Krishi Upaj Mandi Samiti, HANUMANGARH V. ITO, HANUMANGARH

ITA 287/JODH/2010

• Counselvise Citation: 28723314 RSA 2010
• Duration Of Justice: 2 year(s) 2 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-07-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2004-2005
• Appeal Filed On: 29-04-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: G R KOKANI
• Assessee Lawyers: RAKESH GUPTA
• Keywords: Rectification of order; Revised return
• Section: 143(3); 12A; 12AA; 12; 154; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, JODHPUR BENCH, JODHPUR BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NO. 282 & 283/JU/2010 ASSTT. YEAR : 2003-04 & 2005-06 KRISHI UPAJ MANDI SAMITI, VS. INCOME-TAX OFFICER , SURATGARH. SURATGARH. (PAN: AABTK 0473 C) ITA NO. 279, 280 & 281/JU/2010 ASSTT. YEAR : 2003-04, 2004-05 & 2006-07 KRISHI UPAJ MANDI SAMITI, VS. INCOME-TAX OFFICER , SANGARIA WARD-1, HANUMANGARH. (PAN: AABTK 0296 R) ITA NO. 287 & 288/JU/2010 ASSTT. YEAR : 2004-05 & 2006-07 KRISHI UPAJ MANDI SAMITI, VS. INCOME-TAX OFFICER , HANUMANGARH. WARD-1, HANUMANGARH. (PAN: AABTK 0296 R). ITA NO. 277 & 278/JU/2010 ASSTT. YEAR : 2004-05 & 2006-07 KRISHI UPAJ MANDI SAMITI, VS. INCOME-TAX OFFICER , NOHAR. WARD-1, HANUMANGARH. (PAN: AABTK 0471 A). ITA NO. 273 & 272/JU/2010 ASSTT. YEAR : 2003-04 & 2004-05 KRISHI UPAJ MANDI SAMITI, VS. INCOME-TAX OFFICER , ANOOPGARH. SURATGARH. (PAN: AABTK 0476 H). ITA NO. 277 TO 283/JU/2010 ITA NO. 287 & 288/JU/2010 ITA NO. 273 & 272/JU/2010 ITA NO. 292 & 293/JU/2010 2 ITA NO. 292/JU/2010 ASSTT. YEAR : 2003-04 KRISHI UPAJ MANDI SAMITI, VS. INCOME-TAX OFFICER , GHARSANA. SURATGARH. (PAN: AABTK 0466 B). ITA NO. 293/JU/2010 ASSTT. YEAR : 2004-05 KRISHI UPAJ MANDI SAMITI, VS. INCOME-TAX OFFICER , BHADRA. WARD-1, HANUMANGARH. (PAN: AABTK 0471 A). (APPELLANTS) (RESPONDENTS) APPELLANTS BY : SHRI RAKESH GUPTA, A.R. RESPONDENTS BY : SHRI G.R. KOKANI, D.R. DATE OF HEARING : 10.07.2012 DATE OF PRONOUNCEMENT OF ORDER : 13.07.2012 ORDER PER BENCH : THIS ORDER WILL DISPOSE OF ALL THE APPEALS FILED BY DIFFERENT ASSESSEES FOR DIFFERENT ASSESSMENT YEARS, AS MENTIONED ABOVE, ON THE IDENTICAL ISSUE, AGAINST DIFFERENT ORDERS OF LD. CIT(A), BIKANER, CONFIRMING THE REJECTION OF APPLICATION OF RECTIFICATION U/S. 154 OF THE IT ACT. 2. THE LD. COUNSEL FOR THE ASSESSEE MAINLY ARGUED I TA NO. 282/JODH/2010 AND SUBMITTED THAT THE ISSUE IS SAME IN ALL THE APPEALS EXCEPT WITH SOME MINOR VARIATION ITA NO. 277 TO 283/JU/2010 ITA NO. 287 & 288/JU/2010 ITA NO. 273 & 272/JU/2010 ITA NO. 292 & 293/JU/2010 3 IN THREE APPEALS. THEREFORE, FOR THE PURPOSE OF DIS POSAL OF ALL THE APPEALS, THE FACTS STATED IN THE IMPUGNED ORDER RELATING TO ITA NO. 28 2/JODH/2010 ARE CONSIDERED. AS ADMITTED BY BOTH THE PARTIES, THE FACTS, ISSUE AND FINDINGS OF THE LD. CIT(A) ARE IDENTICAL IN ALL THE CASES. 3. WE HAVE HEARD THE LD. REPRESENTATIVES OF BOTH TH E PARTIES AND PERUSED THE FINDINGS OF THE AUTHORITIES BELOW. 4. THE LD. CIT(A) IN THE IMPUGNED ORDER RELATING TO ITA NO. 282/JODH/2010 NOTED THAT THE ASSESSEE WAS AGGRIEVED AGAINST THE R EJECTION OF APPLICATION U/S. 154 OF THE IT ACT. IN THE RECTIFICATION ORDER, THE AO S TATED THAT THE ASSESSEE FILED AN APPLICATION FOR RECTIFICATION U/S. 154 ON 25.08.200 9, CLAIMING THE RECTIFICATION OF ORDER PASSED U/S. 143(3) ON 28.08.2006 IN RESPECT O F ALLOWANCE OF SET OFF OF EXCESS OF EXPENDITURE OVER INCOME OF THE PREVIOUS YEAR. T HE CLAIM OF THE ASSESSEE WAS REJECTED BY THE AO ON THE GROUND THAT THE ASSESSEE NEITHER CLAIMED THE SET OFF OF ACCUMULATED EXCESS OF EXPENDITURE OVER INCOME IN TH E ORIGINAL RETURN NOR FILED ANY REVISED RETURN TO CLAIM THE SAME. ACCORDING TO THE AO, THERE WAS NO MISTAKE APPARENT FROM RECORD, WHICH COULD BE RECTIFIED. ACC ORDINGLY, THE ASSESSEES CLAIM FOR RECTIFICATION WAS REJECTED. THE ASSESSEE BEFORE THE LD. CIT(A) SUBMITTED THAT THE AO FINALIZED THE ASSESSMENT U/S. 143(3) WITHOUT GIVING SET OFF OF ACCUMULATED ITA NO. 277 TO 283/JU/2010 ITA NO. 287 & 288/JU/2010 ITA NO. 273 & 272/JU/2010 ITA NO. 292 & 293/JU/2010 4 EXCESS OF EXPENDITURE OVER INCOME OF PREVIOUS YEAR. THEREFORE, THE ACTION OF THE AO WAS NOT PROPER WHEN THE EXCESS OF INCOME OVER EX PENDITURE WAS DETERMINED IN THE CONCLUDING PART OF THE ASSESSMENT ORDER EVEN TH OUGH THE ASSESSEE DID NOT SHOW SURPLUS OF THE LOSS IN THE INCOME-TAX RETURN, EITHE R ORIGINAL OR REVISED. IT WAS, THEREFORE, SUBMITTED THAT THE ASSESSEES CLAIM MAY BE ALLOWED. 4.1 THE LD. CIT(A) FOUND THAT THE CLAIM OF ASSESSEE IS NOT TENABLE BECAUSE THERE IS NO MISTAKE APPARENT FROM RECORD. IF A REFERENCE IS TO BE MADE TO DOCUMENTS OUTSIDE THE RECORDS, IT WOULD NOT BE A MISTAKE APPA RENT FROM THE RECORD. THE LD. CIT(A) OBSERVED THAT WHEN AN ISSUE CAN BE RESOLVED ONLY BY WAY OF COMPLICATED PROCESS OF INVESTIGATION, RECOURSE CANNOT BE TAKEN OF SECTION 154 OF THE IT ACT. THE LD. CIT(A) RELIED UPON THE DECISION OF HONBLE SUPR EME COURT IN THE CASE OF ANCHOR PRESSING PVT. LTD., 161 ITR 151 TO HOLD THAT THE RECTIFICATION U/S. 154 WAS NOT OBLIGATORY ON THE PART OF THE AO, AS CLEAR DATA WAS NOT AVAILABLE ON RECORD. THE LD. CIT(A) ALSO RELIED UPON THE DECISION OF HONBL E SUPREME COURT IN THE CASE OF ACIT VS. SAURASTRA KUTCH STOCK EXCHANGE LTD., 305 I TR 227. THE LD. CIT(A), AFTER EXAMINING THE RECORD FOUND THAT THE ASSESSEE HAD FILED RETURN OF INCOME DECLARING NIL INCOME. NO CLAIM FOR SET OFF OF ACCUM ULATED EXCESS OF EXPENDITURE OVER INCOME OF PREVIOUS YEAR WAS FILED WITH SUCH RE TURN. NO SUCH CLAIM WAS MADE BY FILING THE REVISED RETURN AS WELL. THE CLAIM WAS PUT FORWARD ONLY BY WAY OF ITA NO. 277 TO 283/JU/2010 ITA NO. 287 & 288/JU/2010 ITA NO. 273 & 272/JU/2010 ITA NO. 292 & 293/JU/2010 5 APPLICATION FOR RECTIFICATION U/S. 154 OF THE ACT W HICH IS NOT PERMISSIBLE UNDER LAW. THE LD. CIT(A) ALSO OBSERVED THAT THE DEDUCTION OR REBATES, ALTHOUGH LEGALLY ALLOWABLE, BUT NOT CLAIMED OR ALLOWED, DO NOT CONST ITUTE A MISTAKE APPARENT ON RECORD. THE ASSESSEE THROUGH APPLICATION FOR RECTIF ICATION HAS SOUGHT DECISION OF THE AO ON THE DEBATABLE ISSUE WHERE TWO VIEWS ARE POSSI BLE. THEREFORE, NO MISTAKE APPARENT ON RECORD OF THE AO WAS FOUND AND ACCORDIN GLY, REJECTION OF RECTIFICATION APPLICATION U/S. 154 OF THE IT ACT WAS UPHELD AND A CCORDINGLY, THE APPEAL OF THE ASSESSEE WAS DISMISSED. 5. THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE LD. CIT(A) AND ALSO REFERRED TO THE ASSESSMENT ORDE R TO SHOW THAT THOUGH THE RETURN OF INCOME IS FILED DECLARING NIL INCOME, BUT THE AO TOOK THE FIGURE OF RS.34,99,281/- BEING THE NET LOSS AS PER INCOME AND EXPENDITURE ACCOUNT IN THE COMPUTATION OF INCOME. THEREFORE, CLAIM OF THE ASSE SSEE SHOULD NOT HAVE BEEN REJECTED. HE HAS FILED COPY OF COMPUTATION OF TOTAL INCOME FILED WITH THE RETURN OF INCOME, IN WHICH TAXABLE INCOME WAS SHOWN AS NIL BE CAUSE THE ASSESSEE APPLIED FOR REGISTRATION U/S. 12A OF THE ACT BEFORE THE COMMISS IONER TO MAKE A CLAIM OF DEDUCTION U/S. 11, 12 AND 13 OF THE IT ACT. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ISSUE IS SAME IN ALL THE APPEALS . HE HAS, HOWEVER, FURTHER SUBMITTED THAT IN ITA NO. 278, 281 AND 288 OF 2010 ABOVE, THOUGH THE ISSUE AND ITA NO. 277 TO 283/JU/2010 ITA NO. 287 & 288/JU/2010 ITA NO. 273 & 272/JU/2010 ITA NO. 292 & 293/JU/2010 6 FINDINGS OF LD. CIT(A) ARE SAME, BUT IN THESE CASES THE ASSESSEE DECLARED NIL INCOME IN THE RETURN OF INCOME AND AO DID NOT TAKE INCOME OF THE ASSESSEE AS PER NET LOSS AS PER INCOME & EXPENDITURE ACCOUNT AS IS TAKEN IN OTHER CASES. HE HAS, THEREFORE, SUBMITTED THAT PRECISELY THE ISSUE IS SAME IN ALL T HE ABOVE APPEALS. 6. ON THE OTHER HAND, THE LD. DR RELIED UPON THE OR DERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT THE ASSESSEE HAS NOT MADE ANY CL AIM OF SET OFF OF ACCUMULATED EXCESS OF EXPENDITURE OVER INCOME IN THE ORIGINAL R ETURN OF INCOME. NO REVISED RETURN IS FILED TO MAKE ANY SUCH CLAIM. THEREFORE, CLAIM OF THE ASSESSEE WAS NOT RIGHTLY ENTERTAINED BY THE AO IN VIEW OF THE DECISI ON OF HONBLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. VS. CIT, 284 ITR 32 3. HE HAS SUBMITTED THAT SINCE THERE WAS NO CLAIM MADE BEFORE THE AO AT THE ASSESS MENT STAGE, THEREFORE, CLAIM MADE U/S. 154 SUBSEQUENTLY IS NOT PART OF RECORD OF THE AO. THEREFORE, THERE WAS NO MISTAKE APPARENT FROM THE RECORD OF THE AO, WHIC H COULD BE RECTIFIED. HE, THEREFORE, RIGHTLY REJECTED THE APPLICATION U/S. 15 4 OF THE IT ACT IN ALL THE CASES. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND THE MATERIAL ON RECORD AND THE FACTS NOTED ABOVE HAVE NOT BEEN DISPUTED BY THE LD. COUNSEL FOR THE ASSESSEE. THE ISSUE IS THE SAME IN ALL THE APPEALS ON IDENTICAL F ACTS AS IS ADMITTED BY BOTH THE PARTIES EXCEPT THAT IN SOME CASES, THE AO IN THE CO MPUTATION OF INCOME TOOK THE ITA NO. 277 TO 283/JU/2010 ITA NO. 287 & 288/JU/2010 ITA NO. 273 & 272/JU/2010 ITA NO. 292 & 293/JU/2010 7 INCOME AS PER NET LOSS AS PER INCOME AND EXPENDITUR E ACCOUNT AS EXPLAINED ABOVE. HOWEVER, THIS WOULD ALSO NOT MAKE ANY DIFFERENCE ON THE ISSUE. IT IS ADMITTED FACT THAT IN ALL THE CASES, THE ASSESSEE FILED RETURN OF INCOME DECLARING NIL INCOME CLAIMING THAT THE ASSESSEE WOULD BE ENTITLED FOR EX EMPTION ON GRANT OF REGISTRATION U/S. 12AA OF THE ACT. COPY OF COMPUTATION OF INCOME IS ALSO FILED WITH THE RETURN OF INCOME, IN WHICH THE ASSESSEE CLAIMED TAXABLE IN COME AS NIL. IT IS, THEREFORE, ESTABLISHED ON RECORD THAT THE ASSESSEE NEITHER CLA IMED THE SET OFF OF ACCUMULATED EXCESS OF EXPENDITURE OVER INCOME IN THE ORIGINAL R ETURN OF INCOME NOR FILED ANY REVISED RETURN TO CLAIM THE SAME. THE AO IN THE REC TIFICATION ORDER SPECIFICALLY NOTED THAT THE ASSESSEE HAS NOT MADE ANY CLAIM OF L OSS IN THE RETURN OF INCOME NOR IN THE COMPUTATION SHEET OF INCOME. THEREFORE, THE CLAIM OF SET OFF WAS MADE BY THE ASSESSEE FOR THE FIRST TIME IN THE APPLICATION U/S. 154 OF THE IT ACT. SECTION 154 OF THE IT ACT PROVIDES THAT WITH A VIEW TO RECTIFY ANY MISTAKE APPARENT FROM THE RECORD, AN INCOME-TAX AUTHORITY REFERRED TO IN SECT ION 116, MAY AMEND ANY ORDER PASSED BY IT UNDER THE PROVISIONS OF THIS ACT AND A MEND ANY INTIMATION OR DEEMED INTIMATION U/S. 143(1) OF THE IT ACT. THE HONBLE S UPREME COURT IN THE CASE OF T.S. BALRAM, ITO VS. VOKART BROTHERS AND OTHERS, 82 ITR 50 HELD A MISTAKE APPARENT ON THE RECORD MUST BE AN OBVIOUS AND PATENT MISTAKE AND NOT SOMETHING WHICH CAN BE ESTAB LISHED BY A LONG DRAWN PROCESS OF REASONING ON POINTS ON WHICH THERE MAY BE ITA NO. 277 TO 283/JU/2010 ITA NO. 287 & 288/JU/2010 ITA NO. 273 & 272/JU/2010 ITA NO. 292 & 293/JU/2010 8 CONCEIVABLY TWO OPINIONS. A DECISION ON A DEBATABLE POINT OF LAW IS NOT A MISTAKE APPARENT FROM THE RECORD. IN THIS CASE, IT WAS ALSO HELD THAT IT WAS NOT OPEN TO THE ITO TO GO INTO THE TRUE SCOPE OF THE PROVISIONS OF THE ACT IN A RECTIFICATI ON PROCEEDINGS U/S. 154 OF THE ACT. 7.1 HONBLE CALCUTTA HIGH COURT IN THE CASE OF HIND USTAN LEVER LTD. VS. JCIT, 284 ITR 42 HELD SUB-SECTION (1) OF SECTION 154 OF THE INCOME-TAX A CT, 1961, CLEARLY STATES THE CIRCUMSTANCES UNDER WHICH RECTIF ICATION CAN BE MADE. A MISTAKE MUST BE APPARENT FROM THE RECORDS, MEANING THEREBY NO EXTERNAL HELP EITHER ON ACT OR IN LAW IS REQUIRE D TO DETECT SUCH MISTAKE. THE MISTAKE MUST BE SO OBVIOUS THAT IT CAN EASILY BE CORRECTED, TO WIT AN ARITHMETICAL MISTAKE, A WRONG QUOTATION OF SECTION, ETC. THE QUESTION WHETHER INTERPRETATION O F A PROVISION OF LAW IS RIGHT OR WRONG IS PER SE A DEBATABLE ISSUE. THIS ISSUE CANNOT BE RESOLVED BY THE OFFICIAL HAVING CO-ORDINATE JURISDI CTION UNDER SECTION 154 OF THE ACT AS IT COULD NOT BE TERMED TO BE APPA RENT FROM THE RECORD. 7.2 IN THE INSTANT CASE, IT WAS FOUND THAT THE ASSE SSEE FILED RETURN OF INCOME DECLARING NIL INCOME AND NO CLAIM OF SET OFF OF ACC UMULATED EXCESS OF EXPENDITURE OVER INCOME WAS FILED WITH THE RETURN OF INCOME. NO SUCH CLAIM WAS ALSO MADE IN THE REVISED RETURN. THE ASSESSEE IS TRYING TO TAKE BENEFIT OF THE COMPUTATION OF INCOME TAKEN BY THE AO IN SOME CASES AS PER INCOME AND EXPENDITURE ACCOUNT, WHICH WAS NOT PERMISSIBLE. THE ASSESSEE IN THE COMP UTATION OF INCOME DECLARED NIL ITA NO. 277 TO 283/JU/2010 ITA NO. 287 & 288/JU/2010 ITA NO. 273 & 272/JU/2010 ITA NO. 292 & 293/JU/2010 9 INCOME AND ALSO FILED THE RETURN OF INCOME AT NIL I NCOME. THE AO IN THE ORDER U/S. 154 OF THE IT ACT SPECIFICALLY MENTIONED THAT ON GO ING THROUGH THE RECORD, THE ASSESSEE DID NOT CLAIM ANY LOSS IN THE RETURN OF IN COME OR IN THE COMPUTATION OF INCOME. THEREFORE, THERE WAS NO POWER WITH THE ASSE SSING OFFICER TO ENTERTAIN SUCH CLAIM MADE OTHERWISE THAN BY WAY OF REVISED RE TURN. WE ARE FORTIFIED IN OUR VIEW BY THE JUDGMENT OF HONBLE SUPREME COURT IN TH E CASE OF GOETZE (INDIA) LTD. (SUPRA), IN WHICH IT WAS HELD THE SUPREME COURT DISMISSED THE APPEAL, MAKING IT CLEAR THAT THE DECISION WAS RESTRICTED TO THE POWER OF THE ASS ESSING AUTHORITY TO ENTERTAIN A CLAIM FOR DEDUCTION OTHERWISE THAN BY A REVISED RETURN, AND DID NOT IMPINGE ON THE POWER OF THE APPELLATE T RIBUNAL UNDER SECTION 254 OF THE INCOME-TAX ACT, 1961. IT IS ALSO CLEAR FROM THE FACTS NOTED BY THE AUTHOR ITIES BELOW THAT THE ASSESSEE MADE CLAIM OF SET OFF FOR THE FIRST TIME IN THE RECTIFIC ATION APPLICATION U/S. 154 OF THE ACT, BUT THE AO CANNOT ENTERTAIN CLAIM OF SET OFF AT THE ASSESSMENT STAGE. HOW IT CAN BE ENTERTAINED BY THE AO U/S. 154 OF THE IT ACT IS NOT EXPLAINED BY THE LD. COUNSEL FOR THE ASSESSEE. FURTHER, THE MISTAKE APPARENT ON RECO RD OF INCOME-TAX AUTHORITY CAN BE RECTIFIED U/S. 154 OF THE ACT, BUT WHEN THERE WA S NO CLAIM MADE AT THE ASSESSMENT STAGE OR IN THE RETURN OF INCOME AT THE TIME OF ASSESSMENT PROCEEDINGS, THERE WAS NO SUCH CLAIM AVAILABLE ON RECORD OF THE AO. THEREFORE, THE CLAIM MADE SUBSEQUENTLY IN THE PROCEEDINGS U/S. 154 OF THE ACT WOULD NOT CONSTITUTE THAT THE ITA NO. 277 TO 283/JU/2010 ITA NO. 287 & 288/JU/2010 ITA NO. 273 & 272/JU/2010 ITA NO. 292 & 293/JU/2010 10 SAME IS ARISING OUT OF THE RECORD OF THE INCOME-TAX AUTHORITY. SINCE, THERE WAS NO CLAIM ON THE RECORD OF THE AO AT THE ASSESSMENT STA GE, THERE COULD NOT HAVE BEEN ANY MISTAKE ON RECORD OF INCOME-TAX AUTHORITY. CONS IDERING THE ABOVE DISCUSSION IN THE LIGHT OF DECISIONS CITED ABOVE, WE DO NOT FI ND ANY INFIRMITY IN THE ORDERS OF THE LD. CIT(A) IN UPHOLDING THE REJECTION OF APPLIC ATION U/S. 154 OF THE ACT. WE, THEREFORE, DO NOT FIND ANY MERIT IN ALL THE APPEALS OF THE ASSESSEE AS MENTIONED ABOVE AND ACCORDINGLY, ALL THE APPEALS OF THE ASSES SEES ARE DISMISSED. 8. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEES ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (A.L. GEHLOT) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A), CONCERNED BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, JODHPUR 6. GUARD FILE ASSTT. REGISTRAR TRUE COPY