KISHORE GOKAL, MUMBAI V. ITO 12(3)(3), MUMBAI

ITA 6443/MUM/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 4308 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 1999-2000
• Appeal Filed On: 01-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMRITA RANJAN
• Assessee Lawyers: B V JHAVERI
• Keywords: Retrospective amendment
• Section: 80HHC; 28

Judgement Text

, ' INCOME TAX APPELLATE TRIBUNAL,MUMBAI- A,BENCH , , BEFORE S/SH. JOGINDER SINGH,JUDICIAL MEMBE R & RAJENDRA,ACCOUNTANT MEMBER /.ITA NO.6443/MUM/2013, /ASSESSMENT YEAR-1999-2000 SHRI KISHORE GOKAL KASTURI BUILDING, 5 TH FLOOR, 171/172, J.T. ROAD MUMBAI-400 020. PAN:AADPG 0699 N VS INCOME TAX OFFICER-12(3)(3) AAYAKAR BHAVAN QUEENS ROAD MUMBAI-400 020. ( / APPELLANT) ( / RESPONDENT) /ASSESSEE BY :SHRI B.V. JHAVERI / REVENUE BY :MS. AMRITA RANJAN / DATE OF HEARING : 03-12- 2015 /DATE OF PRONOUNCEMENT : 01.01.2016 , 1961 1961 1961 1961 254 254 254 254( (( (1 11 1) )) ) ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) PER RAJENDRA, AM - CHALLENGING THE ORDER DT.08.08.13 OF CIT(A)-23,MUMB AI,THE ASSESSEE HAS FILED THE PRESENT APPEAL. BRIEF FACTS 2.ASSESSEE IS AN INDIVIDUAL,ENGAGED IN THE BUSINESS OF MANUFACTURING AND EXPORT OF READYMADE GARMENTS.THE ASSESSING OFFICER(AO) COMPLE TED THE ASSESSMENT ON 30.01. 2004, U/S.143(3) R.W.S.147 OF THE ACT VIDE WHICH THE DEDU CTION CLAIMED BY THE ASSESSEE U/S.80 HHC,AMOUNTING TO RS.90.17 LAKHS,WAS DENIED.AGGRIEVE D BY THE ORDER OF THE AO, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE FIRST APPEL LATE AUTHORITY(FAA),WHO UPHELD THE ORDER OF THE AO.BEFORE HIM,IT WAS ARGUED THAT TAXATION (L AW) AMENDMENT ACT,2005CAME IN TO FORCE FROM 31.10. 2005,THAT IT MADE RETROSPECTIVE A MENDMENT TO INCLUDE CERTAIN ITEMS IN THE SCOPE OF SECTION 28 OF THE ACT W.E.F. 01.04. 1998,T HAT HE WAS ENTITLED TO CLAIM DEDUCTION U/S.80HHC,AMOUNTING TO RS. 66.78 LAKHS FOR THE AY.1 999-2000,THAT HE HAD FILED AN APPLICATION U/S.154 OF THE ACT BEFORE THE AO FOR TH E RECTIFYING THE ASSESSMENT BY ALLOWING THE CLAIM MADE BY HIM,THAT THE AO HAD REJECTED THE APPL ICATION FILED BY THE ASSESSEE,THAT HE FILED AN APPEAL BEFORE THE FAA AGAINST THE REJECTION OF R ECTIFICATION APPLICATION,THAT THE FAA DISMISSED THE APPEAL OF THE ASSESSEE AS IT WAS TIME BARRED,THAT THE TRIBUNAL HAD CONDONED THE DELAY AND HAD VIDE ITS ORDER DATED 07.03.2012(ITA/4 256/MUM/ 2010)RESTORED THE ISSUE TO THE FILE OF THE FAA WITH A DIRECTION TO DECIDE THE APPE AL ON MERIT AND AFTER HEARING THE ASSESSEE. IN PURSUANCE OF THE DIRECTIONS OF THE TRIBUNAL THE FAA FIXED THE CASE AND THE ASSESSEE CONTENDED THAT THE RETROSPECTIVE AMENDMENT TO THE P ROVISIONS OF SECTION 80HHC ENTITLED HIM TO CLAIM DEDUCTION OF RS.66,78,670/-,THAT THE RETRO SPECTIVE AMENDMENT WAS TO BE GIVEN EFFECT.THE ASSESSEE RELIED UPON THE CASES OF J K SY ENTHETICS(251ITR200),GTC INDUSTRIES LTD. (104 ITD86) AND JOHNSON G OOMMEN (43DTR338).IT WAS ALSO ARGUED THAT THE FAA,WHILE DECIDING THE APPEAL FOR THE AY.2004-05,HAD ACCEPTED THE CONTENTION OF THE ASSESSEE ABOUT THE CLAIM MADE U/S.80HHC IN VIEW OF THE RETROSPECTIVE A MENDMENT. 3.AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE, THE FAA HELD THAT THE AO HAD MENTIONED THAT THE CLAIM MADE BY THE ASSESSEE U/S.80HHC WAS R EJECTED BY IN APPELLATE PROCEEDINGS,THAT THE ORDER OF THE AO HAD MERGED WITH THE ORDER OF TH E FAA,THAT AFTER THAT THE AO HAD NO POWER TO RECTIFY THE ORDER,THAT THE AO HAD RIGHTLY REJECTED THE APPLICATION. 6443/13KISHOREGOKAL-99-00 2 4.BEFORE US,THE AUTHORISED REPRESENTATIVE(AR)STATED THAT THE FAA WAS DIRECTED BY THE TRIBUNAL TO DECIDE THE ISSUE MERITS,THAT HE SIMPLY DISMISSED THE MATTER.DEPARTMENTAL REPRESENTATIVE (DR) SUPPORTED THE ORDER OF THE FAA. 5.WE HAVE PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT AFTER THE RETROSPECTIVE AMENDMENT THE ASSESSEE HAD MADE A CLAIM FOR ALLOWIN G HIM DEDUCTION U/S.80HHC OF THE ACT,THAT THE MATTER TRAVELLED UP TO THE TRIBUNAL,TH AT IT RESTORED BACK THE MATTER TO THE FILE OF THE FAA FOR DECIDING IT ON MERITS,THAT HE DISMISSED THE APPEAL ON TECHNICAL GROUNDS.IN OUR OPINION,THE ACTION OF THE FAA WAS NOT AS PER LAW.IN THE CASE OF SAURASHTRA KUTCH STOCK EXCHANGE LTD.(305ITR227)THE HONBLE SUPREME COURT H AS HELD THAT A JUDICIAL DECISION ACTS RETROSPECTIVELY,THAT IF A SUBSEQUENT DECISION WOULD ALTER THE EARLIER DECISION THE LATER DECISION WOULD NOT MAKE NEW LAW,THAT THE DECISION RENDERED L ATER ON WOULD HAVE RETROSPECTIVE EFFECT CLARIFYING THE LEGAL POSITION WHICH WAS EARLIER NOT CORRECTLY UNDERSTOOD.ON THE SAME ANALOGY THE RETROSPECTIVE AMENDMENT HAS TO BE APPLIED.THE F AA WAS DIRECTED BY THE TRIBUNAL TO DECIDE THE ISSUE ON MERITS BUT HE IGNORED THE DIREC TIONS.THEREFORE,WE AGAIN RESTORE THE MATTER TO THE FILE OF THE FAA TO DECIDE THE ISSUE MERITS A ND MERITS ONLY.HE HAS TO DECIDE THE QUESTION AS TO WHETHER THE ASSESSEE WAS ENTITLED TO THE CLAI M DEDUCTION U/S.80HHC IN THE BACKGROUND OF THE RETROSPECTIVE AMENDMENT OR NOT.HE WOULD DEAL WITH THE CASES RELIED UPON BY THE ASSESSEE IN HIS REPLY.IN SHORT,THE FAA WOULD AFFORD A REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE AND WOULD NOT DECIDE THE APPEAL WITHOUT DI SCUSSING THE MERITS OF THE CASE.HE IS DIRECTED TO DISPOSE THE APPEAL WITHIN A PERIOD OF E IGHT WEEKS FROM THE DATE OF RECEIPT OF OUR ORDER.THE ASSESSEE IS DIRECTED TO EXTEND FULL CO-OP ERATION TO THE FAA IN DISPOSING THE APPEAL IN STIPULATED TIME FRAME. EFFECTIVE GROUND OF APPEAL IS DECIDED IN FAVOUR OF THE ASSESSEE,IN PART. . ORDER PRONOUNCED IN THE OPEN COURT ON 1 ST JANUARY, 2016. 01 , 2016 SD/- SD/- ( / JOGINDER SINGH) ( / RAJENDRA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER /MUMBAI, /DATE : 01.01.2016 . . . .. . JV.SR.PS. / COPY OF THE ORDER FORWARDED TO : 1. APPELLANT / 2. RESPONDENT / 3. THE CONCERNED CIT(A)/ , 4. THE CONCERNED CIT / 5. DR A BENCH, ITAT, MUMBAI / , , . . . 6. GUARD FILE/ //TRUE COPY// / BY ORDER, / DY./ASST. REGISTRAR , /ITAT, MUMBAI.