DCIT, New Delhi V. M/s. Khem Chand Vijay Kumar Metal Industries Pvt. Ltd., New Delhi

ITA 3235/DEL/1989

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 5440 (ITAT-DELHI)
• Duration Of Justice: 24 year(s) 9 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-02-2014
• Appeal Filed By: Department
• Bench Allotted: E
• Assessment Year: misc
• Appeal Filed On: 15-05-1989
• Court: TRIBUNAL
• Department Lawyers: SAMEER SHARMA SENIOR
• Assessee Lawyers: RANJIT SINGH MANAGER
• Keywords: Question of law
• Section: 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH FRIDAY-E : NEW DELHI) BEFORE SHRI A.D. JAIN, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.3235/DEL./1989 (ASSESSMENT YEAR :1985-86) DCIT, SPL. RANGE 6, VS. M/S. KHEM CHAND VIJAY KUMA R METAL NEW DELHI. INDUSTRIES PVT. LTD., 13 A, AMRITA SHERGILL MARG, NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI RANJIT SINGH, MANAGER REVENUE BY : SHRI SAMEER SHARMA, SENIOR DR ORDER UNDER SECTION 260 (1) OF THE INCOME TAX ACT, 1961 PER B.C. MEENA, ACCOUNTANT MEMBER : IN THIS CASE, THE FOLLOWING QUESTION OF LAW ARISING FROM ITS ORDER DATED 26 TH FEBRUARY, 1993 IN ITA NO.3235/DEL/1989 FOR ASSESSME NT YEAR 1985-86 WAS REFERRED BY DELHI BENCH B OF ITAT, NEW DELHI TO THE HON'BLE D ELHI HIGH COURT FOR THEIR ESTEEMED OPINION VIDE ITS ORDER DATED 26 TH OCTOBER, 1993 IN R.A. NO.361/DEL/1993 : 'WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CAS E, THE LOSS DETERMINED IN ACCORDANCE WITH RETURN OF INCOME FURNISHED ON 26 TH AUGUST, 1985 IS HIT BY THE PROHIBITION CONTAINED IN SECTION 80 OF THE INCO ME TAX ACT,1961 AND SO SUCH LOSS CANNOT BE CARRIED FORWARD FOR SET OFF UND ER CHAPTER VI OF THE INCOME TAX ACT, 1961? 2. THE HON'BLE DELHI HIGH COURT HAS DECIDED THE APP EAL BEING ITR NO.81/1994 VIDE ORDER DATED 18.03.2011 AS UNDER : RELEVANT PART OF SECTION 80 OF THE IT ACT AS IT ST OOD THEN READS AS UNDER: ITA NO.3235/DEL./1989 2 '80. NOTWITHSTANDING ANYTHING CONTAINED IN THIS CHA PTER, NO LOSS WHICH HAS NOT BEEN DETERMINED IN PURSUANCE OF A RET URN FILED WITHIN THE TIME ALLOWED UNDER SUB-SECTION (1) OF SECTION 1 39 OR WITHIN SUCH FURTHER TIME AS MAY BE ALLOWED BY THE -INCOME-TAX O FFICER, SHALL BE CARRIED FORWARD AND SET OFF UNDER SUB-SECTION (1) O F SECTION 72..' SECTION 80 OF THE IT ACT AS IT THEN OBTAINED, PERMI TTED CARRY FORWARD AND SET OFF OF LOSSES WHICH WERE DETERMINED, PURSUA NT TO A RETURN FILED WITHIN THE TIME PRESCRIBED UNDER SECTION 139(1) OF THE IT ACT OR WITHIN SUCH FURTHER TIME AS MAY BE ALLOWED BY ITO. SEVERAL HIGH COURTS INCLUDING THE DIVISION BENCH OF THE RAJASTHAN HIGH COURT IN R AJASTHAN CYLINDERS & CONTAINERS LTD. VS. COMMISSIONER OF INCOME-TAX (200 3,) 259 ITR 95 TOOK THE VIEW THAT IF AN APPLICATION FOR EXTENSION IS FI LED BY THE ASSESSEE IN FORM NO.6, WHICH IS NOT REJECTED THEN THE PRESUMPTION SH ALL BE THAT TIME STOOD EXTENDED IF THE RETURN IS FILED ON OR BEFORE THE EX TENDED DATE. THE RATIONALE BEING THAT EXTENDED DATE WILL BE THE DUE DATE IN SU CH CIRCUMSTANCES. THE RELEVANT EXTRACT OF THE JUDGEMENT IN THE CASE O F RAJASTHAN CYLINDERS & CONTAINERS LTD. CASE (SUPRA) IS AS FOLL OWS: 'THE ADMITTED FACTS ARE THAT THE RETURNS ARE DUE TO BE FILED ON OR BEFORE JUNE 30, 1985. ONE JUNE 28, 1985, THE ASS ESSEE HAD FILED THE APPLICATION IN FORM NO.6 FOR EXTENSION OF TIME TILL SEPTEMBER, 1985, AND THE RETURNS SHOWING LOSS HAS BEEN FILED O N AUGUST 5, 1985, AS BEFORE SEPTEMBER 30, 1985. THE CONSISTENT VIEW TAKEN BY VARIOUS HIGH COURTS THAT ONCE THE ASSESSEE HAS APPL IED FOR EXTENSION OF TIME ON FORM NO.6 AND IF THAT APPLICATION HAS NO T BEEN DISPOSED OF OR REJECTED, THE PRESUMPTION WILL BE THAT THE TI ME HAS BEEN EXTENDED AND IF THE ASSESSEE HAS FILED THE RETURN O N OR BEFORE THE EXTENDED TIME PRAYED FOR, THE RETURN SHALL BE TAKEN TO BE FILED ON OR BEFORE THE DUE DATE. IN THIS CASE, WHEN THE APPLICA TION HAS BEEN SUBMITTED FOR EXTENSION OF TIME ON JUNE 28, 1985, A ND THAT HAS NOT BEEN REJECTED, IT SHALL BE PRESUMED THAT THE TIME H AS BEEN EXTENDED TILL SEPTEMBER 30, 1985, AND, IN THIS CASE, ADMITTE DLY, THE RETURNS ARE FILED ON AUGUST 5, 1985, THEREFORE, IT CANNOT BE SA ID THAT THE RETURNS ARE NOT FILED ON OR BEFORE THE DUE DATE. IN OUR VIEW, THE TRIBUNAL HAS COMMITTED AN ERROR IN DISALLOWING THE CLAIM OF THE ASSESSEE HOLDING THAT THE RETURNS ARE NOT FILED ON OR BEFORE THE DUE DATE. IN THE RESULT, WE ANSWER THE QUESTION IN THE NEGATI VE, I.E., IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE.' WE ARE IN AGREEMENT WITH THE VIEW TAKEN IN THE AFOR EMENTIONED CASE. ITA NO.3235/DEL./1989 3 THE RESULT OF THE AFORESAID IS THAT THE RETURN HAVI NG BEEN FILED WITHIN THE EXTENDED PERIOD OF TIME, THE BENEFIT OF CARRY F ORWARD LOSSES UNDER SECTION 80 OF THE IT ACT WOULD BE AVAILABLE TO THE ASSESSEE SINCE THE ASSESSING OFFICER HAD NOT REJECTED THE APPLICATION FOR EXTENSION OF TIME TO FILE THE RETURN. WE MAY ALSO ADD AT THIS STAGE THAT THE ITAT APPEARS TO HAVE TAKEN INTO CONSIDERATION THE SUBSEQUENT AMENDMENT TO THE PROVISIONS OF SECTION 80 OF THE IT ACT WHICH WERE NOT IN FORCE FOR THE AS SESSMENT YEAR IN QUESTION. THE QUESTION IS, THUS, ANSWERED IN FAVOUR OF THE AS SESSEE AND THE PETITION IS ACCORDINGLY ALLOWED. 3. IN THE LIGHT OF THE AFORESAID DECISION OF THE HO N'BLE HIGH COURT, THE MATTER WAS FIXED FOR HEARING. 4. WE HAVE HEARD BOTH THE SIDES AND PERUSED THE ORD ER OF THE HON'BLE DELHI HIGH COURT. HON'BLE HIGH COURT, VIDE ITS AFORESAID JUDG EMENT, HAS ANSWERED THE QUESTION IN THE NEGATIVE I.E. IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. THE RESULT IS THAT THE ORDER OF THE TRIBUNAL DATED 26 TH FEBRUARY, 1993 PASSED IN THE ABOVE CAPTIONED APPEA L STANDS REVERSED. THE ASSESSING OFFICER SHALL GIVE CONSEQU ENTIAL EFFECT. ORDER PRONOUNCED IN OPEN COURT ON THIS 21 ST DAY OF FEBRUARY, 2014. SD/- SD/- (A.D. JAIN) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 21 ST DAY OF FEBRUARY, 2014 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT (A) 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.