M/s. Anand Shelter, Developers and Builders Pvt. Ltd., Pune V. Additional Commissioner of Income-tax,

ITA 1606/PUN/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 7365 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 10 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 08-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: V L JAIN
• Keywords: Period of limitation; Additional evidence; Question of law; Reasonable cause; Tax effect; Benefit of exemption
• Section: 80IB; 10B; 148; 54; 10; 11; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUNE , , , BEFORE SHRI ANIL CHATURVEDI , AM AND SHRI VIKAS AWASTHY, JM . / I TA NO. 1606 /PUN/20 15 / ASSESSMENT YEAR : 2011 - 12 M/S. ANAND SHELTER, DEVELOPERS AND BUILDERS PVT. LTD., KOHINOOR, SADASHIV PETH, GANJAVE PATH, PUNE - 411 030. PAN : AAFCA4825P ....... / APPELLANT / V/S. THE ADDITIONAL COMMISSIONER OF INCOME TAX, RANGE - 1, PUNE. / RESPONDENT A SSESSEE BY : SHRI V.L JAIN REVENUE BY : SHRI AJAY MODI / DATE OF HEARING : 24.08.2017 / DATE OF PRONOUNCEMENT : 20 .1 0 .2017 / ORDER PER VIKAS AWASTHY, JM THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) - I, PUNE DATED 07.09.2015 FOR ASSESSMENT YEAR 2011 - 12. 2. THE BRIEF FACTS O F THE CASE AS EMANATING FROM RECORDS ARE: THE ASSESSEE IS A BUILDER, PROMOTER AND DEVELOPER. THE ASSESSEE DEVELOPED A HOUSING 2 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 PROJECT, HILL VIEW AT KONDOW A, PUNE AND CLAIMED DEDUCTION U/S. 80IB (10) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) IN RESPECT OF THE SAID PROJECT. THE ASSESSEE FAILED TO FILE RETURN OF INCOME FOR IMPUGNED ASSESSMENT YEAR WITHIN TIME SPECIFIED U/S. 139(1) OF T HE ACT. HOWEVER, THE RETURN WAS FILED WITHIN THE EXTENDED PERIOD AS PRESCRIBED U/S. 139(4) OF THE ACT. THE ASSESSING OFFICER INVOK ED THE PROVISIONS OF S ECTION 80AC AND REJECTED ASSESSEES CLAIM OF DEDUCTION U/S. 80IB(10) OF THE ACT. FURTHER, THE ASSESSIN G OFFICER HELD THAT BUILT UP AREA OF FOUR RESIDENTIAL UNITS I.E. D - 601, D - 602, E - 601 & E - 602 EXCEED MAXIMUM BUILT UP AREA OF 1500 SQ. FT. AS LAID DOWN UNDER CLAUSE (C) OF SECTION 80IB (10) AND HENCE, REJECTED ASSESSEES CLAIM OF DEDUCTION U/S. 80IB(10) IN RESPECT OF AFORESAID HOUSING PROJECT, HILL VIEW. AGGRIEVED BY THE ASSESSMENT ORDER DATED 31.03.2014, THE ASSESSEE FILED APPEAL BEFORE COMMISSIONER OF INCOME TAX (APPEALS) ASSAILING THE FINDINGS OF ASSESSING OFFICER , INTER ALIA HOLDING ASSESSEE TO BE IN ELIGI BLE FOR FINDINGS OF ASSESSING OFFICER , INTER ALIA HOLDING ASSESSEE TO BE IN ELIGI BLE FOR CLAIMING DEDUCTION U/S. 80IB(10) OF THE ACT FOR FILING RETURN OF INCOME BEYOND THE PER IOD PRESCRIBED U/S. 139(1) AND FOR HAVING BUILT UP AREA OF FOUR RESIDENTIAL UNITS EXCEED ING 1500 SQ. FT , INCLUDING TERRACE. THE COMMISSIONER OF INCOME TAX (AP PEALS) PARTLY ACCEPT ED THE APPEAL OF THE ASSESSEE, H OWEVER, THE GROUNDS WITH RESPECT TO ASSESSEES ELIGIBILITY FOR CLAIMING DEDUCTION U/S. 80IB(10) FOR FILING RETURN OF INCOME BEYOND THE PERIOD SPECIFIED IN SUB - SECTION (1) OF SECTION 139 AND ALLEGED EXCESS BUILT UP AREA OF FOUR RESIDENTIAL UNITS , WERE REJECTED . 3. NOW, THE ASSESSEE IS IN SECOND APPEAL BEFORE THE TRIBUNAL ASSAILING THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) BY RAISING FOLLOWING GROUNDS OF APPEAL: 1. THE LD. C IT(A) HAS ERRED IN CONFIRMING THE DISALLOWANCE OF CLAIM U/S. 80IB(10) ON FOLLOWING GROUNDS : 3 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 A . THAT THE RETURN OF INCOME IS NOT FILED WITHIN THE TIME U/S. 139(1) OF THE INCOME TAX ACT, 1961. B . THAT THE BUILT UP AREA OF EACH OF THE FOUR UNITS EXCEEDS 1500 SQ.F T WHEN THE AREA OF THE TERRACE IS INCLUDED. 2. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER THE GROUNDS OR ACT TO THE SAME BEING NECESSARY. 4. SHRI V.L JAIN APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT IT IS AN UNDISPUTED FACT THAT ASSESSEE FILED ITS RETURN OF INCOME FOR ASSESSMENT YEAR 2011 - 12 BEYOND THE TIME SPECIFIED U/S. 139(1) OF THE ACT. HOWEVER, RETURN WAS FILED WITHIN EX TENDED TIME GRANTED U/S. 139(4) OF THE ACT. THE ASSESSEE COULD NOT FILE RETURN OF INCOME WITHIN DUE DATE AS ENVISAGED UNDER SECTION 139(1) I.E. 30.09.2011 , ON ACCOUNT OF DISPUTE AMONGST THE DIRECTORS AND NON COOPERATION FROM AUDITORS. AS A RESULT, ACCOUNTS AND AUDIT REPORT FOR ASSESSMENT YEAR 2011 - 12 WERE OBTAINED BY THE ASSESSEE ON 17.09.2012. ASSES SEE FILED RETURN OF INCOME ON 30 .09.2012. THE LD. AR CONTENDED THAT THE ASSESSEE FILED PETITION U/S. 119(2) (B) OF THE ACT WITH CBDT ON 19.10.2012 FOR CONDONATION OF DELA Y. THE SAID PETITION HAS NOT BEEN DISPOSED OF BY CBDT TILL DATE. 4.1 THE LD. AR SUBMITTED THAT THERE ARE VARIOUS JUDGMENT WHEREIN IT HAS BEEN HELD THAT DUE DATE FOR FILING RETURN OF INCOME SPECIFIED U/S. 139(1) OF THE ACT INCLUDES EXTENDED TIME AS PRES CRIBED U/S. 139(4) OF THE ACT. TO SUPPORT HIS SUBMISSIONS, THE LD. AR PLACED RELIANCE ON THE FOLLOWING DECISIONS: - I) ITO VS. YASH DEVELOPERS, ITA NO. 809/MUM/2011 DATED 31.01.2014. II) CIT VS. SARKAR BUILDERS, 119 DTR (SC) 241 III) TRUSTEES OF TULSHIDAS GOPALJI CHARITABLE & CHALESHWAR TEMPLE TRUST VS. CIT, 207 ITR 368 ( BOM.) IV) CIT VS. MS. JAGRITI AGGARWAL, 339 ITR 610 V) CIT VS. KULLU VALLEY TRANSPORT PVT. LTD., 77 ITR 518 (SC) 4 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 4.2 IN RESPECT OF SECOND ISSUE RELATING TO ALLEGE D EXCESS BUILT UP ARE A OF FOUR RESIDENTIAL UNITS I.E. D - 601, D - 602, E - 601 & E - 602 , THE LD. AR SUBMITTED THAT THE BUILT UP AREA INCLUDING TERRACE OF THE AFOR ESAID FOUR FLATS IS ALLEGED TO BE EXCEEDING 15 00 SQ. FT EACH . THE LD. AR REFERRING TO BUILDING PLAN AT PAGE 236 OF THE PA PER BOOK SUBMITTED THAT THE SAID BUILDING PLAN HAS BEEN APPROVED BY PUNE MUNICIPAL CORPORATION. THE BUILT UP AREA OF ALL FLATS IN THE BUILDING IS WITHIN THE PRESCRIBED LIMIT AS SPECIFIED IN CLAUSE (C) OF SECTION 80IB (10) OF THE ACT. THE LD. AR FURTHER SUB MITTED THAT AS PER DEFINITION OF BUILT UP AREA GIVEN IN S UB - SECTION ( 14 ) OF SECTION 80IB , BUILT UP AREA MEANS THE INNER MEASUREMENT S OF RESIDENTIAL UNIT AT FLOOR LEVEL , INCLUDING THE PROJECTION S AND BALCON IES . THE DEFINITION DOES NOT INCLUDE TERRACE . TERRACE IS NOT THE SAME AS PROJECTION AND BALCONY. THEREFORE, THE WORD TERRACE CANNOT BE READ IN TO THE DEFINITION OF BUILT UP AREA . 4.3 THE LD. AR FURTHER SUBMITTED THAT THE COMMISSION ER OF INCOME TAX 4.3 THE LD. AR FURTHER SUBMITTED THAT THE COMMISSION ER OF INCOME TAX (APPEALS) DENIE D BENEFIT OR DEDUCTION U/S. 8 0IB (10) IN RESPECT OF FOUR RESIDENTIAL UNITS ON THE GROUND THAT TERRACE IS NOT OPEN TO THE SKY. MERELY FOR THE REASON THAT TERRACE IS NOT OPEN TO THE SKY, BENEFIT OF DEDUCTION U /S. 80 IB(10) COULD NOT BE DENIED TO THE ASSESSEE. THE LD. AR MADE AN ALTERNA TE SUBMISSION , THAT IF THE AFORESAID FOUR RESIDENTIAL UNITS ARE HE LD TO HAVE BUILT UP AREA MORE THAN 1500 SQ. FT., PRO - RATA DEDUCTION SHOULD BE ALLOWED ON THE REMAINING PROJECT. 5. ON THE OTHER HAND, SHRI AJAY MODI REPRESENTING THE DEPARTMENT VEHEMENTLY SUPPORTED THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) IN REJECTING BENEFIT OF DEDUCTION U/S. 80IB (10) OF THE ACT TO THE ASSESSEE FOR FILING RETURN OF INCOME BEYOND THE PERIO D SPECIFIED U/S. 139(1) OF THE ACT . THE LD. DR SUBMITTED THAT A BARE PERUSAL OF PROVISION OF SECTION 80AC WOULD 5 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 CLEARLY SHOW THAT THE BENEFIT OF DEDUCTION U/S. 80IB(10) CANNOT BE GRANTED TO THE ASSESSEE IF , RETURN OF INCOME IS NOT FURNISHED BEFORE DUE DATE AS SPECIFIED UNDER SUB - SECTION ( 1 ) OF SECTION 139 OF THE ACT. THUS, THERE IS NO SCOPE OF EXCEEDING TIME BEYOND THE PERIOD AS GIVEN U/S. 139 (1) OF THE ACT FOR BEING ELIGIBLE FOR CLAIMING DEDUCTION U/S. 80IB(10) OF THE ACT. 5.1 THE LD. DR PLACING RELIANCE ON THE DECISION OF BRITANIA INDUSTRIES LTD. VS. CI T , 27 8 - ITR - 546 (SC) SUBMITTED THAT W HEN THE LANGUAGE OF A STATUTE IS CLEAR AND UNAMBIGUOUS, THE COURTS ARE TO INTERPRET THE SAME IN ITS LITERAL SENSE AND NOT TO GIVE A MEANING WHICH WOULD CA USE VIOLENCE T O THE PROVISIONS OF THE STATUTE . IT IS A WELL SETTLED PRINCIPLE OF LAW THAT THE COURT CANNOT READ ANYTHING INTO A STATUTORY PROVISION OR A STIPULATED CONDITION WHICH IS PLAIN AND UNAMBIGUOUS. THE LD. DR TO FURTHER BUTTRESS HIS SUBMISSIONS PL ACED RELIANCE ON FOLLOWING DECISIONS: 1) UNION OF INDIA VS. DHARMENDRA TEXTI LES PROCESSORS AND OTHERS 1) UNION OF INDIA VS. DHARMENDRA TEXTI LES PROCESSORS AND OTHERS 306 - ITR - 277 (SC). 2) CI T. VS. RAJASTHAN FINANCIAL CORPORATION 295 - ITR - 195 (RAJ F.B.). 3) AJMERA HOUSING COR PORATION AND ANOTHER VS. CI T. 326 - ITR - 642 (SC). 5. 2 THE LD. DR CONTENDED THAT THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS. SHELCON PROPERTIES REPORTED AS 370 ITR 305 AFT ER TAKING INTO CONSIDERATION THE DECISION OF HONBLE APEX COURT IN THE CASE OF KULLU VALLEY TRANSPORT CO. P. LTD VS. CIT HAS HELD THAT BENEFIT U/S. 80IB (10) CAN ONLY BE ALLOWED WHERE THE RETURN OF INCOME HAS BEEN FILED WITHIN THE TIME SPECIFIED U /S. 139(1) OF THE ACT. IF RETURN OF INCOME IS FILED BEYOND THE DUE DATE AS SPECIFIED U/S. 139(1), THE ASSESSEE IS NOT ELIGIBLE FOR CLAIMING BENEFIT OF DEDUCTION U/S. 80IB (10) OF THE ACT. THE LD. DR TO STRENGTHEN HIS SUBMISSIONS PLACED RELIANCE ON THE FOLL OWING DECISIONS: 6 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 I) UMESH CHANDRA DALAKOTI VS. ACIT IN ITA NO. 07/2012 DECIDED ON 27.08.2012 , HONBLE UTTARAKHAND HIGH COURT. II) DCIT VS. SIROYA DEVELOPERS, 78 TAXMANN.COM 19 ( MUMBAI - TRIB.) 6. CONTROVERTING THE SUBMISSIONS MADE BY THE DR, THE LD. A R FU RNISHED WRITTEN SUBMISSIONS; THE SAME ARE REPRODUCED HEREIN BELOW: 1. THE WRITTEN SUBMISSIONS PRESENTED BEFORE YOUR HONOURS ARE IN RELATION TO THE AFORESAID APPELLANT AND IN RESPONSE TO THE SUBMISSION MADE BY THE LEARNED DR VIDE LETTER DATED 08.08.2017. 2. IN PARA 5 OF THE LETTER DATED 08.08.2017 THE LEARNED DR HAS POINTED OUT THAT THE DEPARTMENT HAS NOT FILED APPEAL AGAINST THE ORDER OF THE HON. MUMBAI ITAT IN CASE OF YASH DEVELOPERS (PAGES 164 TO 170 OF PAPER BOOK) ON ACCOUNT OF LOW TAX EFFECT. 3. IT IS SUBMITTED THAT THE DECISION OF HON. ITAT WHICH HAS CONSIDERED THE DECISION OF HON. APEX COURT IN CASE OF M/ S KULLU VALLEY TRANSPORT (77 ITR 518) AND THE DECISION IN TRUSTEES OF TULSIDAS GOPALJI CHARITABLE & CHALESHWAR TEMPLE TRUST (PAGES 176 TO 185 OF THE PAPER BOOK) RENDERED BY THE HON. JURISDICTIONAL BOMBAY HC SHOULD BE RELEVANT FOR THE PURPOSES OF THE PRESENT APPEAL. 4. (A) THE LEARNED DR HAS PLACED RELIANCE ON THE DECISION OF HON. ITAT MUMBAI IN DWARKADAS PANCHMATIYA (FACTS ALREADY COVERED IN THE LETTER OF LEARNED DR AND THEREFORE NOT BEING REPEATED AGAIN), WHEREIN THE CLAIM HAS BEEN DISALLOWED. (B) IN THIS REGARD, AT THE OUTSET, IT WOULD BE SIGNIFICANT TO POINT OUT THAT IN THAT CASE, THE PETITIONER HAS FILED AN APPEAL BEFORE THE HON. BOMBAY HIGH COURT, PETITIONER HAS FILED AN APPEAL BEFORE THE HON. BOMBAY HIGH COURT, WHICH IS POSTED FOR HEARING ON 04.09.2017.(CLC PAGE N O .1) THUS, THE DECISION OF DWARKADAS PANCHMATIYA HAS NOT YET ATTAINED FINALITY AND CANNOT BE RELIED UPON IN PREFERENCE TO THE EARLIER DECISION. (C) THE DECISION HAS ME RELY RELIED UPON THE SPECIAL BENCH (RAJKOT) DECISION IN SAPPHIRE GARMENTS (140ITD 628) (SEE PARA 3.2 OF THE DECISION). HOWEVER, THE SPECIAL BENCH DECISION HELD THE JURISDICTIONAL BOMBAY HIGH COURT DECISION IN TRUSTEES OF TULSIDAS GOPALJI CHARITABLE & CHALE SHWAR TEMPLE TRUST AND THE DECISION OF THE P & H HIGH COURT IN JAGRITI AGARWAL (PAGES 186 TO 192 OF PAPER BOOK) TO BE IRRELEVANT AS IT IS OF A DIFFERENT HIGH COURT. (D). IT MAY BE NOTED THAT THE HON. MUMBAI TRIBUNAL DID NOT INDEPENDENTLY CONSIDER THESE DEC ISIONS AT ALL. 5. (A) THE SECOND DECISION RELIED UPON BY THE LEARNED DR IS OF THE UTTARAKHAND HIGH COURT IN UMESH CHANDRA DALAKOTI V S. ACIT (ITA NO. 07/2012). (B) A PERUSAL OF THE DECISION SHALL MAKE IT ABUNDANTLY CLEAR THAT IT HAS NOT CONSIDERED ANY OF THE JUDICIAL PRECEDENTS AND, WITH RESPECT IT IS SUBMITTED, MERELY READ THE PROVISIONS AS THEY APPEAR. THIS DECISION IS, IT IS SUBMITTED, THEREFORE NOT RELEVANT TO THE ISSUE AT HAND. 6. (A) THE LAST DECISION RELIED UPON BY THE LEARNED DR IS OF THE CALCUTT A HIGH COURT IN THE CASE OF CIT VS. SHELEON PROPERTIES (370 ITR 305). (B)THE CALCUTTA HIGH COURT HAS, IN PARA 8 OF THE DECISION, CONSIDERED THE DECISION OF THE HON. APEX COURT IN KULLU VALLEY TRANSPORT CO. P. LTD. AND OBSERVED THAT THERE WAS NO OBSTACLE BE FORE THEIR LORDSHIPS IN THAT CASE AS THE ONE CREATED BY SECTION 80AC OF THE INCOME TAX ACT, 1961. (E) IT IS SUBMITTED WITH RESPECT THAT THE DISTINCTION SOUGHT TO BE DRAWN IS FEEBLE. THE IMPEDIMENT EVEN BEFORE THE HON. APEX COURT WAS VERY MUCH THERE IN TERM S OF SECTION 22(2A) WHICH SAID THAT IN ORDER TO GET THE BENEFIT OF S. 24(2) 7 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 THE ASSESSEE MUST SUBMIT HIS LOSS RETURN WITHIN THE TIME SPECIFIED BY S. 22(1). (D) IT IS FURTHER SIGNIFICANT TO NOTE THAT THE HON. APEX COURT HELD THAT 'THE PROVISION MUST BE R/W S. 22(3) FOR THE PURPOSE OF DETERMINING THE TIME WITHIN WHICH A RETURN HAS TO BE SUBMITTED. IT CAN WELL BE SAID THAT S. 22(3) IS MERELY A PROVISO TO S. 22(1). THUS, A RETURN SUBMITTED AT ANY TIME BEFORE THE ASSESSMENT IS MADE IS A VALID RETURN. IN CONSIDERING WHETHER A RETURN MADE IS WITHIN TIME SUB - S . (1) OF S. 22 MUST BE READ ALONG WITH SUB - S (3) OF THAT SECTION. A RETURN WHETHER IT IS A RETURN OF INCOME, PROFITS OR GAINS OR OF LOSS MUST BE CONSIDERED AS HAVING BEEN MADE WITHIN TH E TIME PRESCRIBED IF IT IS MADE WITHIN THE TIME SPECIFIED IN S. 22(3). IN OTHER WORDS, IF S. 22(3) IS COMPLIED WITH, S. 22(1) ALSO MUST BE HELD TO HAVE BEEN COMPLIED WITH. IF COMPLIANCE HAS BEEN MADE WITH THE LATTER PROVISION THE REQUIREMENTS OF S. 22(2A) WOULD STAND SATISFIED'. (E) FURTHER, THE DECISION DOES NOT EVEN CONSIDER ITS EARLIER DECISION IN PRESIDENCY MEDICAL CENTRE (108 ITR 838) OR OTHER HIGH COURT DECISIONS RENDERED IN SIMILAR CONTEXT. (F) IT IS THEREFORE SUBMITTED THAT MUCH CANNOT BE DRAWN FROM THIS DECISION AGAINST THE APPELLANT. 7. YOUR HONOURS ATTENTION IS INVITED TO THE DECISION OF THE HON. APEX COURT IN KULLU VALLEY TRANSPORT CO. P. LTD. WHEREIN THE HON. APEX COURT WAS SEIZED OF THE ISSUE WHETHER IN THE FACE OF THE PROVISIONS OF SECTION 24(2), THE ASSESSEE CAN BE ALLOWED TO CARRY FORWARD LOSS THROUGH A RETURN FILED BEYOND THE TIME PROVIDED U/S 22(1) BUT WITHIN THE TIME U/S 22(3). THESE SECTIONS ARE IN LINE WITH THE PRESENT SECTION 139(1)/ (22(1), 139(4)/22(3). IN ANSWERING THE QUESTION IN FAVOUR OF THE ASSESSEE, THE HON. APEX COURT HAS HELD THAT S. 22(3) IS MERELY A PROVISO TO S. 22(1) AND THAT IN CONSIDERING WHETHER A RETURN MADE IS WITHIN TIME SUB - S . (1) OF S. 22 MUST BE READ ALONG WITH SUB - S . (3) OF THAT SECTION .... IN OTHER WORDS, IF S. 22(3) IS COMPLIED WITH, S. 22(1) ALSO MUST BE HELD TO HAVE BEEN COMPLIED WITH'. 