The Principal, V. ACIT, Patna

ITA 22/PAT/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 1174 (ITAT-PATNA)
• Duration Of Justice: 2 year(s) 6 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 25-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R K MISHRA
• Assessee Lawyers: SHALIN KUMAR
• Keywords: Bonafide belief; Retrospective amendment
• Section: 80C; 133A; 80G; 201(1); 56; 139

Judgement Text

1 ITA NOS. 22 TO 27/PAT/2014. IN THE INCOME TAX APPELLATE TRIBUNAL, PATNA BENCH, PATNA. BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER. (S.M.C.) I.T.A. NO S . 22 & 23 /PAT/ 2014. ASSESSMENT YEARS : 2008 - 09 & 2009 - 10. THE PRINCIPAL, ASSTT. COMMISSIONER OF INCOME - TAX, H.D. JAIN COLLEGE, VS. TDS CIRCLE, PATNA. AR RAH . APPELLANT. RESPONDENT. I.T.A. NOS. 24 & 25/PAT/2014. ASSESSMENT YEARS : 2008 - 09 & 2009 - 10. THE REGISTRAR, ASSTT. COMMISSIONER OF INCOME - TAX, V.K.S. UNIVERSITY VS. TDS CIRCLE, PATNA. AR RAH . APPELLANT. RESPONDENT. I.T.A. NOS. 2 6 & 2 7 /PAT/2014. ASSESSMENT YEARS : 2008 - 09 & 2009 - 10. THE PRINCIPAL, ASSTT. COMMISSIONER OF INCOME - TAX, M.M. MAHILA COLLEGE, VS. TDS CIRCLE, PATNA. AR RAH . APPELLANT. RESPONDENT. APPELLANT BY : SHRI SHALIN KUMAR. RESPONDENT BY : SHRI R.K. MISHRA. DATE OF HEARING : 05 - 08 - 2016 DATE OF PRONOUNCEMENT : 20 TH SEPT., 2016 O R D E R THESE APPEALS BY THREE ASSESSEES ARE DIRECTED AGAINST THE COMMON ORDER OF CIT(APPEALS) FOR THE CONCERNED ASSESSMENT YEARS. THE COMMON ISSUE RAISED READ AS UNDER : 2 ITA NOS. 22 TO 27/PAT/2014. 1. FOR THAT THE ORDER PASSED BY THE COMMISSIONER OF INCOME TAX, APPEALS [II], PATNA IS DEFECTIVE BOTH IN LAW AND FACTS. 2. FOR THAT TH E LEARNED CIT, APPEAL [II], PATNA HAS ERRED TO TREAT THE ASSESSEE AS ASSESSEE IN DEFAULT U/S 201 FOR NOT DEDUCTING THE TAX ON THE CLAIM OF THE DEDUCTION BY THE EMPLOYEES U/S 80 DD AND 80 U. 3. FOR THAT THE LEARNED CIT, APPEAL [II], PATNA HAS ERRED TO CONSIDER THAT THE SECTION 192 DOES NOT DELEGATE POWER OF ASSESSING OFFICER TO THE ASSESSEE TO ADJUDICATE THE CLAIM OF THE EMPLOYEE RATHER AUHORIZED TO DEDUCT THE TAX ON THE COMPUTATION OF THE ESTIM ATED INCOME. AFTER OBTAINING THE COMPUTATION OF THE ESTIMATED INCOME FROM THE EMPLOYEE THE DEDUCTOR ASSESSEE ACTED UPON THE ADVICE OF HIS LEGAL ADVISOR WITH BONA FIDE BELIEF THAT THE EMPLOYEES CLAIMING DEDUCTION U/S 80 DD AND 80 U MUCH BEFORE THE AMENDED P ROVISION OF THE SAID SECTION W.E.F. 01.04.2004 NEED NOT TO SUBMIT CERTIFICATE FROM THE MEDICAL AUTHORITY. 4. FOR THAT THE LEARNED CIT, APPEAL [II], PATNA HAS ERRED TO CONSIDER THAT THE ADVICE OF THE LEGAL ADVISOR MADE THE ASSESSEE TO BELIEVE THAT THE EMPLOYEE S WHO WERE CLAIMING DEDUCTION U/S 80 DD AND 80 U MUCH BEFORE 01.04.2004 COULD ALSO AVAIL THE BENEFIT OF THE PREAMENDED PROVISIONS OF THE SECTION 80 DD AND 80 U THE ASSESSEE WAS NOT MALA FIDE RATHER A BONA FIDE. AND ANY ACTION OF THE ASSESSEE BASED UPON HIS BONA FIDE BELIEF CANNOT MAKE HIM ASSESSEE IN DEFAULT [ CIT & ANR VS. ITC LTD. (2013) 263 CTR (ALL) 241, CIT & ANR. VS. LA RSEN & TUBRO LTD. (2009) 221 CTR (SC) 620, CIT & ANR VS. ITI LTD. (2009) 221 (SC) 619, CIT VS. NESTLE INDIA LTD. (2000) 159 CTR (DEL) 243, ITO VS. GIIRAT NARMADA VALLIEV FERTILIZERS CO. LTD. (2000) 163 CTR (GUJ) 554, CIT VS. OIL AND NATURAL GAS CORPORATION LTD. (2000) 164 (GUJ) 129]. 5. FOR THAT THE LEARNED CIT, APPEAL [II], PATNA HAS ERRED TO CONSIDER THAT IT IS A SETTLED RULE OF CONSTRUCTION THAT EVERY STATUE IS PRIMA FACIE PROSPECTIVE UNLESS IT IS EXPRESSLY OR BY NECESSARY IMPLICATION MADE TO HAVE RETROSPECTIVE OPERATION . ANY AMENDMENT WHICH HAS NOT BEEN GIVEN RETROSPECTIVE EFFECT BY THE LEGISLATURE CANNOT BE CONSTRUED AS RETROSPECTIVE [BHARATI SHIPYARD LTD. VS. DEPUTY COMMISSIONER OF INCOME TAX, ITAT MUMBAI B SPECIAL BENCH, (2011) 141 TTJ (MUMBAI) (SB) 129, POLICY NETWORK (P) LTD. VS. ITO, (2012) 146 TTJ (DEL) 464, CIT VS. POOS HYA EXPORT (P) LTD. VS. DEPUTY CIT (2009) 120 TTJ (DEL) (SB) 577, KOTAK MAHINDRA CAPITAL CO. LTD. VS. ACIT (2012) 148 TTJ (MUMBAI) (SB) 393]. 3 ITA NOS. 22 TO 27/PAT/2014. 6. FOR THAT THE LEARNED CIT, APPEAL [II], PATNA HAS ERRED TO CONSIDER THAT THE SUBSTITUTED PROVISIONS OF THE SECTION 80 DD AND 80 U NEVER INTENDS TO PRODUCE THE COPY OF THE CERTIFICATE ISSUED BY THE MEDICAL AUTHORITY FROM THOSE EMPLOYEES TOO WHO HAVE ALREADY BEEN CLAIMED DEDUCTION U/S 80DD AND 80U MUCH BEFORE 01.04.2004. THIS VERY INTENTION OF THE NEWLY SUBSTITUTED PROVI SION IS VERY MUCH CLEAR FROM THE ABSENCE OF ANY SUCH CLAUSE OF ASKING FOR THE CERTIFICATE ISSUED BY THE MEDICAL AUTHORITY. IF THE INTENTION OF THE LEGISLATURE WAS TO ASK FOR THE CERTIFICATE ISSUED BY THE MEDICAL AUTHORITY FROM THOSE ASSESSEE TOO WHO HAVE A LREADY BEEN CLAIMING DEDUCTION U/S 80DD AND 80U MUCH BEFORE THE EFFECTIVE DATE OF THE NEW SUBSTITUTION I.E. 01.04.2004 IT WOULD HAVE BEEN MENTIONED IN THE SUBSTITUTED PROVISION. 7. FOR THAT THE LEARNED CIT, APPEAL [II], PATNA TALKS ON THE INTENTION OF THE LEG ISLATURE BUT HE HIMSELF FAILED TO CONSIDER THAT THE INTENTION OF THE LEGISLATURE IS CLEARLY EXPRESSED THROUGH THE LANGUAGE OF THE PROVISIONS OF THE SECTION AND NO WHERE THE LANGUAGE OF THE SUBSTITUTED SECTION OF 80DD AND 80U EVER EXPRESS ITS INTENTION TO ENACT ITSELF WITH RETROSPECTIVE EFFECT. THE LEARNED CIT FAILED ALSO TO CONSIDER THAT THE SENTENCE STRUCTURE OF THE SAID SECTIONS ARE IN PRESENT TENSE. 8. FOR THAT THE LEARNED CIT, APPEAL [II], PATNA FURTHER FAILED TO GO THROUGH THE REPORT OF THE TASK FORCE ON DIRECT TAXES [ KELKAR COMMITTEE] SUBMITTED TO THE GOVERNMENT ON 27.1.2002 WHICH CLEARLY EXPRESSED ITS INTENTION TO CONTINUE THE BENEFIT UNDER SECTION 80DD AND 80U, THE LEARNED CIT AGAIN ERRED NOT TO CONSIDER THE BUDGET SPEECH FOR THE BUDGET 2003 - 04 BY THE MINISTER OF FINANCE AND THE FINANCE BILL 2003 WHICH MOVES FURTHER WITH THE RECOMMENDATIONS OF THE TASK FORCE BY WIDENING THE SCOPE OF SECTION 80DD AND 80U ON THE FUNDAMENTAL PRINCIPLE OF EQUAL OPPORTUNITIES, PROTECTION OF RIGHTS AND ALL ROUND DEVELOPMENT OF PERSONS WITH DISABILITY. THE LEARNED CIT AGAIN FAILED TO CONSIDER THAT PRE AMENDED 80DD AND 80U PROVIDED BENEFIT ONLY TO THE PERSONS WITH PERMANENT DISABILITY WHILE THE POST AMENDED 80DD AND 80U, AFTER GOING BY THE INTENTIONS OF THE TGASK FORCE, BUDGET SPEECH OF THE MINISTER OF FINANCE AND THE FINANCE BILL 2003, BEGAN TO PROVIDE BENEFIT NOT ONLY TO THE PERSONS WITH PERMANENT DISABILITY BUT ALSO TO THE PERSONS WITH TEMPORARY DISABILITY. THE LEARNED CIT FAILED TO CONSIDER THAT THE AMENDMENT IN SECTI ON 80DD 4 ITA NOS. 22 TO 27/PAT/2014. AND 80U WAS NOTHING BUT AN EXERCISE IN WIDEN THE BENEFIT OF THE SAID SECTIONS. 9. FOR THAT THE LEARNED CIT, APPEAL [II], PATNA HAS ERRED TO CONSIDER THAT E - FILING OR PAPER FILING OF QUARTERLY RETURN IN FORM 24 Q WAS NOTHING BUT MODE OF FILING WHILE TH E JUDGMENT OF HONOURABLE PATNA HIGH COURT WAS MEANT FOR THE DUTY OF FILING RETURN AND PERFORMING THAT DUTY OF FILING RETURN THE HONOURABLE PATNA HIGH COURT HELD THAT RETURN FILED THROUGH UPC IS A VALID RETURN [ CIT VS. KALYANI SELECTION KARGALLIA COLLIERY (1984) 146 ITR 577 (PAT) 1. FOR PATNA HIGH COURT FILING OF RETURN WAS MORE IMPORTANT. THE LEARNED CIT FAILED TO CONSIDER THAT THE RETURN SENT THROUGH UPC WAS ALSO MEANT TO FILE RETURN ELECTRONICALLY AND NOT MANUALLY. THE SAID UPC WAS ADDRESSED TO NSDL AND NOT TO THE LOCAL OFFICE OF INCOME TAX. 2. IN ALL THESE CASES, SURVEY WAS CONDUCTED U/S 133A OF THE ACT. COMMON OBSERVATION OF THE AO IN THE CASE OF THE ASSESSEES IN ORDER U/S 201(1)(1A) IS AS UNDER : ON EXAMINATION OF TDS CERTIFICATE IN FORM NO. 16 ISSUED FOR THE A.Y. 2008 - 09 , IT WAS FOUND THAT THE DEDUCTION U/S 80DD, 80F & 80U WERE WRONGLY ALLOWED BY THE D.D.O. SO FAR AS DEDUCTION U/S 80DD & 80U ARE CONCERNED, COPY OF MEDICAL CERTIFICATES WERE NOT FOUND IN THE PRESCRIBED FORM. MOST OF THE PERSONS CL AIMED SUCH DEDUCTION WERE RECEIVING IT ON THE CONSULTANT SHEET OF THE DOCTOR. ON THE OTHER HAND, THE CLAIM OF DEDUCTION U/S 80G BY EMPLOYEES ARE ALSO NOT ACCEPTABLE AS THE DONATIONS WERE NOT MADE TO THE TRUST/INSTITUTION AS SPECIFIED IN SECTION 80G OF THE INCOME - TAX ACT, 1961. HENCE, THE ABOVE DEDUCTION SHOULD HAVE NOT BEEN ALLOWED BY THE DDO WHILE COMPUTING TDS ON THE EMPLOYEES. IN VIEW OF THE ABOVE STATED FACTS, THERE ARE SHORT DEDUCTION OF TAX HAS BEEN MADE IN THE CASE OF SOME EMPLOYEES. THEREAFTER THE AO MADE THE CALCULATION AND COMPUTED THE AMOUNT OF SHORT DEDUCTION AND INTEREST U/S 201(1A). 3. UPON ASSESSEES APPEAL, LEARNED CIT(APPEALS) CONSIDERED THE SUBMISSIONS AND HELD AS UNDER : 5 ITA NOS. 22 TO 27/PAT/2014. 3.1 I HAVE CONSIDERED THE FACTS OF THE CASE. FOR REFERENCE, SECTION 80U AS IT EXISTED BEFORE AMENDMENT W.E . . 01 . 04.2004 IS REPRODUCED AS UNDER. - DEDUCTION IN THE CASE OF PERMANENT PHYSICAL DISABILITY (INCLUDING BLINDNESS). 