K. Anji reddy, Hyderabad V. DCIT, Circle-1(2), Hyderabad

ITA 1741/HYD/2011

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2770 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-05-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 10-10-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: AMISHA S GUPT
• Assessee Lawyers: A V RAGHURAM
• Keywords: Reopening of assessment; Depreciation; Search and seizure; Difference of opinion; Revised return; Change of opinion; Reassessment proceedings
• Section: 143(3); 153A; 147; 148; 28; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, J UDICIAL MEMBER ITA NO. 1741/HYD/2011 ASSTT. YEAR : 2005-06. SRI K. ANJI REDDY, HYDERABAD. PAN:AERPK6947F V/S. DCIT, CIR-1(2), HYDERABAD. (APPELLANT) (RESPONDENT) APPELLANT BY : SRI A.V. RAGHU RAM DEPARTMENT BY : SMT. AMISHA S. GUPT DATE OF HEARING 13 - 3 - 2013 DATE OF PRONOUNCEMENT 10 -5-2013 . O R D E R PER SAKTIJIT DEY, JUDICIAL MEMBER: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST OR DER DATED 12-7-2011 OF CIT (A)II, HYDERABAD PASSED IN ITA NO.004 0/CIT(A)- II/2010-11 PERTAINING TO THE ASSESSMENT YEAR 2005-06. 2. BRIEFLY THE FACTS ARE, THE ASSESSEE IS AN INDIVIDUAL. FOR THE ASSESSMENT YEAR UNDER DISPUTE, THE ASSESSEE FILED HIS ORIGI NAL RETURN OF INCOME ON 24-10-2005 DECLARING A TOTAL INCOME OF RS.1,8 5,67,834/-. SUBSEQUENTLY, THE ASSESSEE FILED A REVISED RETURN ON 13-4 -2006 DECLARING TOTAL INCOME OF RS.1,98,62,953/-. ASSESSMENT U /S 143(3) WAS COMPLETED VIDE ASSESSMENT ORDER DATED 3-5-2007 BY ACCEP TING THE INCOME DECLARED IN THE REVISED RETURN. THEREAFTER, O N THE BASIS OF REASONS RECORDED IN THE ORDER SHEET ENTRY DATED 22-2-20 10 THE ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 2 ASSESSMENT COMPLETED U/S 143(3) WAS REOPENED U/S 147 OF TH E ACT BY ISSUANCE OF NOTICE DATED 22-2-2010 U/S 148 OF THE ACT CALL ING UPON THE ASSESSEE TO SUBMIT HIS RETURN OF INCOME. IN RESPONSE TO TH E NOTICE ISSUED U/S 148 OF THE ACT, THE ASSESSEE SUBMITTED HIS REPLY ST ATING THEREIN THAT THE RETURN OF INCOME ALREADY SUBMITTED T O BE TREATED AS HAVING BEEN FILED IN RESPONSE TO NOTICE ISSUED U/S 148 OF THE ACT. DURING THE REASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NO TED THAT THE ASSESSEE HAS CLAIMED 100% DEDUCTION U/S 80GGA OF THE A CT ON PAYMENT MADE TO HYDERABAD EYE RESEARCH FOUNDATION, LB PRASAD MARG, BANJARA HILLS, HYDERABAD OF AN AMOUNT OF RS.12 LAKHS ON 20-7- 2004 AND RS.1 CRORE ON 23-3-2005. IT WAS FURTHER NOTE D BY THE ASSESSING OFFICER THAT DURING THE YEAR UNDER DISPUTE THE ASSESSEE HAS SHOWN LOSS OF RS.74,02,422/- UNDER THE HEAD INCOME FROM BUSINESS OR PROFESSION. THE LOSS FROM BUSINESS WAS SET OFF AGAINST THE I NCOME AVAILABLE UNDER THE HEAD INCOME FROM HOUSE PROPERTY AND INCOME FROM OTHER SOURCES AND BALANCE LOSS OF RS.13,68,323/- WAS CLAIMED AS CARRY FORWARD OF LOSS. THE ASSESSING OFFICER ON INTERPRETING T HE PROVISION CONTAINED U/S 80GGA (3) OF THE ACT OPINED THAT IN CASE OF AN ASSESSEE WHOSE GROSS TOTAL INCOME INCLUDES INCOME WHICH IS CHARGEA BLE UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION WO ULD NOT BE ELIGIBLE FOR DEDUCTION U/S 80GGA OF THE ACT. ON THE A FORESAID BASIS, THE ASSESSING OFFICER CAME TO A CONCLUSION THAT THE ASSESSEE IS NOT E NTITLED FOR DEDUCTION U/S 80GGA AS HE WAS HAVING INCOME/LOSS U NDER THE HEAD INCOME FROM BUSINESS OR PROFESSION. THOUGH THE A SSESSEE CONTENDED THAT SINCE THERE IS LOSS DURING THE YEAR AND NO INCOME UNDER THE HEAD INCOME FROM BUSINESS OR PROFESSION AS SPECIF IED IN SUB- SECTION THE ASSESSEE IS ENTITLED FOR DEDUCTION CLAIMED U/S 8 0GGA. THE ASSESSING OFFICER HOWEVER REJECTED SUCH CONTENTION OF THE ASSE SSEE AND ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 3 DISALLOWED THE DEDUCTION CLAIMED U/S 80GGA OF THE ACT A ND ADDED IT BACK TO THE TOTAL INCOME OF THE ASSESSEE. 3. THE ASSESSEE CHALLENGED THE ASSESSMENT ORDER PASSED U/S 143 (3) READ WITH SECTION 147 OF THE ACT BY PREFERRING AN APPEAL BEFORE THE CIT (A) BOTH ON THE LEGAL ISSUE OF VALIDITY OF REASSESSME NT PROCEEDINGS AS WELL AS ON THE MERITS OF THE DISALLOWANCE. THE CIT (A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE OPINED THAT RECOU RSE TO SECTION 147 CAN BE TAKEN IF EXCESSIVE LOSS OR DEPRECIATION A LLOWANCE OR ANY OTHER ALLOWANCES UNDER THE ACT HAS BEEN COMPUTED. S HE FURTHER OPINED THAT THOUGH THERE WAS AN ASSESSMENT U/S 143(3) OF THE ACT IN CASE OF THE ASSESSEE BUT THE ASSESSMENT WAS DONE IN A SUMMARY WAY AND THE ISSUE UNDER REFERENCE WAS NOT SCRUTINISED. THE CI T (A) FURTHER OBSERVED IN FACT THE ASSESSEE HIMSELF WAS NOT SURE OF ALLOWA BILITY OF THE CLAIM AS IN THE ORIGINAL RETURN, THE DEDUCTION WAS CLAI MED U/S 35AC AND IN THE REVISED RETURN U/S 80GGA. THE CIT (A) HELD T HAT AS THE CLAIM OF DEDUCTION WAS NOT VERIFIED IN THE ORIGINAL ASSESSMENT NO OPINION WAS FORMED BY THE ASSESSING OFFICER. HENCE, WHEN IT WAS NOTI CED THAT AS PER THE PROVISIONS OF SECTION 80GGA (3) THIS ISSUE WAS NOT CONSIDERED AT THE TIME OF ORIGINAL ASSESSMENT, THE ASSESSING OFFICER IN ITIATED ACTION U/S 147 OF THE ACT. THEREFORE, THERE HAS BEEN NO CHA NGE OF OPINION. THE CIT (A) ULTIMATELY HELD THAT SINCE THE DEDUCTION U/S 80GGA WAS WRONGLY ALLOWED IN THE ORIGINAL ASSESSMENT THE INITIAT ION OF PROCEEDINGS U/S 147 OF THE ACT WAS VALID. SO FAR AS ELIGIBILITY T O DEDUCTION U/S 80GGA IS CONCERNED, THE ASSESSEES CONTENTION THAT SINCE HE DOES NOT HAVE INCOME CHARGEABLE UNDER THE HEAD PROFITS OR GAINS AND BUSINESS OR PROFESSION, THE PROVISIONS U/S 80GGA(3) ARE NOT APPLI CABLE WAS NOT ACCEPTED BY THE CIT(A) WHO HELD THAT INCOME INCLUDES L OSS. IN THIS CONTEXT, THE CIT (A) RELIED UPON THE DECISION OF THE HO NBLE SUPREME ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 4 COURT IN THE CASE OF CIT V/S. GOLD COIN HEALTH (P) LTD. (304 ITR 308) WHEREIN IT WAS HELD THAT THE EXPRESSION INCOME APPEAR ING IN THE STATUTE IN SECTION 2(24) OF THE ACT HAS BEEN CLARIFIED T O MEAN THAT IT IS AN INCLUSIVE DEFINITION AND INCLUDES LOSSES I.E. NEGATIV E PROFIT. THE CIT (A) WAS FURTHER OF THE VIEW THAT FROM THE CHARGING PROVISIONS OF THE ACT, IT IS DISCERNIBLE THAT THE WORD INCOME OR PROFIT OR GAINS SHOULD BE UNDERSTOOD AS INCLUDING LOSSES ALSO SO THAT IN ANY SENSE PROF IT OR GAINS REPRESENT PLUS INCOME WHEREAS LOSS REPRESENTS MINUS INCOME. IN OTHER WORDS, LOSS IS NEGATIVE PROFIT AND BOTH POSITIVE A ND NEGATIVE PROFITS ARE OF REVENUE NATURE AND BOTH ENTER INTO CO MPUTATION WHEREVER IT BECOMES MATERIAL. THE CIT (A) WAS OF THE VIEW THAT WHILE CONSIDERING ALLOWING OF DEDUCTION U/S 80GGA ONE HAS TO SE E WHETHER THE CLAIMANT HAS INCOME FROM SOURCES OTHER THAN BUSINESS OR PROFESSION. THE CIT (A) HELD THAT THE INTENTION OF THE LEGISLATURE IN BRINGING OUT CLEAR DEMARCATION IN RESPECT OF ALLOWABILI TY OF DEDUCTION U/S 80GGA (3) OF THE ACT SHOWS THAT ONCE THE ASSESSEE HAS I NCOME UNDER THE HEAD BUSINESS OR PROFESSION HE IS NOT ELIGIBL E FOR CLAIMING DEDUCTION U/S 80GGA AND WHETHER THERE INCOME OR LOSS IS I MMATERIAL. ON THE AFORESAID FINDING, THE CIT (A) CONFIRMED THE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER. BEING AGGRIEVED OF THE O RDER OF THE CIT (A), THE ASSESSEE IS IN APPEAL BEFORE US. 4. GROUND NOS. 1 AND 10 ARE GENERAL IN NATURE AND T HEY DO NOT REQUIRE ANY ADJUDICATION. 5. GROUND NO.2 IS A LEGAL GROUND CHALLENGING THE VA LIDITY OF ASSESSMENT PROCEEDINGS U/S 147 OF THE ACT. THE LEARNED AR IN HIS WRITTEN SUBMISSIONS SUBMITTED BEFORE US THAT THE CLAIM OF DEDUCTIONU8/S 80GGA WAS CLEARLY MENTIONED IN THE STATEM ENT OF TOTAL ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 5 INCOME ANNEXED TO THE RETURNED INCOME. IT WAS FURTHER STATED THAT IN COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE APPEARED FROM TIME TO TI ME TO EXPLAIN THE RETURN AND ALSO FURNISHED THE DETAILS/INFORMATION CALLED FOR AND THE ASSESSMENT U/S 143(3) WAS COMPLETED AFTER VERIFYING ALL TH E FACTS RELATING TO CLAIM OF DEDUCTION U/S 80GGA. THEREFORE , THE REOPENING OF ASSESSMENT ON THE VERY SAME ISSUE IS BAD IN LAW AS THE REOPE NING IS BASED ON MERE CHANGE OF OPINION WITHOUT ANY FURTHER T ANGIBLE MATERIAL. IN SUPPORT OF SUCH CONTENTION, THE LEARNED AR RELIED UPON THE DECISION OF THE HONBLE SUPREME COURT IN CASE OF CIT V/S. KELVI NATOR OF INDIA (320 ITR 561) AND OF THE HONBLE DELHI HIGH COURT IN CASE OF USHA INTERNATIONAL LIMITED, A COPY OF WHICH WAS SUBMITTED I N THE PAPER BOOK. 6. THE LEARNED DEPARTMENTAL REPRESENTATIVE, ON THE O THER HAND, SUBMITTED THAT THE ASSESSING OFFICER HAVING NOT AT ALL EX AMINED THE ISSUE WHILE COMPLETING THE ORIGINAL ASSESSMENT, THE REOPEN ING IS JUSTIFIED AS THE ASSESSEE WAS CLEARLY NOT ENTITLED FORAVA ILING DEDUCTION U/S 80GGA OF THE ACT. HE FURTHER SUBMITTED THAT THE AS SESSING OFFICER HAS NOT AT ALL MADE ANY ENQUIRY WITH REGARD TO THE CL AIM OF THE ASSESSEE. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED TH E MATERIAL AVAILABLE ON RECORD. ON A PERUSAL OF THE OR DER PASSED U/S 143(3) OF THE ACT, IT IS CLEAR THAT THE ORDER IS A VERY CRYPTIC ONE AND THERE IS NO DISCUSSION IN THE ORDER WITH REGARD TO ASSESSEE S CLAIM OF DEDUCTION U/S 80GGA OF THE ACT. IN THE ASSESSMENT ORDER, THE ASSESSING OFFICER EVEN HAS NOT REFERRED TO THE DEDUCTION CL AIMED U/S 80GGA OF THE ACT. THE ASSESSMENT ORDER PASSED U/S 143(3) OF THE ACT ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 6 A COPY OF WHICH IS AT PAGE-7 OF THE PAPER BOOK WOULD REVEAL THE FACT THAT THE ASSESSING OFFICER HAS SIMPLY MENTIONED AS UNDER:- TOTAL INCOME AS PER ORDER U/S 154 DT. 20-10-2006 RS.1,98,62,950/- THE ASSESSMENT ORDER PASSED U/S 143(3) DOES NOT REVEAL EVEN SEMBLANCE OF ENQUIRY BY THE ASSESSING OFFICER WITH REGARD TO CLAIM OF DEDUCTION U/S 80GGA. NO OTHER MATERIAL WAS SUBMITTED BE FORE US TO DEMONSTRATE THAT THE ASSESSING OFFICER HAD CONDUCTED ANY E NQUIRY WITH REGARD TO CLAIM OF DEDUCTION U/S 80GGA. WHEN THE ASSESSEE HAD MADE THE CLAIM OF DEDUCTION U/S 80GGA FOR THE FIRST TIME IN THE REVISED RETURN IT WAS INCUMBENT UPON THE ASSESSING OFFICER TO PROPERLY EX AMINE THE ALLOWABILITY OF THE CLAIM MADE BY THE ASSESSEE. IN VIEW OF RESTRICTION IMPOSED UNDER SUB-SECTION (3) OF SECTION 80GGA THE ASSESSING OFFICER HAVING NOT AT ALL CONSIDERED THE ISSUE OR APPLIED HIS M IND TO THE CLAIM OF DEDUCTION U/S 80GGA, THERE WAS ESCAPEMENT OF INCOME AN D AS SUCH INITIATION OF PROCEEDING U/S 147 OF THE ACT IS VALID. WHEN THE ASSESSING OFFICER HAS NOT AT ALL EXAMINED THE ISSUE, IT CANNOT BE SAID THAT HE HAS FORMED ANY OPINION IN THAT REGARD. IN THESE CIRCUMSTAN CES, IT CANNOT BE SAID THAT THERE IS A CHANGE OF OPINION WHILE REOPEN ING THE ASSESSMENT. IN AFORESAID VIEW OF THE MATTER, WE ARE NOT INCLINED TO ACCEPT THE CONTENTIONS RAISED ON BEHALF OF THE ASSESSEE AND HOLD THAT THE REOPENING OF ASSESSMENT WAS VALID. ACCORDINGLY, THE CONCLUSION DRAWN BY THE CIT (A) ON THIS ISSUE IS CONFIRMED AND THE GROUND RAISED BY THE ASSESSEE IS DISMISSED. 8. THE NEXT ISSUE RAISED IN GROUND NOS. 3 TO 5 IS WITH REGARD TO DISALLOWANCE OF CLAIM OF DEDUCTION U/S 80GGA OF THE ACT. ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 7 9. THE LEARNED AR IN HIS WRITTEN SUBMISSIONS SUB MITTED THAT AS PER THE PROVISION CONTAINED UNDER SUB-SECTION (3) OF SECTI ON 80GGA OF THE ACT, THE DEDUCTIONS ARE NOT ALLOWED IN THE CASE OF THE ASSESSEE WHOSE GROSS TOTAL INCOME INCLUDES INCOME WHICH IS CHARGEABLE UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION. HE SUBMITTED THAT GROSS TOTAL INCOME HAS BEEN DEFINED IN CLAUSE -5 O F SECTION 80B OF THE ACT FOR THE PURPOSE OF CHAPTER VI-A OF WHICH SECTION 80GGA IS A PART. AS PER SECTION 80B(5) GROSS TOTAL INCOME MEANS THE T OTAL INCOME COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF THE ACT BEF ORE MAKING ANY DEDUCTION UNDER CHAPTER VI-A. IT WAS FURTHER SUBM ITTED A READING OF SECTION 2(45), 4 AND 5 AND COMPUTATIONAL PROVISIONS U NDER VARIOUS HEADS/CHAPTER SUGGEST THAT THE TOTAL INCOME IS NET OF TH E TAXABLE INCOME COMPUTED IN ACCORDANCE WITH RELEVANT COMPUTATION P ROVISIONS OF THE ACT WHEREAS THE CONCEPT OF GROSS TOTAL INCOME AS P ER SECTION 80B (5) IS DIFFERENT AS IT REFERS TO THE TOTAL INCOME B EFORE MAKING ANY DEDUCTION UNDER CHAPTER VI-A OF THE ACT. IT WAS SUBMITT ED THAT THE TERM GROSS TOTAL INCOME REFERS TO THE AGGREGATE OF PO SITIVE INCOMES UNDER VARIOUS HEADS FOR THE PURPOSE OF DEDUCTIONS UNDER CHAPTER VI-A. IT WAS SUBMITTED THAT IN THE CASE OF THE ASSESSEE THE GRO SS TOTAL INCOME FOR THE YEAR UNDER CONSIDERATION COMPRISED ONLY INCOME F ROM SALARY AND AS SUCH IT DID NOT INCLUDE ANY INCOME UNDER THE HEAD PROFIT OR GAINS OF BUSINESS OR PROFESSION. HENCE, THE CLAIM OF DEDU CTION U/S 80GGA WAS RIGHTLY ALLOWED BY THE ASSESSING OFFICER WHILE COMPLETING THE ASSESSMENT U/S 143(3) OF THE ACT. IN SUM AND SUBSTANCE T HE SUBMISSION OF THE LEARNED AUTHORIZED REPRESENTATIVE IS THAT THERE BEING NO INCOME DURING THE YEAR UNDER THE HEAD INCOME FROM BUSINESS OR PROFESSION WHICH IS CHARGEABLE TO TAX, THE ASSESSEE IS ELIGI BLE FOR DEDUCTION U/S 80GGA OF THE ACT. IN SUPPORT OF SUCH CONTEN TION THE LEARNED AR RELIED UPON THE FOLLOWING DECISIONS:- ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 8 I) CIT V/S., KOTAGIRI INDUSTRIAL CO-OPERATIVE TEA F ACTORY LTD. (224 ITR 604) (SC) II) SYNCO INDUSTRIES LTD. V/S. ASSESSING OFFICER (299 ITR 444 (SC) III) CIT V/S. WILLIAMSON FINANCIAL SERVICES (297 ITR 17 (SC) 10. THE LEARNED DEPARTMENTAL REPRESENTATIVE, ON THE OTHER HAND, SUPPORTING THE REASONING OF THE FIRST APPELLATE AUTHOR ITY SUBMITTED THAT SINCE ASSESSEE HAD INCOME WHICH ALSO INCLUDES LOSS UNDER THE H EAD INCOME FROM BUSINESS OF PROFESSION, NO DEDUCTION U/S 80GG A CAN BE GRANTED IN VIEW OF RESTRICTION IMPOSED UNDER SUB-SECTION (3) OF SECTION 80GGA. 11. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED T HE MATERIAL AVAILABLE ON RECORD. WE HAVE ALSO CAREFULLY APPLIED OUR MIND TO THE DECISIONS CITED BEFORE US. UNDISPUTEDLY, THE ASSESSE E IS CARRYING ON BUSINESS AND FOR THE YEAR UNDER DISPUTE THE ASSESSEE HAD A NEGATIVE INCOME I.E., LOSS FROM BUSINESS. IT IS THE CONTEN TION OF THE ASSESSEE THAT SINCE HE HAD NO POSITIVE INCOME CHARGEABLE TO TAX, HE IS ELIGIBLE TO AVAIL DEDUCTION U/S 80GGA OF THE ACT. THE SUBMISSIONS OF THE LEARNED AR THOUGH APPEARS ATTRACTIVE AT THE FIRST BLUS H, HOWEVER, ON DEEPER ANALYSIS IT CANNOT BE ACCEPTED. SECTION 80GGA WH ICH COMES UNDER CHAPTER VI-A OF THE ACT PROVIDES FOR DEDUCTION F ROM GROSS TOTAL INCOME COMPUTED, ANY SUM PAID BY THE ASSESSEE TO A RESEA RCH ASSOCIATION UNDERTAKING SCIENTIFIC RESEARCH OR RESEARCH IN SOCIAL SCIENCE OR STATISTICAL RESEARCH. THE SECTION FURTHER PROVIDES THA T DEDUCTION CAN ALSO BE ALLOWED IN RESPECT OF THE SUM PAID BY THE ASSESSEE TO AN ASSOCIATION OR INSTITUTION WHICH HAS AS ITS OBJECT THE UN DERTAKING OF ANY PROGRAMME OF RURAL DEVELOPMENT, FOR CARRYING OUT ANY ELIGIBLE ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 9 SCHEME OR PROJECT APPROVED BY THE NATIONAL COMMITTEE, T O ANY PROGRAMME OF CONSERVATION OF NATURAL RESOURCES OR OF A FORESTATION, TO A RURAL DEVELOPMENT FUND SET UP AND NOTIFIED BY THE CE NTRAL GOVERNMENT AND ANY SUM PAID TO THE NATIONAL URBAN POVERTY ERADI CATION FUND SET UP AND NOTIFIED BY THE CENTRAL GOVERNMENT. SUB-SECT ION (3) OF SECTION 80GGA READS AS UNDER:- (3) NOTWITHSTANDING ANYTHING CONTAINED IN SUB-SECTION ( 1), NO DEDUCTION UNDER THIS SECTION SHALL BE ALLOWED IN THE CASE OF AN ASSESSEE WHOSE GROSS TOTAL INCOME INCLUD ES INCOME WHICH IS CHARGEABLE UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION. 12. A READING OF SUB-SECTION (3) WHICH BEGINS WITH A NO N OBSTANTE CLAUSE MAKES IT CLEAR THAT AN ASSESSEE WHOSE GROSS TOTAL IN COME INCLUDES INCOME WHICH IS CHARGEABLE UNDER THE HEAD PROFIT S OR GAINS OF BUSINESS OR PROFESSION SHALL NOT BE ELIGIBLE FOR DEDUCTION U/S 80GGA OF THE ACT. SECTION 28 OF THE ACT PROVIDES FOR INCOME WHICH SHALL BE CHARGEABLE TO INCOME-TAX UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION. SECTION 29 OF THE ACT PROVIDES T HAT INCOME U/S 28 SHALL BE COMPUTED IN ACCORDANCE WITH THE PROVISION S CONTAINED IN SECTIONS 30 TO 43D OF THE ACT. SECTION 30 TO 43D PROVI DES FOR VARIOUS DEDUCTIONS WHICH CAN BE CLAIMED BY AN ASSESSEE WHILE COMPUT ING THE INCOME UNDER THE HEAD BUSINESS OR PROFESSION. SECTION 3 5AC PROVIDES FOR EXPENDITURE INCURRED BY WAY OF PAYMENT OF ANY SU M TO A PUBLIC SECTOR COMPANY OR A LOCAL AUTHORITY OR TO AN ASSOCIATION O R INSTITUTION APPROVED BY A NATIONAL COMMITTEE FOR CARRYING OUT AN Y ELIGIBLE PROJECT OR SCHEME. THEREFORE, AN ASSESSEE WHO IS CARRYING ON BUSIN ESS OR PROFESSION CAN CLAIM EXEMPTION OF ANY SUM PAID TO ANY IN STITUTION TOWARDS SCIENTIFIC RESEARCH, RURAL DEVELOPMENT ETC., UN DER VARIOUS PROVISIONS AS CONTAINED U/S 30 TO 43D OF THE ACT. HENCE, THE RATIONALE ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 10 BEHIND IMPOSING CERTAIN RESTRICTION UNDER SUB-SECTION (3) OF SECTION 80GGA IS THAT SINCE THE ASSESSEE HAVING INCOME UNDER THE H EAD BUSINESS OR PROFESSION CAN AVAIL DEDUCTION TOWARDS PAYME NT OF ANY SUM UNDER VARIOUS PROVISIONS CONTAINED U/S 30 TO 43D OF THE ACT WHILE COMPUTING THE INCOME UNDER THE HEAD BUSINESS OR PROFESSIO N, THE VERY SAME DEDUCTION CANNOT BE ALLOWED TO THEM U/S 80GGA WHI CH IS SPECIFICALLY MEANT FOR ASSESSEES WHO DO NOT HAVE ANY INCOME UNDER THE BUSINESS OR PROFESSION WHICH IN OTHER WORDS MEANS AN ASSESSE E WHO DOES NOT CARRY OUT ANY BUSINESS OR PROFESSION. OTHERWISE , AN ASSESSEE CARRYING ON BUSINESS OR PROFESSION CAN CLAIM DEDUCTION BOTH UNDER THE PROVISIONS AS CONTAINED U/S 30 TO 43D AND AGAIN U/S 80GGA OF THE ACT. THIS CANNOT BE THE INTENTION OF THE LEGISLATURE. IT WI LL BE PERTINENT TO MENTION HERE THAT THE ASSESSEE, IN FACT, HAD CLAIMED DED UCTION U/S 35AC, IN THE ORIGINAL RETURN WHILE COMPUTING PROFIT FROM BUSINESS AND PROFESSION. SUBSEQUENTLY HOWEVER THE ASSESSEE GAVE UP ITS CLAIM U/S 35AC AND CLAIMED DEDUCTION U/S 80GGA IN THE REVISED RET URN PROBABLY TO REDUCE THE TAX BURDEN. 13. SO FAR AS THE CONTENTION OF THE LEARNED AR THAT SI NCE THE ASSESSEE DURING THE YEAR HAD INCURRED LOSS FROM BUSINESS AND HAD NO INCOME CHARGEABLE TO TAX UNDER THE HEAD INCOME FROM BUSINESS OR PROFESSION SUB-SECTION (3) OF SECTION 80GGA WILL NOT APPLY, WE ARE AFRAID, SUCH CONTENTION IS NOT ACCEPTABLE FOR THE SIMPLE REASON THAT INCOME AS DEFINED U/S 2(24) OF THE ACT IS AN INCLUSIVE DEFINITIO N AND ALSO INCLUDES LOSS. THE HONBLE SUPREME COURT IN CASE OF CIT V/S. H ARA PRASAD & CO. PVT. LIMITED (99 ITR 118) HELD THAT THE WORDS INCOME OR PROFIT AND GAINS SHOULD BE UNDERSTOOD AS INCLUDING LOSSES ALSO, SO THAT, IN ONE SENSE PROFITS AND GAINS REPRESENT PLUS INCOME WHE REAS LOSSES REPRESENT MINUS INCOME. IN OTHER WORDS, LOSS IS NEGATI VE PROFIT. BOTH ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 11 POSITIVE AND NEGATIVE PROFITS ARE OF REVENUE CHARACTER. BOTH MUST ENTER INTO COMPUTATION, WHEREVER IT BECOMES MATERIAL IN THE SAME MODE OF THE TAXABLE INCOME OF THE ASSESSEE. THE AFORESAID VIEW WA S AGAIN REITERATED BY THE HONBLE SUPREME COURT IN CASE OF RE LIANCE JUTE AND INDUSTRIES LIMITED V/S. CIT (120 ITR 921) AND CIT V/ S. GOLDCOIN HEALTH (P) LTD. (304 ITR 308). THEREFORE, IN VIEW OF THE SPECIFIC BAR CREATED UNDER SUB-SECTION (3) OF SECTION 80GGA, THE ASSESSEE IS NOT ENTITLED TO AVAIL DEDUCTION U/S 80GGA OF THE ACT. IN A FORESAID VIEW OF THE MATTER, WE UPHOLD THE ORDER OF THE CIT(A) ON T HIS ISSUE. THUS, THE GROUNDS RAISED BY THE ASSESSEE ARE DISMISSED. 14. BEFORE US, THE ASSESSEE HAS RAISED THE FOLLOWING NEW GROUND WHICH WAS NOT TAKEN BEFORE THE CIT (A). AS THE GROUND S RAISED ARE LEGAL GROUNDS AND CAN BE DECIDED ON THE BASIS OF FACTS ALREADY ON RECORD WE TAKE UP THE SAME FOR CONSIDERATION. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED CIT OUGHT TO HAVE APPRECIATED THAT THE ASSESSING OFFICER COULD HAVE ALLOWED THE DEDUCTION ALTERNATIVELY US 35AC. 7. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED CIT(A) ERRED BY NOT HOLDING THAT THE APPELLANT WAS ALTERNATIVELY ELIGIBLE FOR THE DEDUCT ION U/S 35AC. 8. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED CIT(A) OUGHT TO HAVE APPRECIATED THAT THE ASSESSING OFFICER ERRED BY LEVYING INTEREST U/S 234D. 9. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED CIT (A) ERRED BY NOT HOLDING THAT INTEREST U/S 234D WAS NOT LEVIABLE IN THE CASE OF RE-ASSESSM ENT. ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 12 15. IN GROUND NO.6 AND 7, THE ASSESSEE HAS MADE AN ALTER NATIVE CLAIM THAT IN CASE DEDUCTION U/S 80GGA IS NOT ALLOWED TO THE ASSESSEE, THE ASSESSING OFFICER COULD HAVE ALLOWED DEDUCTION U/S 35AC OF THE ACT. 16. THE LEARNED AR THROUGH HIS WRITTEN SUBMISSION S SUBMITTED BEFORE US THAT THE ASSESSING OFFICER DISALLOWED THE DEDU CTION CLAIMED U/S 80GGA ONLY ON THE GROUND THAT THE ASSESSEE HAS INCOME UNDER THE HEAD PROFITS AND GAINS OF BUSINESS AND PROFESSION AND HE HAS NOT DISPUTED EITHER GENUINENESS OF EXPENDITURE OR ITS ALLOW ABILITY OTHERWISE, HENCE THE ASSESSING OFFICER SHOULD HAVE ALLOWED SUCH CLAIM ALTERNATIVELY U/S 35AC OF THE ACT AND ACCORDINGLY RECOM PUTED THE LOSS FROM BUSINESS. HE FURTHER CONTENDED THAT WHEN A DEDU CTION CLAIMED BY AN ASSESSEE ON A PARTICULAR SECTION IS DENIED ON THE GR OUND THAT HE WAS NOT ELIGIBLE FOR SUCH RELIEF UNDER THE SAID SECTION, EVEN IN THE ABSENCE OF AN ALTERNATE CLAIM FOR THE DEDUCTION UNDER D IFFERENT SECTIONS, IF, BY THE PROVISIONS OF THE ACT IS ENTITLED FOR SUCH DEDUCTION, THE SAME SHOULD BE ALLOWED. WHEN THE BENCH RAISED A QUE RY AS TO HOW THE ASSESSEES ALTERNATE CLAIM CAN BE ALLOWED IN AN APPEA L PROCEEDING ARISING OUT OF REASSESSMENT PROCEEDINGS U/S 147 OF THE ACT , IN VIEW OF THE DECISION OF HON'BLE SUPREME COURT IN CASE OF CIT V /S. SUN ENGINEERING WORKS LTD. (198 ITR 297), THE LEARNED AR THROUGH A FURTHER WRITTEN SUBMISSIONS SUBMITTED THAT IN THE ORIGI NAL RETURN, THE ASSESSEE HAD CLAIMED DEDUCTION U/S 35AC OF THE ACT. HOWEVER , BY FILING A REVISED RETURN THE ASSESSEE CLAIMED DEDUCTION U/S 80GGA OF THE ACT. THE ASSESSING OFFICER IN THE REASSESSMENT PROCEEDINGS O BJECTED TO THE CLAIM OF DEDUCTION U/S 80GGA OF THE ACT BUT WHILE DENYING THE CLAIM OF DEDUCTION U/S 80GGA, THE ASSESSING OFFICER COULD H AVE CONSIDERED THE ALLOWABILITY OF CLAIM OF DEDUCTION U/S 3 5AC OF THE ACT. THE LEARNED AR RELYING UPON THE DECISION OF HONBLE SUPREME COURT IN ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 13 CASE OF CIT VS. SUN ENGINEERING WOKS LTD. (SUPRA) SUBMITT ED THAT CLAIM OF DEDUCTION OF ANY EXPENDITURE RELATABLE TO E SCAPED INCOME IS PERMISSIBLE IN REASSESSMENT PROCEEDINGS. 17. THE LEARNED DEPARTMENTAL REPRESENTATIVE, ON THE OTHER HAND, STRONGLY OPPOSED THE CONTENTIONS PUT FORTH BY THE LEARN ED COUNSEL FOR THE ASSESSEE. 18. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED T HE MATERIAL AVAILABLE ON RECORD. WE HAVE ALSO APPLIED O UR MIND TO THE DECISIONS CITED BEFORE US. UNDISPUTEDLY, PROCEEDINGS U/S 147 OF THE ACT WAS INITIATED FOR BRINGING TO TAX THE INCOME WHICH HA S ESCAPED ASSESSMENT DUE TO ALLOWANCE OF DEDUCTION U/S 80GGA OF THE ACT WHICH WAS OTHERWISE NOT ALLOWABLE TO THE ASSESSEE. THEREFORE, THE REASSESSMENT PROCEEDINGS WAS VERY MUCH LIMITED IN ITS NATURE AND SCOPE I.E., TO ASSESS THE ESCAPED INCOME. THEREFORE, WHILE ASSESSING THE ESCAPED INCOME UNDER A PROCEEDING INITIATED U/S 147 OF THE ACT, THE ASSESSING OFFICER CAN ONLY CONSIDER THE MATTERS WHICH A RE RELEVANT ONLY IN RESPECT OF INCOME WHICH HAD NOT BEEN BROUGHT TO TAX DURING THE COURSE OF ORIGINAL ASSESSMENT. AN ASSESSEE CAN ONLY PUT FORW ARD CLAIM FOR DEDUCTION OF ANY EXPENDITURE IN RESPECT OF T HAT INCOME OR THE NON TAXABILITY OF THAT INCOME. UNDISPUTEDLY, IN THE R EASSESSMENT PROCEEDINGS, THE ONLY ISSUE FOR CONSIDERATION WAS INCOME E SCAPING ASSESSMENT ON ACCOUNT OF ALLOWANCE OF CLAIM OF DEDUCTION U/ S 80GGA(3) OF THE ACT. HENCE, THE ASSESSEE S ALTERNATE CLAIM FOR DEDUCTION U/S 35AC OF THE ACT COULD NOT HAVE BEEN CONSID ERED IN THE REASSESSMENT PROCEEDINGS AS IT DID NOT RELATE TO AN EXPEND ITURE IN RESPECT OF THE ESCAPED INCOME. THE HON'BLE SUPREME COURT IN CASE OF CIT V/S. SUN ENGINEERING WORKS (SUPRA) HELD IN THE FOL LOWING MANNER:- ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 14 ' AS A RESULT OF THE AFORESAID DISCUSSION, WE FIND TH AT, IN PROCEEDINGS UNDER S. 147 OF THE ACT, THE ITO MAY BRING TO CHARGE ITEMS OF IN COME WHICH HAD ESCAPED ASSESSMENT OTHER THAN OR IN ADDITIONAL TO T HAT ITEM OR TIMES WHICH HAVE LED TO THE ISSUANCE OF THE NOTICE UNDER S. 148 AND WHERE REASSESSMENT MADE UNDER S. 147 IN RESPECT OF INCOME WHICH HAS ESCAPED TAX, THE ITO 'S JURISDICTION IS CONFINED TO ONLY SUCH INCOME WHICH HAS ESCAPED TAX OR HAS BEEN UNDER ASSESSED AND DOES NOT EXTEND TO REVISING , REOPENING OR RECONSIDERING THE WHOLE ASSESSMENT OR PERMITTING TH E ASSESSEE THE REAGITATE QUESTIONS WHICH HAD BEEN DECIDED IN THE ORIGINAL AS SESSMENT PROCEEDINGS. IT IS ONLY THE UNDERASSESSMENT WHICH IS SET ASIDE AND NOT THE ENTIRE ASSESSMENT WHEN REASSESSMENT PROCEEDINGS ARE INITIATED. THE IT O CANNOT MAKE AN ORDER OF REASSESSMENT INCONSISTENT WITH THE ORIGINAL ORDER OF ASSESSMENT IN RESPECT OF MATTERS WHICH ARE THE SUBJECT MATTER OF PROCEEDINGS UNDER S. 147. AN ASSESSEE CANNOT RESIST VALIDLY INITIATED REASSES SMENT PROCEEDINGS UNDER THIS SECTION MERELY BY SHOWING THAT OTHER INCOME WH ICH HAD BEEN ASSESSED ORIGINALLY WAS AT TOO HIGH A FIGURE EXCEPT IN CASES UNDER S. 152(2}. THE WORDS 'SUCH INCOME' IN S. 147 CLEARLY REFER TO THE INCOME WHICH IS CHARGEABLE TO TAX BUT HAS 'ESCAPED ASSESSMENT' AND THE ITO'S JURI SDICTION UNDER THE SECTION IS CONFINED ONLY TO SUCH INCOME WHICH HAS E SCAPED ASSESSMENT. IT DOES NOT EXTEND TO RECONSIDERING GENERALLY THE CONC LUDED EARLIER ASSESSMENT. CLAIMS WHICH HAVE BEEN DISALLOWED IN THE ORIGINAL A SSESSMENT PROCEEDING CANNOT BE PERMITTED TO BE REAGITATED ON THE ASSESSM ENT BEING REOPENED FOR BRINGING TO TAX CERTAIN INCOME WHICH HAD ESCAPED AS SESSMENT BECAUSE THE CONTROVERSY ON REASSESSMENT IS CONFINED TO MATTERS WHICH ARE RELEVANT ONLY IN RESPECT OF THE INCOME WHICH HAD NOT BEEN BROUGHT TO TAX DURING THE COURSE OF THE ORIGINAL ASSESSMENT. A MATTER NOT AGITATED IN T HE CONCLUDED ORIGINAL ASSESSMENT PROCEEDINGS ALSO CANNOT BE PERMITTED TO BE AGITATED IN THE REASSESSMENT PROCEEDINGS UNLESS RELATABLE TO THE ITEM SOUGHT TO BE TAXED AS 'ESCAPED INCOME'. INDEED, IN THE REASSESSMENT PROCEEDINGS FOR BRINGING TO TAX ITEMS WHICH HAD ESCAPED ASSESSMENT, IT WOULD BE OPEN TO AN ASSESSEE TO PUT FORWARD CLAIMS FOR DEDUCTION OF ANY EXPENDITURE IN RESPECT OF THAT INCOME OR THE NON-TAXABILITY OF THE ITEMS AT ALL. KEEPING IN VIEW THE OBJECT AND PURPOSE OF THE PROCEEDINGS UNDER S. 147 OF THE ACT WHICH ARE FOR THE BENEFIT OF THE REVENUE AND NOT AN ASSESSEE, AN ASSE SSEE CANNOT BE PERMITTED TO CONVERT THE REASSESSMENT PROCEEDINGS A S HIS APPEAL OR REVISION, IN DISGUISE, AND SEEK RELIEF IN RESPECT O F ITEMS EARLIER REJECTED OR CLAIM RELIEF IN RESPECT OF ITEMS NOT CLAIMED IN THE ORIGINAL ASSESSMENT PROCEEDINGS, UNLESS RELATABLE TO 'ESCAPED INCOME', AND REAGITATE THE CONCLUDED MATTERS. EVEN IN CASES WHERE THE CLAIMS O F THE ASSESSEE DURING THE COURSE OF REASSESSMENT PROCEEDINGS RELATING ON THE ESCAPED ASSESSMENT ARE ACCEPTED, STILL THE ALLOWANCE OF SUC H CLAIMS HAS TO BE LIMITED TO THE EXTENT TO WHICH THEY REDUCE THE INCO ME TO THAT ORIGINALLY ASSESSED. THE INCOME FOR PURPOSES OF 'REASSESSMENT' CANNOT BE REDUCED BEYOND THE INCOME ORIGINALLY ASSESSED. ' ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 15 19. THAT BESIDES IT IS AN UNDISPUTED FACT THAT IN T HE ORIGINAL RETURN OF INCOME THE ASSESSEE HAD CLAIMED DEDUCTION U/S 35AC OF TH E ACT. HOWEVER, IN THE REVISED RETURN, THE ASSESSEE WITHDREW ITS CLAIM U/S 35ACOF THE ACT AND CLAIMED DEDUCTION U/S 80GGA OF THE A CT. THE ORIGINAL ASSESSMENT U/S 143(3) OF THE ACT WAS COMPLETED ON THE BASIS OF THE REVISED RETURN FILED BY THE ASSESSEE. THUS, THE ASSESSEE HAVING GIVEN UP ITS CLAIM U/S 35AC OF THE ACT IN THE REVISED R ETURN FILED BY HIM, THE CLAIM OF DEDUCTION/S 35AC OF THE ACT CANNOT BE ALLO WED ON THE BASIS OF THE ORIGINAL RETURN. THE HON'BLE SUPREME COU RT IN CASE OF CIT V/S. MAHENDRA MILLS (243 ITR 56)HELD IN THE FOLLOWING MANNER:- TO US IT APPEARS THAT IF THE REVISED RETURN IS A VALID RETURN AND THE ASSESSEE HAS WITHDRAWN THE CLAIM OF DEPRECIATIO N, IT CANNOT BE GRANTED RELYING ON THE ORIGINAL RETURN WHEN THE ASSESSMENT IS BASED ON THE REVISED RETURN. THEREFORE, ON THE AFORESAID VIEW OF THE MATTER, THE ASSESSEES ALTERNATE CLAIM FOR DEDUCTION U/S 35AC OF THE ACT CANNOT BE ALLOW ED. THE GROUNDS RAISED ARE DISMISSED. 20. IN GROUND NOS. 8 AND 9, ASSESSEE HAS CHALLENGED THE L EVY OF INTEREST U/S 234D OF THE ACT. WHILE MAKING COMPUTATION IN THE ORDER PASSED U/S 143(3) READ WITH SECTION 147 OF THE ACT THE ASSE SSING OFFICER LEVIED INTEREST OF RS.14,78,824/- U/S 234D OF THE ACT ON ACCOUNT OF EXCESS REFUND GRANTED TO THE ASSESSEE. 21. THE LEARNED AR SUBMITTED BEFORE US THAT THE PROVI SIONS OF SECTION 234D ARE APPLICABLE ONLY IN RESPECT OF REGULAR ASSESSMENTS WHICH AS PER THE DEFINITION U/S 2 (40) OF THE ACT WOULD MEAN THE ASSESSMENT MADE US 143(3) OR 144 OF THE ACT. HE SUBMITTED THAT A S PER THE RATIO LAID DOWN BY THE HON'BLE SUPREME COURT IN CASE OF MODI INDUSTRIES LIMITED (216 ITR 759), REGULAR ASSESSMENT MEANS ASSESSMENT MADE ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 16 FOR THE FIRST TIME U/S 143(3) OR U/S 144 OF THE ACT. HE FURTHER SUBMITTED THAT THE SCOPE OF THE EXPRESSION REGULAR ASSESSMENT HAS BE EN WIDENED BY VIRTUE OF EXPLANATION-1 TO SECTION 234D T O INCLUDE ONLY THE ASSESSMENT MADE U/S 147 FOR THE FIRST TIME. IT WAS SUBMIT TED THAT SINCE IN THE CASE OF THE ASSESSEE REGULAR ASSESSMENT WAS MADE EA RLIER U/S 143(3) OF THE ACT , INTEREST U/S 234D COULD NOT BE L EVIED IN THE REASSESSMENT PROCEEDINGS. IN SUPPORT OF SUCH CONTENTION, THE LEARNED AUTHORISED REPRESENTATIVE RELIED UPON A DECISION OF IN COME-TAX APPELLATE TRIBUNAL, VIZAG BENCH IN CASE OF DREDGING C ORPORATION OF INDIA LIMITED V/S. ACIT (2011) (63 DTR 15). 22. THE LEARNED DEPARTMENTAL REPRESENTATIVE, ON THE OTHER HAND, SUBMITTED THAT LEVY OF INTEREST U/S 234D OF THE ACT IS VALID. 23. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED T HE MATERIAL AVAILABLE ON RECORD. WE HAVE ALSO CAREFULLY APPLIED OUR MIND TO THE DECISIONS CITED BEFORE US. SECTION 234D OF THE ACT AUTHORIZES LEVY OF INTEREST IN A CASE WHERE ANY REFUND IS GRANTED TO THE ASSESSEE U/S 143(1) OF THE ACT BUT NO REFUND IS DUE ON REGULA R ASSESSMENT OR THE AMOUNT REFUNDED U/S 143(1) EXCEEDS THE AMOUNT REFU NDABLE ON REGULAR ASSESSMENT. THE TERM REGULAR ASSESSMENT HAS BEEN DEFINED U/S 2(40) OF THE ACT. ACCORDING TO THE AFORESAID DEFINI TION, REGULAR ASSESSMENT WOULD MEAN AN ASSESSMENT MADE UNDER SUB-SECTION (3) OF SECTION 143 OR SECTION 144 OF THE ACT. EXPLANATION-1 TO SECTION 234D WHICH WAS INTRODUCED BY THE FINANCE ACT, 2012 WITH RETR OSPECTIVE EFFECT FROM 1-6-2003 SAYS THAT WHERE IN RELATION TO AN ASSESSME NT YEAR AN ASSESSMENT IS MADE FOR THE FIRST TIME U/S 147 OR SECTION 153 A OF THE ACT, THE ASSESSMENT SO MADE SHALL BE REGARDED AS A REGULAR ASSESSMENT. THUS, THE PROVISION CONTAINED U/S 234D(1) AL ONG WITH ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 17 EXPLANATION-1 IF CONSTRUED HARMONIOUSLY WOULD MEAN TH AT IF THERE IS NO REGULAR ASSESSMENT I.E., ASSESSMENT U/S 143(3) OR SECTION 14 4 IN CASE OF AN ASSESSEE FOR AN ASSESSMENT YEAR, THEN AN ASSESSMENT MADE FOR THE FIRST TIME U/S 147 OR SECTION 153A OF THE ACT SHALL BE REGARDED AS A REGULAR ASSESSMENT. HOWEVER, IN CASE OF THE ASSESSEE BEFORE US AN ASSESSMENT HAS ALREADY BEEN COMPLETED U/S 143(3) OF THE ACT . THEREFORE, IT CANNOT BE SAID THAT THE ASSESSMENT MADE U/S 147 OF THE ACT IS A REGULAR ASSESSMENT IN TERMS WITH THE EXPLANATION -1 TO SECTION 234D OF THE ACT. THIS VIEW HAS ALSO BEEN EXPRESSED BY TH E INCOME-TAX APPELLATE TRIBUNAL VIZAG BENCH IN CASE OF DREDGING COR PORATION OF INDIA LTD. V/S. ACIT (SUPRA). IN SUCH VIEW OF THE MATTER , WE HOLD THAT NO INTEREST U/S 234D OF THE ACT IS LEVIABLE ON THE ASSESSEE I N THE ASSESSMENT COMPLETED U/S 147 OF THE ACT. ACCORDINGLY, WE DI RECT THE ASSESSING OFFICER TO DELETE THE SAME. HENCE, THESE GROUNDS OF THE ASSESSEE ARE ALLOWED. 24. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED IN PA RT. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 10 TH MAY, 2013 . SD/- (CHANDRA POOJARI) ACCOUNTANT MEMBER SD/- (SAKTIJIT DEY) JUDICIAL MEMBER HYDERABAD, DATED THE 10 TH MAY, 2013 JMR* COPY FORWARDED TO: 1. 2. 3. 4. SRI K. ANJI REDDY, 8-2-576/1, ROAD NO.7, BANJARA HIL LS, HYDERABAD. DCIT, CIR-1(2), AAYAKAR BHAVAN, HYDERABAD. CIT (A)-II, HYDERABAD. CIT CONCERNED, HYDERABAD. 5. THE DR B BENCH ITAT, HYDERABAD. ITA NO.1741 OF 2011 SRI K. ANJI REDDY, HYD. 18