WEL Intertrade (P) Ltd., New Delhi V. ACIT, Circle- 27(2), New Delhi

ITA 7167/DEL/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5591 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-06-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2013-2014
• Appeal Filed On: 12-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Rectification of order; Set aside
• Section: 69C; 69B; 68; 69; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: B, NEW DELHI) BEFORE SH. N. K. BILLAIYA, ACCOUNTANT MEMBER AND SH. K. N. CHARY, JUDICIAL MEMBER ITA NO:-7167/DEL/2018 ( ASSESSMENT YEAR: 2013-14) WEL INTERTRADE (P) LTD. 5E LOCAL SHOPPING CENTRE MASJID MOTH, GREATER KAILASH II NEW DELHI VS. ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 27 (2) NEW DELHI APPELLANT RESPONDENT ASSESSEE BY : SH. C. S. AGGARWAL, SR. ADVOCATE SH. RAVI PRATAP MALL, ADVOCATE REVENUE BY : SH. ABHISHEK KUMAR, SR. DR DATE OF HEARING : 15.05.2019 DATE OF PRONOUNCEMENT : 03.06.2019 ORDER PER: N. K. BILLAIYA, AM THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST TH E ORDER OF THE COMMISSIONER OF INCOME TAX [APPEALS]-9, NEW DELHI, DATED 20.09.2018 FOR ASSESSMENT YEAR 2013-14. 2. THE SUM AND SUBSTANCE OF THE GRIEVANCE OF THE AS SESSEE IS THAT THE CIT(A) ERRED IN SUSTAINING THE ORDER OF THE ASSESSI NG OFFICER FRAMED U/S. 154 OF THE ACT. 2 ITA NO.-7167/DEL/2018 3. FACTS OF THE CASE SHOW THAT AN ASSESSMENT WAS FR AMED U/S 143 (3) OF THE ACT VIDE ORDER DATED 28.03.2016 AFTER MAKING AD DITION OF RS.4.50 CRORES U/S 68 OF THE ACT. AFTER FRAMING THE ASSESS MENT THE ASSESSING OFFICER FOUND THAT THE TAX COMPUTATION AS PER ASSES SMENT ORDER DATED 28.03.2014 REQUIRED TO BE AMENDED AS THERE IS MISTA KE APPARENT FROM THE RECORD. 4. THE ASSESSING OFFICER NOTICED THAT THE NET TAXAB LE INCOME HAS BEEN CALCULATED AT RS.37369890/- AFTER INADVERTENTLY SET TING OF THE CURRENT YEAR LOSS OF RS.7630108/- AGAINST INCOME FROM OTHER SOUR CES OF RS.4.50 CRORES ADDED U/S. 68 OF THE ACT. 5. THE ASSESSING OFFICER WAS OF THE OPINION THAT TH E ADDITION MADE U/S 68 HAS TO BE TAXED AT A FLAT RATE OF 30% AND NO DED UCTION AND ALLOWANCE CAN BE SET OFF THERE WITH U/S. 115 BBE OF THE ACT. ACCORDINGLY THE ASSESSMENT WAS RECTIFIED U/S. 154 OF THE ACT. 6. ASSESSEE AGITATED THE MATTER BEFORE THE CIT(A) B UT WITHOUT ANY SUCCESS. 7. BEFORE US THE COUNSEL FOR THE ASSESSEE STATED TH AT THE PROVISIONS OF SECTION 115 BBE DO NOT APPLY IN THE YEAR UNDER CONS IDERATION. IT IS THE SAY OF THE COUNSEL THAT THE AMENDMENT ARE EFFECT FROM 0 1.04.2017 AND HENCE NOT APPLICABLE IN THE YEAR UNDER CONSIDERATION. 3 ITA NO.-7167/DEL/2018 8. THE DR STRONGLY SUPPORTED THE FINDINGS OF THE AS SESSING OFFICER. 9. WE HAVE CAREFULLY CONSIDERED THE ORDERS OF THE A UTHORITIES BELOW. AT THE VERY OUTSET, WE HAVE TO STATE THAT THE ADDITION OF RS.4.50 CRORES HAVE BEEN DELETED BY US IN ITA NO.7166/DEL/2018 VIDE ORD ER DATED 03.06.2019. ON THIS ISSUE ITSELF THE RECTIFICATION ORDER DOES N OT SURVIVE. 10. EVEN OTHERWISE THE AMENDED PROVISIONS OF SECTIO N 115BBE DO NOT APPLY DURING THE YEAR UNDER CONSIDERATION. FOR READ Y REFERENCE SECTION 115 BBE AS IT STANDS TODAY READ AS UNDER :- 115 BBE [(1) WHERE THE TOTAL INCOME OF AN ASSESSEE- (A) INCLUDES ANY INCOME REFERRED TO IN SECTION 68, SECT ION 69, SECTION 69A, SECTION 69B, SECTION 69C OR SECTION 69 D AND REFLEC TED IN THE RETURN OF INCOME FURNISHED UNDER SECTION 139; OR (B) DETERMINED BY THE ASSESSING OFFICER INCLUDES ANY IN COME REFERRED TO IN SECTION 68, SECTION 69, SECTION 69A, SECTION 69B, S ECTION 69C OR SECTION 69D IF SUCH INCOME IS NOT COVERED UNDER CLAUSE (A), THE INCOME TAX PAYABLE SHALL BE THE AGGREGATE OF (I) THE AMOUNT OF INCOME-TAX CALCULATED ON THE INCOME R EFERRED TO IN CLAUSE (A) AND CLAUSE (B), AT THE RATE OF SIXTY PER CENT; AND 4 ITA NO.-7167/DEL/2018 (II) THE AMOUNT OF INCOME-TAX WITH WHICH THE ASSESEE WOU LD HAVE BEEN CHARGEABLE HAD HIS TOTAL INCOME BEEN REDUCED B Y THE AMOUNT OF INCOME REFERRED TO IN CLAUSE (I).] (2) NOTWITHSTANDING ANYTHING CONTAINED IN THIS ACT, NO DEDUCTION IN RESPECT OF ANY EXPENDITURE OR ALLOWANCE [ OR SET OF F OF ANY LOSS ] SHALL BE ALLOWED TO THE ASSESSEE UNDER ANY PROVISION OF THIS ACT IN COMPUTING HIS INCOME REFERRED TO CLAUSE (A) [AND CLAUSE (B) OF SU B-SECTION(1)] 11. THE PRE AMENDED SECTION READ AS UNDER :- 15. SUBSTITUTED BY THE TAXATION LAWS (SECOND AMENDM ENT) ACT, 2016 W.E.F. 01.04.2017. PRIOR TO ITS SUBSTITUTION, SUB-SECTION (1) READ AS UNDER : (1) WHERE THE TOTAL INCOME OF AN ASSESSEE INCLUDE S ANY INCOME REFERRED TO IN SECTION 68, SECTION 69, SECTION 69A SECTION 69B OR SECTION 69D THE INCOME-TAX PAYABLE SHALL BE THE AGGREGATE OF (A) THE AMOUNT OF INCOME-TAX CALCULATED ON INCOME REFER RED TO IN SECTION 68, SECTION 69, SECTION 69A, SECTION 69B, SECTION 69C O R SECTION 69D AT THE RATE OF THIRTY PER CENT; (B) THE AMOUNT OF INCOME-TAX WITH WHICH THE ASSESSEE WO ULD HAVE BEEN CHARGEABLE HAD HIS TOTAL INCOME BEEN REDUCED BY THE AMOUNT OF INCOME REFERRED TO IN CLAUSE (A). 12. A PERUSAL OF THE ABOVE SHOW THAT THE AMENDMENT IS APPLICABLE FROM 01.04.2017. IN OUR CONSIDERED VIEW WHETHER THE AMEN DMENT IS PROSPECTIVE 5 ITA NO.-7167/DEL/2018 OR RETROSPECTIVE IS A HIGHLY DEBATABLE ISSUE AND, T HEREFORE, CANNOT BE A SUBJECT MATTER OF RECTIFICATION U/S. 154 OF THE ACT . 13. CONSIDERING THE FACTS OF THE CASE AND THE LAW W E SET ASIDE THE FINDINGS OF THE CIT(A) AND QUASH THE RECTIFICATION ORDER DATED 05.05.2016 FRAMED U/S.154 OF THE ACT. 14. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ACCORDINGLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 03.06.2019. SD/- SD/- (K.N.CHARY) (N.K.BILLAIYA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 03.06.2019 *NEHA* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI 6 ITA NO.-7167/DEL/2018 DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE 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 0 3 . 0 6 . 2 0 1 9 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER