M/s The Orissa State Police Housing & Welfare Corporation Ltd, Bhubaneswar V. ACIT, Bhubaneswar

ITA 140/CTK/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 4419 (ITAT-CUTTACK)
• Duration Of Justice: 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-05-2011
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Assessment Year: 2003-2004
• Appeal Filed On: 11-03-2011
• Court: TRIBUNAL
• Department Lawyers: S C MOHANTY
• Assessee Lawyers: C R JENA
• Keywords: Set aside
• Section: 142(1); 143(2); 144

Judgement Text

IN THE INCME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE : HONBLE SHRI K.K.GUPTA, ACCOUNTANT MEMBER, AND HONBLE SHRI K.S.S.PRASAD RAO, JUDICIAL MEMBER. ITA NO. 140/CTK/2011 (ASSESSMENT YEAR 2003 - 04) M/S.THE ORISSA ST A TE POLICE HOUSING & WELFARE CORPORATION, JANPATH, BHOINAGAR, BHUBANESWAR PAN: AABCT 7853 N VERSUS ASST.COMMISSIONER OF INCOME - TAX, CIRCLE 2(1), AYAKAR BHAWAN,BHUBANESWAR. (APPELLANT) (RESPONDENT) FOR THE APPELLANT: SHRI C.R.JENA, AR FOR THE RESPONDENT SHRI S.C.MOHANTY, DR ORDER SHRI K.K.GUPTA, ACCOUNTANT MEMBER : THE ASSESSEE HAS FILED THIS APPEAL AGAINST THE ORDER DT.11.1.2011 OF THE COMMISSIONER OF INCOME - TAX (APPEALS) FOR THE ASSESSMENT YEAR 2003 - 04 . 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A PUBLIC SE CTOR UNIT INCORPORATED UNDER THE COMPANIES AT,1956. RETURN FOR THE ASSESSMENT YEAR 2003 - 04 WAS FILED ON1.12.2003. SINCE THE RETURN WAS NOT ACCOMPANIED WITH FINAL AUDITED ACCOUNTS, DEFICIENCY LETTER WAS ISSUED AND SERVED ON THE ASSESSEE BY THE ASSESSING OFF ICER ON 18.3.2004 FOR FILING THE AUDITED FINAL ACCOUNTS BY 30.3.2004. THE ASSESSEE DID NOT RESPOND TO THE SAID NOTICE. CONSEQUENTLY, THE ASSESSING OFFICER ASSESSED THE ASSESSEE U/S.144 ON A NIL TOTAL INCOME. AGGRIEVED, THE ASSESSEE PREFERRED APPEAL BEFORE THE COMMISSIONER OF INCOME - TAX (APPEALS) . 3. BEFORE THE CIT(A), THE ASSESSEE OBJECTED TO THE ORDER PASSED U/S.144 AND PRAYED FOR SETTING ASIDE THE SAME AND RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR DE NOVO ASSESSMENT. IT PLACED RELIANCE O N THE DECISION OF THE ITAT, CUTTACK BENCH IN ITA NO.538/CTK/2005 DT.24.5.2006. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, THE LEARNED CIT(A) DECLINED TO ACCEPT THE ABOVE PRAYER OF THE ASSESSEE EXPRESSING THAT HE HAS NO POWER TO DO SO. IN VIEW OF T HIS AND ALSO ON THE FINDING THAT THE ASSESSEE HAVING FAILED TO FILE THE AUDITED ACCOUNT BEFORE 2 THE ASSESSING OFFICER INSPITE OF OPPORTUNITIES GIVEN, HE CONFIRMED THE ASSESSMENT. AGGRIEVED, THE ASSESSEE HAS FILED THE PRESENT APPEAL HERE BEFORE THE TRIBUNAL. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUS ED THE MATERIAL AVAILABLE ON RECORD . THE LEARNED AR OF THE ASSESSEE SUBMITTED BEFORE US THAT T HE ORISSA STATE POLICE HOUSING & WELFARE CORPORATION LTD ., A WHOLLY OWNED GOVT . OF ORISSA UNDERTAKING , IS ONE OF THE GOVT . COMPANY DERIVES ITS INCOME FROM DEPOSITORY WORKS .THE ASSESSEE BEING A COMPANY MAINTAINS ITS BOOKS OF ACCOUNTS AS REQUIRED IN THE REGULAR COURSE OF BUSINESS ACTIVITIES AND CONFIRMING TO THE PROVISIONS OF THE COMPANIES ACT, 1956, SUCH AS CASH BOOK LED GER JOURNAL REGISTER, SUPPORTING BILLS & VOUCHERS FOR EXPENSES ETC. THE ACCOUNTS OF THE COMPANY ARE AUDITED BY THE STATUTORY AUDITORS APPOINTED BY THE CAG. THE GROSS RECEIPT OF THE COMPANY EXCEEDING RS.40.00 LAKHS ARE ALSO FURTHER AUDITED BY THE STATUTORY AUDITORS U/S 44AB OF THE I.T ACT ,1961. ALL THE TRANSACTIONS ARE ROUTED THROUGH BANK ACCOUNT. SINCE THE COMPUTATION OF TOTAL INCOME UNDER THE NORMAL PROVISIONS OF I.T.ACT , 1961 OF THE CURRENT YEAR WAS NIL AFTER SET OFF OF THE BROUGHT FORWARD LOSSES THE ASS ESSEE COMPANY COMPUTED OF ITS TAX LIABILITY UNDER THE DEEMING PROVISION U/S 115 JB I.E BOOK PROFIT & DISCHARGED ITS TAX LIABILITY WITH THAT TAX DEDUCTED AT SOURCE & CLAIMED REFUND OF RS. 1,55,386 BY FILING OF RETURN ON DATED 01.12.2003 ACCOMPANIED WITH THE PROVISIONAL P&L ACCOUNT ,BALANCE SHEET, TAX AUDIT REPORTS ETC. THE CASE WAS SELECTED FOR SCRUTINY. IN RESPONSE TO NOTICE U/S 143(2) & 142(1) OF THE I.T ACT , THE AUTHORISED REPRESENTATIVE OF THE ASSESSEE COMPANY APPEARED BEFORE THE A.O AND THE CASE WAS DISC USSED IN DETAILS .SINCE THE ASSESSEE HAD FILED ITS RETURN OF INCOME ON THE BASIS OF PROVISIONAL TRADING , PROFIT AND LOSS ACCOUNT, THE A.O DESIRED THE SUBMISSION OF FINAL ACCOUNTS. IT WAS HUMBLY SUBMITTED BEFORE THE A.O THAT SINCE IT IS ONE OF THE GOVERNMEN T COMPANY , THE FINAL ACCOUNTS AS WELL AS THE STATUTORY AUDIT REPORT COULD NOT BE OBTAINED DUE TO DELAY IN APPOINTMENT PROCESS O F THE AUDITOR BY THE GOVERNMENT . THEREFORE, IT WAS SUBMITTED THAT THE ASSESSMENT BE COMPLETED ON THE BASIS OF THE PROVISIONAL TRA DING , PROFIT & LOSS ACCOUNT, WHICH CONFIRMS TO THE BOOKS OF ACCOUNT MAINTAINED BY THE ASSESSEE. THOUGH THE A.O APPRECIATED THE SUBMISSION OF THE ASSESSEE AND FOR THAT REASON ALTHOUGH OBSERVED THAT THE RETURN SO FILED ON THE BASIS OF THE PROVISIONAL TRADING 3 PROFIT AND LOSS ACCOUNT IS AN INVALIDATE ONE, BUT HOWEVER, COMPLETED THE ASSESSMENT TO THE BEST OF JUDGMENT U/S 144 OF THE I.T ACT, 1961 BASING ON THE TRADING ,PROFIT & LOSS ACCOUNT. ON THE BASIS OF THE ABOVE SUBMISSIONS, THE LEARNED AR OF THE ASSESSEE CO NTENDED THAT THE IMPUGNED ORDER OF THE LEARNED CIT(A) BE SET ASIDE AND THE MATTER BE RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR DE NOVO ASSESSMENT. 5. CONSIDERING THE FACTS NARRATED BY THE LEARNED AR OF THE ASSESSEE AND RECORDED AS ABOVE, WHICH TH E LEARNED DR DID NOT DISPUTE, AND CONSIDERING THE FACT THAT THE LEARNED CIT(A) EXPRESSED HIS INABILITY TO SET ASIDE THE ASSESSMENT BECAUSE OF WANT OF SUCH POWER, WE SET ASIDE THE IMPUGNED ORDER OF THE LEARNED CIT(A) AND RESTORE THE MATTER TO THE FILE OF TH E ASSESSING OFFICER FOR DE NOVO ASSESSMENT IN ACCORDANCE WITH LAW , BY FOLLOWING THE DECISION OF THE ITAT, CUTTACK BENCH IN ASSESSEES OWN CASE FOR THE AY 2002 - 03 IN ITA NO.538/CTK/2005, RELIED ON BY THE LEARNED AR OF THE ASSESSEE, WHEREIN THE TRIBUNAL ON IDENTICAL DISPUTES HAS RESTORED THE MATTER TO THE FILE OF THE AO FOR DE NOVO ASSESSMENT IN ACCORDANCE WITH LAW. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN OPEN COURT ON DT. 20 TH MAY, 2011 SD/ - SD/ - (K.S.S.P RASAD RAO) JUDICIAL MEMBER (K.K.GUPTA) ACCOUNTANT MEMBER DATE: 20 TH MAY, 2011 H.K.PADHEE, SENIOR PRIVATE SECRETARY. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT: 2. THE RESPONDENT: 3. THE C IT, 4. THE CIT(A), 5. THE DR, CUTTACK 6. GUARD FILE (IN DUPLICATE) TRUE COPY, BY ORDER, SENIOR PRIVATE SECRETARY.