DCIT, New Delhi V. M/s. Delhi Transport Corporation Ltd., New Delhi

ITA 3258/DEL/2014

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 3519 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2019
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 15-05-2017
• Assessment Year: 2006-2007
• Appeal Filed On: 28-05-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: NIDHI SRIVASTAVA
• Keywords: Business expenditure; Retrospective amendment
• Section: 43B; 143(3); 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL , DELHI BENCH B , NEW DELHI BEFORE S H RI N. K. BILLAIYA , ACCOUNTANT MEMBER , AND MS . SUCHITRA KAMBLE , JUDICIAL MEMBER ITA NO. 3258 /DEL/201 4 ASSESSMENT YEAR: 20 06 - 07 THE D.C. I . T . VS. CIRCLE 10 ( 1 ), NEW DELHI M/S DELHI TRANSPORT CORPN LTD INDRAPRASTHA ESTATE NEW DELHI PAN NO. AAACD 3004 G (APPELLANT) (RESPONDENT) APPELLANT BY : MS. NIDHI SRIVASTAVA RESPONDENT BY : SHRI PRADEEP DINODIA, ADV DATE OF HEARING: 18 / 0 2 /2 0 1 9 DATE OF PRONOUNCEMENT: 20 / 0 2 /201 9 ORDER PER N. K. BILLAIYA, A CCOUNTANT M EMBER : TH IS APPEAL BY THE REVENUE IS PREFERRED AGAINST THE ORDER OF THE LD. CIT( A) 1 3 , NEW DELHI DATED 13 .0 3 .20 1 4 PERTAINING TO A.Y 20 06 - 07 . 2 2. THE ONLY SUBSTANTIVE GRIEVANCE OF THE REVENUE IS THAT THE LD. CIT(A) ERRED IN DIRECTING THE ASSESSING OFFICER TO TREAT THE PROCEEDINGS U/S 147 OF THE INCOME - TAX ACT, 1961 [HEREINAFTER REF ERRED TO AS 'THE ACT' FOR SHORT] AS DROPPED AS PER THE PROVISIONS OF SECTION 152(2) OF THE ACT AND WHILE DECIDING SO, THE LD. CIT(A) ENTERTAINED RELIEF CLAIMED BY THE ASSESSEE WHICH WAS NEVER EXAMINED BY THE ASSESSING OFFICER. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT ASSESSMENT ORDER U /S 14 3(3) OF THE ACT, 1961 WAS COMPLETED VIDE ORDER DATED 2 3.12.20 08 AT A LOSS OF RS. 568 CRORES . SUBSEQUENTLY, IT CAME TO THE NOTICE OF THE ASSESSING OFFICER THAT THE ASSESSEE HAS CLAIMED CERTAIN EXPENSES WHICH WE RE NOT APPARENTLY ADMISSIBLE. ACCORDINGLY, NOTICE U/S 148 OF THE ACT WAS ISSUED AND PROCEEDINGS U/S 147 WERE INITIATED. ASSESSMENT WAS FRAMED U/S 147 R.W.S 143(3) OF THE ACT VIDE ORDER DATED 30.08.2011 AT AN ASSESSED LOSS OF RS. 429 CRORES. . 4. T HE ASSE SSEE ASSAILED THE MATTER BEFORE THE LD. CIT(A) AND STRONGLY CONTENDED THAT THE PROCEEDINGS U/S 147 SHOULD HAVE BEEN DROPPED IN VIEW OF THE PROVISIONS OF SECTION 152(2) OF THE ACT. IT WAS BROUGHT TO THE NOTICE OF THE LD. CIT(A) THAT THE ASSESSING OFFICER H AD ISSUED NOTICE U/S 148 OF THE ACT WITH THE ALLEGATION THAT THE FOLLOWING INCOMES HAVE ESCAPED ASSESSMENT: 3 (I) CONTRIBUTION TO RESERVE FUND IS NOT A BUSINESS EXPENDITURE RS. 4,04,81,531 / - (II) EXPENDITURE ON WHICH T DS HAS NOT BEEN DEDUCTED AS PER ITEM I 7(F) OF 3(4) REPORT RS. 5,44,45,576/ - (III) EXCESS CLAIM OF LEAVE ENC ASHMENT AS PER ANNEXURE 4!' OF 3(4) REPORT RS 11,1 1 , 40 , 147 / - RS. 20,60,67,254/ - 5. IT WAS BROUGHT TO THE NOTICE OF THE LD. CIT(A) THAT THE ASSESS EE HAD OMITTED TO DEDUCT THE FOLLOWING AMOUNTS U/S 43B OF THE ACT ON THE BASIS OF ACTUAL PAYMENT AS PER THE TAX AUDIT REPORT AND ANNEXURE IV BEFORE THE DATE OF FILING THE RETURN: (I ) PROVIDENT FUND (DISALLOWANCE IN EARLIER YEARS) RS. 20,77,10,005/ - (II) PROVIDENT FUND (DTC EMPLOYEES PENSION FUND) RS. 15,05,30,425/ - (DISALLOWED IN EARLIER YEARS) (III) EMPLOYEES CONTRIBUTION TO PF. ESI. EPS DISALLOWED ON ACCOUNT OF THEIR DELAY IN PAYMENT, EVEN THOUGH, THE ASSESSEE WAS LEGALLY ENTITLED TO CLAIM DEDUCTION ON ACCOUNT OF RETROSPECTIVE AMENDMENT BY THE FINANCE ACT.2003 W.E.F, 1.4.2004 AS A RESULT OF WHICH SECOND PROVISO IN CLAUSE (B) TO SECTION 43B WAS OMITTED.