Appeal Details
Counselvise Citation
[2012] 140 COUNSELVISE.COM (IT) 63808 (ITAT-BANGALORE)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
8 month(s) 21 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
07-12-2012
Appeal Filed By
Assessee
Order Result
Partly Allowed
Bench Allotted
A
Next Hearing Date
14-11-2012
Assessment Year
2008-2009
Appeal Filed On
16-03-2012
Judgement Text
PAGE 1 OF 30 ITA NO.386 /BANG/2012 1 IN THE INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCH A BEFORE SHRI N BARATHVAJA SANKAR, VICE PRESIDENT AND SHRI GEORGE GEORGE K, J.M ITA NO.386/BANG/2012 (ASSESSMENT YEAR 2008-09) M/S VANSHEE BUILDERS & DEVELOPERS P. LTD., NO.684, 9 TH MAIN, 1 ST STAGE, INDIRANAGAR, BANGALORE-38. PA NO.AABCV 3394 G VS THE INCOME TAX OFFICER, WARD-12(2), BANGALORE-1. (APPELLANT) (RESPONDENT) DATE OF HEARING : 14.11.2012 DATE OF PRONOUNCEMENT : 07.12.2012 APPELLANT BY : SHRI B P SACHIN KUM AR, C.A. RESPONDENT BY : SHRI BIJOY KUMAR PANDA , ACIT ORD ER PER GEORGE GEORGE K : THIS APPEAL FILED BY THE ASSESSEE COMPANY IS DIRECT ED AGAINST THE ORDER OF THE LEARNED CIT (A)-III, BANGALORE DAT ED 12.01.2012. THE RELEVANT ASSESSMENT YEAR IS 2008-09. 2. THE ASSESSEE COMPANY HAS, IN ITS GROUNDS OF APPE AL, RAISED TEN GROUNDS, IN WHICH, GROUND NOS. 1 AND 3 ARE GENERAL IN NATURE AND, THEREFORE, THEY DO NOT SURVIVE FOR ADJUDICATION. GROUND NO.9 RELATES TO THE PAYMENT OF CASH OF RS.4 LAKHS FOR ELECTRIFICATION WO RK WHICH DID NOT ATTRACT TDS PROVISIONS OF THE ACT. HOWEVER, DURING THE COU RSE OF HEARING, THE PAGE 2 OF 30 ITA NO.386 /BANG/2012 2 LEARNED A R SUBMITTED THAT THIS GROUND IS NOT PRESS ED. ACCORDINGLY, GROUND NO.9 IS DISMISSED AS NOT PRESSED. GROUND NO.10 IS NOT MAINTAINABLE AS LEVY OF INTEREST U/S 234B OF THE ACT IS MANDATORY AND CON SEQUENTIAL IN NATURE. THE REMAINING GROUNDS RELATE TO THE FOLLOWING ISSUE S, NAMELY: (1) (GR.NO.2) THAT THE ORDER WAS PASSED WITHOUT PRO VIDING REASONABLE OPPORTUNITY TO THE ASSESSEE; (2) (GR.NOS.4 & 5) THAT THE CIT (A) OUGHT TO HAVE HELD THAT THE ASSESSEE BEING A COMPANY NEED NOT FILE A RETURN OF I NCOME U/S 139(1)(B) OF THE ACT; (3) (GR.NO.6, 7 & 8) THAT THE CIT (A) ERRED IN INV OKING THE PROVISIONS OF S. 80AC OF THE ACT; - THAT THE CIT (A) ALSO ERRED IN CONFIRMING THE DISAL LOWANCE OF DEDUCTION MADE U/S 80IB OF THE ACT. 3. THE ISSUES, IN BRIEF, ARE DISCUSSED AS UNDER: THE ASSESSEE COMPANY [THE ASSESSEE HENCE-FORTH] IS ENGAGED IN THE CONSTRUCTION AND REAL ESTATE BUSINESS. THE A SSESSEES PREMISE WAS SUBJECTED TO A SURVEY U/S 133A OF THE ACT ON 4.1.200 8. FOR THE ASSESSMENT YEAR UNDER CONSIDERATION, THE ASSESSEE HAD FILED ITS RETURN OF INCOME ON 25.4.2009, ADMITTING AN INCOME OF RS.1,05,58,731/- AND CLAIMED DEDUCTION OF RS.1,18,65,656/- UNDER S. 80-IB OF THE ACT. THE RE TURN WAS INITIALLY PROCESSED U/S 143(1) OF THE ACT AND, SUBSEQUENTLY, T OOK UP FOR SCRUTINY. ACCORDING TO THE AO, NOTICES WERE ISSUED POSTING TH E CASE FOR HEARING ON A NUMBER OF OCCASIONS. THERE WAS NO COMPLIANCE EXCEP T ON ONE OCCASION I.E., IN RESPONSE TO A NOTICE DATED 9.9.2010, ONE OF THE DIR ECTORS HAD APPROACHED THE AO WITH A REQUEST FOR A WEEKS TIME TO PRODUCE THE RELEVANT DETAILS, AMONG OTHERS, THE CLAIM OF DEDUCTION U/S 80IB, PROJ ECT COMPLETION, TDS PAGE 3 OF 30 ITA NO.386 /BANG/2012 3 DETAILS, CASH PAYMENTS ETC. HOWEVER, THERE WAS NO FURTHER COMPLIANCE. ACCORDING TO THE AO, AS THE CASE WAS GETTING BARRED BY LIMITATION BY 31.12.2010, THE ASSESSMENT WAS CONCLUDED U/S 144 OF THE ACT BASED ON THE MATERIALS AVAILABLE ON RECORD. WHILE DOING SO, THE AO MADE THE FOLLOWING ADDITION, AMONG OTHERS, NAMELY: (I) DISALLOWANCE OF DEDUCTION OF RS.1,18,65,656/- U/S 8 0IB OF THE ACT ON THE PREMISE THAT THE ASSESSEE HAD FURNISHED ITS RETURN OF INCOME ONLY ON 25.4.2009 WHICH WAS BELATED AND, THUS , THE ASSESSEE WAS DISENTITLED FOR SUCH A DEDUCTION. 4. AGGRIEVED, THE ISSUE WAS TAKEN UP BEFORE THE FI RST APPELLATE AUTHORITY FOR RELIEF. BEFORE THE CIT (A), IT WAS CO NTENDED BY THE ASSESSEE THAT FOR THE CLAIM OF DEDUCTION U/S 80IB (10) OF TH E ACT, THE ASSESSEE WAS NOT LIABLE TO FILE A RETURN SINCE IT HAD NIL INCO ME. 4.1. AFTER DUE CONSIDERATION OF THE ASSESSEES SUB MISSION, THE CIT(A) HAD REJECTED THE ISSUE RAISED BY THE ASSESSEE FOR THE REASONS THAT AS PER THE PROVISIONS OF S. 80AC OF THE ACT, RETURN HAS TO BE FILED WITHIN DUE DATE OF FILING RETURN UNDER SECTION 139(1) AND THE CASE LAWS RELIED ON BY THE ASSESSEE WERE FOUND TO BE ON GENERAL NORMATIVE PREM ISES RATHER THAN IN ANY INTERFERING WITH THE CLARITY OF THE LEGAL REQUIREMEN T AS PER S. 80AC. AS THERE WAS NO INFIRMITY WITH THE ORDER OF THE AO ON T HIS ACCOUNT, THE DENIAL OF DEDUCTION U/S 80IB (10) OF THE ACT WAS UPHELD. 5. AGGRIEVED, THE ASSESSEE HAS COME UP WITH THE PR ESENT APPEAL. DURING THE COURSE OF HEARING, THE SUBMISSIONS MADE BY THE LEARNED AR ARE SUMMARIZED AS UNDER: PAGE 4 OF 30 ITA NO.386 /BANG/2012 4 (I) THAT THE PROVISION UNDER S.80AC OF THE ACT AS R EGARDS THE TIME LIMIT FOR FILING THE RETURN OF INCOME IS N EITHER AN INEXORABLE RULE OF PRESCRIPTION NOR AN INVIOLABL E RULE OF RESTRICTION FOR ALLOWANCE OF DEDUCTION U/S 80IB OF THE ACT; - THAT AS PER S. 80-IB, THE DEDUCTION PROVIDED FOR THEREIN SHALL BE ALLOWED IN COMPUTING THE TOTAL INCOME OF T HE ASSESSEE FROM THE PROFITS AND GAINS DERIVED FROM TH E BUSINESS SUBJECT TO CERTAIN CONDITIONS CONTAINED TH EREIN; - THAT THE ENTIRE THRUST OF THE TAX CONCESSION U/S 80IB (10) IS AIMED AT PROVIDING MORE DWELLING UNITS AND PROVIDING TAX INCENTIVES; THAT IN EVERY BUDGET SPEEC H, THE FINANCE MINISTERS HAVE MADE EVERY ENDEAVOUR TO ADDRE SS THE PROBLEM OF ACUTE SHORTAGE OF DWELLING UNITS PRIMARILY FOR LESS PRIVILEGED SECTIONS OF THE SOCIET Y. THE PREDOMINANT OBJECTIVE OF THIS INCENTIVE PROVISION I S, THEREFORE, TO ENCOURAGE BETTER AVAILABILITY OF THE DWELLING UNITS AT AFFORDABLE RATES FOR LOW AND MIDD LE CLASS SEGMENTS OF THE SOCIETY AND, THUS IT IS A BENE FICIAL PROVISION FOR THE ASSESSEES; - THAT S. 80AC OF THE ACT PROVIDES THAT DEDUCTION U/S 80 IB SHALL BE ALLOWED TO ASSESSEE ONLY IF THE ASSESSEE FURNISHES A RETURN OF HIS INCOME ON OR BEFORE THE D UE DATE SPECIFIED UNDER SUB-SECTION 139(1); - THAT S.139(1) OF THE ACT PROVIDES FOR DUE DATES FOR FILING THE RETURN OF INCOME. ACCORDINGLY, THE DUE DATE FOR FILING THE RETURN OF INCOME OF ANY CORPORATE ENTITY I S SEP. 30 OF THE RELEVANT AY. HOWEVER, S. 139(4) OF THE A CT CARVES OUT AN EXCEPTION (EXTENSION) TO THE TIME LIM IT UNDER SECTION 139(1) FOR FILING THE RETURN OF INCOM E; - THAT AS PER THE PROVISIONS OF S. 139(4), IT IS C LEAR, THAT THE TIME LIMIT FOR FILING THE RETURN OF INCOME IS N EITHER INFLEXIBLE NOR INELASTIC. THE QUESTION THAT ARISES , PAGE 5 OF 30 ITA NO.386 /BANG/2012 5 THEREFORE, FOR CONSIDERATION AS REGARDS THE ALLOWAN CE OF DEDUCTION UNDER SECTION 80-IB OF THE ACT IS WHETHER THE PROVISIONS OF S. 80IB ARE APPLICABLE TO THE ASSESSE E OR WHETHER THE ASSESSEE FALLS WITHIN THE AMBIT OF THE DEDUCTION U/S 80IB BUT NOT THE TIME LIMIT FOR FILIN G THE RETURN OF INCOME BY HIM MENTIONED IN S. 80AC OF THE ACT. THIS VIEW IS FURTHER REINFORCED BY THE PROVISIONS OF S. 119 OF THE ACT; (II) AS PER THE PROVISIONS OF S. 119 OF THE ACT, T HE BOARD MAY FOR AVOIDING GENUINE HARDSHIP TO THE ASSESSEES RELA X ANY REQUIREMENT CONTAINED IN ANY OF THE PROVISIONS OF CH . IV OR CH. VI-A, WHERE THE ASSESSEE HAS FAILED TO COMPL Y WITH ANY REQUIREMENT SPECIFIED IN SUCH PROVISION FOR CLAIMING DEDUCTION THERE-UNDER, SUBJECT TO THE COND ITIONS THAT THE DEFAULT IN COMPLYING WITH SUCH REQUIREMENT WAS DUE TO CIRCUMSTANCES BEYOND THE CONTROL OF THE ASSES SEE; AND THE ASSESSEE HAS COMPLIED WITH SUCH REQUIREMENT BEFORE THE COMPLETION OF ASSESSMENT IN RELATION TO THE PREVIOUS YEAR IN WHICH SUCH DEDUCTION IS CLAIMED; - THAT IT IS CLEAR, THEREFORE, THAT THE PROVISION CONTAINED IN S. 80AC AS REGARDS THE TIME LIMIT FOR FILING THE RE TURN OF INCOME IS DIRECTORY BUT NOT MANDATORY IN VIEW OF THE AFORESAID PROVISIONS OF THE ACT PERMITTING RELAXATI ON OF THE TIME LIMIT FOR FILING THE RETURN. IT IS TO BE DISTINCTLY UNDERSTOOD THAT SUCH RELAXATION IS STATUTORY IN NATU RE (AS IT IS ALLOWED BY THE STATUTE ITSELF) AND NOT ADMINIS TRATIVE IN CHARACTER; (III) THAT THE PROVISIONS OF THE ACT RELATING TO EXEMPTIO N, ALLOWANCE AND DEDUCTION, REBATE OR RELIEF SHOULD BE INTERPRETED LIBERALLY AND BROADLY. RELIES ON CASE LAWS: O UNION OF INDIA V. WOOD PAPERS LTD (1991) 83 STC 251 ; O CIT V. GWALIOR RAYON SILK MFG. CO LTD AIR 1992 SC 1 782; PAGE 6 OF 30 ITA NO.386 /BANG/2012 6 O CONTROLLER OF ESTATE DUTY V. R. KANAKASABAI (1973) 8 9 ITR 251 (SC); O BAJAJ TEMPO LTD V. CIT (1992) 196 ITR 188 (SC); O ACIT V. DHIR GLOBAL INDUSTRIAL (P) LTD 133 TTJ (DEL ) 580; & O ITO V. SRI S VENKATAIAH ITA NO.984/HYD/2011 DT..31 .5.2012 OF THE HYDERABAD BENCH B. (IV) THAT THE SECTION 80AC OF THE ACT RESTRICTS DEDUCTIO N AVAILABLE U/S 80IB OF THE ACT WHERE THE RETURN OF INCOME IS NOT FILED WITHIN THE DUE DATES PROVIDED U /S 139(1) OF THE ACT; THAT THE S. 139(1) OF THE ACT PROVIDES FOR DUE DATES FOR FILING THE RETURN OF INC OME. ACCORDINGLY, DUE DATE FOR FILING THE RETURN OF INCOM E FOR THE AY 2008-09 WAS 31.10.2008; - THAT THE ASSESSEE HAD FILED ITS RETURN OF INCOME ELECTRONICALLY U/S 139(1B) OF THE ACT. S. 139(1B) P ROVIDES THAT A CORPORATE ENTITY MAY FURNISH THE RETURN OF INC OME U/S 139(1), AT ITS OPTION, ON OR BEFORE THE DUE DAT E ELECTRONICALLY IN ACCORDANCE WITH THE ELECTRONIC FURNISHING OF RETURN OF INCOME SCHEME, 2007 [EFRIS 2007] NOTIFICATION NO.SO1281(E) DATED 27.7.2007; - THAT THE EFRIS 2007 PROVIDES THAT ELIGIBLE PERSO N MAY AT ITS OPTION FURNISH HIS RETURN OF INCOME WHICH HE IS REQUIRED TO FURNISH U/S 139.. OF THE ACT FOR AY 2 007 08 OR ANY SUBSEQUENT AY TO AN E-RETURN INTERMEDIARY W HO SHALL DIGITIZE THE DATA OF SUCH RETURN AND TRANSMIT THE SAME ELECTRONICALLY TO A SERVER DESIGNATED FOR THIS PURPOSE BY THE E-RETURN ADMINISTRATOR ON OR BEFORE T HE DUE DATE; - THAT THE TIME LIMIT PROVIDED UNDER EFRIS 2007 [NOTIFICATION NO. SO1281(E) DATED 27.07.2007) IS NO T RESTRICTED TO TIME LIMIT PROVIDED U/S 139(1), BUT, IT EXTENDS TO THE TIME LIMIT ALLOWED U/S 139(4) (BELAT ED RETURN). PAGE 7 OF 30 ITA NO.386 /BANG/2012 7 RELIES ON CASE LAWS: FATHIMA BAI V. ITO (2009) 32 DTR (KAR); CIT V. TARNETAR CORPORATION (TAX APPEAL NO.1241 OF 2011 GUJARAT HIGH COURT; ITO V. MAHAVEER CALYX (IT APPEAL NOS.153 & 998(BANG) OF 2011 DATED 31.8.2012; SRI SAMBANDAM UDAYKUMAR V. CIT (IT APPEAL NO.175 OF 2012 DT.15.2.2012 OF HONBLE KARANATAKA HIGH COURT; (V) THUS, THE TIME LIMIT PRESCRIBED U/S 139(1) IS NOT MANDATORY BUT DIRECTORY IN NATURE; THAT THIS ARGUMENT CAN BE STRENGTHENED BY THE FOLLOWING EXAMPLE. IN TH E INSTANT CASE, THE DEDUCTION U/S 80-IB WAS DENIED BY THE AO BY THE AO ON THE GROUND THAT THE RETURN OF INCOME WAS NOT FILED WITHIN THE DUE DATE. IF A HYPOTHETICAL SITUATION IS TAKEN UP WHEREIN THE TIME LIMIT FOR FILING RETURN U/S 139(1) WAS NOT OVER AND A SEARCH U/S 132 TOOK PLACE. THE ASSESSEE FILED RETU RN OF INCOME IN RESPONSE TO NOTICE U/S 153A AFTER CLAIMING DEDUCTION U/S 80IB. THE RETURN OF INCOME IS FILED BEYOND TIME LIMIT SPECIFIED U/S 139(1) TIME, B UT IT IS WELL WITHIN THE TIME LIMIT SPECIFIED U/S 153A . IN THIS SITUATION, DEDUCTION COULD NOT BE DENIED JUST BECAUSE RETURN WAS FILED BEYOND THE DUE DATE SPECIFIED U/S 139(1) SINCE THE RETURN IS WELL WITHI N THE TIME LIMIT OF S. 153A. THUS, IT WAS CLEAR THAT VAR IOUS JUDICIARIES HAVE TAKEN A LIBERAL VIEW WHILE INTERPR ETING THE BENEFICIAL PROVISIONS OF THE ACT. 5.1. IN FURTHERANCE, THE LEARNED A R SOUGHT THE PERMISSION OF THIS BENCH VIDE THE ASSESSEES PETITION 31.10.2012, FOR ADMISSION OF THE ADDITIONAL EVIDENCES. THE CONTENTS OF THE PETITION FOR ADMISSION OF ADDITIONAL EVIDENCES READ AS FOLLOWS:- PAGE 8 OF 30 ITA NO.386 /BANG/2012 8 1. THE PETITIONER, A COMPANY, ENGAGED IN THE BUSINE SS OF REAL ESTATE HAS SUBMITTED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION DECLARING NIL INCOME AFTER CLAIMING THE DEDUCTION U/S 80-IB OF TH E INCOME-TAX ACT. RETURN OF INCOME WAS FILED BELATED LY ON 25.4.2009, AFTER A DELAY OF 207 DAYS; 2. THE ASSESSMENT WAS COMPLETED UNDER SECTION 144 O F THE ACT, DETERMINING THE INCOME OF THE APPELLANT AT RS.1,09,58,731/-. A SUM OF RS.1,18,65,656/- BEING DEDUCTION CLAIMED U/S 80IB OF THE ACT WAS DISALLOWE D BY THE AO ON THE GROUND THAT THE RETURN OF INCOME WAS SUBMITTED BEYOND THE DUE DATE SPECIFIED U/S 139(1) O F THE ACT AS STIPULATED U/S 80AC OF THE ACT. 3. IN THIS CONNECTION, IT IS HUMBLY SUBMITTED THAT T HERE WAS SUFFICIENT REASON FOR FILING THE RETURN BELATED LY AND IN SUPPORT OF THE SAME, WE WISH TO SUBMIT AN AFFIDA VIT OF MR. PRABHU, DIRECTOR AND CBDT CIRCULAR NO.4 OF 2009 DATED 30 TH JUNE, 2009 AS ADDITIONAL EVIDENCES. 4. THE ADDITIONAL EVIDENCES SOUGHT TO BE FILED NOW COULD NOT BE FILED BEFORE THE AO AND CIT (A) DUE TO FOLLO WING REASONS: (I) WE WERE NOT PROPERLY ADVISED IN THE PROCEEDINGS BEFORE THE LOWER AUTHORITIES AND IT DID NOT HAVE TH E SERVICES OF AN ADVOCATE AT OUR COMMAND; (II) DURING THE RELEVANT AY, THERE WAS CONFUSION PREVALENT WITH REGARD TO CLAIM OF DEDUCTION UNDER SEC. 80 IB OF THE ACT. ASSESSEES, PROFESSIONALS A ND EVEN FOR THAT MATTER THE INCOME-TAX DEPARTMENT WAS NOT VERY CLEAR AS TO DEDUCTION U/S 80IB (10) WOULD BE AVAILABLE ON A YEAR TO YEAR BASIS WHERE AN ASSESSEE IS SHOWING PROFIT ON PARTIAL COMPLETION OR IF IT WOULD BE AVAILABLE ONLY IN THE YEAR OF COMPLETION OF THE PROJECT. IT WAS SUBSEQUENTLY CLARIFIED BY THE PAGE 9 OF 30 ITA NO.386 /BANG/2012 9 BOARD (BY) WAY OF INSTRUCTION NO.4 OF 2009 DATED 30 TH JUNE, 2009. 5. UNDER THESE CIRCUMSTANCES, IT IS REQUESTED THAT THE HONBLE TRIBUNAL BE PLEASED TO: (I) ADMIT THE ADDITIONAL EVIDENCES; (II) HEAR AND DISPOSE OF THE APPEAL IN ACCORDANCE WITH LAW; AND (III) PASS SUCH OTHER ORDER AS THE HONBLE TRIBUNAL DEEMS FIT AND PROPER AND THUS RENDER JUSTICE. 5.1.1. IN ADDITION, THE ASSESSEE FURNISHED AN AFFI DAVIT DATED 31.10.2012 WHEREIN, THE DIRECTOR OF THE ASSESSEES HAD SOLEMNLY AFFIRMED ON OATH AS UNDER: 1. RETURN OF INCOME OF THE APPELLANT COMPANY FOR T HE AY 2008-09 WAS FILED BELATEDLY ON 25.04.2009. THE DEL AY WAS DUE TO THE FOLLOWING REASONS: A) MR. LOKESH, ACCOUNTANT WHO WAS WORKING WITH US FOR QUITE LONG QUIT ABRUPTLY WITHOUT PROVIDING PRIOR INTIMATION WHILE FINALIZING THE ACCOUNTS FOR THE FINANCIAL YEAR 2007-08; B) WE COULD NOT TRACE THE PASSWORD OF THE SYSTEM DESPITE OUR BEST EFFORTS; C) WE TRIED TO RETRIEVE THE DATA FROM THE SYSTEM WITH THE HELP OF HARDWARE ENGINEERS, IN THE PROCESS LOST COUPLE OF IMPORTANT DATA. FINANCIAL INFORMATION OF THE COMPANY WAS ONE SUCH DATA THAT WAS LOST; D) WE TRIED TO RECONSTRUCT THE DATA WITH AVAILABLE INFORMATION ON HAND. WE COULD NOT SUCCEED IN RECONSTRUCTING THE DATA AS THE INCOME-TAX DEPARTMENT HAD IMPOUNDED MANY OF THE VITAL DOCUMENTS IN PURSUANCE TO SURVEY CARRIED ON IN THE BUSINESS PREMISES OF THE APPELLANT ON 04.01.2008; PAGE 10 OF 30 ITA NO.38 6/BANG/2012 10 E) THEREFORE, IT TOOK QUITE SOME TIME FOR US TO RECONSTRUCT THE FINANCIAL STATEMENTS AND SUBMIT IT TO THE INCOME-TAX DEPARTMENT. THUS, THERE WAS DELAY IN 207 DAYS FOR FILING THE RETURN OF INCOME FOR THE AY 2008-09; 2. DURING THE RELEVANT AY, THERE WAS CONFUSION PRE VALENT WITH REGARD TO CLAIM OF DEDUCTION UNDER SEC. 80 IB OF THE ACT. ASSESSEES, PROFESSIONALS AND EVEN FOR THAT MA TTER THE INCOME-TAX DEPARTMENT WAS NOT VERY CLEAR AS TO WHETHER DEDUCTION U/S 80IB (10) WOULD BE AVAILABLE ON A YEAR TO YEAR BASIS WHERE AN ASSESSEE ADMITS PROFIT ON PARTIAL COMPLETION OR IT WOULD BE AVAILABLE ONLY IN THE YEAR OF COMPLETION OF THE PROJECT. IT WAS SUBSEQUENTLY CLARIFIED BY THE BOARD BY WAY OF INSTRUCTION NO.4 O F 2009 DATED 30 TH JUNE 2009. 3. DUE TO THIS CONFUSION, ASSESSEE COMPANY HAD TO FILE THE RETURN OF INCOME ADMITTING NIL INCOME AND SUBMISSIONS WERE MADE TO THIS EFFECT BEFORE THE LEA RNED COMMISSIONS OF INCOME-TAX (APPEALS). 5.2. YET AGAIN, IN THE SUBSEQUENT HEARING, THE ASSESSEE THROUGH ITS PETITION DATED 13.11.2012 SOUGHT THE PERMISSION OF THIS BENCH TO PLACE FURTHER ADDITIONAL EVIDENCES. THE CONTENTS OF PETI TION DATED 13.11.2012 READ AS FOLLOWS:- 1. THE STATUTORY AUDIT OF ACCOUNTS OF THE APPELLAN T FOR THE PREVIOUS YEAR 2007-08 RELEVANT TO THE AY 2008-0 9 ARE COMPLETED ON 12.09.2008. HOWEVER, TAX AUDIT U/ S 44AB OF THE ACT WAS COMPLETED ON 22.4.2009; 2. AUDIT REPORT UNDER SEC. 80 IB OF THE ACT IN FOR M 10CCB WAS OBTAINED ON 22.09.2008; PAGE 11 OF 30 ITA NO.38 6/BANG/2012 11 3. THE APPELLANT HAS FILED THE RETURN OF INCOME ON 25.04.2010 (SIC) 25.04.2009 THROUGH ELECTRONIC FILI NG MECHANISM. AS NO ENCLOSURES TO BE GIVEN WHILE E-FI LING OF THE RETURNS, THE SAME HAS BEEN NOT FILED ALONG WITH THE RETURN OF INCOME; 4. DURING THE COURSE OF THE HEARING BEFORE THE AO AND THE LD. CIT (A), SUFFICIENT OPPORTUNITY WAS NOT PRO VIDE TO THE APPELLANT TO FURNISH THE FORM 10CCB. LD. AO COMPLETED THE ASSESSMENT UNDER SEC. 144 OF THE ACT WHERE AS LD. CIT (A) DISMISSED THE APPEAL ONLY ON T HE GROUND THAT THE RETURN OF INCOME WAS FILED BELATEDL Y. THEREFORE, THERE WAS NO OCCASION FOR THE APPELLANT TO FILE FORM 10 CCB BEFORE THE LOWER AUTHORITIES. 5. UNDER THESE CIRCUMSTANCES, IT IS REQUESTED THAT THE HONBLE TRIBUNAL BE PLEASED TO - (I) ADMIT THE ADDITIONAL EVIDENCES; (II) HEAR AND DISPOSE OF THE APPEAL IN ACCORDANCE WITH LAW; AND (III) PASS SUCH OTHER ORDER AS THE HONBLE TRIBUNAL DEEMS FIT AND PROPER AND THUS RENDER JUSTICE. IN CONCLUSION, THE LEARNED A R SUBMITTED THAT SINCE THE IMPUGNED ORDER OF THE LEARNED CIT (A) IS SUFFERING FROM INFIRMITY WHICH REQUIRES TO BE CURED BY RESCINDING THE SAME. TO SUB STANTIATE HIS CLAIM, THE LEARNED A R CAME UP WITH A PAPER BOOK CONTAINING 1 41 PAGES WHICH, INTER ALIA, CONSIST OF VARIOUS CASE LAWS. 5.3. ON THE OTHER HAND, THE LEARNED D R CAME UP WI TH A STRONG DEFENSE TO THE FINDINGS OF THE CIT (A). THE SUBMIS SIONS OF THE LEARNED D R ARE, FOR APPRECIATION OF FACTS, SUMMARIZED HEREUNDE R: PAGE 12 OF 30 ITA NO.38 6/BANG/2012 12 - THAT THE FACTUAL POSITION WAS THAT THE ASSESSEE H AD NOT FILED THE AUDIT REPORT U/S 44AB OF THE ACT ALONG WITH THE RETURN OF INCOME OR IN SUBSEQUENT PROCEEDINGS EITHER BEFORE T HE AO OR THE CIT (A); AND THAT THE CERTIFICATE FROM THE AUDI TOR IN FORM NO.10CCB AS REQUIRED UNDER RULE 18BBB OF THE I.T. R ULES ON THE ELIGIBILITY FOR DEDUCTION U/S 80-IB HAS ALSO NOT BE EN FURNISHED TO THE DEPARTMENT; - THAT THE ASSESSEE HAS COME UP WITH THE FRESH THEO RY THAT THE DELAY IN FILING THE RETURN OF INCOME AS A RESULT OF ITS MISSING ACCOUNTANT AND CONSEQUENTIAL DELAY TO RECONSTRUCT T HE FINANCIAL STATEMENTS, HOWEVER, THE FOLLOWING QUESTIONS REMAIN UNANSWERED, NAMELY: (I) WHETHER THE ACCOUNTS OF THE ASSESSEE GOT COMPLETED, IF YES, WHEN? (II) WHETHER THE ACCOUNTS OF THE ASSESSEE GOT AUDITED U/ S 44AB, IF YES, WHEN? (III) IF AUDIT OF THE ACCOUNTS WERE COMPLETED THEN WHY THE AUDITORS REPORT IN FORM 10CCB COULD NOT BE OBTAINE D? (IV) IF BOTH THE AUDIT REPORT AND REPORT IN FORM 10CCB WERE OBTAINED, THEN, WHAT PREVENTED THE ASSESSEE TO SUBM IT THE SAME BEFORE THE AO OR BEFORE THE CIT (A)? & (V) WHETHER AND WHEN THE AUDIT REPORT IS FILED WITH THE ROC WHICH IS A STATUTORY REQUIREMENT UNDER THE COMPANIE S ACT? - THAT THE ASSESEE HAS FILED A PETITION ON 1.11.201 2 BEFORE THE HONBLE BENCH FOR ADMISSION OF ADDITIONAL EVIDENCE WHICH IS NOT ACCEPTABLE AND MAY NOT BE ADMITTED. - EXTENSIVELY QUOTING THE RULE 29 OF APPELLATE TRIBU NAL RULES 1963, IT WAS CONTENDED THAT THE ASSESSEE WAS DISENT ITLED TO FILE THE ADDITIONAL EVIDENCE BEFORE THE HONBLE TRIBUNAL UNLESS THE TRIBUNAL REQUIRES THE ASSESSEE TO DO SO; AND THAT T HE MERE FACT THAT THE EVIDENCE SOUGHT TO BE PRODUCED WAS VITAL A ND IMPORTANT DID NOT PROVIDE A SUBSTANTIAL REASON TO A LLOW ITS ADMISSION AT THE APPELLATE STAGE, ESPECIALLY, WHEN T HE EVIDENCE PAGE 13 OF 30 ITA NO.38 6/BANG/2012 13 WAS AVAILABLE TO THE PARTY AT THE INITIAL STAGE AND HAD NOT BEEN PRODUCED BY IT, WITHOUT ANY REASON. RELIES ON THE FOLLOWING CASE LAWS : O CIT V. JAIPUR UDYOG LTD. - 227 ITR 345 (RAJ); O VELJI DEORAJ & CO., V. CIT 68 ITR 708 (BOM); O A.K. BABU KHAN V. CIT 102 ITR 757 (AP); & O RAM PRASAD SHARMA V. CIT 119 ITR 867 (ALL) IT WAS, THEREFORE, URGED NOT TO ADMIT THE ADDITIONA L EVIDENCE AND TO REJECT THE SAME. - THAT FROM THE PETITION, THERE DOES NOT APPEAR TO BE EXISTENCE OF ANY REASONABLE CAUSE FOR FILING THE RETURN OF INC OME BELATEDLY; AND THAT THE REASONS ADVANCED IN THE AFFI DAVIT ARE NOT ACCEPTABLE FOR THE FOLLOWING: (I) THAT THE ASSESSEE WAS NOT PROPERLY ADVISED IN T HE PROCEEDINGS BEFORE THE AO / CIT (A) WAS TOO SIMPLIS TIC TO BE ACCEPTED/BELIEVED; AND SIMILARLY THE CONTENTION THAT THE ASSESSEE DID NOT HAVE THE SERVICES OF AN ADVOCATE W AS NOT ACCEPTABLE AND CANNOT BE BELIED AND THAT THE ASSESS EE WAS REPRESENTED BEFORE THE CIT(A) BY A QUALIFIED CA; (II) THAT THE PLEA OF ITS ACCOUNTANT LEFT THE WORK ABRUPTLY AND THE COMPUTER SYSTEM COULD NOT BE OPERATED WAS A VERY VAGUE EXPLANATION AS PROOF OF ITS ACCOUNTANT HAVING EMPLO YED WITH IT WAS NOT FORTH-COMING. IF IT WERE TO BE SO IN FILING THE RETURN BELATEDLY, THE SAME SHOULD HAVE BEEN SUBMITTED BEFOR E THE AUTHORITIES BELOW. AS THE EXPLANATION SUBMITTED WA S VERY VAGUE AND DEVOID OF ANY MERIT, THE SAME CANNOT BE CONSTRUE D AS A GENUINE HARDSHIP WHICH PREVENTED THE ASSESSEE FROM FILING ITS RETURN OF INCOME IN TIME. - THAT THE CASE LAW CITED BY THE ASSESSEE [ITO V. S . VENKATAIAH ITA NO.984/HYD/2011] IS NOT APPLICABLE TO THE ASS ESSEES CASE FOR THE FOLLOWING REASONS: PAGE 14 OF 30 ITA NO.38 6/BANG/2012 14 IN THE CASE OF SRI VENKATAIAH IN THE CASE OF THE AS SESSEE I)DEDUCTION WAS CLAIMED U/S 80IC; II) DELAY OF 74 DAYS EXPLAINED BEFORE THE AO THAT THERE WAS TECHNICAL PROBLEM IN COMPUTER SYSTEM; (III) IT WAS EXPLAINED THAT DUE TO REASONABLE CAUSE OF PROBLEM IN COMPUTER AND RE-ENTRY OF DATA, MULTI- LOCATION OF BUSINESS ACTIVITY, TIME CONSUMED FOR AUDITING BY THE STATUTORY AUDITORS; (IV) DELAY OF 74 DAYS AS GENUINE AND BEYOND THE CONTROL OF THE ASSESSEE WHICH WAS DULY SUPPORTED BY THE CONFIRMATION FROM THE STATUTORY AUDITOR; (V) THE COMPUTER GOT CORRUPTED AND THE DATA LOST FOR TWO MONTHS WHICH WAS RETRIEVED. HE HAD MULTI LOCATIONS OF SALES POINTES IN 12 STATES AND COLLECTING DATA AND SUBSEQUENT AUDIT BY THE AUDITORS TOOK TIME WHICH HAD RESULTED IN DELAY OF 74 DAYS; (VI) THE HONBLE TRIBUNAL HAD HELD THAT THE CLAIM OF THE ASSESSEE CANNOT BE DENIED ON TECHNICALITIES WHEN THE ASSESSEE WAS LEGALLY OTHERWISE ENTITLED FOR DEDUCTION. I)DEDUCTION WAS CLAIMED U/S 80IB; II) DELAY OF 207 DAYS NO EXPLANATION WAS FURNISHED BEFORE THE AO FOR SUCH A DELAY; (III) NO AUDIT REPORT WAS FILED EITHER WITH THE RETURN OF INCOME OR DURING THE ASSESSMENT PROCEEDINGS. NO FORM 10CCB WHICH WAS MANDATORY AND A PRE-REQUISITE FOR DEDUCTION U/S 80IB WAS FILED WITH THE RETURN OR IN THE SUBSEQUENT PROCEEDINGS; (IV) REASON ADVANCED WAS VAGUE , UNSUBSTANTIATED BUT AN AFTER THOUGHT WHICH WAS SUPPORTED BY THE FACT THAT THE ASSESSEE HAD BROUGHT NO REASON FOR THE DELAY EITHER BEFORE THE AO OR BEFORE THE CIT (A); (V)THERE WAS NO SUCH PROBLEM WHICH WAS BEYOND THE CONTROL OF THE ASSESSEE; (VI) IT APPEARS THE ASSESSEE WAS IN THE HABIT OF FILING ITS RETURNS BELATEDLY. FOR THE AY 2007-08, THE RETURN WAS FILED AFTER ISSUANCE OF A NOTICE U/S 148 AND, HENCE, THE DELAY FOR FILING THE RETURN BE CONSTRUED AS INTENTIONAL AND NOT A MERE TECHNICAL FLAW. - THAT IN THE CASE OF ACIT V. DHIR GLOBAL INDUSTRIA L PVT. LTD [133 TTJ (DEL) 580 RELIED ON BY THE ASSESSEE, IN FAC T, THIS CASE DEALS WITH S. 10B (1) OF THE ACT, THAT THE ASSESSEE COULD NOT PAY SELF-ASSESSMENT TAX ON TIME DUE TO SOME FINANCIAL PROBLEMS; THAT THE NEW PROVISION REGARDING E-FILING OF RETURN WAS INTRODUCED IN THIS FIRST YEAR, THE SOFTWARE DID NOT ACCEPT THE RETURN, IF SELF ASSESSMENT WAS NOT PAID AND THUS, T HERE WAS A DELAY OF NEARLY 45 DAYS FOR FILING THE RETURN AND THE HONBLE TRIBUNAL AFTER DUE CONSIDERATION OF THE SAME AS GEN UINE AND PAGE 15 OF 30 ITA NO.38 6/BANG/2012 15 VALID REASON FOR THE DELAY IN FILING THE RETURN. HOW EVER, IN THE CASE OF THE PRESENT ASSESSEE, THE CLAIM FOR DEDUCTI ON WAS U/S 80IB AND THE APPLICATION OF PROVISIONS OF S. 80AC. 5.4. IN CONCLUSION, THE LEARNED D R SUBMITTED THAT THERE WAS NO REASONABLE CAUSE FOR THE ASSESSEE TO FILE THE RETUR N BELATED, THE CASE LAWS RELIED ON BY THE ASSESSEE ARE DISTINGUISHABLE AND CA NNOT BE APPLIED TO THE CASE ON HAND. IT WAS, THEREFORE, PLEADED THAT THER E WAS NO ANY INFIRMITY IN THE FINDINGS OF THE CIT (A) WHICH REQUIRES THE INTE RVENTION OF THIS BENCH. 6. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS, DILIGENTLY PERUSED THE RELEVANT CASE RECORDS AND ALSO VARIOUS CASE LAWS ON WHICH BOTH THE PARTIES HAVE PLACED STRONG RELIANCE. 6.1. THE MULTIPLICITY OF THE ISSUES RAISED BY THE A SSESSEE ARE DEALT WITH ONE BY ONE AS UNDER: I . ASST. ORDER WAS PASSED WITHOUT PROVIDING SUFFI CIENT OPPORTUNITY: (I) ON A PERUSAL OF THE ASSESSMENT ORDER, IT IS OBSERVED THAT NOTICE U/S 143(2) DATED 21.8.2009, POSTING THE CASE FOR HEARING ON 4.9.2009, WAS ISSUED WHICH WAS FOLLOWED BY NOTICES U/S 142(1) OF THE ACT ON 24.5.2010 AND ON 30.8.2010 POSTING THE CASE FOR HEARING ON 24 .7.2010 AND 6.9.2010 RESPECTIVELY. THERE WAS NO COMPLIANCE. IN COMPLIANC E TO SUBSEQUENT NOTICE U/S 142(1) OF THE ACT DATED 9.9.2010, ACCORDING TO THE AO, ONE OF THE DIRECTORS APPEARED BEFORE HIM AND SOUGHT FOR A WEEK S TIME TO PRODUCE ALL THE DETAILS AS CALLED FOR. ACCORDING TO THE AO, AS THE ASSESSEE WAS REQUIRED TO SUBSTANTIATE THE CLAIMS OF DEDUCTION U/S 80-IB O F THE ACT, PROJECT COMPLETION DETAILS, TDS, CASH PAYMENT EXCEEDING RS.2 0,000/- ETC., THE PAGE 16 OF 30 ITA NO.38 6/BANG/2012 16 HEARING OF THE CASE WAS RESCHEDULED TO 5.10.2010. HOWEVER, THERE WAS NO COMPLIANCE. THERE WAS NO RESPONSE TO SUBSEQUENT NO TICE U/S 131 OF THE ACT DATED 9.11.2010 WHICH WAS FOLLOWED BY A LETTER DT.22 .11.2010 AND A FINAL NOTICE DATED 24.11.2010. (II) IN VIEW OF NON-COMPLIANCE TO THE NOTICES MENTIONED SUPRA AND THE CASE WAS GETTING BARRED BY LIMITATION BY 31.1 2.2010, THE AO WAS LEFT WITH NO ALTERNATIVE OTHER THAN TO CONCLUDE THE ASSE SSMENT U/S 144 OF THE ACT ON THE BASIS OF MATERIALS AVAILABLE ON RECORD. (III) CONSIDERING THE SCENARIO AS DETAILED, WE ARE OF THE CONSIDERED VIEW THAT THERE WAS NO SUBSTANCE IN THE ALLEGATION OF THE ASSESSEE THAT THE ASSESSMENT WAS CONCLUDED WITHOUT AFFORDING ADEQUATE OPPORTUNITY OF BEING HEARD. ACCORDINGLY, THIS GROUND IS DECIDED AGAINST THE ASSESSEE. II. CIT (A) ERRED IN INVOKING THE PROVISIONS OF S. 80AC OF THE ACT AND ALSO CONFIRMATION OF THE DISALLOWANCE OF DEDUCTION U/S 8 0IB OF THE ACT: (I) THE ASSESSEE FURNISHED ITS RETU RN OF INCOME FOR THE ASSESSMENT YEAR UNDER DISPUTE ON 25.4.2009, ADMITTIN G A TOTAL INCOME OF RS.1.05 CRORES AND ALSO CLAIMING OF DEDUCTION OF RS .1.18 CRORES UNDER SECTION 80IB OF THE ACT. ADMITTEDLY, THE RETURN OF INCOME W AS BELATED. AS THERE WAS NO PROPER COMPLIANCE TO THE NOTICES AS DETAILED ABOVE, THE ASSESSMENT WAS CONCLUDED BY THE AO U/S 144 OF THE ACT ON THE BA SIS OF DETAILS/MATERIALS ON RECORD. WHILE DOING SO, THE A SSESSEES CLAIM, AMONG OTHERS, FOR DEDUCTION U/S 80-IB OF THE ACT WAS TURN ED DOWN ON THE PREMISE PAGE 17 OF 30 ITA NO.38 6/BANG/2012 17 THAT THE RETURN OF INCOME OF THE ASSESSEE WAS BELAT ED AND, THUS, THE ASSESSEE WAS DISENTITLED FOR SUCH A CLAIM. (II) WHEN THE ISSUE WAS TAKEN UP BEFORE THE FIR ST APPELLATE AUTHORITY FOR RELIEF, THE CIT (A), PLACING RELIANCE ON THE PROVISIONS OF SECTION 80AC OF THE ACT, CONFIRMED THE STAND OF THE AO WITH AN OBSERVATION THAT THERE WAS NO ANY INFIRMITY WITH THE ORDER OF TH E AO ON THIS ACCOUNT AND THE DENIAL OF DEDUCTION U/S 80IB (10) OF THE AC T WAS, ACCORDINGLY, SUSTAINED. (III) THE STAND OF THE CIT (A) WAS CHALLENGED BY THE ASSESSEE IN THIS APPEAL. DURING THE COURSE OF HEARING, THE LEA RNED AR CONCEDED THAT S. 80AC OF THE ACT PROVIDES THAT DEDUCTION U/S 80IB SH ALL BE ALLOWED TO THE ASSESSEE ONLY IF THE ASSESSEE FURNISHES A RETURN OF ITS INCOME ON OR BEFORE THE DUE DATE AS SPECIFIED UNDER SUB-SECTION 139(1) OF THE ACT. HOWEVER , THE LEARNED AR HAD POINTED OUT THAT THE CIT (A) HAD FAI LED TO TAKE RECOURSE TO S. 139(4) OF THE ACT. FOR APPRECIATION OF FACTS AN D CLARITY, THE RELEVANT PORTION OF S. 139(4) WHICH HAS BEEN SUBSTITUTED BY T HE DIRECT TAX LAWS (AMENDMENT) ACT, 1987 W.E.F. 1.4.1989 IS EXTRACTED AS BELOW: (4) ANY PERSON WHO HAS NOT FURNISHED A RETURN WITHI N THE TIME ALLOWED TO HIM UNDER SECTION (1), OR WITHIN TH E TIME ALLOWED UNDER A NOTICE ISSUED UNDER SUB-SECTION (1) OF SECTION 142, MAY FURNISH THE RETURN FOR ANY PREVIOUS YEARS AT ANY TIME BEFORE THE EXPIRY OF ONE YEAR FROM TH E END OF THE RELEVANT ASSESSMENT YEAR OR BEFORE THE COMPLETION OF THE ASSESSMENT, WHICHEVER IS EARLIER. (IV) AS PER S. 139(4) OF THE ACT, IT IS ABUNDANTLY IMPLICIT THAT THE TIME LIMIT FOR FILING THE RETURN WAS NEITHER RI GID NOR INELASTIC. PAGE 18 OF 30 ITA NO.38 6/BANG/2012 18 (V) NOW THE MOOT QUESTION I S WHETHER THE ASSESSEE IS ENTITLED TO DEDUCTION U/S 80IB OF THE ACT, EVEN THOUGH IT HA S NOT FILED RETURN OF INCOME WITHIN THE DUE DATE OF FILING OF RETURN UNDE R SECTION 139(1) OF THE ACT BUT THE SAME WAS FILED WITHIN THE DUE DATE MENT IONED UNDER SECTION 139(4) OF THE ACT? (VI) AT THIS POINT OF TIME, LET US ANALYSE THE JUDICIAL PRECEDENT ON THE SUBJECT. (1) IN THE CASE OF BAJAJ TEMPO LIMITED V. CIT REPORTED IN (1992) 104 CTR (SC) 116: (1992) 196 ITR 0188 (SC), THE HONBLE SUPREME COURT HAD HELD THAT A PROVISION IN THE TAXING STATUTE GRANTING INCENTIV ES FOR PROMOTING GROWTH AND DEVELOPMENT SHOULD BE CONSTRUE D LIBERALLY. SINCE A PROVISION INTENDED FOR PROMOTING ECONOMIC GROWTH HA S TO BE INTERPRETED LIBERALLY, THE RESTRICTION ON IT TOO HAS TO BE CONST RUED SO AS TO ADVANCE THE OBJECTIVE OF THE PROVISION AND NOT TO FRUSTRATE IT. (2) THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF UDDEERESWARA MINING INDUSTRIES V. CIT REPORTED IN ( 1993) 204 ITR 550 (KAR) HAD RULED THAT - 5. THERE CAN BE NO DISPUTE ABOUT THE PROPOSITION THAT THE TERM USED IN A FISCAL LEGISLATION DESCRIBING TH E SUBJECTS OF TAXATION ARE TO BE NORMALLY UNDERSTOOD I N THEIR POPULAR SENSE UNLESS THE LAW ITSELF INDICATES A DIFFERENT APPROACH. SCIENTIFIC AND TECHNICAL MEANI NGS ARE TO BE ATTRIBUTED TO THOSE WORDS ONLY WHEN THE CONTEXT REQUIRES SUCH MEANINGS TO BE GIVEN. THE NO RMAL RULE IS TO GIVE THAT MEANING WHICH TO PERSONS ENGAG ED IN DEALING WITH THAT SUBJECT MATTER ATTRIBUTE TO THAT TERM, PAGE 19 OF 30 ITA NO.38 6/BANG/2012 19 DESCRIBING THE SUBJECT. IT IS ALSO TRUE THAT A BEN EFICIAL PROVISION IN A FISCAL STATURE SHOULD BE LIBERALLY CO NSTRUED TO ADVANCE THE PURPOSE BEHIND THE LEGISLATION (3) THE HONBLE B BENCH OF THE DELHI TRIBUNAL IN THE CASE OF ACIT V. DHIR GLOBAL INDUSTRIAL (P) LTD REPORTED IN (2011) 43 SOT 640 RECORDED ITS FINDING WHICH IS EXTRACTED AS BELOW: A PROVISO HAS BEEN INSERTED DURING THE CURRENT YEAR IN S. 10B(1) WHICH