Gujarat Sheep and Wool Development Corpn. Ltd., Gandhinagar V. The ACIT.,GNR Circle, Gandhinagar

ITA 1447/AHD/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 6712 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 11 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 07-05-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K MADHUSUDAN SRDR
• Assessee Lawyers: M K PATEL
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD AHMEDABAD B BENCH BEFORE SHRI G.D. AGARWAL, HONBLE VICE-PRESIDENT (AZ) AND SHRI T.K. SHARMA, HONBLE JUDICIAL MEMBER ITA NO.1447/AHD/2009 ASSESSMENT YEAR:2006-07 DATE OF HEARING:21.4.11 DRAFTED:26.4.11 GUJARAT SHEEP AND WOOL DEVELOPMENT CORPORATION LTD. BLOCK NO.18, 5 TH FLOOR, UDYOG BHAVAN, SECTOR-II, GANDHINAGAR PAN NO.AAACG7142C V/S . ACIT, GANDHINAGAR CIRCLE, GANDHINAGAR (APPELLANT) .. (RESPONDENT) APPELLANT BY :- SHRI M.K. PATEL, AR RESPONDENT BY:- SHRI K.MADHUSUDAN, SR-DR O R D E R PER T.K. SHARMA, JUDICIAL MEMBER:- THIS APPEAL BY ASSESSEE IS AGAINST THE ORDER DATED 20-12-2009 OF COMMISSIONER OF INCOME-TAX (APPEALS)-GANDHINAGAR HO LDING THAT THE RETURN OF INCOME IS NOT FILED WITHIN TIME ALLOWED U/S139(1) O F THE INCOME-TAX ACT, 1961 AND THEREBY DISALLOWING THE LOSS CLAIMED TO BE CARR Y FORWARD FOR THE ASSESSMENT YEAR UNDER APPEAL. 2. BRIEFLY STATED FACTS ARE THAT ASSESSEE IS A COMP ANY. FOR THE ASSESSMENT UNDER APPEAL IT FILED ITS RETURN OF INCOME DECLARIN G LOSS AT RS.10,24,085/- AND SAME WAS PROCESSED U/S.143(1) OF THE ACT. ITA NO.1447/AHD/2009 A.Y. 2006-07 GS&WD CORPN LTD. V. ACIT GNG PAGE 2 3. SUBSEQUENTLY, ASSESSING OFFICER FRAMED THE ASSES SMENT U/S.143(3) OF THE ACT, WHEREIN HE OBSERVED THAT ASSESSEE HAS NOT FILED ITS RETURN OF INCOME BY DUE DATE OF FILING ITS RETURN, THEREFORE LOSS IS NOT ALLOWED TO CARRY FORWARD. 4. ON APPEAL BEFORE LD. CIT(APPEALS) ASSESSEE PLEAD ED THAT IT FILED THE RETURN OF INCOME THROUGH ELECTRONIC MEDIA (E-RETURN ) ON 31-12-2006 WHICH IS WITHIN DUE DATE I.E. UP TO 31-12-2006. THEREAFTER A SSESSEE WAS REQUIRED TO FILE PAPER RETURN WITHIN 15 DAYS. THIS WAS FILED ON 16-0 1-2007 WHICH IS DELAYED BY ONE DAY. IN THE IMPUGNED ORDER LD. CIT(APPEALS) CON FIRMED THE ACTION OF ASSESSING OFFICER. ON THE GROUND THAT E-RETURN WITH OUT DIGITAL SIGNATURE THEREFORE THE DATE OF FURNISHING RETURN WOULD BE TH E SAME AS DATE OF FILING OF E- RETURN PROVIDED SUBSEQUENT PAPER RETURN IS SUBMITTE D WITHIN 15 DAYS. SINCE E- RETURN WITHOUT DIGITAL SIGNATURE IS NOT VERIFIED, T HIS NEEDS TO BE VERIFIED BY PROPER PAPER RETURN WITHIN 15 DAYS. SINCE THIS WAS NOT DONE, THE ASSESSEE HAD FILED THE RETURN OF INCOME BEYOND DUE DATE OF F ILING. AGGRIEVED, ASSESSEE IS IN APPEAL BEFORE US. 5. AT THE TIME OF HEARING ON BEHALF OF ASSESSEE, SH RI M.K PATEL APPEARED AND CONTENDED WHEN THE ASSESSEE FILED THE E-RETURN, THE FILING OF PAPER RETURN IS ONLY PROCEDURAL AND ONE DAY DELAY SHOULD HAVE BE EN IGNORED KEEPING IN VIEW THE POLICY OF MINISTRY OF FINANCE TO PROMOTE E -FILING. HE FURTHER SUBMITTED THAT OBJECT OF PAPER FILING IS ONLY TO VERIFY THE S IGNATURE. IN THIS CASE ASSESSEE HAS FURNISHED PAPER RETURN CONFRONTING THE E-FILING OF RETURN THEREFORE THE DEPARTMENT SHOULD HAVE TAKEN A LENIENT VIEW. FOR PR OPOSITION THE RELIANCE WAS PLACED ON JUDGMENT OF HONBLE JURISDICTIONAL HIGH C OURT ON THE FOLLOWING TWO CASES:- 1) CIT V. GUJARAT AND ALLIED INDUSTRIES (1993) 201 ITR 325 (GUJ) 2) ZENITH PROCESSING MILLS V. CIT (1996) 219 ITR 7 21 (GUJ) ITA NO.1447/AHD/2009 A.Y. 2006-07 GS&WD CORPN LTD. V. ACIT GNG PAGE 3 6. SHRI K. MADHUSUDAN, LD. SR-DR APPEARED ON BEHALF OF REVENUE VEHEMENTLY RELIED ON THE ORDER OF AUTHORITY BELOW A ND HE POINTED OUT THAT ASSESSING OFFICER HAS NO POWER TO EXTEND THE TIME O F 15 DAYS PROVIDED IN THE ACT THEREFORE VIEW TAKEN BY LD. CIT(A) BE UPHELD. 7. HAVING HEARD BOTH SIDES WE HAVE CAREFULLY GONE T HROUGH THE AUTHORITIES BELLOW. IT IS PERTINENT TO NOTE THAT FOR ASSESSMENT IN APPEAL ASSESSING OFFICER COMPLETED THE ASSESSMENT U/S.143(3) OF THE ACT ON 1 0-11-2008 AT RETURNED LOSS DECLARED AT RS.10,24,085/-. ON APPEAL IN THE I MPUGNED ORDER LD. CIT(APPEALS) MODIFIED THE ORDER OF ASSESSING OFFICE R TO THE EXTENT THAT LOSS WITHOUT THE COMPONENT OF DEPRECIATION SHOULD NOT BE ALLOWED TO BE CARRY FORWARD. IT IS WELL SETTLED LAW THAT IN COMPLETING AN ASSESSMENT, DETERMINATION HAS TO BE MADE BY AO OF EITHER THE TOTAL INCOME OF THE ASSESSEE ASSESSABLE TO THE TAX OR OF THE LOSS WHICH THE ASSESSEE HAS IN CURRED IN RESPECT OF ANY PARTICULAR ASSESSMENT YEAR. WHERE THE RESULTANT FIG URE IS A LOSS, THE QUESTION WHETHER SUCH LOSS IS TO BE CARRIED AND SET OFF IS T O BE DETERMINED IN A SUBSEQUENT YEAR WHERE SET OFF IS CLAIMED OR IS PERM ISSIBLE. THE AO CANNOT, BY RECORDING A DECISION IN THE YEAR IN WHICH THE LOSS IS INCURRED, PREVENT THE ASSESSEE FROM CLAIMING A CARRY FORWARD AND SET OFF IN A SUBSEQUENT YEAR. THIS WAS LAID DOWN BY THE HONBLE SUPREME COURT IN THE C ASE OF CIT V. MANMOHAN DAS (1966) 59 ITR 699 (SC). ADMITTEDLY IN THE ASSESSME NT YEAR IN APPEAL, THE ASSESSEE HAS NOT CLAIMED SET OFF OF BROUGHT FORWARD LOSSES AT EARLIER ASSESSMENT YEAR. THEREFORE DECISION RECORDED BY AO IN THE ASSESSMENT OF APPEAL AFTER COMPUTING THE LOSSES IN THE PREVIOUS Y EAR RELEVANT TO ASSESSMENT YEAR UNDER APPEAL, THAT LOSS CANNOT BE SET OFF AGAI NST THE INCOME OF SUBSEQUENT YEAR IS NOT BINDING ON THE ASSESSEE. 8. IN VIEW OF THE FOREGOING, FOLLOWING RATIO OF JUD GMENT OF HONBLE SUPREME COURT IN THE CASE OF MONMOHAN DAS (SUPRA) HELD THAT LD. CIT(APPEALS) AS WELL AS ASSESSING OFFICER CLEARLY ERRED IN HOLDING THAT LOSS COMPUTED IN THE ASSESSMENT YEAR OF APPEAL IS NOT ALLOWED TO BE CARR IED FORWARD TO BE SET OFF IN ITA NO.1447/AHD/2009 A.Y. 2006-07 GS&WD CORPN LTD. V. ACIT GNG PAGE 4 SUBSEQUENT YEAR. THE AUTHORITIES BELOW ARE AT LIBER TY TO DECIDE THIS ISSUE IN THE YEAR IN WHICH THE ASSESSEE CLAIMED THE BENEFIT OF SET OFF OF LOSS COMPUTED BY AO IN THE ASSESSMENT OF APPEAL. 9. IN THE RESULT, FOR STATISTICAL PURPOSE THE APPEAL O F ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON THIS DAY OF 29 TH APRIL, 2011 SD/- SD/- ( G.D.AGARWAL ) ( T.K. SHARMA ) (VICE PRESIDENT) (JUDICIAL MEMBER) AHMEDABAD, DATED : 29/04/2011 *DKP COPY OF THE ORDER FORWARDED TO :- 1. THE ASSESSEE. 2. THE REVENUE. 3. THE CIT(APPEALS)- 4. THE CIT CONCERNS. 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, /TRUE COPY/ DEPUTY / ASSTT.REGISTRAR ITAT, AHMEDABAD