8. (A) THE DECISION OF THE HON. SUPREME COURT IN PRAKASHNATH KHANNA (266 ITR 1) IS IN THE CONTEXT OF DUE DATE IN THE CONTEXT OF KHANNA (266 ITR 1) IS IN THE CONTEXT OF DUE DATE IN THE CONTEXT OF PROSECUTION UNDER SECTION 276CC.(B) THE HON. APEX COURT OBSERVED THAT THE DECISION IN KULLU VALLEY TRANSPORT WAS RENDERED IN A CONCEPTUALLY DIFFERENT SITUATION, AND HAD NO RELEVANCE SO FAR AS THE DISPUTE BEFORE IT WAS CONCERNED. (C) IT IS THEREFORE ABUNDANTLY CLEAR THAT THE DECISION IN PRAKASHNATH K HANNA DOES NOT OVERTURN THE DECISION IN KULLU VALLEY TRANSPORT. (D) LASTLY, THE DECISION IN PRAKASHNATH KHANNA IS A TWO JUDGE JUDGEMENT WHILE THE DECISION OF HON. APEX COURT IN THE CASE OF MIS KULLU VALLEY TRANSPORT IS A THREE JUDGE JUDGEMENT. THUS, THE DE CISION OF A LARGER BENCH WOULD BE ADOPTED IN PREFERENCE TO THE DECISION OF THE DIVISION BENCH COMPRISING OF TWO JUDGES. (E) WE PLACE RELIANCE ON THE HON. SC DECISION IN CIT VS. SUN ENGINEERING WORKS (P) LTD. (SC) 198 ITR 0297 FOR THE PROPOSITION THAT THE J UDGMENT OF PRAKASHNATH KHANNA MUST BE READ AS A WHOLE AND THE OBSERVATIONS FROM THE JUDGMENT HAVE TO BE CONSIDERED IN THE LIGHT OF THE QUESTIONS WHICH WERE BEFORE THIS COURT. A DECISION OF THIS COURT TAKES ITS COLOUR FROM THE QUESTIONS INVOLVED IN THE CASE IN WHICH IT IS RENDERED AND, WHILE APPLYING THE DECISION TO A LATER CASE, THE COURTS MUST CAREFULLY TRY TO ASCERTAIN THE TRUE PRINCIPLE LAID DOWN BY THE DECISION OF THIS COURT AND NOT TO PICK OUT WORDS OR SENTENCES FROM THE JUDGMENT. (F) THE ONLY WAY IN WHICH WE CAN HARMONIOUSLY INTERPRET BOTH THESE JUDGMENTS IS THAT THESE DECISIONS DEAL WITH TWO DIFFERENT ISSUES AND RATIO DECIDENDI OF THESE DECISIONS MUST BE CONSTRUED ACCORDINGLY. 9. IN SO FAR AS THE DECISION OF THE RAJKOT SPECIAL BENCH IN SAFFIRE GARM ENTS(140 ITD 6), IT IS SUBMITTED WITH RESPECT THAT - (A) RELIANCE ON THE DECISION IN PRAKASH NATH KHANNA IS ON GROUNDS OF NON - DILUTION OF INFRACTION IN THE CONTEXT OF PROSECUTION AND NOT IN THE CONTEXT OF AN INCENTIVE PROVISION. (B) THE JUDGMENTS IN CIT VS JAGARITI AGRAWAL (SUPRA) AND TRUSTEES OF TULSIDAS GOPALJI CHARITABLE & CHALESHWAR TEMPLE TRUST (SUPRA) WERE HELD TO BE OF NO RELEVANCE BECAUSE THESE 8 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 JUDGEMENTS ARE OF TWO DIFFERENT HIGH COURTS, ONE OF THEM BEING THE JURISDICTIONAL HIGH COURT FOR THE PRESE NT APPELLANT. (C) THE SPECIAL BENCH HAS NOT CONSIDERED THE DECISION IN KULLU VALLEY TRANSPORT P LTD. (D) THE DISCUSSION IN PARA 15 OF THE ORDER RELATING TO VARIOUS DECISIONS RELIED UPON BY THE AR IS OBITER AND NOT BINDING IN VIEW OF THE PREFACE TO THAT DIS CUSSION WHICH READS THUS - 'REGARDING OTHER JUDGEMENTS OF VARIOUS HIGH COURTS AND HON'BLE APEX COURT, WE FIND THAT THE SAME ARE NOT IN RESPECT OF FAILURE OF THE ASSESSEE FOR FILING THE RETURN OF INCOME WITHIN THE DUE DATE PRESCRIBED U/S 139(1) OF THE INCOME TAX ACT, 1961 AND HENCE NOT APPLICABLE. STILL, WE DISCUSS.' (E) THE AP HIGH COURT IN S. VENKATAIAH (ITA NO. 114/2013) HAS, POST SAFFIRE GARMENTS DECISION, DISMISSED THE APPEAL OF THE REVENUE BY CONFIRMING THAT THE APPELLATE TRIBUNAL IS JUSTIF IED IN HOLDI NG THAT DEDUCTION UNDER SEC. 80I C OF THE INCOME TAX ACT COULD BE ALLOWED EVEN THOUGH THE RETURN OF INCOME WAS NOT FILED WITHIN TIME AS SPECIFIED UNDER SECTION 80AC OF THE INCOME TAX ACT. 10. WITH REGARD TO THE DECISION IN THE CASE OF BALKISH AN DHAWAN HUF VS. ITO (18 TAXMANN.COM 234) (AMR), IT IS RESPECTFULLY SUBMITTED THAT (A) IT DOES NOT TAKE INTO ACCOUNT THE DECISION OF THE HON. SUPREME COURT IN KULLU VALLEY TRANSPORT AND VARIOUS OTHER DECISIONS. (B) IT ONLY DISTINGUISHES THE DECISION OF P& H HIGH COURT IN CIT VS. JAGRITI AGGARWAL ( 203 ITR 203) ON THE GROUND THAT IT IS WITH REFERENCE TO THE PROVISIONS OF SECTION 54 AND NOT SECTION 80AC. AND THAT SECTION 80AC PROVIDES A CONSEQUENCE WHICH SECTION 54 DOES NOT. (C) IT IS SUBMITTED THAT LIKE 80 A C DOES NOT ALLOW DEDUCTION IF RETURN IS NOT FURNISHED IN TIME, SECTION 54 DENIES THE EXEMPTION FROM CAPITAL GAINS IF THE AMOUNT IS NOT DEPOSITED WITHIN TIME OF FURNISHING RETURN.(D) THE DECISION DOES NOT EVEN DISCUSS THE DECISION OF THE HON. BOMBAY HC IN T RUSTEES OF TULSIDAS GOPALJI CHARITABLE & CHALESHWAR TEMPLE TRUST, THOUGH IT IS CITED IN THE COURSE OF ARGUMENT. 11. IN ACIT VS. DHIR GLOBAL INDIA (DEL) (ITA NO. 2317/2010), THE TRIBUNAL IN THE CONTEXT OF SECTION 10B HAS HELD THAT IN SPITE OF THE TRIBUNAL IN THE CONTEXT OF SECTION 10B HAS HELD THAT IN SPITE OF THE PROVISO TO SECTION 10B(1), DEDUCTION HAS TO BE ALLOWED FOR A RETURN FILED BEYOND THAT THE TIME PROVIDED U/S . 139(1). THIS HAS BEEN DONE AFTER OBSERVING THAT THE PROVISO IS DIRECTORY AND NOT MANDATORY (PARA 6.6) AFTER CONSIDERING AND RELYING ON THE DELHI HC DECISIO N IN WEB COMMERCE INDIA PVT. LTD. (318 ITR 135) AND AFTER APPRECIATING THAT THE ACT ALLOWS RELIEF U/S . 119(2)(B) (PARA 6.12). 