PROVIDES THAT NO DEDUCTION UNDER THIS SECTION SHALL BE ALLOWED TO AN ASSESSEE IF THE RETU RN OF INCOME IS NOT FURNISHED ON OR BEFORE THE DUE DATE SPECIFIED UNDER SUB-SECTION (1) OF S. 139. THIS PR OVISO IN S. 10B(1) IS DIRECTORY AND NOT MANDATORY. IN THE PR ESENT CASE, THERE WAS ONLY A MARGINAL DELAY OF 1 MONTH INFILLING THE RETURN OF INCOME. THE RETURN FILED W AS VALID ONE. THE SAME HAS ALSO BEEN ACCEPTED AS A VALID RE TURN BY THE AO. THE REASONABLE CAUSE ATTRIBUTED BY THE ASSESSEE FOR THE DELAY IS THAT NEW PROVISION OF E-FI LING OF THE RETURN WAS INTRODUCED FROM THE CURRENT ASSESSME NT YEAR. THERE WAS SOME PROBLEM UNDER THE NEW PROVISIO NS DUE TO WHICH THE DATE OF FILING THE RETURN HAD BEEN EXTENDED BY THE CBDT FROM TIME TO TIME AND FROM 31 ST OCTOBER 2006, THE SAME WAS EXTENDED TO 30 TH NOVEMBER, 2006. THE NEW PROVISION REGARDING E-FILI NG OF RETURN WAS INTRODUCED IN THIS FIRST YEAR; THE SOFTWA RE DID NOT ACCEPT THE RETURN, IF SELF-ASSESSMENT TAX WAS N OT PAID. ASSESSEES CASE IS THAT DUE TO SOME FINANCIA L PROBLEMS IT COULD NOT PAY THE SELF-ASSESSMENT TAX ON TIME, AS A RESULT OF WHICH THERE WAS A DELAY IN THE PAYMENT OF TAX AND CONSEQUENT FILING OF RETURN BY ABO UT 1 MONTHS. IT WAS FURTHER CLAIMED THAT SUBSEQUENTLY THE SOFTWARE HAS BEEN MODIFIED AND NOW RETURNS ARE BEIN G ACCEPTED, EVEN WHEN SELF-ASSESSMENT TAX IS NOT PAID . THESE FACTUAL FACTORS HAVE NOT BEEN DISPUTED BY THE REVENUE. IN THESE CIRCUMSTANCES, THERE WAS GENUINE AND PAGE 20 OF 30 ITA NO.38 6/BANG/2012 20 VALID REASON FOR THE DELAY IN FILING OF RETURN AND MOREOVER THESE PROVISIONS ARE DIRECTORY AND NOT MANDATORY. ONCE THE VALIDITY OF THE RETURN HAS NOT B EEN QUESTIONED BY THE REVENUE, THE REJECTION OF THE ASSESSEES CLAIM UNDER S. 10B(1) AT THE THRESHOLD B Y THE AO WAS NOT JUSTIFIED. THE ACT DOES NOT PROHIBIT TH AT RELIEF IN THIS REGARD WHEN GENUINE HARDSHIP IS FACE D CANNOT BE GRANTED BY APPELLATE AUTHORITY. FURTHER, THE VERY FACT THAT THE ACT ENVISAGES THAT RELIEF REGARDI NG EXEMPTION SHOULD BE CONSIDERED AND GRANTED WHEN APPLICATION IS MADE AFTER THE SPECIFIED PERIOD IN C ASES OF GENUINE HARDSHIP CLEARLY INDICATES THAT PROVISION IN THIS REGARD IS DIRECTORY AND NOT MANDATORY. HENCE, IN CAS E OF GENUINE HARDSHIP THE RELIEF CAN BE GRANTED BY THE APPELLATE AUTHORITY.. IN ITS CONCLUSION, THE HONBLE BENCH HAD OBSERVED THUS - PROVISO FOURTH TO S. 10B(1) WHICH PROHIBITS DEDUCT ION UNDER THIS SECTION IF THE RETURN IS NOT FURNISHED O N OR BEFORE THE DUE DATE SPECIFIED UNDER S. 139(1) IS DI RECTORY AND NOT MANDATORY AND, THEREFORE, RELIEF CAN BE GRAN TED BY THE APPELLATE AUTHORITY IN CASE, THERE WAS GENUINE AND VALID REASON FOR THE MARGINAL DELAY IN FILING OF RET URN (4) AN IDENTICAL ISSUE TO THAT OF THE PRESENT ONE WAS CONSIDERED BY THE HONBLE B BENCH OF HYDERABAD TRI BUNAL IN THE CASE OF ITO V. SHRI S VENKATAIAH IN ITA NO.984/HYD/2011 DATE D 31.5.2012 FOR THE ASSESSMENT YEAR 2008-09. THE REVENUE HAD, AMONG OTHERS, APPROACHED THE HONBLE TRIBUNAL WITH THE FOLLOWING RELEVANT GR OUNDS: 1.THE ORDER OF THE CIT(A) 2. THE CIT (A) ERRED IN ALLOWING THE ADDITIONAL EVI DENCE WITHOUT GIVING A REASONABLE OPPORTUNITY TO THE AO TO PAGE 21 OF 30 ITA NO.38 6/BANG/2012 21 EXAMINE THE EVIDENCE WHICH IS IN CONTRAVENTION TO T HE RULE 46A(3) OF IT RULES 1962; 3. THE CIT (A) OUGHT TO HAVE APPRECIATED THAT THE A O HAD RIGHTLY DISALLOWED THE DEDUCTION CLAIMED U/S 80I C FOLLOWING THE PROVISIONS OF SECTION 80AC; 4. THE CIT (A) OUGHT TO HAVE HELD THAT THE EXPLANAT ION OFFERED BY THE ASSESSEE WAS NOTHING BUT AN AFTER THOUGHT AND DEVOID OF ANY MERIT AS NO EFFORT WAS MAD E BY HIM TO TAKE RECOURSE U/S 119(2)(B) FOR EXTENSION OF TIME FOR FILING THE RETURN OF INCOME; 5. THE CIT (A) ERRED IN COMING TO A CONCLUSION THAT THE ASSESSEE WAS PREVENTED BY A GENUINE REASON IN FILING THE RETURN BELATEDLY; & 6. THE CIT (A) OUGHT TO HAVE APPRECIATED THAT THE INTENTION OF THE LEGISLATURE BEHIND INCORPORATING S . 80AC WAS TO IMPOSE STRINGENT GUIDELINES ON THE ASSESSEE WHO CLAIM EXEMPTION OF PROFITS U/S 80IA TO 80IE. (I) TAKING INTO ACCOUNT THE SUB MISSION OF THE ASSESSEE AND THE REBUTTAL OF THE LEARNED D R AS RECORDED IN ITS FIND INGS, THE HONBLE TRIBUNAL HAD DECIDED THE ISSUES AGAINST THE REVENUE. THE RE LEVANT PORTIONS OF FINDINGS OF THE HONBLE BENCH, FOR APPRECIATION OF FACTS, ARE EXTRACTED AS UNDER: 13..IN THIS CASE, ADMITTEDLY, THE ASSESSEE FILED THE RETURN OF INCOME ON 23.12.2008. THE DUE DATE FOR FILING THE RETURN OF INCOME U/S 139(1) OF THE A CT FOR THE ASSESSMENT YEAR UNDER CONSIDERATION IN THE CASE OF THE ASSESSEE IS 31.10.2008. AS SUCH, THE RETURN FI LED BY THE ASSESSEE IS BELATED. IN THIS, THE ASSESSEE CLA IMED DEDUCTION U/S 80IC OF THE ACT WHICH WAS DISALLOWED BY PAGE 22 OF 30 ITA NO.38 6/BANG/2012 22 THE ASSESSING OFFICER AS THE RETURN OF THE ASSESSEE WAS NOT FILED WITHIN THE TIME AS PRESCRIBED U/S 139(1) OF THE ACT. THE ASSESSEE HAS GIVEN REASONS FOR DELAY IN FI LING THE RETURN OF INCOME THAT THE ASSESSEE WAS PREPARIN G ITS ACCOUNTS THROUGH COMPUTER AND THE COMPUTER GOT CORRUPTED DUE TO VIRUSES AND IN SPITE OF CONTINUOUS EFFORTS BY THE COMPUTER TECHNICAL PERSONNEL TO RETRI EVE THE DATA IN TIME FOR FILING THE RETURN OF INCOME, P ROBLEM PERSISTED IN THE SYSTEM. BY TRYING TO RETRIEVE THE D ATA FOR 4 DAYS THE REQUIRED DATA COULD NOT BE RETRIEVED AND THE BACKED UP DATA WERE AVAILABLE UP-TO 31 ST JANUARY 2008 IN THE CD AND THE ENTIRE DATA FOR THE TWO MONT HS PERIOD, FEBRUARY AND MARCH, 2008, HAD TO BE RE-ENTER ED INTO THE COMPUTER SYSTEM AGAIN. ON PREPARATION OF THE FINAL ACCOUNTS AND FINALIZING OF STATUTORY AUDIT IT TOOK A LITTLE EXTRA TIME THAT RESULTED IN BELATED FILING O F RETURN OF INCOME. THUS, THERE WAS A DELAY OF 74 DAYS IN FIL ING THE RETURN OF INCOME WHICH IS BEYOND THE CONTROL OF ASSESSEE. THIS WAS ALSO CONFIRMED BY THE STATUTORY AUDITOR VIDE HIS LETTER DATED 20.3.2011. BEING SO, IN OUR OPINION THERE IS A REASONABLE CAUSE FOR FILING THE RETURN OF INCOME BELATEDLY AND THIS IS BEYOND THE CONTROL OF THE ASSESSEE. WHEN THE SUBSTANTIAL QUESTION OF JUSTICE INVOLVED, TECHNICALITIES SHOULD BE IGNORED. FURTHE R, WE ARE SUPPORTED BY THE ORDER OF THE TRIBUNAL IN ITA NO S. 1231 & 1199/HYD/2010 IN THE CASE OF DCIT V. M/S. VEG A CONVEYORS & AUTOMATION LIMITED ORDER DATED 31 ST DECEMBER 2010 WHEREIN IN PARA 5 OF THE ORDER, THE TRIBUNAL HELD AS FOLLOWS: 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PE RUSED THE ORDERS OF THE LOWER AUTHORITIES, AND OTHER MATE RIAL AVAILABLE ON RECORD, INCLUDING THE CASE-LAW RELIED UPON BY THE PARTIES. IT IS AN UNDISPUTED FACT THAT THE ASS ESSEE IN THE PRESENT CASE HAS FILED THE AUDIT REPORT IN FORM 10CCB DURING THE COURSE OF RE-ASSESSMENT PROCEEDING S. THE ISSUE THAT ARISES FOR CONSIDERATION IS WHETHER THE ASSESSING OFFICER WAS JUSTIFIED IN DISALLOWING THE PAGE 23 OF 30 ITA NO.38 6/BANG/2012 23 ASSESSEES CLAIM FOR DEDUCTION UNDER S.80IB ON THE GROUND THAT THE AUDIT REPORT IN FORM 10CCB WAS NOT FILED ALONG WITH THE RETURN OF INCOME; OR WHETHER THE CIT (A) WAS CORRECT IN PROCEEDING ON THE BASIS OF FORM 10CC B FILED DURING THE COURSE OF RE-ASSESSMENT PROCEEDING S AND DIRECTING THE ASSESSING OFFICER TO ALLOW THE CLAIM OF THE ASSESSEE FOR DEDUCTION UNDER S. 80IB OF THE ACT. I T IS SETTLED POSITION OF LAW, AS CONSISTENTLY HELD BY VARI OUS BENCHES OF THIS TRIBUNAL AND AS HELD IN VARIOUS DEC ISIONS REFERRED TO BY THE CIT (A) IN THE IMPUGNED ORDER, TH AT THOUGH FILING OF AUDIT REPORT IN FORM 10CCB IS MANDATORY AND PRE-REQUISITE FOR DEDUCT ION UNDER S. 80IB, NON-FILING OF THE SAME ALONG WITH TH E RETURN OF INCOME IS ONLY A CURABLE DEFECT, AND ASSES SEES CLAIM FOR DEDUCTION HAS TO BE CONSIDERED ON ITS MER ITS AS SAND WHEN THE DEFECT IS CURED BY FILING FORM 10CCB. WE ARE FORTIFIED IN THIS BEHALF BY THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF HEMSONS INDUSTRIES (SUPRA), RELIED UPON BY THE LEARNED COUNS EL FOR THE ASSESSEE. IT IS CONTENDED BY THE LEARNED DEPARTMENTAL REPRESENTATIVE THAT THE ASSESSEES CLA IM FOR DEDUCTION UNDER S. 80IB CAN BE ENTERTAINED AND EXAMINED ON MERITS, WHEN THE AUDIT REPORT IS FILED BEFORE THE COMPLETION OF ASSESSMENT, WHICH HAS NOT BEEN DO NE IN THE PRESENT CASE, SINCE THE AUDIT REPORT WAS FILED ONLY DURING THE COURSE OF RE-ASSESSMENT PROCEEDINGS INIT IATED BY THE ASSESSING OFFICER, WHICH CANNOT END UP GIVING ADDITIONAL DEDUCTIONS/BENEFITS TO THE ASSESSEE. WE DO NOT FIND MERIT EVEN IN THIS CONTENTION OF THE LEARN ED DEPARTMENTAL REPRESENTATIVE. IN THE CASE OF HEMSON S INDUSTRIES (SUPRA) BEFORE THE JURISDICTIONAL HIGH C OURT, OF ONE OF THE YEARS UNDER APPEAL BEFORE HONBLE HIG H COURT, VIZ., ASSESSMENT YEAR 1979-80, AUDIT REPORT W AS FILED DURING THE COURSE OF RE-ASSESSMENT PROCEEDING S AND IN RESPONSE TO THE SHOW-CAUSE NOTICE UNDER S. 148 I SSUED BY THE ASSESSING OFFICER. IN THIS VIEW OF THE MATTE R, RESPECTFULLY FOLLOWING THE DECISION OF THE JURISDICT IONAL HIGH COURT CITED ABOVE, AMONG OTHERS, WE FIND NO PAGE 24 OF 30 ITA NO.38 6/BANG/2012 24 JUSTIFICATION TO INTERFERE WITH THE ORDER OF THE CI T (A). WE ACCORDINGLY UPHOLD THE SAME AND REJECT THE GROUND S OF THE REVENUE IN THIS APPEAL. 14. IN OUR OPINION, IN VIEW OF THE ABOVE DISCUSSION , THE CLAIM OF THE ASSESSEE CANNOT BE DENIED ON TECHNICAL ITIES WHEN THE ASSESSEE IS LEGALLY OTHERWISE ENTITLED FOR DEDUCTION. AS SUCH, WE ARE INCLINED TO DISMISS THE APPEAL FILED BY THE REVENUE AS DEVOID OF MERIT. 7. CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE ISSUE AS DELIBERATED UPON IN THE FORE-GOING PARAGRAPHS AND A LSO IN CONFORMITY WITH THE RULINGS OF THE HONBLE SUPREME COURT, THE HONB LE JURISDICTIONAL HIGH COURT AND ALSO THE FINDINGS OF THE HONBLE BENCHES OF DELHI AND HYDERABAD TRIBUNALS CITED SUPRA, WE ARE OF THE CONSIDERED VIE W THAT S. 80AC OF THE ACT WHICH PROHIBITS DEDUCTION U/S 80IB IF THE RETURN IS NOT FURNISHED ON OR BEFORE THE DUE DATE SPECIFIED U/S 139(1) OF THE ACT IS ONLY DIRECTORY AND NOT MANDATORY, PROVIDED THERE WAS REASONABLE CAUSE FOR F ILING OF RETURN OF INCOME BELATEDLY. 7.1. HOWEVER, A SALIENT FEATURE IN THE PRESENT CAS E WAS THAT THE CLAIM OF DEDUCTION U/S 80-IB (10) OF THE ACT WAS DE NIED BY THE AO PRIMARILY ON THE GROUND THAT THE RETURN OF INCOME WAS FILED B EYOND THE DUE DATE AS SPECIFIED U/S 139(1) OF THE ACT. SINCE THE ASSESSM ENT WAS CONCLUDED UNDER SECTION 144 OF THE ACT, NEITHER THE AO HAD AN OCCAS ION TO VERIFY THE CAUSE FOR SUCH A DELAY IN FILING THE RETURN OF INCOME NOR THE ASSESSEE HAD AN OPPORTUNITY TO DEFEND ITSELF FOR HAVING FURNISHED IT S RETURN BELATEDLY. PAGE 25 OF 30 ITA NO.38 6/BANG/2012 25 7.1.1. IN THIS CONNECTION, AS NARRATED SUPRA, THE ASSESSEE, DURING THE COURSE OF HEARING, SOUGHT THE PERMISSION OF THIS BE NCH TO ADDUCE ADDITIONAL EVIDENCE AND ALSO AN AFFIDAVIT EXPLAINING THE REASO N FOR DELAYED FILING OF RETURN. ACCORDING TO THE ASSESSEE, THE ADDITIONAL E VIDENCE COULD NOT BE FURNISHED EITHER BEFORE THE AO OR BEFORE THE CIT (A ) SINCE THE RETURN WAS E-FILED AND NO ENCLOSURES WERE TO BE ATTACHED AND N EITHER THE ASSESSING OFFICER NOR THE CIT(A) CALLED FOR 44AB AUDIT OR FOR M 10CCB, AS THE CLAIM OF THE ASSESSEE UNDER SECTION 80IB WAS DENIED PRIMA FA CIE WITHOUT MUCH DELIBERATION FOR THE REASON THAT RETURN WAS FILED B ELATEDLY. THIS ATTEMPT OF THE ASSESSEE WAS OBJECTED TO BY THE REVENUE FOR THE REASONS ALSO RECORDED SUPRA. 7.2. WE HAVE CAREFULLY CONSIDERED THE ASSESSEES SU BMISSION AS WELL AS THE OBJECTION RAISED BY THE REVENUE. 7.2.1. TO DRIVE HOME ITS POINT, THE REVENUE HA D EXTENSIVELY QUOTED THE RULE 29 OF APPELLATE TRIBUNAL RULES 1963. LET US NO W DEAL WITH THE ISSUE AS UNDER: RULE 29 OF APPELLATE TRIBUNAL RULES, 1963 SAYS AS UN DER: RULE 29: THE PARTIES TO THE APPEAL SHALL NOT BE EN TITLED TO PRODUCE ADDITIONAL EVIDENCE EITHER ORAL OR DOCUMENTARY BEFORE THE TRIBUNAL, BUT, IF THE TRIBUNA L REQUIRES ANY DOCUMENT TO BE PRODUCED OR ANY WITNESS T O BE EXAMINED OR ANY AFFIDAVIT TO BE FILED TO ENABLE I T TO PASS ORDERS OR FOR ANY OTHER SUBSTANTIAL CAUSE, OR, IF THE INCOME-TAX AUTHORITIES HAVE DECIDED THE CASE WITHOU T GIVING SUFFICIENT OPPORTUNITY TO THE ASSESSEE TO ADD UCE EVIDENCE EITHER ON POINTS SPECIFIED BY THEM OR NOT SPECIFIED BY THEM OR NOT SPECIFIED BY THEM, THE TRIBU NAL, FOR REASONS TO BE RECORDED, MAY ALLOW SUCH DOCUMENT TO PAGE 26 OF 30 ITA NO.38 6/BANG/2012 26 BE PRODUCED OR WITNESS TO BE EXAMINED OR AFFIDAVIT TO BE FILED OR MAY ALLOW SUCH EVIDENCE TO BE ADDUCED. 7.3. IN THE PRESENT CASE, THE ASSESSEE SUBMITTED T HAT THERE WAS SUFFICIENT CAUSE FOR FILING ITS RETURN OF INCOME BE LATEDLY AND TO SUBSTANTIATE ITS STAND, THE ASSESSEE SOUGHT THE PERMISSION OF TH IS BENCH TO LAY ITS REASONING. ONE OF THE REASONS FOR THE DELAY IN FILI NG ITS RETURN OF INCOME IN TIME AND THE ADDITIONAL EVIDENCES COULD NOT BE FILE D BEFORE THE AO OR BEFORE THE CIT (A) WAS THAT DURING THE RELEVANT ASSESSMENT YEAR, THERE WAS CONFUSION PREVALENT WITH REGARD TO CLAIM OF DEDUCTI ON UNDER SEC. 80IB OF THE ACT. ASSESSEES, PROFESSIONA LS AND EVEN FOR THAT MATTER THE INCOME-TAX DEPARTMENT WAS NOT VERY CLEAR AS TO DEDUCTION U/S 80IB (10) WOU LD BE AVAILABLE ON A YEAR TO YEAR BASIS WHERE AN ASSESSEE I S SHOWING PROFIT ON PARTIAL COMPLETION OR IF IT WOULD BE AVAILABLE ONLY IN THE YEAR OF COMPLETION OF THE PROJE CT.. THE STATUTORY AUDIT OF ACCOUNTS OF THE APPELLANT FOR THE PREVIOUS YEAR 2007-08 RELEVANT TO THE AY 2008-09 WAS COMPLETED ON 12.9.2008. HOWEVER, TAX AUDIT U/S 44A B OF THE ACT WAS COMPLETED ON 22.4.2009. THE APPELLANT HAD FILED THE RETURN OF INCOME ON 25.4.2010 (SIC) 25.5.2009 THROUGH ELECTRONIC FILING MECHANISM. AS NO ENCLOSURES TO BE GIVEN WHILE E-FI LING OF THE RETURNS, THE SAME HAVE NOT BEEN FILED ALONG WIT H THE RETURN OF INCOME. 7.3.1. AT THIS POINT OF TIME, WE WOULD LIKE TO RECALL THAT A SIMILAR SITUATION HAD BEEN CONFRONTED BY THE HONBLE DELHI B ENCH OF THE TRIBUNAL IN THE CASE OF ACIT V. DHIR GLOBAL INDUSTRIAL (P) LTD (SUPRA) WHEREIN THE HONBLE BENCH HAD, AFTER TAKING COGNIZANCE OF THE P ECULIAR SITUATION IN WHICH PAGE 27 OF 30 ITA NO.38 6/BANG/2012 27 THAT ASSESSEE WAS PLACED, OBSERVED THAT ACT DOES NOT PROHIBIT RELIEF IN THIS REGARD WHEN GENUINE HARDSHIP IS FACED. 7.4. FURTHERMORE, IN THE AFFIDAVIT(S) FURNISHED, THE DIR ECTOR OF THE PRESENT ASSESSEE HAD AFFIRMED ON OATH THAT 1. RETURN OF INCOME OF THE APPELLANT COMPANY FOR T HE AY 2008-09 WAS FILED BELATEDLY ON 25.4.2009. THE DELA Y WAS DUE TO THE FOLLOWING REASONS: (A) MR. LOKESH, ACCOUNTANT WHO WAS WORKING WITH US FOR QUITE LONG QUIT ABRUPTLY WITHOUT PROVIDING PRIOR INTIMATION WHILE FINALIZING THE ACCOUNTS FOR THE FINANCIAL YEAR 2007-08; (B) WE COULD NOT TRACE THE PASSWORD OF THE SYSTEM DESPITE OUR BEST EFFORTS; (C) WE TRIED TO RETRIEVE THE DATA FROM THE SYSTEM WITH THE HELP OF HARDWARE ENGINEERS, IN THE PROCESS LOST COUPLE OF IMPORTANT DATA. FINANCIAL INFORMATION OF THE COMPANY WAS ONE SUCH DATA THAT WAS LOST; (D) WE TRIED TO RECONSTRUCT THE DATA WITH AVAILABLE INFORMATION ON HAND. WE COULD NOT SUCCEED IN RECONSTRUCTING THE DATA AS THE INCOME-TAX DEPARTMENT HAD IMPOUNDED MANY OF THE VITAL DOCUMENTS IN PURSUANCE TO SURVEY CARRIED ON IN THE BUSINESS PREMISES OF THE APPELLANT ON 04.01.2008; (E) THEREFORE, IT TOOK QUITE SOME TIME FOR US TO RECONSTRUCT THE FINANCIAL STATEMENTS AND SUBMIT TO THE INCOME-TAX DEPARTMENT. THUS, THERE WAS DELAY IN 207 DAYS FOR FILING THE RETURN OF INCOME FOR THE AY 2008-09; IN ITS AFFIDAVIT DATED 13.11.2012,IT WAS AFFIRMED O N OATH THAT: PAGE 28 OF 30 ITA NO.38 6/BANG/2012 28 (I) THE STATUTORY AUDIT ACCOUNTS OF THE APPELLANT FOR THE PREVIOUS YEAR 2007-08 RELEVANT TO THE AY 2008-09ARE COMPLETED ON 12.9.2008. HOWEVER, TAX AUDIT U/S 44AB OF THE ACT WAS COMPLETED ONLY ON 22.4.2009; (II) AUDIT REPORT UNDER SEC. 80IB OF THE ACT IN FORM 10CCB WAS OBTAINED ON 22.9.2008 7.5. CONSIDERING THE FACTS AS NARRATED IN A SSESSEES PETITION AND ALSO IN THE AFFIDAVITS FURNISHED BY THE DIRECTOR OF THE A SSESSEE, WE ARE OF THE CONSIDERED VIEW THAT THE ADDITIONAL EVIDENCES FURNI SHED AND REASONS FURNISHED FOR DELAYED FILING OF RETURN NEED TO BE TA KEN ON RECORD. 7.6. AS POINTED OUT EARLIER AND ALSO IN CONF ORMITY WITH THE FINDINGS OF THE (I) HONBLE DELHI BENCH OF THE TRIBUNAL (SUPRA) THAT [AT THE COST OF REPETITION] PROVISO FOURTH TO S. 10B(1) WHICH PROHIBITS DEDUCT ION UNDER THIS SECTION IF THE RETURN IS NOT FURNISHED O N OR BEFORE THE DUE DATE SPECIFIED UNDER S. 139(1) IS DI RECTORY AND NOT MANDATORY AND, THEREFORE, RELIEF CAN BE GRAN TED BY THE APPELLATE AUTHORITY IN CASE, THERE WAS GENUINE AND VALID REASON FOR THE MARGINAL DELAY IN FILING OF RET URN AND (II) IN THE CASE OF S. VENKATAIAH, THE HONBLE BENCH OF THE HYDERABAD TRIBUNAL (SUPRA) THAT 14.IN OUR OPINION, IN VIEW OF THE ABOVE DISCUSSION, THE CLAIM OF THE ASSESSEE CANNOT BE DENIED ON TECHNICALITIES WHEN THE ASSESSEE IS LEGALLY OTHERWI SE ENTITLED FOR DEDUCTION. AS SUCH, WE ARE INCLINED TO DISMISS THE APPEAL FILED BY THE REVENUE AS DEVOID OF MERIT, PAGE 29 OF 30 ITA NO.38 6/BANG/2012 29 WE WOULD LIKE TO REITERATE THAT SINCE THE ADDITIONA L EVIDENCES NOW PRODUCED BY THE ASSESSEE WERE NOT PLACED BEFORE THE AO FOR HI S CONSIDERATION AND ALSO KEEPING THE PRINCIPLES OF NATURAL JUSTICE AND EQUITY IN MIND, THE ISSUE REQUIRES VERIFICATION AT THE AOS LEVEL. ACCORDING LY, THIS ISSUE IS REMITTED BACK TO THE FILE OF THE AO WITH A SPECIFIC DIRECTIO N TO LOOK INTO THE MERITS OF THE ASSESSEES CLAIM FOR EXEMPTION U/S 80IB (10) OF THE ACT AFRESH: (I) WHETHER THE ASSESSEE WAS PREVENTED BY A REASONABLE CAUSE, AS ATTRIBUTED BY IT IN ITS AFFIDAVITS (ABOVE) , IN FURNISHING ITS RETURN OF INCOME BELATEDLY? & (II) WHETHER THE ASSESSEE HAS SATISFIED THE OTHER CONDIT IONS STIPULATED IN S. 80-IB OF THE ACT TO DETERMINE THE QUANTUM OF DEDUCTION U/S 80IB OF THE ACT? 7.6.1. IT IS FURTHER EMPHASIZED THAT WHILE CARRYING OUT THE DIRECTIONS OF THIS BENCH REFERRED ABOVE, THE AO SHALL KEEP IN VIEW THE FINDINGS OF THE HONBLE BENCHES OF THE DELHI & HYDERABAD TRIBUNALS Q UOTED ABOVE AND TO TAKE APPROPRIATE ACTION IN THE MATTER. THE ASSESSEE ON ITS PART SHALL CO- OPERATE WITH THE AO IN CARRYING OUT THE DIRECTIONS O F THIS BENCH CITED SUPRA. 8. IN THE RESULT , THE ASSESSEES APPEAL IS TREATED AS PARTLY ALLOWED FOR STATISTICAL PURPOSE. THE ORDER PRONOUNCED ON THE 7 TH DAY OF DECEMBER, 2012 AT BANGALORE. SD/- SD/- (N BARATHVAJA SANKAR) (GEORGE GEORGE K) VICE PRESIDENT JUDICIAL MEMBER PAGE 30 OF 30 ITA NO.38 6/BANG/2012 30 COPY TO : 1. THE REVENUE 2. THE ASSESSEE 3. THE CIT CONCERNE D. 4. THE CIT(A) CONCERNED. 5. DR 6. GF MSP/ BY ORDER SENIOR PRIVATE SECRETARY, ITAT, BAN GALORE.