80U. IN COMPUTING THE TOTAL INCOME OF AN INDIVIDUAL, BEING A RESIDENT , WHO, AT THE END OF THE PREVIOUS YEAR, IS SUFFERINGFROM A PERMANENT PHYSICAL DISABILITY (INCLUDING BLINDNESS) OR IS SUBJECT TO MENTAL RETARDATION, BEING A PERMANENT PHYSICAL DISABILITY OR MENTAL RETARDATION SPECIFIED IN THE RULES MADE IN THIS BEHALF BY T HE BOARD, WHICH IS CERTIFIED BY A PHYSICIAN, A SURGEON , AN OCULIST OR . A PSYCHIATRIST, AS THE CASE MAY BE, WORKING IN A GOVERNMENT HOSPITAL, AND WHICH HAS THE EFFECT OF REDUCING CONSIDERABLY SUCH INDIVIDUAL ' S CAPACITY FOR NORMAL WORK OR ENGAGING IN A GAI NFUL EMPLOYMENT OR OCCUPATION, THERE SHALL BE ALLOWED - A DEDUCTION OF A SUM OF {FORTY J THOUSAND RUPEES: PROVIDED THAT SUCH INDIVIDUAL PRODUCES THE AFORESAID CERTIFICATE BEFORE - THE ASSESSING OFFICER IN RESPECT OF THE FIRST ASSESSMENT YEAR FOR WHICH HE C LAIMS DEDUCTION UNDER THIS SECTION: . PROVIDED FURTHER THAT THE REQUIREMENT OF PRODUCING THE AFORESAID CERTIFICATE FROM A PHYSICIAN , A SURGEON , AN OCULIST OR A PSYCHIATRIST , AS THE CASE MAY BE , WORKING IN A GOVERNMENT HOSPITAL SHALL . ' NOT APPLY TO AN INDIVIDUAL WHO HAS ALREADY PRODUCED A CERTIFICATE BEFORE THE ASSESSING OFFICER UNDER THE PROVISIONS OF THIS SECTION AS THEY STOOD IMMEDIATELY BEFORE THE 1ST DAY OF APRIL, 1992. EXPLANATION . - F O R TH E PURPO S E S OF THI S SECTION . THE E X PRESSION ' GO V ERNMENT HOSPITAL ' SHALL ' H AV E THE MEANIN G A S SI G NED TO IT IN THE EXPLANATION TO SECTION 80DD . ] 3. : 2 THE AI R OF THE APPELLANTS HAS RE LIED HEAVILY ON THE DE CISION OF THE HIGH COURT OF GUJARAT IN THE CASE OF SNEHLATA CHANDRAKANT CHALISHAZAR V. THANVI REPORTED IN [ : 200 0] 108 TAXMAN 171. F OR REF ERENCE, THE CATCH NOTE OF THE SAME IS BEING REPRODUCED HEREUNDER: SECTION 80U OF THE I NCOME - TAX A C T 1961 DEDUCTIONS - - TOTALLY B LIND OR P H YS ICALLY H AN DI CAPPE D PERSONS - ASSESSMENT YEARS 1991 - 92 TO 1995 - 96 - WH ET H ER A SURGEON REN DERI NG HONORARY SERVICE AT A GOVERNMENT HOSPITAL IS AS MUCH A SURGEON WORKING ON REGULAR BASIS IN A GOVERNMENT HOSPITAL UNDER RE G ULAR RULES OF EM P LO Y MENT AND. THEREFORE. CERTIFICATE GIVEN BY HIM COU LD NOT DE REJEC TE D MERELY B ECAUSE H E WAS WOR KI NG AS AN H ONORARY SURGEON AN D NOT AS A PAID EMPLOYEE - HELD, YES - WHETHER ASSESSING OFFICER IS NOT EMPOWERED WITH AUTHORITY TO ADJ UDICATE U P ON CORRECTNESS OF CERTIFICATE OF DOCTOR IF CERTIFICATE IS FOUND G ENUINE AND COMIN G FROM SOURCE REQU I RE D UN DER STATUTE - HELD , YES - W H ET H ER, WHERE GENUINENESS O F CER TIFI CATE WAS NOT IN DOUBT INASMUCH AS ON VERY SAME CERTIFICATE DEDUCTION UNDER SECTION 80U HAD BEEN ALLOWED FOR SUBSE Q UENT YEARS. COMMISSIONER WAS NOT J USTI F IED IN RE J ECTIN G CERTIFICATE FOR Y EARS CONCERNE D - HELD , YES 6 ITA NOS. 22 TO 27/PAT/2014. 3.3 THE AIR POINTED OUT THAT IT IS MENTIONED IN THE LAST PARA OF THIS JUDGMENT THAT CERTIFICATE ONCE OBTAINED BY THE ASSESSEE ENURED FOR ALL SUBSEQUENT YEARS . AS CAN BE SEEN FROM THE ABOVE PROVISIONS OF SECTION 80U, IT IS CLEARLY MENTIONED IN THE SECTION ITSELF AS IT EXISTED PRIOR TO AMENDMENT BY FINANCE ACT, : 2003 THAT THE REQUIREMENT OF PRODUCING THE AFORESAID CERTIFICATE SHALL NOT APPLY TO AN INDIVIDUAL WHO HAS ALREADY PRODUCED A CERTIFICATE BEFORE THE AO UNDER THE PROVISIONS OF THIS SECTION AS THEY STOOD IMMEDI ATELY BEFORE THE FIRST DAY OF APRIL, 1992. THE ABOVE CASE PERTAINS TO A. Y. 1991 - 92 T O 95 - 96. ALTER THE AMENDMENT BY THE FINANCE ACT, 2003 W . E.T. 01 . 04.2004, THE SECTION 80U READS AS UNDER: - 7 ITA NOS. 22 TO 27/PAT/2014. 80U .( 1} IN CO MP U TIN G THE TOTAL INCOME OF J AN INDIVIDUAL I , B E IN G A RE SIDE NT, W H O , A T ANY TIME D U RING THE PREVIOUS YEAR , IS CERT I FIED BY THE MEDICAL AUTHORIT Y TO BE A PERSON WITH DISABILIT Y , THERE SHALL BE ALLOW ED A DED UCT I ON O F A SUM O F FIFTY T H OUSAN D RUPEES : PROVIDED THAT WHERE SUCH INDIVIDUAL IS A PERSON WITH SEVERE DISABILIT Y , THE PROVISIONS OF THIS SUB - SECTI ON SHALL HAVE EF F ECT AS IF FOR THE WORDS ' FIFTY THOUSAND RU P EES'. THE WORDS ' SEVENT Y - F IV E T H OUSAN D RUPEES HAD BEEN S UBST I TUTE D . (2) EVERY INDIVIDUAL CLAIMING A DEDUCTION UNDER THIS SECTION SHALL FURNISH A COPY OF THE CERTIFICATE I SSUE D B Y ME DICAL AUT H O RI TY IN THE FORM AN D MANNER , AS MAY BE PRESC RIBED , A L ONG WITH THE RETURN OF INCOME UNDER SECTION 139 , IN RESPECT OF ( T HE ASSESSMENT YEAR FOR WHICH THE DEDUCTION IS CLAIMED: PROV IDED TH AT WHERE THE CON DIT ION O F DISABILITY REQUIRES REASSESSMENT O F ITS EXTENT A F TER A PE RIOD STIPULATED IN THE AFORESAID CERTIFICATE , NO DEDUCTION UNDER THIS SECTION SHALL BE ALLOWED FOR ANY ASSESSMENT YEAR RE LATING TO ANY PREVIOUS YEAR BEGINNING AFTER THE EXP IRY O F THE PREVIOUS YEAR DURING WHICH THE AFORESAID CERTIFICATE OF DISABILITY HAD EXPIRED, UNLESS A NEW CERTIFICATE IS OBTAINED F R OM THE MEDICAL AUTHORITY IN THE FORM AND MANNER , AS MAY BE PRESCRIBED, AND A COP Y T HEREOF IS FURNISHED ALONG W ITH THE RETURN OF INCOME U NDER SECT I O N 139. . EXPLANATION. - FOR THE PURPOSES OF THIS SECTION , - (A) DISABILITY : SHALL HAVE THE MEA NI NG ASSIGNE D TO IT T IN CLAUSE ( 1) O SECTION 2 OF THE PERSONS WITH DISABILITIES (EQUAL OPPORTUNITIES , PROTECTION OF RIGHTS AND FULL PARTICIPATION) ACT , 1995 (1 OF 1996); (B) MEDICAL AUTHORITY MEANS THE ME DICAL AUT H ORIT Y AS RE FERRED TO IN C LA USE ( P) OF SECTION 2 OF THE PERSONS WITH DISABILITIES (EQUAL OPPORTUNITIES , PROTECTION OF RIGHTS AND FULL PARTICIPATION) ACT , 1995 (1 OF 1996) . ( C) ' PERSON WITH DISABILITY ' MEANS A PERSON REFERRED TO IN CLAUSE (T) OF SECTION 2 OF THE PERSONS WITH DISABILITIES (EQUAL OPPORTUNITIES, PROTECTION OF RIGHTS AND FULL PARTICIN A TIONT A C T . 1995 (J OF 1996> . ' ( D ) ' PERSON W T ITH S EVERE DISABILITY MEANS A PERSON W ITH EIG H TY PER CENT OR MORE O F ONE OR MORE DISABILITIES , AS REFERRED TO IN SUB - SECTION (4) OF SECTION 56 OF THE PERSONS WITH DISABILITIES ( E QUAL OPPORTUNITIES , PROTECTION OF RIGHTS AND FULL PARTICIPATION) ACT , 1995 (1 OF 1996 ) . 3 . 4 THUS, IT CAN BE SEEN THAT THE OLD SECTION HAS BEEN REMOVED ALTOGETHER AN D H AS BEEN SU B S TI TUTE D BY A NEW SECTION. IT IS NOT A MERE AMEN D MENT AT EXISTING SECTION BUT ALTOGETHER SUBSTITUTION OF THE OLD SECTION BY THE NEW SECTION. . THEREFORE , EXCEPT T H E NUMBER 800 , NOTHING 0 F T H E O LD SECTION HAS REMAINED. SAME IS THE CASE WITH SECTION 80DD. BY NO STRETCH OF IMAGINATION, IT CAN BE ACCEPTED THAT CERTIFICATE OBTAINED UNDER THE OLD SECTION WILL STILL ENTITLE A PERSON TO CLAIM DEDUCTION UNDER THE NEW SECTION . FROM THE SUB - SECTION (2) AS ABOVE, IT IS CLEAR THAT FOR CLAIMING A DEDUCTION UNDER THIS SECTION, A COPY OF CERTIFICATE ISSUED BY THE MEDICAL AUTHORITY IS REQUIRED TO BE FURNISHED ALONG . 8 ITA NOS. 22 TO 27/PAT/2014. WITH THE RETURN OF INCOME IN RESPECT OF THE ASSESSMENT YEAR F OR W HICH T H E DEDUCTION IS CLAIMED. AS PER PROVISO TO THIS SUB - SECTION, RE - ASSESSMENT : OR SUCH CERTIFICATE ISSUED BY SUCH MEDICAL AUTHORITY IS REQUIRED TO BE DONE IF SO PRESCRIBED IN SUCH CERTIFICATE AFTER THE PERIOD SPEC IFIED. AS PER T H E EX PLANATORY NOTES TO THE FINANCE ACT, 2003 ALSO, SUCH CERTIFICATE IS REQUIRED TO BE PRODUCED ALONG WITH THE RETURN OF INCOME. THE RELEVANT PART IS BEING REPRO DUCED AS UNDER: - 41.3 FOR CLAIMING THE DEDUCTION, THE ASSESSEE IS REQUIRED TO FURNISH A COPY OF THE CERT IFICATE ISSUED BY THE MEDICAL AUTHORITY UNDER THE PERSONS WITH DISABILITY (EQUAL OPPORTUNITIES, PROTECTION OF RIGHTS AND FULL PARTICIPATION) ACT, 1995 ALONG W ITH TH E RETURN OR INCOME FILED UNDER SECTION 139(1) . WHERE THE CONDITION OF DISABILITY REQUIRES RE ASSESSMENT, A FRESH CERTIFICATE FROM THE MEDICAL AUTHORITY SHALL HAVE TO BE OBTAINED A F TER T H E EXP IRY OF THE PERIOD MENTIONED ON THE ORIGINAL CERTIFICATE IN ORDER TO CONTINUE CLAIMING THE DEDUCTION. 3.5 THEREFORE, I AM OF THE CONSIDERED OPI NION THAT THE. PROVISIONS O F T H E SECTIONS 80 DD AS 80U AS THEY EXIST AFTER 01 . 04.2004 ARE REQUIRED TO BE FOLLOWED FOR CLAIMING DEDUCTION UNDER THESE SECTIONS W.E.R. ASSESSMENT YEAR 2004 - 05 AND THEREAFTER, I.E. A CERTIFICATE OF DISABILITY IS REQUIRED TO BE TAKEN FROM THE PRESCRIBED MEDICAL AUTHORITY. IT THE INTENTION O F THE L EGIS L A T URE WAS TO CONTINUE ALLOWING DEDUCTION TO THOSE ASSESSEES ALREADY CLAIMING IT ON THE BASIS OF THE OLD CERTIFICATES, IT WOULD HAVE BEEN SO MENTIONED AS IT WAS MEN TIONED IN SECTION 80U A S ABOVE WHEN IT WAS AMENDED W.E.F. 01 . 04.1992. AS FAR AS REFERENCE TO RE - ASSESSMENT OF DISABILITY IS CONCERNED, THE RELEVANT PROVISO IS PART OF SUB - SECTION (2) OF SECTION 8000 W.E.F . 01 . 04.2004 AND SUCH RE - ASSESSMENT IS IN RESPECT OF CERTIFICATE ISSUED BY THE MEDICAL AUT HORITY AS ABOVE AND REFERENCE OF THE AIR TO IMPLY THAT THE SAME REFERS TO RE - ASSESSMENT OF CERTIFICATE ISSUED UNDER THE OLD PROV I SIO NS IS INCORRECT. ANOTHER CLAIM OF T H E AIR IS THAT ONCE ANY BENEFIT IS ALLOWED BY THE ACT, IT SHOULD CONTINUE IN ALL ASSESSMENT YEARS. NEEDLESS TO SAY THAT SUCH ARGUMENT. H AS B EEN MA D E O NLY TO BE REJECTED. THE PARLIAMENT IN ITS OWN WISDOM, INTRODUCES FROM TIME TO TIME VA RI OUS EXEMPT I ONS AND DEDUCTI ONS AND SOME EXISTING EXEMPTIONS AND DEDUC TIONS ARE W ITHDRAWN . FOR EXAMPLE, W.E. F . 01.04.1997 , SECTION 80 CCC WAS - - - _ .. .. - ._ . -- INSERTED WHICH PROVIDED FOR A DEDUCTION OF RS. 10,000/ - OVER AND ABOVE I DEDUCTI O N ALLOWABLE UNDER SECTION 80 C IN RESPECT OR PENSION PLANS UN D ERTA K EN. HOWEVER, LATER ON, THIS DEDUCTION WAS WITHDRAWN OR MERGED IN THE OVERALL DEDUC TI ON A LLOWABLE UNDER SECTION 80D. THEREFORE, IF AN ASSESSEE H AS TAKEN A PENSION PLAN FOR 25 YEARS IN ASSESSMENT YEAR 1997 - 98, HE CANNOT CLAI M THAT A DEDUCTION OF RS. 10,00 O / - OVER AND ABOVE DEDUCTI O N CLAIMABLE UNDER SECTION 80C OF THE INCOME TAX ACT, 1961 SHOULD BE ALLOWED FOR ALL THE NEXT 25 YEARS. THE RE ARE SEVERAL OTHER EXAMPLES WH ERE DEDUCTION A LLOWABLE UNDER VA RI OUS SECTIONS HAS BEEN WI THDRAWN AND NEW DEDUCTIONS HAVE BEEN INTRODUCED. E.G. DEDUCTION UNDER SECTION 80L W HICH REMAINED IN FORCE FOR A L ONG TIME WAS WITHDRAWN AND AFTER SEVERAL YEARS, A NEW SECTION 80TTA HAS BEEN INTRODUCED. THEREFORE , I AM OF T H E CONSIDERED OPI NI ON T H AT THE RESPECT I VE DDOS FELL IN ERROR IN ALLOWING DEDUCTIONS 9 ITA NOS. 22 TO 27/PAT/2014. UNDER SECTION 80DD AND 80U FOR ASSESSMENT YEAR 2004 - 05 AND LATER ASSESSMENT YEARS ON THE BASIS OF OLD CERT IFICATES . ACCOR DINGLY , THE ACTION OF T HE AO IN THIS REGARD IS UPHELD. 4. AGAINST THE ABOVE OR DER, THE ASSESSEE IS IN APPEAL BEFORE THE ITAT. 5. I HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. LEARNED COUNSEL OF THE ASSESSEE HAS GIVEN THE FOLLOWING SUBMISSIONS. 1. FOR THAT THE ORDER PASSED BY THE COMMISSIONER OF INCOME TAX APPEAL [II], PATNA IS DEFECTIVE BOTH IN LAW AND FACTS. 2. FOR THAT THE LEARNED CIT APPEAL[II], PATNA HAS ERRED IN TREAING THE ASSESSEE AS ASSESSEE IN DEFAULT U/S 201 FOR NOT DEDUCTING THE TAX ON THE CLAIM OF THE DEDUCTION BY THE EMPLOYEES U/S 80DD AND 80U. 3. FOR THA T SECTION 192 STATES (1) ANY PERSON RESPONSIBLE FOR PAYING ANY INCOME CHARGEABLE UNDER THE HEAD SALARIES SHALL, AT THE TIME OF PAYMENT, DEDUCT INCOME - TAX ON TH E AMOUNT PAYABLE AT THE AVERAGE RATE OF INCOME - TAX COMPUTED ON THE BASIS OF THE RATES IN FOR CE FOR THE FINANCIAL YEAR IN WHICH THE PAYMENT IS MADE ON THE ESTIMATED INCOME OF THE ASSESSEE UNDER HIS HEAD FOR THAT FINANCIAL YEAR. 4. FOR THAT THE SIMPLE AND PLAIN READING OF THE SECTION 192 MAKES IT CRYSTAL CLEAR THAT IT DOES NOT DELEGATE POWER OF ASSESSING OFFICER TO THE ASSESSEE TO ASSESS OR ADJUDICATE THE CLAIM OF THE EMPLOYEE OR TO SIT IN THE JUDGMENT WHICH CAN BE DONE ONLY BY THE ASSESSING OFFICER. RATHER THE ACT GIVES RESPONSIBILITY TO DEDUCT THE TAX ON THE COMPUTATION OF THE ESTIMATED INCOME. 5. FOR THAT TO DEDUCT THE TAX THE DE D UTROR ASSESSEE ASKS FOR THE COMPUTATION OF THE ESTIMATED INCOME FROM THE EMPLOYEE UNDER DECLARATION. BY USING THE CLAUSE INCOME - TAX COMPUTED THE SECTION PUTS ONUS NOT ON THE EMPLOYER BUT ON HE EMPLOYEE TO COMPUTE T AX ON HIS ESTIMAT ED INCOME AND SUBMIT IT TO HIS/HER EMPLOYER. IN SUCH A SITUATION OF THE SELF DECLARATION OF COMPUTATION OF THE ESTIMATED INCOME FROM THE EMPLOYEE THE EMPLOYER WILL NATURALLY BELIEVE THE DECLARATION OF HIS EMPLOYEE. EVEN ACT DOES NOT AUT HORIZE 10 ITA NOS. 22 TO 27/PAT/2014. HIM TO DISBELIEVE HIS EMPLOYEES. HIS SATISFACTION COMES FROM HIS BONA FIDE BELIEF UPON THE GENUINENESS OF THE DECLARATION OF HIS EMPLOYEE. BUT IN THE PRESENT CASE THE ASSESSEE FOR HIS SATISFACTION AND IN ORDER TO PERFORM HIS DUTY AS A DRAWING AND D ISBURSING OFFICER HE ASKED FOR THE ADVICE FROM HIS LE G AL ADVISOR. WHEN THE LEGAL ADVISOR SUBMITTED HIS ADVICE TO THE ASSESSEE HE ACTED WITH HIS BONA FIDE BELIEF THAT THE EMPLOYEES CLAIMING THE DEDUCTION U/S 80DD AND 80U MUCH MORE BEFORE THE AMENDMENT TOOK PLACE I.E. 01.04.2004 NEED NOT TO SUBMIT CERTIFICATE FROM THE MEDICAL AUTHORITY. AS PER LEGAL ADVICE ALL THE EMPLOYEE WHO HAVE BEEN CLAIMING DEDUCTION U/S 80DD AND 80U BEFORE 01.04.2004 NEED NOT TO SUBMIT CERTIFICATE FROM THE MEDIAL AUTHORITY BUT THOSE EMPLOYEE WHO ARE CLAIMING DEDUCTION U/S 80DD AND 80U AF TER 01.04.2004 OR WHO ARE GOING TO CLAIM FOR THE FIRST TIME AFTER 01.04.2004 NEED TO SUBMIT THE CERTIFICATE FROM THE MEDICAL AUTHORITY, ACCORDING TO THE ADVICE. IN OTHER WORDS, THE ASSESSEES SATISFACTION COMES FROM HIS BONA FIDE BELIEF BASED ON THE ADVI CE OF HIS LEGAL ADVISOR. THE LEGAL ADVISOR NOT GIVES HIS LEGAL OPINION BUT ALSO PROVIDE THE DECLARATION FORM BASED ON HIS ADVICE. 6. FOR THAT THE LEARNED CIT(APPEALS) HAS FAILED TO UNDERSTAND IT IS THE ADVICE OF THE LEGAL ADVISOR THAT MADE THE ASSESSEE T O BELIEVE THAT EMPLOYEES WHO WERE CLAIMING DEDUCTION U/S 80DD AND 80U MUCH BEFORE 01.04.2004 COULD ALSO AVAIL THE BENEFIT OF THE PRE AMENDED PROVISIONS OF THE SECTIONS 80DD AND 80U. THE CONDUCT OF THE ASSESSEE BASED UPON HIS BONA FIDE BELIEF CANNOT MAKE HIM ASSESSEE IN DEFAULT [ CIT & ANR VS. ITC LTD. (2013) 263 CTR (ALL) 241, CIT & ANR. VS. LARSEN & TUBRO LTD. (2009) 221 CTR (SC) 620, CIT & ANR VS. ITI LTD. (2009) 221 (SC) 619, CIT VS. NESTLE INDIA LTD. (2000) 159 CTR (DEL) 243, ITO VS. GIIRAT NARMADA V ALLIEV FERTILIZERS CO. LTD. (2000) 163 CTR (GUJ) 554, CIT VS. OIL AND NATURAL GAS CORPORATION LTD. (2000) 164 (GUJ) 129]. 7. FOR THAT THE LEARNED CIT(APPEALS) HAS ERRED TO CONSIDER THAT THE CLAIM OF THE DEDUCTION BY THE EMPLOYEES U/S 80DD AND 80U , NOT ON T HE CERTIFICATE ISSUED BY THE MEDICAL AUTHORITY IN THE PRESCRIBED FORM RATHER ON TH 11 ITA NOS. 22 TO 27/PAT/2014. SAME CERTIFICATE ISSUED BY A DOCTOR WORKING IN GOVERNMENT HOSPITAL HAVE REGULARLY BEEN ALLOWED BY THE AO [TDS] EVEN AFTER THE EFFECTIVE DATE OF THE AMENDMENT IN THE PROVISIO NS OF SECTION 80DD AND 80U I.E. 01 - 04 - 2004 AND NEVER RAISED THE OBJECTION OVER IT. IN THAT SENSE THE ASSESSING OFFICER [TDS] HAS ACCEPTED THAT CERTIFICATES HAVE COME FROM THE SOURCE REQUIRED UNDER THE PROVISIONS OF BOTH THE SECTIONS OF THE INCOME TAX ACT, 1961. 8. THAT THE LEARNED CIT(APPEALS) FAILD TO GO THROUGH THE RIGHT TEXTURE AND TONE OF THE SECTION 80DD AND 80U. THE LEARNED CIT(APPEALS) HAS ERRD IN CONSIDERING THE FACT THAT THE NEW PROVISIONS OF THE SECTION 80DD AND 80U THAT ASK FROM THE ASSESSEE TO PRODUCE THE COPY OF THE CERTIFICATE ISSUED BY THE MEDICAL AUTHORITY IN PRESCRIBED FORM AND MANNER WITH EFFECT FROM 01 - 04 - 2004. IT CLEARLY MEANS THA T IF AN EMPLOYEE IS CLAIMING THE DEDUCTION U/S 80DD OR 80U FOR THE FIRST TIME AFTER 01 - 04 - 2004 HE/SHE HAS T O FURNISH THE COPY BOF THE CERTIFICATE ISSUED BY THE MEDICAL AUTHORITY. BUT THE SUBSTITUTED PROVISION NEVER INTENDS TO PRODUCE THE COPY OF THE CERTIFICATE ISSUED BY THE MEDICAL AUTHORITY FROM THOSE EMPLOYEE TOO WHO HAVE ALREADY BEEN CLAIMING DEDUCTION U/ S 80DD AND 80U MUCH BEFORE 01 - 04 - 2004. THIS VERY INTENTION OF THE NEWLY SUBSTITUTED PROVISION IS VERY MUCH CLEAR FROM THE ABSENCE OF ANY SUCH CLAUSE OF ASKING FOR THE CERTIFICATE ISSUED BY THE MEDICAL AUTHORITY. IT IS WORTHWHILE TO MENTION THAT CHANGE IN T HE PROVISIONS OF THE ACT DOES NEVER MEAN THE OMISSION OF THE BENEFI T S PROVIDED BY THE OLD PROVISIONS. THE PROVISION EXISTED AT THE TIME OF THE FIRST CLAIM OF THE DEDUCTION WILL ENUE FOR THE CONSECUTIVE YEARS [ SNEHLATA CHANDRAKANT VS. MS. THANVI OR HIS S UCCESSOR [ GUJ. 1 ITR VOL 242 [2000] P. 293]. 9. FOR THAT THE LEARNED CIT(APPEALS) HAS ERRED IN NOT CONSIDERING THE ORDER OF THE APEX COURT IN THE CASE OF ZILE SINGH VS. STATE OF HARYANA & ORS. 2004 [8] SSC 1 - IT IS SETTLED RULE OF CONSTRUCTION THAT EVERY STATUE IS PRIMA FACIE PROSPECTIVE UNLESS IT IS EXPRESSLY OR BY NECESSARY IMPLICATION MADE TO HAVE 12 ITA NOS. 22 TO 27/PAT/2014. RETROSPECTIVE OPERATION. BUT THE RULE IN GENERAL IS APPLICABLE WHERE THE OBJECT OF THE STATUTE IS TO AFFECT VESTED RIGHTS OR TO IMPOSE NEW BURDENS OR TO IMPOSE EXISTING OBLIGATIONS. UNLESS THERE ARE WORDS IN THE STATUTE SUFFICIENT TO SHOW THE INTENTION OF THE LEGISLATURE TO AFFECT EXISTING RIGHTS, IT IS DEEMED TO BE PROSPECTIVE ONLY.................................. ANY AMENDMENT WHICH HAS NOT BEEN GIVE N RETROSPECTIVE EFFECT BY THE LEGISLATURE CANNOT BE CONSTRUED AS RETROSPECTIVE. 10. FOR THAT MANY MORE JUDGMENTS REITERATED THE SAME INTERPRETATION EXPRESS BY THE APEX COURT MENTIONED IN PARA 7 [BHARATI SHIPYARD LTD. VS. DEPUTY COMMISSIONER OF INCOME TAX , ITAT MUMBAI B SPECIAL BENCH, (2011) 141 TTJ (MUMBAI) (SB) 129, POLICY NETWORK (P) LTD. VS. ITO, (2012) 146 TTJ (DEL) 464, CIT VS. POOSHYA EXPORT (P) LTD. VS. DEPUTY CIT (2009) 120 TTJ (DEL) (SB) 577, KOTAK MAHINDRA CAPITAL CO. LTD. VS. ACIT (2012) 148 TTJ (MUMBAI) (SB) 393]. 11.FOR THAT LEARNED CIT(APPEALS) HAS FAILED TO CONSIDER THAT THE SUBSTITUTED PROVISIONS OF THE SECTION 80DD AND 80U NEVER INTENDS TO PRODUCE THE COPY OF THE CERTIFICATE ISSUED BY THE MEDICAL AUTHORITY FROM THOSE EMPLOYEES TOO WHO HAVE ALREADY BEEN CLAIMING DEDUCTION U/S 80DD AND 80U MUCH BEFORE 01 - 04 - 2004. THIS VERY INTENTION OF THE NEWLY SUBSTITUTED PROVISION IS VERY MUCH CLEAR FROM THE ABSENCE OF ANY SUCH CLAUSE OF ASKING FOR THE CERTIFICATE ISSUED BY THE MEDICAL AUTHORITY FROM THOSE ASSESSEES TOO WHO HAVE ALREADY BEEN CLAIMING DEDUCTION U/S 80DD AND 80U MUCH BEFORE THE EFFECTIVE DATE OF THE NEW SUBSTITUTION I.E. 01 - 04 - 2004 IT WOULD HAVE BEEN MENTIONED IN THE SUBSTITUTED PROVISION. 12. FOR THAT THOUGH THE LEARNED CIT(APPELS) TA LKS OF THE INTENTION OF THE LEGISLATURE BUT HE HIMSELF FAILED TO CONSIDER THAT THE INTENTION OF THE LEGISLATURE IS CLEARLY EXPRESSED THROUGH THE TERMINOLOGY AND LANGUAGE OF THE PROVISIONS OF THE SECTION AND NO WHERE THE LANGUAGE OF THE SUBSTITUTED SECTION OF 80DD AND 80U EVER EXPRESS IS INTENTION TO ENACT ITSELF WITH RETROSPECTIVE 13 ITA NOS. 22 TO 27/PAT/2014. EFFECT. THE LEARNED CIT(APPEALS) FAILED ALSO TO CONSIDER THAT THE SENTENCE STRUCTURE OF THE SAID SECTIONS ARE IN PRESENT TENSE. 13. FOR THAT THE LEARNED CIT(APPEALS) WHILE TALK ING OF THE INTENTION OF THE LEGISLATURE FORGOT TO RECALL THE BUDGER SPEECH 2003 - 04 BY SHRI JASHWAN SINGH, THE HONOURABLE MINISTER OF FINANCE WHEN HE DECLARES THE TRUE INTENTION OF THE LEGISLATURE 32. THE GOVERNMENT IS COMMITTED TO PROVIDING EQUAL OPPO RTUNITIES, PROTECTION OF RIGHTS, AND ALL ROUND DEVELOPMENT OF PERSON WITH DISABILITY. A NUMBER OF INITIATIVES HAVE ALREADY BEEN TAKEN IN THIS REGARD. 33. NOW, FOR INCOME TAX PURPOSE, IT IS PROPOSED THAT THE PHYSICALLY HANDICAPPED OR PERSONS WITH SUCH DEPE NDENTS BE ENTITLED TO BE A DEDUCTION FOR PERMANENT PHYSICAL DISABILITY OF RS.50000 AND AN ENHANCED DEDUCTION OF RS.75000 IN CASE OF SEVERE DISABILITY. 14. FOR THAT THE LEARNED CIT(APPEALS) AGAIN FORGOT THE REASON BEHIND THE WIDENING OF THE SCOPE OF SEC T ION 80DD AND 80U ON THE FUNDAMENTAL PRINCIPLE OF EQUAL OPPORTUNITY, PROTECTION OF RIGHTS, AND ALL ROUND DEVELOPMENT OF PERSON WITH DISABILITY, IN THE FINANCE BILL 2003 I.E. REPORT OF THE TASK FORCE ON THE DIRECT TAX [KELKAR COMMITTEE] WHO SUBMITTED ITS REPORT ON 27 - 12 - 2002. 15. FOR THAT KELKAR COMMITTEE IN I T S REPORT STATED THAT 4.018 GIVEN THE PERSONAL CIRCUMSTANCES OF HANDICAPPED THE TA SK FORCE RECOMMENDS THE CONTINUATION OF THE PERSONAL DEDUCTIONS UNDER SECTION 80DD AND 80U, HOWEVER, ON GROUND OF EQUITY, WE ALSO RECOMMEND THAT THE INCOME BASED DEDUCTION UNDER THESE PROVISIONS SHOULD BE CONVERTED TO A TAX REBATE.... AND 4.010 THE POLICY MEASURES FOR THE REFORM OF PERSONAL INC OME TAX THEREFORE COMPRISES OF THE FOLLOWING ELEMENTS; 14 ITA NOS. 22 TO 27/PAT/2014. [ A ] ..................................... [1] THE INCOME BASED DEDUCTION FOR HANDICAPPED UNDER SECTION 80DD AND 80U WILL HOWEVER CONTINUE 16. FOR THAT THE LEARNED CIT(APPEALS) WRONGLY JUMP TO THE CONCLUSION THAT THE OLD SECTION HAS BEEN REMOVED ALTOGETHER AND HAS BEEN SUBSTITUTED BY A NEW SECTION IF HE WOULD HAVE BEEN GONE THROUGH KELKAR COMMITTEE BUDGE SPEECH OF THE MINISTER OF FINANCE AND THE FINANCE BILL 2003 HE WOULD NOT HAVE SAID SO. 1 7. FOR THAT THE LEARNED CIT(APPEALS) MISERABLY FAILED TO UNDERSTAND THAT PREAMENDED 80DD AND 80U PROVIDED BENEFIT ONLSY TO THE PERSON WITH PERMANENT DISABILITY WHEREAS AS PER INTENTION OF THE LEGISLATURE THE SECTION 80DD AND 80U HAVE BEEN AMENDED TO WIDENE D UP THE SCOPE FOR PERSON WITH TEMPORARY DISABILITY ALONG WITH THE PERSON WITH PERMANENT DISABILITY. IN OTHER WORDS, HE FAILED TO UNDERSTAND THAT THE OLD AND THE NEW PROVISION WILL GO HAND IN HAND PARALLEL. IN THE ABSENCE OF ANY EXPRESSION OF THE RETROSPEC TIVE EFFECT NEW PROVISION CANNOT NULLIFY BENEFIT OF THE EARLIER PROVISION. 18. FOR HAT THE LEARNED CIT(APPEALS) FORGOT THE CARDINAL RULE WHICH CLEARLY ESTABLISHES THAT THE LAW TO BE APPLID IS THAT WHICH IS IN FORCE ON THE DAY OF THE ASSESSMENT YEA UNLESS SOTHERWISE MANDATED EXPRESSLY OR PROVIDED BY NECESSARY IMPLICATION. THE POST AMENDED SECTION 80DD AND 80U IS EFFECTIVE WITH 01 - 04 - 2004 AND THERE IS NO EXPRESSION FROM THE LEGISLATURE TO ENACT THESE TWO SECTIONS WITH RETROSPECTIVE EFFECT. 19. FOR HAT THE LEARNED CIT(APPEALS) HAS ERRED TO CONSIDER THAT THE CLAIM OF THE DEDUCTION BY HE EMPLOYEES U/S 80DD AND 80U, NOT ON THE SAME CERTIFICATE ISSUED BY THE MEDICAL AUTHORITY IN THE PRESCRIBED FORM FRATHER ON THE SAME CERTIFICATE ISSUED BY A DOCTOR WORKING IN G OVERNMENT HOSPITAL HAVE REGULARLY BEEN ALLOWED BY THE AO EVEN AFTER THE EFFECTIVE DATE OF THE AMENDMENT IN THE PROVISIONS OF SECTION 80DD AND 80U I.E. 01 - 04 - 2004. IN THAT 15 ITA NOS. 22 TO 27/PAT/2014. SENSE THE ASSESSING OFFICER HAS ACCEPTED THAT CERTIFICATES HAVE COME FROM THE SOURCES REQUIRED UNDER THE PROVISIONS OF BOTH THE SECTIONS OF THE INCOME TAX ACT, 1961. 20. FOR THAT THE LEARNED CIT(APPEALS) HAS ERRED WITH THE FACT THAT THE CERTIFICATE ISSUED BY THE DOCTOR WORKING IN THE GOVERNMENT HOSPITAL WAS NO ON THE CONSULTANT SHEET RATHER ON THE LETTER PAD OF THE SAID DOCTOR WITH HIS REGISTRATION NO. AND THE STAMP REGARDING HIS DESIGNATION IN THE GOVERNMENT HOSPITAL. 21. FOR THAT THE LEARNED CIT(APPEALS) HAS ERRED IN CONSIDERING THAT THE CLAIM OF DEDUCTIONS UNDER THE PROVISIONS OF THE DIFFERENT SECTIONS OF THE ACT ARE LIKE AN AGREEMENT BETWEEN THE ASSESSEE AND THE ACT. THE ACT WITH ALL IS DIFFERENT PROVISIONS OFFERS THE ASSESSEE TO PICK UP THE SCHEMES [SUCH AS EXEMPTIONS, DEDUCTIONS, REBATE AND RELIEF ETC.] PROVIDED BY THE ACT JU ST BY SATISFYING AND FULFILLING CERTAIN CRITERIAS OF THAT PARTICULAR SECTION OF THE ACT. ANY AMENDMENT OR CHANGE IN THE TERMS AND CONDITIONS OF THAT PARTICULAR SCHEMES / PROVISIONS CAN NEVER AFFECT THE BENEFITS PROVIDED BY THE OLD TERMS AND CONDITIONS OF THAT PARTICULAR SCHEME. 22. FOR THAT THE LEARNED CIT(APPEALS) HAS FAILED TO UNDERSTAND THAT E - FILING OR PAPER FILING OF QUARTER RETURN IN FORM 24 Q WAS NOTHING BUT MODE OF FILING WHILE THE JUDGMENT OF THE HONOURABLE PATNA HIGH COURT WAS MEANT FOR THE DUTY OF FILING RETURN AND IN PERFORMING THAT DUTY OF FILING RETURN THE HONBLE PATNA HIGH COURT HELD THAT THE POSTING OF A VALID RETURN WITHIN THE TIME PRESCRIBED BY THE ACT UNDER CERTIFICATE OF POSTING WAS SUFFICIENT EVIDENCE OF THE RETURN HAVING BEEN F ILED WITHIN TIME [COMMISSIONER OF INCOME TGAX VS. KALYANI SELECTION KARGALLIA COLLIERY (1984) 146 ITR 577 (PAT) ]. FOR PATNA HIGH COURT THE FILING OF RETURN WAS MORE IMPORTANT. THE LEARNED CIT(APPEALS) FAILED TO CONSIDER THAT THE RETURN SENT THROUGH UPC W AS ALSO MEANT TO FILE RETURN ELECTRONICALLY AND NOT MANUALLY. THE SAID UPC WAS ADDRESSED TO NSDL, ARA AND NOT TO THE LOCAL OFFICE OF INCOME TAX. 16 ITA NOS. 22 TO 27/PAT/2014. IT IS, THEREFORE, PRAYED THAT THE SUBMISSION BE ACCEPTED AND ORDER OF THE CIT(APPEALS) BE QUASHED. 6. PER CONTRA LEARNED D.R. RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. HE REITERATED THAT AFTER THE AMENDMENT IN THE ACT IT WAS INCUMBENT UPON THE ASSESSEE TO INSIST FOR PROPER MEDICAL CERTIFICATE AND THE ASSESSEE HAS ERRED IN ALLOWIN G DEDUCTION WITHOUT OBTAINING THE SAME. 7. I HAVE CAREFULLY CONSIDERED THE SUBMISSIONS AND PERUSED THE RECORDS. I FIND THAT THE SOLE ISSUE TO BE ADJUDICATED HERE IS WHETHER THE ASSESSEE IN THIS CASE CAN BE TREATED TO BE THE ASSESSEE IN DEFAULT U/S 201 (1) FOR NOT DEDUCTING THE TAX ON THE CLAIM OF THE DEDUCTION BY THE EMPLOYEES U/S 80DD AND 80U. REVENUES CONTENTION IS THAT S UBSEQUENT TO THE AMENDMENT FROM 01 - 04 - 2004 FOR CLAIMING DEDUCTION UNDER THESE SECTIONS, FRESH CERTIFICATE OF DISABILITY IS REQUIRED TO BE TAKEN FROM PRESCRIBED MEDICAL AUTHORITY. PER CONTRA IT IS ASSESSEES CLAIM THAT C ONSIDERING THE EARLIER AMENDMENTS IN THESE SECTIONS AND LEGAL OPINION OBTAINED, THE ASSESSEE WAS UNDER A BONAFIDE BELIEF THAT THE EMPLOYEES CLAIMING DEDUCTION UNDER THIS S ECTION CAN CONTINUE TO AVAIL THE DEDUCTION ON THE BASIS OF CERTIFICATES WHICH WERE OBTAINED EARLIER. 8. IT IS UNDISPUTED THAT THE ASSESSEE HAS SOUGHT A LEGAL OPINION AND THE LEGAL ADVISER HAD ADVISED THE ASSESSEE TO CONTINUE TO GRANT DEDUCTION TO THE EMPLOYEES ON THE BASIS OF EXISTING MEDICAL CERTIFICATES WHICH WERE OBTAINED PRIOR TO THE AMENDMENT. THIS BELIEF OF THE ASSESSEE IN MY CONSIDER OPINION CANNOT BE SAID TO BE NOT BONAFIDE. I FIND THAT THE PROVISIONS OF THE ACT IN THIS REGARD COULD HAVE BEEN INTERPRETED IN TWO WAYS WITHOUT REFLECTING ANY MALAFIDE. THIS IS CLEAR FROM THE LONG DRAWN REASONING MENTIONED BY THE LEARNED CIT(APPEALS) IN PARA 3.5 OF HIS APPELLATE ORDER AS ABOVE. IT IS SETTLED LAW THAT WHEN THE ASSESSEE WAS UND ER A BONAFIDE BELIEF THAT TAX WAS NOT REQUIRED TO BE DEDUCTED , THE ASSESSEE CANNOT BE VISITED WITH THE PROVISIONS OF SECTION 201(1) OF THE I.T. ACT. FOR THIS PROPOSITION I MAY REFER TO THE FOLLOWING CASE LAWS : 17 ITA NOS. 22 TO 27/PAT/2014. 1. CIT VS. AIR FRANCE LTD. 241 ITR 626 (DEL.) [SLP DISMISSED, 242 ITR (ST) 185 (SC) ] 2. CIT VS. NESTLE INDIA LTD. 243 ITR 435 (DEL.). 9 . THUS ON THE FACTS AND CIRCUMSTANCES ON THIS ISSUE IN PARTICULAR NOTING THE FACT THAT THE ASSESSEE HA S OBTAINED A LEGAL OPINION AND CONSIDERING THE COMPLEXITY IN THE INTERPRETATION OF THE PROVISIONS AS DEMONSTRATED BY THE LEARNED CIT(APPEALS) INTERPRETATION IN PARA 3.5 OF HIS ORDER ABOVE , I AM OF THE CONSIDERED OPINION THAT THE ASSESSEE CAN BE HELD TO BE OF THE BONAFIDE BELIEF THAT THE ASSESSEE WAS NOT REQUIRED TO INSIST UPON ASKING THE EMPLOYEES TO SUBMIT FRESH MEDICAL CERTIFICATES. ACCORDINGLY FOLLOWING THE ABOVE CASE LAWS, I HOLD THAT THE ASSESSEE CANNOT BE HELD TO BE ASSESSEE IN DEFAULT U/S 201(1) OF THE I.T. ACT. INTEREST U/S 201(1A) IS CONSEQUENT IAL. 10 . I MAKE IT CLEAR THAT THE ASSESSEE HAS BEEN HELD TO BE NOT IN DEFAULT ON THE BASIS OF THE BONAFIDE BELIEF. I AM NOT ENDORSING THE ASSESSEES VIEW ON THE INTERPRETATION OF LAW. 1 1 . IN THE RESULT, THESE APPEALS BY THE ASSESSEE STAND ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 20 TH DAY OF SEPT., 2016. SD/ - ( SHAMIM YAHYA) ACCOUNTANT MEMBER. DATED: SEPT., 2016. 18 ITA NOS. 22 TO 27/PAT/2014. COPY FORWARDED TO : 1. THE PRINCIPAL, H.D. JAIN COLLEGE, ARRAH. 2. THE REGISTRAR, V.K.S. UNIVERSITY, ARRAH. 3. THE PRINCIPAL, M.M. MAHILA COLLEGE, ARRAH. 4. A.C.I.T., TDS CIRCLE, PATNA. 5. C.I.T. - , PATNA. 6. CIT(APPEALS), - , PATNA. 7. D.R., ITAT, PATNA. 8. GUARD FILE TRUE COPY BY ORDER ASSISTANT REGIS TRAR, INCOME TAX APPELLATE TRIBUNAL, PATNA BENCH, PATNA. WAKODE.