7. WE HAVE HEARD THE SUBMISSIONS MADE BY REPRESENTATIVES OF RIVAL SIDES AND HAVE PERUSED THE ORDERS OF AUTHORITIES BELOW. WE HAVE ALSO CONSIDERED THE DECISIONS ON WHICH BOTH SIDES HAVE PLACED RELIANCE AND WRITTEN SUBMISSIONS FILED BY RESPECTIVE PARTIES. THE CORE ISSUE RAISED IN THE APPEAL IS : W HETHER IN VIEW OF PROVISIONS OF SECTION 80AC, THE ASSESSEE IS ELIGIBLE FOR CLAIMING DEDUCTION U/S. 80IB (10) IF RETURN OF INCOME IS FILED BEYOND DUE DATE AS SPECIFIED U/S. 139(1) OF THE ACT , BUT WITHIN THE EXTENDED TIME SPECIFIED U/S. 139(4) OF THE ACT. 9 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 BEFORE PROCEEDING FURTHER ON THIS ISSUE, IT W OULD BE RELEVANT TO FIRST REFER TO THE PROVISIONS OF SECTION 80AC OF THE ACT : 80AC. WHERE IN COMPUTING THE TOTAL INCOME OF AN ASSESSEE OF THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR COMMENCING ON THE 1 ST DAY OF APRIL, 2006 OR ANY SUBSEQUENT ASSESS MENT YEAR, ANY DEDUCTION IS ADMISSIBLE UNDER SECTION 80 - IA OR SECTION 80 - IAB OR SECTION 80 - IB OR SECTION 80 - IC [ OR SECTION 80 - ID OR SECTION 80 - IE], NO SUCH DEDUCTION SHALL BE ALLOWED TO HIM UNLESS HE FURNISHES A RETURN OF HIS INCOME FOR SUCH ASSESSMENT YE AR ON OR BEFORE THE DUE DATE SPECIFIED UNDER SUB - SECTION (1) OF SECTION 139.] THE PROVISION OF SECTION 80AC MANDATES THAT UNLESS THE RETURN OF INCOME IS FURNISHED ON OR BEFORE DUE DATE SPECIFIED U/S. 139(1), THE ASSESSEE WOULD NOT BE ADMISSIBLE FOR DEDUCTION U/S. 80IB OF THE ACT. 8. THE LD. AR HAS DRAWN OUR ATTENTION TO THE DECISION RENDERED IN THE CASE OF TRUSTEES OF TULSIDAS GOPALJI CHARITABLE & C HALESHWAR TEMPLE TRUST (SUPRA.), WHEREIN IT HAS BEEN HELD THAT RETURN FILED WITHIN TIME SPECIFIED IN S UB - SECTION (4) HAS TO BE CONSIDERED AS HAVING BEEN TIME SPECIFIED IN S UB - SECTION (4) HAS TO BE CONSIDERED AS HAVING BEEN MADE WITHIN THE TIME PRESCRIBED IN SUB - SECTION (1) OR S UB - SECTION (2) O F SECTION 139. THE HONBLE JURISDICTIONAL HIGH COURT WHILE CONSIDERING CLAIM OF EXEMPTION U/S. 11 OF THE ACT HAS HELD , THAT WHERE RETURN HAS BEEN FILED WITHIN THE TIME ALLOWED U/S. 139(4), THE ASSESSEE IS ELIGIBLE FOR CLAIMING EXEMPTION U/S. 11 OF THE ACT. 9. THE HYDERABAD BENCH OF THE TRIBUNAL IN THE CASE OF ITO VS. SRI S. VENKATAIAH (SUPRA.) WHILE DECIDING THE ISSUE RELATING TO ASSESSEES ELIGIBILITY FOR CLAIMING DEDUCTION U/S. 80IC , WHERE THE RETURN WAS FILED BEYOND DUE DATE AS SPECIFIED U/S. 139(1) OF THE ACT HELD THAT THE ASSESSEES CLAIM CANNOT BE DENIED ON TECHNICALITIES WHEN THE ASSESSEE IS LEGALLY OTHERWISE ENTITLED FOR DEDUCTION . THE GROUND BEFORE THE TRIBUNAL FOR CONSIDERATION WAS: 3. THE CIT(A) OUGHT TO HAVE APPRECIATED THAT THE AO HAD RIGHTLY DISALLOWED THE DEDUCTION CLAIMED U/S.80IC FOLLOWING THE PROVISIONS OF 10 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 SECTION 80AC . THE TRIBUNAL DEC IDED THE GROUND IN FAVOUR OF ASSESSEE BY OBSERVING AS UNDER : 13. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. IN THIS CASE ADMITTEDLY, THE ASSESSEE FILED THE RETURN OF INCOME ON 23.12.2008. THE DUE DATE FOR FILING THE RETURN OF INCOME U/S. 139(1) OF THE ACT FOR THE ASSESSMENT YEAR UNDER CONSIDERATION IN THE CASE OF THE ASSESSEE IS 31.10.2008. AS SUCH THE RETURN FILED BY THE AS SESSEE IS BELATED. IN THIS THE ASS ESSEE CLAIMED DEDUCTION U/S. 80I C OF THE ACT WHICH WAS DISALLOWED BY THE ASSESSING OFFICER AS THE RETURN OF THE ASSESSEE WAS NOT FILED WITHIN THE TIME AS PRESCRIBED U/S. 139(1) OF THE ACT. THE ASSESSEE HAS GIVEN REASONS FO R DELAY IN FILING THE RETURN OF INCOME THAT THE ASSESSEE WAS PREPARING ITS ACCOUNTS THROUGH COMPUTER AND THE COMPUTER GOT CORRUPTED DUE TO VIRUSES AND IN SPITE OF CONTINUOUS EFFORTS BY THE COMPUTER TECHNICAL PERSONNEL TO RETRIEVE THE DATA IN TIME FOR FILIN G THE RETURN OF INCOME, PROBLEM PERSISTED IN THE SYSTEM. BY TRYING TO RETRIEVE THE DATA FOR 4 DAYS THE REQUIRED DATA COULD NOT BE RETRIEVED AND THE BACKED UP DATA WERE AVAILABLE ONLY UP TO 31ST 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 FINALISING OF STATUTORY AUDIT IT TOOK A LITTLE EXTRA TIME THAT RESULTED 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 FILING THE RETURN OF INCOME BELATEDLY AND THIS IS BEYOND THE CONTROL OF THE ASSESSEE. WHEN THE SUBSTANTIAL QUESTION OF JUSTICE 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 BY THE ORDER OF THE TRIBUNAL IN ITA NOS. 1231 & 1199/HYD/2010 IN THE CASE OF DCIT VS. M /S. VEGA CONVEYNORS & AUTOMATION LTD. ORDER DATED 31ST 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 OTHER MATERIAL AVAILABLE ON RECORD, INCLUDING THE CASE - LAW RELIED UPON BY THE PARTIES. IT IS AN UNDISPUTED FACT THAT THE ASSESSEE IN THE PRESENT CASE HAS FILED T HE AUDIT REPORT IN FORM 10 CCB DURING THE COURSE OF RE - ASSESSMENT PROCEEDINGS. THE ISSUE THAT ARISES FOR CONSIDERATION IS WHETHER THE ASSESSING OFFICER WAS JUSTIFIED IN DISALLOWING THE ASSESSEE'S CLAIM FOR DEDUCTION UNDER S. 80I B ON THE GROUND THAT THE AUD IT 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 