(SE E ANNEXURE - IV OF AUDIT REPORT) RS. 90 , 15 , 54 , 265/ - 4 6. ACCORDINGLY, IT WAS STRONGLY CONTENDED THAT THE PROVISIONS OF SECTION 152(2) OF THE ACT SQUARELY APPLY ON THE FACTS OF THE CASE IN AS MUCH AS THE ASSESSEE HAD MADE THE ADDITIONS , WHICH WERE FA R LESS THAN THE RELIEF CLAIMED U/S 43B OF THE ACT. 7. AFTER CONSIDERING THE FACTS AND SUBMISSIONS, THE LD. CIT(A) WAS CONVINCED WITH THE CLAIM OF THE ASSESSEE AND HELD THAT SINCE THE ASSESSEE HAS ALREADY BEEN ASSESSED AT A HIGHER AMOUNT THAN IT WAS LEGAL LY LIABLE TO PROVISIONS OF SECTION 152(2) OF THE ACT, PROCEEDINGS U/S 147 OF THE ACT HAVE TO BE DROPPED. 8. BEFORE US, THE LD. DR STRONGLY CONTENDED THAT THE ADDITIONAL RELIEF CLAIMED BY THE ASSESSEE BEFORE THE FIRST APPELLATE AUTHORITY WAS NEVER CLAIMED BEFORE THE ASSESSING OFFICER AND THEREFORE, THE ASSESSING OFFICER HAD NO OCCASION TO EXAMINE THE ADDITIONAL RELIEF CLAIMED BY THE ASSESSEE. IT IS THE SAY OF THE LD. DR THAT WITHOUT EXAMINING THE ADDITIONAL RELIEF, PROVISIONS OF SECTION 152(2) OF THE ACT C ANNOT BE APPLIED. 9. PER CONTRA, THE LD. COUNSEL FOR THE ASSESSEE BROUGHT TO OUR NOTICE THAT THE LD. CIT(A) DID NOT CALL FOR A REMAND REPORT FROM THE ASSESSING 5 OFFICER. BUT, ON RECEIVING NO PLAUSIBLE REPLY, THE LD. CIT(A) DECIDED THE APPEAL IN FAVOUR OF THE ASSESSEE. 10. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE GIVEN THOUGHTFUL CONSIDERATION TO THE ORDERS OF THE AUTHORITIES BELOW. THERE IS NO DISPUTE THAT THE ADDITIONS SOUGHT TO BE DISALLOWED BY THE ASSESSING OFFICER , BY ISSUE OF NOTICE U/S 148 OF TH E ACT , ARE FAR MORE LESS THAN THE RELIEF WHICH IS OTHERWISE AVAILABLE TO THE ASSESSEE AND ALLOWED BY THE LD. CIT(A). THIS CLEARLY ATTRACTS THE PROVISIONS OF SECTION 152(2) OF THE ACT WHICH READS AS UNDER: 'SEC. 152(2) WHERE ON ASSESSMENT IS REOPENED U/S .147, THE ASSESSEE MAY, IF HE HAS NOT IMPUGNED ANY PART OF THE ORIGINAL ASSESSMENT ORDER FOR THAT YEAR EITHER U/S.146 TO 148 OR U/S.264, CLAIM THAT THE PROCEEDINGS U/S.147 SHALL BE DROPPED ON HIS SHOWING THAT HE HAD BEEN ASSESSED ON AN AMOUNT OR TO A SUM N OT LOWER THAN WHAT HE WOULD BE RIGHTLY LIABLE FOR EVEN IF THE INCOME ALLEGED TO HAVE BEEN ESCAPED ASSESSMENT HAD BEEN TAKEN INTO ACCOUNT OR THE ASSESSMENT OR COMPUTATION HAD BEEN PROPERLY MADE : PROVIDED THAT IN DOING SO HE SHALL NOT BE ENTITLED TO REOPEN M ATTERS CONCLUDED BY AN ORDER U/S.154, 155, 260, 262 OR 263.' 6 11. HOWEVER, RELIEF CLAIM BY THE ASSESSEE, WHICH IS EXHIBITED ELSEWHERE, REMAINS UNVERIFIED BY THE ASSESSING OFFICER IN SPITE OF THE FACT TH A T THE LD. CIT(A) DID CALL FOR REMAND REPORT. IN THE I NTEREST OF JUSTICE AND FAIR PLAY, WE DEEM IT FIT TO RESTORE THIS ISSUE TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER IS DIRECTED TO VERIFY THE CLAIM OF THE ASSESSEE U/S 43B OF THE ACT, EXAMINE THE CLAIM AND SEE THAT THE SAID EXPENDITURE ARE NOT DOUBLY CLAIMED BY THE ASSESSEE. IF THE CLAIM U/S 43B OF THE ACT IS FOUND CORRECT, THEN, IN THE LIGHT OF PROVISION OF SECTION 152(2) OF T HE ACT, PROCEEDINGS U/S 147 DESERVE TO BE DROPPED. 12 . IN THE RESULT, WITH THE ABOVE DIRECTIONS, THE APPEAL OF TH E REVENUE IN ITA NO. 325 8 /DEL/201 4 IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCE D IN THE OPEN COURT ON 20 .02.2019. SD/ - SD/ - ( SUCHITRA KAMBLE ) ( N. K. BILLAIYA ) JUDICIAL MEMBER A CCOUNTANT M EMBER DATE D : 20 . 0 2 .201 9 7 VL COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/ PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 11.01.2019 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH FILE GOES TO THE HEAD CLERK. THE DATE ON WHICH FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER