Gnanam Films Private Limited, CHENNAI V. ITO, CHENNAI

ITA 1623/CHNY/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7195 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 4 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 10-12-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 06-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S DAS GUPTA IRS
• Keywords: Depreciation; Revised return

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . , ! , ' # BEFORE SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER & SHRI VIKAS AWASTHY, JUDICIAL MEMBER ./ I.T.A. NO.1623/MDS/2013 ( / ASSESSMENT YEAR : 2009-2010) M/S. GNANAM FILMS PRIVATE LIMITED, NO.45, TATA TOWER, II FLOOR, SAIT COLONY, 2 ND STREET, EGMORE, CHENNAI 600 008. [PAN :AACCG 6660M] ( !$ /APPELLANT) VS INCOME TAX OFFICER, MEDIA WARD- I, CHENNAI 600 034. ( %&!$ /RESPONDENT) / APPELLANT BY : SHRI. SAROJ KUMAR PARIDA, ADVOCATE / RESPONDENT BY : SHRI. S. DASGUPTA, IRS, JCIT. /DATE OF HEARING : 10.12.2014. !' /DATE OF PRONOUNCEMENT : 19.12.2014 ' / O R D E R PER VIKAS AWASTHY, JUDICIAL MEMBER THE APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-VI, CHENNAI DA TED 18.01.2013 FOR THE ASSESSMENT YEAR 2009-2010. I.T.A.NO.1623 /MDS/2013 . :- 2 -: 2. THE ONLY ISSUE RAISED BY THE ASSESSEE IN THIS AP PEAL IS THAT THE AUTHORITIES BELOW HAVE ERRED IN NOT CONSIDERING THE REVISED STATEMENT OF INCOME DRAWN ON THE BASIS OF AUDITED ACCOUNTS SU BMITTED DURING THE COURSE OF ASSESSMENT PROCEEDINGS. 3. THE BRIEF FACTS OF THE CASE ARE: THE ASSESSEE IS A PRIVATE LIMITED COMPANY REGISTERED UNDER THE PROVISIONS OF COMPANIES ACT, 1956. THE ASSESSEE FILED ITS RETURN OF INCOME FOR T HE ASSESSMENT YEAR 2009-10 ON 30.09.2009 ADMITTING TOTAL INCOME OF RS. 60,010/-. THE ASSESSEE HAD FILED RETURN OF INCOME ON THE BASIS OF PROVISIONAL ACCOUNTS. DURING THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS, THE ASSESSEE FILED REVISED STATEMENT BASED ON THE AUDIT ED ACCOUNTS. THE ASSESSEE SUBMITTED THAT THE ORIGINAL RETURN OF INCO ME COULD NOT BE FILED ON THE BASIS OF AUDITED ACCOUNTS AS THERE WAS FRAUD IN THE COMPANY THAT LED TO DELAY IN FINALIZING OF ACCOUNTS . THE DELAY WAS FURTHER CAUSED BY THE DEATH OF ACCOUNTANT WHO WAS R ESPONSIBLE FOR THE FRAUD. THE RETURN OF INCOME WAS THUS FILED ON THE BASIS OF PROVISIONAL FINANCIAL STATEMENTS. THE ASSESSING OFFICER REFUSED TO ACCEPT THE REVISED STATEMENT FILED DURING THE COURSE OF SCRUTI NY ASSESSMENT AND PROCEEDED ON TO MAKE ADDITION/DISALLOWANCE ON THE B ASIS OF I.T.A.NO.1623 /MDS/2013 . :- 3 -: INFORMATION EXTRACTED FROM THE REVISED STATEMENT OF ACCOUNTS RECEIVED FROM THE ASSESSEE. AGGRIEVED, BY THE ASSESSMENT ORDER DATED 29.12.2 011, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE COMMISS IONER OF INCOME TAX (APPEALS). THE COMMISSIONER OF INCOME TAX (APPE ALS) VIDE IMPUGNED ORDER UPHELD THE FINDINGS OF THE ASSESSING OFFICER, BARRING THE FINDINGS ON SHORT TERM CAPITAL GAIN WHICH WAS P ARTLY ALLOWED. AGGRIEVED BY THE ORDER OF FIRST APPELLATE AUTHORITY , THE ASSESSEE HAS COME IN SECOND APPEAL BEFORE THE TRIBUNAL. 4. SHRI. SAROJ KUMAR PARIDA APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT, REASONS FOR NOT FILING THE RETURN O N THE BASIS OF AUDITED ACCOUNTS WAS EXPLAINED BEFORE THE AUTHORITIES BELOW . THE REASON CAUSING DELAY IN AUDIT OF ACCOUNTS WAS BEYOND THE C ONTROL OF ASSESSEE. THE ASSESSEE FILED THE REVISED COMPUTATION BASED ON AUDITED FINANCIAL RESULTS ON THE FIRST OPPORTUNITY BEFORE THE ASSESSI NG OFFICER. THE ASSESSING OFFICER IN AN ARBITRARY AND UNJUSTIFIABLE MANNER USED THE INFORMATION GIVEN IN THE REVISED STATEMENT AND MADE ADDITION/DIS- ALLOWANCE IN THE RETURN FILED BY THE ASSESSEE. THE ADDITION/DIS- ALLOWANCE WERE INTER-ALIA MADE ON ACCOUNT OF :- (I) ADDING BACK OF MISCELLANEOUS INCOME BASED ON RE VISED I.T.A.NO.1623 /MDS/2013 . :- 4 -: COMPUTATION. (II)ADDITIONAL PROVISION FOR BAD-DEBTS CLAIMED. (III) DIFFERENCE IN AMOUNT OF DEPRECIATION CLAIMED. (IV) SET OFF OF BUSINESS LOSS AGAINST SHORT TERM CA PITAL GAIN. THE LD. COUNSEL CONTENDED THAT THE COMMISSIONER OF INCOME TAX (APPEALS) UPHELD THE FINDINGS OF ASSESSING OFFICER IN A MECHANICAL MANNER, WITHOUT APPRECIATING THE FACTS AND CIRCUMST ANCES OF THE CASE. THE REVISED COMPUTATION FILED BY THE ASSESSEE AT TH E TIME OF ASSESSMENT SHOULD HAVE BEEN TAKEN INTO CONSIDERATIO N BY THE AUTHORITIES BELOW. THE LEARNED COUNSEL IN ORDER TO SUPPORT HIS SUBMISSIONS PLACED RELIANCE ON THE DECISION OF HON BLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. VS. CIT REPORTED AS 284 ITR 323(SC). 5. SHRI. S. DAS GUPTA, REPRESENTING THE DEPARTMENT CONTROVERTING THE SUBMISSIONS MADE BY THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE AUTHORITIES BELOW WERE JUSTIFIED IN MAKING ADDITION/DIS-ALLOWANCE. THE ASSESSING OFFICER IS N OT COMPETENT TO ACCEPT ANY CLAIM OF ASSESSEE OTHERWISE THAN BY WAY OF REVISED RETURN, WHICH WAS NEVER FILLED IN THE PRESENT CASE. THIS POSITION HAS BEEN UPHELD BY THE HONBLE SUPREME COURT OF INDIA IN TH E CASE OF GOETZE (INDIA) LTD VS. CIT. I.T.A.NO.1623 /MDS/2013 . :- 5 -: 6. WE HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESENTATIVES OF BOTH SIDES AND HAVE PERUSED THE ORDERS OF AUTHORITIES BELOW. THE ASSESSMENT WAS MADE ON THE RETURN OF INCOME FILED BY THE ASSESSEE BASED ON PROVISIONAL ACCOUNTS . THE ASSESSEE HAS GIVEN REASONS FOR DELAY IN FINALIZATION AND AUDIT O F ACCOUNTS WHICH SEEMS TO BE FAIRLY REASONABLE. THE ASSESSEE FILED THE REVISED COMPUTATION OF INCOME BASED ON THE AUDITED FINANCIA L RESULTS AT THE TIME OF ASSESSMENT PROCEEDINGS. IT IS A WELL SETTLED LAW THAT THE ASSESSING OFFI CER CANNOT ENTERTAIN ANY CLAIM FOR DEDUCTION ETC., OTHERWISE T HAN BY WAY OF REVISED RETURN. IT IS AN UNDISPUTED FACT THAT NO R EVISED RETURN WAS FILED IN THE PRESENT CASE. THE ASSESSING OFFICER WAS THUS JUSTIFIED IN REJECTING THE REVISED STATEMENT FILED BY THE ASSESS EE AT THE TIME OF ASSESSMENT PROCEEDINGS. HOWEVER, THE HONBLE APEX COURT IN THE CASE OF M/S. GOETZE (INDIA) LTD (SUPRA) HAS HELD THAT TH E POWER OF THE TRIBUNAL U/S. 254 OF THE ACT IS NOT IMPINGED TO CO NSIDER ADDITIONAL CLAIM OF THE ASSESSEE, OTHERWISE THAN THE REVISED R ETURN OF INCOME. 7. WE OBSERVE THAT THE ASSESSING OFFICER DURING T HE COURSE OF ASSESSMENT PROCEEDINGS HAS EXTRACTED CERTAIN INFORM ATION FROM THE REVISED STATEMENT FILED BY THE ASSESSEE DURING THE COURSE OF I.T.A.NO.1623 /MDS/2013 . :- 6 -: ASSESSMENT PROCEEDINGS TO MAKE DISALLOWANCE/ADDITIO N IN THE RETURN. IN OUR CONSIDERED OPINION, IN THE INTEREST OF JUST ICE, IT WOULD BE FAIR IF THE MATTER IS REMITTED BACK TO THE ASSESSING OFFICE R TO CONSIDER THE REVISED STATEMENT OF ACCOUNTS BASED ON AUDITED ACCO UNTS FILED BY THE ASSESSEE AT THE TIME OF ASSESSMENT PROCEEDINGS. TH E FILE IS ACCORDINGLY REMANDED TO ASSESSING OFFICER TO PASS A FRESH ASSESSMENT ORDER AFTER AFFORDING AN OPPORTUNITY OF HEARING TO THE ASSESSEE, IN ACCORDANCE WITH LAW. 8. THE IMPUGNED ORDER IS SET ASIDE AND THE APPEAL O F THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON FRIDAY, THE 19TH OF DECEM BER 2014, AT CHENNAI. #$% & ( . ) (A.MOHAN ALANKAMONY) / ACCOUNTANT MEMBER SD/- ( ! ) (VIKAS AWASTHY) ' / JUDICIAL MEMBER '( /DATED:19.12.2014. K.V () *+ ,+ /COPY TO: 1. % APPELLANT/ 2. / RESPONDENT / 3. - ( )/CIT(A)/ 4. - /CIT 5. +./ 0 /DR/ 6. /1 2 /GF. I.T.A.NO.1623 /MDS/2013 . :- 7 -: