SHIVASSA APPARELS, MUMBAI V. ITO 15(2)(3), MUMBAI

ITA 4362/MUM/2014

• Counselvise Citation: 436219914 RSA 2014
• Duration Of Justice: 1 year(s) 1 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-08-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2004-2005
• Appeal Filed On: 20-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Retrospective amendment
• Section: 10AA; 80HHC; 10B

Judgement Text

, - IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE S/SHRI B.R.BASKARAN (ACCOUNTANT MEMBER ) . . , ./ I.T.A. NO . 4 362 / MUM/20 14 ( / ASSESSMENT YEAR : 20 0 4 - 05 ) M/S SHIVASSA APPARELS, C/O M .S SARAF AND CHANDRA, CA, BHARAT INSURANCE BLDG. 3 RD FLOOR, 15 A HORNIMAN CIRCLE, FORT, MUMBAI - 40000 1 / VS. INCOME TAX OFFICER, 1 5 ( 2 )( 3 ), MATRU MANDIR, (1 ST FLOOR), TARDEV ROAD, GRAN T ROAD, MUMBAI - 400007 ( / APPELLANT ) .. ( / RESPONDENT ) ./ ./PAN/GIR NO. : AAUFS9219F / APPELLANT BY SHRI M SUBRAMANIAM / RSPONDENT BY SHRI K P R R MURTY / DATE OF HEARING : 6 .8 . 201 5 / DATE OF PRONOUNCEMENT : 6 . 8. 201 5 / O R D E R PER B ENCH: THE ASSESSEE HAS FILED THIS APPEAL CHALLENGING THE ORDER DATED 19 - 03 - 2014 PASSED BY LD CIT(A) - 26, MUMBAI CONFIRMING THE REJECTION OF DEDUCTION CLAIMED BY THE ASSESSEE U/S 80HHC OF THE ACT. 2. I HEARD THE PARTIES AND PERUSED THE RECORD. THIS IS THE SECOND ROUND OF PROCEEDINGS BEFORE THE TRIBUNAL. THE ASSESSEE ORIGINALLY CLAIMED DEDUCTION U/S 80 IB OF THE ACT AND THE SAME CAME TO BE REJECTED BY THE AO. HENCE, THE ASSESSEE MADE ALTERNATIVE CLAIM FOR DEDUCTION U/S 80HHC OF THE ACT. THE ALTERNATIVE CLAIM, THOUGH REJECTED BY THE TAX AUTHORITIES, ITA NO. 4 362 / MUM/20 14 2 WAS RESTORED TO THE FILE OF THE AO BY THE TRIBUNAL, VI DE ITS ORDER DATED 30 - 4 - 2010 PASSED IN ITA NO.6182/M/07. IN THE SET ASIDE PROCEEDINGS, THE AO AGAIN REJECTED THE CLAIM BY QUOTING THE PROVISIONS OF SEC. 80A(5) OF THE ACT, WHICH READS AS UNDER: - WHERE THE ASSESSEE FAILS TO MAKE A CLAIM IN HIS RETURN OF INCOME FOR ANY DEDUCTION UNDER SECTION 10A OR SECTION 10AA OR SECTION 10B OR SECTION 10BA OR IN ANY PROVISIONS OF THIS CHAPTER UNDER THE HEADING C - DEDUCTIONS IN RESPECT OF CERTAIN INCOMES , NO DEDUCTION SHALL BE ALLOWED TO HIM THERE UNDER. THE LD CIT (A) ALSO CONFIRMED THE ORDER OF THE ASSESSING OFFICER AND HENCE THE ASSESSEE HAS FILED THIS APPEAL BEFORE THE TRIBUNAL. IT IS PERTINENT TO NOTE THAT THE DEDUCTION U/S 80HHC OF THE ACT IS ALLOWED UNDER CHAPTER VIA UNDER C DEDUCTION IN RESPECT OF CERTAIN INCOMES. 3. WE NOTICE THAT THE ASSESSEE FILED ITS ORIGINAL RETURN OF INCOME ON 29 - 10 - 2004. THE PROVISIONS OF SECTION 80A(5) EXTRACTED ABOVE WERE INSERTED BY THE FINANCE (NO.2) ACT, 2009 W.R.E.F. 1.4.2003, I.E., THE ABOVE SAID PROVISION WAS INSERTE D INTO THE STATUTE BY THE LEGISLATURE ONLY IN 2009, I.E, YEARS AFTER FILING OF RETURN OF INCOME BY THE ASSESSEE. HENCE THE SAID PROVISION WAS NOT IN STATUTE AT THE POINT OF TIME, WHEN THE ASSESSEE FILED ITS ORIGINAL RETURN OF INCOME. THE STATUTE HAS ALSO NOT MADE ANY PROVISION IN THE ACT, WHICH WOULD ENABLE THE ASSESSEE TO AMEND THE RETURN OF INCOME IN ORDER TO COMPLY WITH THE PROVISIONS OF SEC. 80A(5) OF THE ACT INSERTED BY FINANCE (NO.2) ACT, 2009. UNDER THIS SITUATION, THE ASSESSEE SHALL BE BURDENED TO PERFORM AN ACT OF IMPOSSIBILITY, IF IT IS COMPELLED TO COMPLY WITH THE PROVISIONS OF SEC. 80A(5) OF THE ACT. THERE SHOULD NOT BE ANY DISPUTE THAT, AT THE TIME OF FILING ORIGINAL RETURN OF INCOME, AN ASSESSEE CANNOT VISUALISE THE AMENDMENT THAT MAY BE BRO UGHT IN BY THE LEGISLATURE AFTER EXPIRY OF ABOUT FIVE YEARS THAT TOO WITH RETROSPECTIVE EFFECT. THE FACT REMAINS THAT THE ASSESSEE HAS MADE ALTERNATE CLAIM DURING ITA NO. 4 362 / MUM/20 14 3 THE COURSE OF ORIGINAL ASSESSMENT /APPELLATE PROCEEDINGS. HENCE, IN THE FACTS AND CIRCUMSTANC ES OF THE CASE AND FOR THE REASONS CITED ABOVE, I AM OF THE VIEW THAT THE PROVISIONS OF SEC. 80A(5) SHOULD NOT BE APPLIED TO THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION. 4. I ALSO NOTICE THAT THE REVENUE HAD FILED MISCELLANEOUS APPLICATION SEEKING R ECTIFICATION OF THE ORDER PASSED BY THE TRIBUNAL, REFERRED ABOVE BY CITING THE PROVISIONS OF SEC. 80A(5) OF THE ACT. HOWEVER, THE TRIBUNAL, VIDE ITS ORDER DATED 04 - 05 - 2011 PASSED IN M.A. NO.611/MUM/2010 (ARISING OUT OF ITA NO.6182/MUM/2007), HAS REJECTED THE PETITION FILED BY THE REVENUE ON THE GROUND THAT IT IS NOT OPEN TO THE REVENUE TO URGE NEW ARGUMENT THROUGH MISCELLANEOUS PETITION. 5. IN VIEW OF THE FOREGOING DISCUSSIONS, I AM OF THE VIEW THAT THE TAX AUTHORITIES ARE NOT JUSTIFIED IN APPLYING TH E PROVISIONS OF SEC. 80A(5) OF THE ACT, SINCE THE CONDITION PRESCRIBED IN THAT PROVISION, WHICH WAS BROUGHT INTO THE STATUTE AT A LATER DATE, COULD NOT AT ALL BE COMPLIED WITH BY THE ASSESSEE. FURTHER, THE TRIBUNAL, VIDE ITS ORDER REFERRED ABOVE, HAD ALSO DIRECTED THE ASSESSING OFFICER TO EXAMINE THE CLAIM FOR DEDUCTION U/S 80HHC OF THE ACT. ACCORDINGLY, I SET ASIDE THE ORDER OF LD CIT(A) ON THIS ISSUE AND RESTORE THE SAME TO THE FILE OF THE ASSESSING OFFICER TO EXAMINE THE CLAIM OF THE ASSESSEE AFRESH IN ACCORDANCE WITH THE LAW, AFTER AFFORDING NECESSARY OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED ACCORDINGLY ON 6 TH AUGUST 2015. 6 TH AUGUST, 2015 SD ( . . / B.R. BASKARAN) / ACCOUNTANT MEMBER MUMBAI: 6 TH AUG , 2015 . ITA NO. 4 362 / MUM/20 14 4 . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - CONCERNED 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI CONCERNED 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) , /ITAT, MUMBAI