1 0 CCB FILED DURING THE COURSE OF RE - ASSESSMENT PROCEEDINGS 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 VARIOUS BENCHES OF THIS TRIBUNAL AND AS HELD IN VARIOUS DECISIONS REFERRED TO BY THE CIT(A) IN THE IMPUGNED ORDER, THAT THOUGH FILING OF AUDIT REPORT IN FORM 10CCB IS MANDATORY AND PRE - REQUISITE FOR DEDUCTION UNDER S. 80I B, NON - FILING OF THE SAME ALONG WITH THE RETURN OF INCOME IS ONLY A CURABLE DEFECT, AND ASSESSEE'S CLAIM FOR DEDUCTION HAS TO BE CONSIDERED ON ITS MERITS AS AND WHEN THE DEFECT IS CURED BY FILING FORM 10CCB. WE ARE FORTIFIED IN THIS BEHALF BY THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF HEMSONS INDUSTRIES (SUPRA), RELIED UPON BY THE LEARNED COUNSEL FOR THE ASSESSEE. IT IS CONTENDED BY THE LEARNED DEPARTMENTAL REPRESENTATIVE THAT THE ASSESSEE'S CLAIM FOR DEDUCTION UNDER S. 80 I B CAN BE ENTERTAINED 11 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 AND EXAMINED ON MERITS, WHEN THE AUDIT REPORT IS FILED BEFORE THE COMPLETION OF ASSESSMENT, WHICH HAS NOT BEEN DONE IN THE PRESENT CASE, SINCE THE AUDIT REPORT WAS FILED ONLY DURING THE COURSE OF RE - ASSESSMENT PROCEEDINGS INITIATED BY THE ASSESSING OFFICER, WHICH CANNOT END UP GIVING 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 COURT, FOR ONE OF THE YEARS UNDER APPEAL BEFORE HON'BLE HIGH COURT, V IZ., ASSESSMENT YEAR 1979 - 80, AUDIT REPORT WAS FILED DURING THE COURSE OF RE - ASSESSMENT PROCEEDINGS AND IN RESPONSE TO THE SHOW - CAUSE NOTICE UNDER S. 148 ISSUED BY THE ASSESSING OFFICER. IN THIS VIEW OF THE MATTER, RESPECTFULLY FOLLOWING THE DECISION OF THE JURISDICTIONAL HIGH COURT CITED ABOVE, AMONG OTHERS, WE FIND NO JURISDICTION TO INTERFERE WITH THE ORDER OF THE CIT(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 DISCU SSION, THE CLAIM OF THE ASSESSEE CANNOT BE DENIED ON TECHNICALITIES 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. 9 .2 THEREAFTER, THE REVENUE CARRIED THE MATTER IN APPEAL BEFORE THE HONBLE ANDHRA PRADESH HIGH COURT. THE SUBSTANTIAL QUESTION OF LAW RAISED BEFORE THE HONBLE HIGH COURT WAS : A. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE APPELLATE TRIBUNAL IS JUSTIFIED IN HOLDING THAT DEDUCTION UNDER SECTION 80IC OF THE INCOME TAX ACT COULD BE ALLOWED EVEN THOUGH THE RETURN OF INCOME WAS NOT FILED WITHIN TIME AS SPECIFIED UNDER SECTION 80AC OF THE INCOME TAX ACT? B. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE APPELLATE TRIBUNAL IS JUSTIFIED IN NOT CONSIDERING THE ISSUE AS TO THE ADMISSIBILITY OF ADDITIONAL EVIDENCE IN THE APPEAL BEFORE COMMISSIONER OF INCOME TAX (APPEALS) WITHOUT AFFORDING OPPORTUNITY TO THE ASSESSING OFFICER IN VIOLATION OF RULE 46(A) (3) OF THE INCOME TAX RULES? THE HONBLE HIGH COURT CONFIRM ED THE FINDINGS OF TRIBUNAL AND DISM ISSED THE APPEAL OF THE REVENUE. 10. THE HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. MS. JAGRITI AGGARWAL (SUPRA.) WHILE CONSIDERING THE ISSUE, WHETHER THE ASSESSEE IS ELIGIBLE FOR CLAIMING BENEFIT OF EXEMPTION U/S. 54, IF CAPITAL GAIN AMOUNT IS DEPOSITED/INVESTED AFTER DUE DATE OF FURNISHING RETURN OF INCOME U/S. 139(1 ) BUT BEFORE THE DUE DATE OF FURNISHING RETURN OF INCOME U/S. 139(4) HELD : 12 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 12. .. SUB - S ECTION (4) OF S ECTION 139 PROVIDES EXTENDED PERIOD OF LIMITATION AS AN EXCEPTION TO SUB - S ECTION (1) OF S ECTION 139 OF THE ACT. S UB - S ECTION (4) IS IN RELATION TO THE TIME ALLOWED TO AN ASSESSEE UNDER SUB - S ECTION (1) TO FILE RETURN. THEREFORE, SUCH PROVISION IS NOT AN INDEPENDENT PROVISION, BUT RELATES TO TIME CONTEMPLATED UNDER SUB - S ECTION (1) OF S ECTION 139. THEREFORE, SUCH SUB - S ECTION (4) H AS TO BE READ ALONG WITH SUB - S ECTION (1). SIMILAR IS THE VIEW TAKEN BY THE DIVISION BENCH OF KARNATAKA AND GAUHATI HIGH COURTS IN FATIMA BAI S CASE (SUPRA) AND RAJESH KUMAR JA LANS CASES (SUPRA) RESPECTIVELY. 1 1 . THE LD. DR HAS PLACED RELIANCE ON THE DECISION OF HONBLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS. SHELCON PROPERTIES PVT. LTD (SUPRA.), WHEREIN, THE HONBLE HIGH COURT REJECTED ASSESSEES CLAIM OF DEDUCTION U/S. 80IB(10), WHERE RETURN OF INCOME WAS NOT FILED WITHIN THE TIME SPECIFIED U /S. 139(1). THE QUESTIONS OF LA W BEFORE THE HONBLE HIGH COURT FOR CONSIDERATION WAS : (A) WHETHER THE DEDUCTION UNDER SECTION 80 - IB(10) OF THE INCOME TAX ACT CAN BE ALLOWED WHEN THE RETURN WAS NOT FILED ON OR BEFORE THE DUE DATE SPECIFIED UNDER SECTION 139(1) OF THE INCOME TAX ACT? (B) WHETHER SECTION 80AC OF THE INCOME TAX ACT CAN BE SAID TO HAVE LEFT ANY ROOM FOR DISCRETION IN THE CASE OF DELAYED FILING OF RETURNS? THE HONBLE HIGH COURT AF TER TAKING INTO CONSIDERATION VARIOUS DECISIONS INCLUDING ; CIT VS. KULLU VALLEY TRANSPORT CO. LTD. (SUPRA.) ; FERTILIZER CORPORATION OF INDIA VS. STA TE OF BIHAR (68 STC 158)(SC); CIT VS. BERGER PAINTS (I NDIA) LTD. (254 ITR 503) (CAL.); CCE VS. HARI CHAND SHRI GOPAL (6 G STR 369) (SC) , ANSWERED