MAHARIA NETTING P. LTD, MUMBAI V. ITO WD 6(3)(3), MUMBAI

ITA 1479/MUM/2013

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 3478 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-06-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 22-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: TASNEEM DALAL
• Keywords: Revised return
• Section: 143(3)

Judgement Text

. , IN THE INCOME TAX APPELLATE TRIBUNAL SMC , BENCH MUMBAI , BEFORE SHRI R. K. GUPTA , JM ITA NO. 1 479 / MUM/ 20 1 3 ( ASSESSMENT Y EAR : 200 7 - 20 08 ) MAKHARIA NETTING PRIVATE LIMITED, 10, RAJABI HOUSE, JANJIKAR STREET, MASJID BUNDER, MUMBAI - 400 003 VS. ITO WD 6(3)(3), MUMBAI PAN/GIR NO. : A A ACM 7325H ( APPELLANT ) .. ( RESPONDENT ) /ASSESSEE BY : MISS TASNEEM DALAL /REVENUE BY : SHRI ARUN KUMAR DATE OF HEARING : 2 3 RD MAY , 201 3 DATE OF PRONOUNCEMENT : 12 TH JUNE , 2013 O R D E R TH IS APPEAL HAS BEEN PREFERRED BY THE ASSESSEE AGAINST THE ORDER DATED 15 - 10 - 2012 OF CIT(A) - 12 , MUMBAI RELA TING TO THE ASSESSMENT YEAR 200 7 - 08 . 2 . THE ASSESSEE IS OBJECTING IN CONFIRMING THE ORDER OF THE AO IN REFUSING TO ALLOW CARRY FORWARD OF LOSSES UNDER SECTION 72 OF THE ACT. 3 . THE FACTS IN SUCCINCT ARE THAT THE AO DID NOT ALLOW THE CARRY FORWARD OF LOSSES OF RS. 2,66,770/ - WHILE COMPLETING THE ASSESSMENT UNDER SECTION 143(3) VIDE ORDER DATED 11 - 12 - 2009. THE AO OBSERVED THAT THE ASSESSEE HAS NOT FILED RE VISED RETURN, THEREFORE, IN VIEW OF THE DECISION OF THE HON BLE SUMMIT COURT IN THE CASE OF GOETZE (INDIA) LIMITED VS. CIT, REPORTED IN 284 ITR 323 (SC) , THE CLAIM IS NOT ALLOWABLE. ITA NO. 1479 /20 1 3 2 4 . ASSESSEE PREFERRED APPEAL BEFORE THE CIT(A) , WHEREIN LEARNED CIT(A) C ONFIRMED THE ORDER OF THE AO BY OBSERVING THAT THE REVISED RETURN FILED BY THE ASSESSEE WAS BARRED BY TIME AND, THEREFORE, THE AO WAS CORRECT IN NOT ALLOWING THE CARRY FORWARD LOSSES AS THE ASSESSEE HAS NOT FILED ITS REVISED RETURN OF INCOME BUT SOUGHT DED UCTION BY WAY OF AN APPLICATION, WHICH CANNOT BE ALLOWED. THESE OBSERVATION HAS BEEN MADE BY THE LEARNED CIT(A) IN PARA 3.5 AT PAGE 5 OF HIS ORDER. 5 . BEING DISSATISFIED WITH THE ORDER OF THE CIT(A), THE ASSESSEE IS NOW IN APPEAL HERE BEFORE THE TRIBUNA L. 6 . AFTER CONSIDERING THE SUBMISSION OF BOTH THE SIDES, I FOUND THAT THE CLAIM OF THE ASSESSEE IN RESPECT TO CARRY FORWARD LOSSES SHOULD HAVE BEEN ENTERTAINED BY LEARNED CIT(A) . THERE IS NO DISPUTE THAT THE CARRY FORWARD LOSSES WERE QUANTIFIED IN PREVI OUS YEAR . A S TH E LOSSES ARE QUANTIFIED AND THEY ARE LIABLE TO BE ALLOWED IN SUBSEQUENT YEARS. IN THE DECISION OF THE HON BLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LIMITED (SUPRA), IT HAS BEEN HELD THAT THE CLAIM BEFORE THE AO CAN BE ALLOWED ONLY BY F ILING A REVISED RETURN AS PER THE PROVISION OF LAW, HOWEVER, BEFORE THE APPELLATE AUTHORITY THE LEGAL CLAIM CAN BE MADE FIRST TIME. THIS IS PURELY A LEGAL CLAIM AS THE ASSESSEE DUE TO MISTAKE COULD NOT CLAIM THE CARRY FORWARD LOSSES IN THE ORIGINAL RETURN BUT DURING THE ASSESSMENT PROCEEDING, FILED A LETTER TO ALLOW THE QUANTIFIED CARRY FORWARD LOSSES TO BE SET OFF AGAINST THE INCOME OF THE YEAR UNDER CONSIDERATION. THE AO DID NOT ALLOW FOR THE REASON THAT THE ASSESSEE HAS NOT FILED REVISED RETURN IN TIME, AND, THEREFORE, IN VIEW OF THE HON BLE SUPREME COURT IN THE CASE OF GOETZE ITA NO. 1479 /20 1 3 3 (INDIA) LIMITED (SU PRA), THE CLAIM OF THE ASSESSEE IS NOT LIABLE TO BE ENTERTAINED. HOWEVER, AS STATED ABOVE, THE CIT(A) , SHOULD HAVE ENTERTAINED THE CLAIM OF THE ASSESSEE AS THE CL AIM OF THE ASSESSEE IS OTHERWISE ALLOWABLE AS PER PROVISION OF LAW BECAUSE THE CLAIM OF CARRY FORWARD LOSSES IS ON ACCOUNT OF QUAN TIFIED LOSSES IN PREVIOUS YEAR IS ALLOWABLE, EVEN IT CAN BE ALLOWED WHILE PASSING A RECTIFICATORY ORDER. 7 . IN VIEW OF THE AF ORESAID FACTS AND CIRCUMSTANCES, I DIRECT THE AO TO ALLOW THE CARRY FORWARD LOSSES OF THE ASSESSEE AFTER VERIFICATION THAT THE LOSSES ARE QUANTIFIED AND THEY ARE ALLOWABLE AS PER PROVISION OF LAW. I ORDER ACCORDINGLY. 8 . IN THE RESULT, APPEAL OF THE ASSESS EE IS ALLOWED AS STATED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 12 TH DAY OF JUNE 2013 201 3 SD/ - ( ) ( R.K.GUPTA ) / JUDICIAL MEMBER MUMBAI; DATED : 12/06/ 2013 /PKM , PS COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE CIT(A) , MUMBAI. 4. / CIT 5. / DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY// / BY ORDER, ( ASSTT. REGISTRAR) / ITAT, MUMBAI