSESSING OFFICER IN VIEW OF THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF JUTE CORPORATION OF INDI A L:TD. V. CIT 187 ITR 688 (SC), WAS COMPETENT TO INDEPENDENTLY ENTERTAIN A FRESH CLAIM OF THE ASSESSEE EVEN IF IT WAS NOT BEFORE THE ASSESSING OFFICER. TH E LEARNED COUNSEL SUBMITTED THAT THE ASSESSEE WOULD BE SATISFIED IF THE CLA M OF THE ASSESSEE IS ENTERTAINED AND MATER IS RESTORED BACK FOR EXAMINATION ON MERITS OF THE CLAIM. 4. ON THE OTHER HAND, THE LEARNED CIT-DEPARTMENTAL REPRESENTATIVE APPEARING FOR THE REVENUE, HAS POINTED OUT THAT THE ASSESSING OFFICER WAS QUITE JUSTIFIED IN NOT ENTERTAINING THE FRESH PLEA IN VIEW OF THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. (SUPRA) AND ACCORDINGLY SUPPORTED THE ACTION OF THE AUTHORITIES BELO W. 5. WE HAVE CAREFULLY CONSIDERED RIVAL SUBMISSIONS. IN OUR VIEW, THE PLEA OF THE ASSESSEE IS WELL-REASONED, INASMUCH AS THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. (SUPR A) DOES NOT IMPINGE ON THE POWERS OF THE APPELLATE AUTHORITIES TO ENTERTAIN A FRESH CLAIM WHICH WAS HITHERTO NOT PREFERRED BY THE ASSESSEE IN THE RETURN OF INCOME. IN FACT, THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT V. JAI PAR ABOLIC SPRINGS LTD. 306 ITR 42 (DEL) SUPPORTS THE PROPOSITION THAT THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. (SUPRA) WAS L IMITED TO THE POWER OF THE ASSESSING OFFICER TO ENTERTAIN CLAIM FOR DEDUCTION OTHERW ISE THAN BY A REVISED RETURN AND DOES NOT PUT FETTERS ON SUCH POWERS OF THE A PPELLATE AUTHORITIES. 6. WE, THEREFORE, DEEM IT FIT AND PROPER TO HOLD T HAT THE CLAIM OF THE ASSESSEE HAS BEEN WRONGLY REFUSED TO BE ENTERTAINED AT THE THRESHOLD ITSELF, BY THE LOWER AUTHORITIES. SINCE NONE OF THE AUTHORITI ES BELOW HAS EXAMINED THE CLAIM OF THE ASSESSEE ON MERITS, WE FIND IT APPROPRIATE TO RESTORE IT BACK TO THE FILE OF THE ASSESSING OFFICER WHO SHALL EXAMINE THE CLAI M OF THE ASSESSEE ON MERITS, AFTER ALLOWING THE ASSESSEE A REASONABLE OPPORT UNITY OF BEING HEARD IN SUPPORT OF ITS CLAIM. NEEDLESS TO MENTION, IT IS A SETTLE D POSITION OF LAW THAT ONLY SUCH EXPENDITURE CAN BE PERMITTED DEDUCTION WHICH IS INCU RRED OR THE LIABILITY THEREOF HAS BEEN CRYSTALISED IN THE RELEVANT ASSESSMENT YEA R. THE ASSESSING OFFICER SHALL, THEREFORE, CARRY OUT THE AFORESAID EXERCI SE AND PASS A FRESH ORDER ON THIS ASPECT IN ACCORDANCE WITH LAW. 7. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. DECISION PRONOUNCED IN THE OPEN COURT ON 30 TH DAY OF JANUARY, 2012. SD/- SD/- (I C SUDHIR) (G.S . PANNU) JUDICIAL MEMBER ACCOUNTANT MEMB ER PUNE, DATED: 30 TH JANUARY, 2012 B COPY TO:- 1) JAIN IRRIGATION SYSTEM, JALGAON 2) ACIT CIR. 2 JALGAON 3) THE CIT (A)-II NASHIK 4 THE CIT-II NASHIK 5) DR, B BENCH, I.T.A.T.,PUNE. 6) GUARD FILE TRUE COPY BY ORDER SR. PS, ITAT PUNE