THE QUESTION OF LA W ( A) IN NEGATIVE HOLDING ASSESSEE INELIGIBLE FOR CLAIMING DEDUCTION U/S.80IB (10). THE HONBLE COURT HELD : 16 . MR. KHAITAN SUBMITTED THAT THE PROVISION REGARDING FILING OF THE RETURN ON OR BEFORE THE PRESCRIBED DAY IS DIRECTORY IN NATURE. WE ARE UNABLE TO CONCUR WITH HIM. THE BENEFIT, IN THE PRESENT CASE, CAN ONLY BE CLAIMED IN CASE OF FULFILLMENT OF THE PRE - CONDITIONS LAID DOWN UNDER SECTION 80AC OF THE INCOME TAX ACT. WHEN THE PRE - CONDITIONS HAVE NOT BEEN FULFILLED, THE BENEFIT CANNOT BE CLAIMED. THERE IS , AS SUCH, NO REASON TO FIND OUT WHETHER THE DIRECTION IS DIRECTORY OR MANDATORY. IN ANY EVENT, WHEN THE PROVISION IS THAT THE BENEFIT CANNOT BE CLAIMED IF THE RETURN HAS NOT BEEN FILED ON OR BEFORE THE PRESCRIBED DAY, IN OUR VIEW, IT IS A MANDATORY DIRECT ION WHICH PRESCRIBES THE CONSEQUENCE 13 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 OF OMISSION TO FILE THE RETURN IN TIME. THE COURTS CANNOT REWRITE THE LAW TO DO WHAT IS JUST ACCORDING TO THEM AS RIGHTLY POINTED OUT BY MRS. BHARGAVA. 1 2 . THE HONBLE HIGH COURT OF UTTARAKHAND IN THE CASE OF UMESH CHANDRA DALAKOTI VS. ACIT (SUPRA) HELD THAT BENEFIT U/S. 80IC IS ADMISSIBLE ONLY WHERE THE RETURN OF INCOME HAS BEEN FILE D BEFORE DUE DATE SPECIFIED IN S UB - SECTION ( 1 ) OF SECTION 139. THE RELEVANT EXTRACT OF THE FINDINGS OF THE HONBLE HIGH COURT ARE AS UN DER : 5. LEARNED COUNSEL SUBMITTED THAT SECTIONS 80IB AND 80IC BEING BENEFICIAL STATUTE, SECTION 80AC MUST BE CONCURRED LIBERALLY AND , HAVING REGARD TO WHAT HAS BEEN PROVIDED IN SECTION 139(4), IN THE EVENT COMPLIANCE THEREOF, THE ASSESSEE MUST BE ACCORD ED THE BENEFITS OF SECTIONS 80IB AND 80IC OF THE ACT. IN THE MATTER OF CONSTRUCTION OF A FISCAL STATUTE, ONE IS REQUIRED TO READ THE WORDS USED BY THE LEGISLATURE RATHER THAN GO INTO THE QUESTION OF REASONABLENESS, RATIONALITY AND BENEFICIALNESS OF A PART OF THE STATUTE. IN THE EVENT, WITHIN THE PLAIN WORDS USED IN THE STATUTE, A PERSON IS ENTITLED TO THE BENEFIT GRANTED BY THE STATUTE, HE WOULD BE ENTITLED TO THE SAME, BUT IF, NOT, HE WOULD NOT BE ENTITLED TO THE BENEFIT , THUS, GIVEN. THE FACT REMAINS, WH ILE THE DUE DATE OF FURNISHING RETURN HAS BEEN SPECIFIED UNDER SUB SECTION (1) OF SECTION 139 OF THE ACT, IN SUB - SECTION (4) OF SECTION 139 PERMISSION HAS BEEN GRANTED TO FURNISH THE RETURN EVEN AFTER EXPIRY OF THE DUE DATE FOR FURNISHING RETURN SPECIFIED UNDER SUB SECTION (1) OF SECTION 139 OF THE ACT; AND AT THE SAME TIME IN SECTION 80AC, IT HAS BEEN PROVIDED THAT ONLY WHEN THE RETURN HAS BEEN FURNISHED ON OR BEFORE THE DUE DATE SPECIFIED UNDER SUB SECTION (1) OF BEEN FURNISHED ON OR BEFORE THE DUE DATE SPECIFIED UNDER SUB SECTION (1) OF SECTION 139, THE ASSESSEE CONCERNED WILL B E ENTITLED TO THE DEDUCTIONS ADMISSIBLE UNDER SECTION 80IB OR SECTION 80IC OF THE ACT. 13 . THE MUMBAI BENCH OF TRIBUNAL IN THE CASE OF DCIT VS. SIROYA DEVELOPERS (SUPRA.) HAS HELD THAT DEDUCTION UNDER SECTION 80 - IB CAN BE ALLOWED ONLY WHEN RETURN IS FIL ED ON OR BEFORE DUE DATE SPECIFIED UNDER SECTION 139(1); IF RETURN IS FILED BELATEDLY ASSESSEE WILL NOT BE ENTITLE TO SUCH DEDUCTION. HOWEVER, WHILE COMING TO SUCH CONCLUSION, THE TRIBUNAL TOOK SUPPORT FROM THE DECISION S RENDERED IN THE CASE OF CIT VS. SHE LCON PROPERTIES PVT. LTD. (SUPRA.) AND UMESH CHANDRA DALAKOTI VS. ACIT (SUPRA.). THE DECISION RENDERED BY HONBLE ANDHRA PRADESH HIGH COURT IN THE CASE OF CIT VS. SRI S. VENKATAIAH WAS NOT BROUGHT TO THE NOTICE OF THE TRIBUNAL. 14 . IT IS A WELL SETTLED PRINCIPLE OF LAW THAT WHEN THE LANGUAGE OF A STATUTE IS CLEAR AND UNAMBIGUOUS, THE C OURTS ARE TO INTERPRET THE SAME IN ITS LITERAL 14 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 SENSE. A PERUSAL OF DISCUSSIONS DISCUSSED ABOVE INDICATE S THAT TWO DIAGONALLY OPPOSITE VIEWS HAVE BEEN TAKEN BY THE DIFFERENT HON BLE HIGH COURTS WHILE INTERPRETING THE PROVISIONS OF SECTION 139(1) AND 139(4) READ WITH SECTION 80AC. THE HONBLE HIGH COURT OF ANDHRA PRADESH LIBERALLY INTERPRETING THE PROVISIONS OF SECTION 80AC HAS GRANTED RELIEF OF DEDUCTION BY EXTE NDING THE TIME SPECIFIED FOR FILING RETURN OF INCOME U/S 139(1) TO TIME LIMIT SPECIFIED UNDER SUB - SECTION (4) OF SECTION 139. ON THE OTHER HAND, HONBLE CALCUTTA HIGH COURT AND HONBLE UTTRAKHAND HIGH COURT BY LITERAL INTERPRETING THE PROVISIONS OF SECTION 80AC HAS RESTRICTED BENEFIT OF DEDUCTION U/S. 80IB WHERE RETURN OF INCOME HAS BEEN FILED WITHIN THE TIME SPECIFIED U/S. 139(1) OF THE ACT. IT IS A TRAIT LAW THAT WHERE TWO DIVERGENT VIEWS ARE AVAILABLE AND THERE IS NO DIRECT DECISIONS ON THE ISSUE BY HON BLE JURISDICTIONAL HIGH COURT, THE VIEW IN FAVOUR OF ASSESSEE HAS TO BE FOLLOWED [CIT VS. VEGETABLES PRODUCTS, 88 ITR 192 (SC)]. RESPECTFULLY FOLLOWING JUDICIAL DISCIPLINE, WE APPLY THE 88 ITR 192 (SC)]. RESPECTFULLY FOLLOWING JUDICIAL DISCIPLINE, WE APPLY THE DECISION OF HONBLE HIGH COURT OF ANDHRA PRADESH IN THE CASE OF CIT V S. M/S. S. VENKATAIAH (SUPRA.) TO THE FACTS OF PRESENT CASE AND HOLD THAT ASSESSEE IS ELIGIBLE FOR CLAIMING DEDUCTION U/S. 80IB(10) OF THE ACT. ACCORDINGLY, THE GROUND NO. 1.A RAISED IN THE APPEAL IS DECIDED IN FAVOUR OF THE ASSESSEE. 15 . THE SECOND ISSUE RAISED IN APPEAL IS WHETHER FOUR RESIDENTIAL UNITS I.E. D - 601, D - 602, E - 601 & E - 602 IN THE HOUSING PROJECT, HILL VIEW DEVELOPED BY ASSESSEE HAVE BUILT UP AREA BEYOND 1500 SQ.FT AND HENCE, IN ELIGIBLE FOR CLAIMING DEDUCTION U/S. 80IB(10) O F THE ACT. IT HAS BEEN CONTENDED BY ASSESSEE THAT THE BUILT UP AREA OF THE AFORESAID FOUR FLATS IS LESS THAN 1500 SQ. FT. THE AUTHORITIES BELOW HAVE GIVEN FINDINGS THAT BUILT UP AREA OF AFORESAID FOUR FLATS INCLUDING AREA OF TERRACE ADJACENT TO THE FLATS E XCEED 1500 SQ.FT. SECTION 80IB (14) DEFINES BUILT UP AREA AS UNDER: 15 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 (14) (A) BUILT UP AREA MEANS THE INNER MEASUREMENT OF THE RESIDENTIAL UNIT AT THE FLOOR LEVEL, INCLUDING THE PROJECTIONS AND BALCONIES, AS INCREASED BY THE THICKNESS OF THE WALLS BUT DOES NOT INCLUDE THE COMMON AREAS SHARED WITH OTHER RESIDENTIAL UNITS. A PER USAL OF THE DEFINITION SHOWS THAT PROJECTIONS AND BALCONIES ARE TO BE INCLUDED WHILE COMPUTING BUILT UP AREA . HOWEVER, THERE IS NO MENTION OF TERRACE IN THE SAID DEFINITION. 16 . THE HONBLE GUJRAT HIGH COURT IN THE CASE OF CIT VS. M/S . AMALTAS ASSOCIATE S REPORTED AS 389 ITR 175 HAS HELD THAT THE TERM BALCONY WOULD NOT INCLUDE A N OPEN TERRACE ADJOINING A BEDROOM OR ANY OTHER CONSTRUCTED AREA OF PENT HOUSE. TERRACE IS NOT PROJECTION. THE RELEVANT EXTRACT OF THE OBSERVATION S OF HONBL E HIGH COURT DIFFERENT IATING B ALCONY FROM TERRACE IS AS UNDER: 8. SECTION 80(14) OF THE ACT CONTAINS DEFINITIONS FOR THE PURPOSE OF THE SAID SECTION. CLAUSE (A) THEREOF PROVIDES THAT BUILT UP AREA MEANS THE INNER MEASUREMENTS OF THE RESIDENTIAL UNIT AT THE FLOOR LEVEL, INCLUDING THE PROJECTIONS MEASUREMENTS OF THE RESIDENTIAL UNIT AT THE FLOOR LEVEL, INCLUDING THE PROJECTIONS AND BALCONIES, AS INCREASED BY THE THICKNESS OF THE WALLS, BUT DOES NOT INCLUDE THE COMMON AREAS SHARED WITH OTHER RESIDENTIAL UNITS. THUS, THE BUILT UP AREA WOULD INCLUDE INNER MEASUREMENTS OF A RESIDENTIAL UNIT ON THE FLOOR LEVEL ADDED BY THICKNESS OF A WALL AS ALSO PROJECTIONS AND BALCONIES. THIS WOULD HOWEVER, EXCLUDE THE COMMON AREAS SHARED WITH OTHER RESIDENTIAL UNITS. THIS EXCLUSION CLAUSE OF T HE COMMON AREAS SHARED BY OTHER UNITS CANNOT BE APPLIED IN THE REVERSE. IN OTHER WORDS, THE MOMENT A CERTAIN AREA IS NOT SHARED BUT IS EXCLUSIVELY ASSIGNED FOR THE USE OF A PARTICULAR RESIDENTIAL UNIT HOLDER, WOULD NOT MEAN THAT SUCH AREA WOULD AUTOMATICAL LY BE INCLUDED IN THE BUILT UP AREA. IN ORDER TO BE PART OF THE BUILT UP AREA, THE SAME MUST BE PART OF THE INNER MEASUREMENTS OF A RESIDENTIAL UNIT OR PROJECTION OR BALCONY. THE OPEN TERRACE SPACE ON THE TOP FLOOR OF A BUILDING WOULD NOT SATISFY THIS DE SCRIPTION. IT WILL ALSO NOT BE COVERED IN THE EXPRESSION BALCONY. TERM 'BALCONY' HAS BEEN EXPLAINED IN WEBSTER'S THIRD INTERNATIONAL DICTIONARY (UNABRIDGED) AS UNROOFED PLATFORM PROJECTING FROM THE WALL OF A BUILDING, ENCLOSED BY A PARAPET OR RAILING, AND USUALLY RESTING ON BRACKETS OR CONSOLES. IT IS OFTEN USED AS SYNONYMS TO GALLERY, LOGGIA, VERANDA, PIAZZA, PORCH, PORTICO, STOOP ETC. IN THE CONTEXT OF RESIDENTIAL OR EVEN COMMERCIAL COMPLEXES, TERM' BALCONY' HAS GAINED A DEFINITE COMMON PARLANCE MEANING. IT USUALLY CONSISTS OF A PROJECTION FROM A BUILDING COVERED BY A PARAPET OR RAILING AND MAY OR MAY NOT BUT USUALLY IS COVERED FROM THE TOP. THIS TERM 'BALCONY' CERTAINLY WOULD NOT INCLUDE AN OPEN TERRACE ADJOINING A BEDROOM OR ANY OTHER CONSTRUCTED AREA OF A PENTHOUSE. THE TERRACE IS NOT A PROJECTION. [ EMPHASIZED BY US ] 16 ITA NO. 1606/PUN/2015 A.Y.2011 - 12 1 7 . A PERUSAL OF THE BUILDING PLAN AT PAGE NO. 236 OF THE PAPER BOOK SHOWS THAT OPEN AREA MENTIONED ADJOINING TO THE LI VING ROOM AND BEDROOM I S TERRACE AND NOT BALCONY . T HE OPEN AREA WHICH HAS BEEN INCLUDED WHILE COMPUTING BUILT UP AREA OF FLAT IS TERRACE AND NOT BALCONY. THE DEFINITION OF BUILT UP AREA DOES NOT INCLUDE TERRACE AND IN THE CASE OF CIT VS. AMA L TAS ASSOCIATES (SUPRA.), THE HONBLE HIGH COURT HAS HELD THAT TERRACE IS DIFFERENT FROM BALCONY. THUS, OPEN AREA OF TERRACE WOULD NOT FORM PART OF BUILT UP AREA OF FLAT S IN QUESTION . ACCORDINGLY, SECOND ISSUE I.E. GROUND NO. 1 .B. RAISED IN THE APPEAL IS D ECIDED IN FAVOUR OF THE ASSESSEE. 18 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRO NOUNCED ON FRIDAY, THE 20 TH DAY OF OCTOBER , 201 7 . SD/ - SD/ - ( / ANIL CHATURVEDI ) ( /VIKAS AWASTHY) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / / / PUNE; / DATED : 20 TH OCTOBER , 2017 . SB / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT(APPEALS) - 1, PUNE 4. THE CIT - 1, PUNE. 5 . , , , / DR, ITAT, B BENCH, PUNE. 6 . / GUARD FILE. // TRUE COPY // / BY ORDER, / PRIVATE SECRETARY , / ITAT, PUNE .