Appeal details
Counselvise Citation
[2011] 124 COUNSELVISE.COM (IT) 8652 (ITAT-COCHIN)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
3 year(s) 11 month(s) 23 day(s)
Appellant
Respondent
Appeal Type
Income Tax (Search & Seizure) Appeal
Pronouncement Date
18-01-2011
Appeal Filed By
Department
Bench Allotted
DB
Next Hearing Date
12-01-2011
Assessment Year
misc
Appeal Filed On
25-01-2007
Judgement Text
IN THE INCOME TAX APPELLAT E TRIBUNAL COCHIN BEN CH, COCHIN BEFORE S/SHRI N.VIJAYAKUMARAN, JM AND SANJAY AR ORA, AM I.T.(SS)A. NO. 06/COCH/2007 BLOCK PERIOD: 1.4.1996 TO 24.9.2002 THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, THIRUVANATHAPURAM. VS. M/S. SREE VELLAYANI HANDLOOM WEAVERS CO-OP SOCIETY LTD., NO. H. IND (T)-328, KALLIYOOR P.O., TRIVANDRUM. [PAN: AACTS 0604C] (REVENUE -APPELLANT) (ASSESSEE - RESPONDENT) REVENUE BY SHRI S.C.SONKAR, CIT-DR ASSESSEE BY SHRI K.S.MADHU, FCA-AR O R D E R PER SANJAY ARORA, AM: THIS APPEAL BY THE REVENUE ARISES OUT OF THE ORDER BY THE COMMISSIONER OF INCOME-TAX (APPEALS)-I, KOCHI (CIT(A) FOR SHORT) DATED 11.10.2006, ALLOWING THE ASSESSEES APPEAL CONTESTING ITS ASSESSMENT U/S. 15 8BD R.W.S. 158BC AND 143(3) OF THE INCOME-TAX ACT, 1961 ('THE ACT', HEREINAFTER) DATED 30.12.2005, AS MODIFIED VIDE ORDER U/S. 154 OF THE ACT DATED 8.6.2006. 2. THE ONLY ISSUE IN APPEAL IS THE WITHDRAWAL OF TH E DEDUCTION ALLOWED TO THE ASSESSEE U/S. 80P OF THE ACT QUA ITS ASSESSED UNDISCLOSED INCOME, I.E., AT ` 20,26,512/-, AT 100% THEREOF. THE SAME WAS SUBSEQUENTLY WITHDRAWN VIDE THE IMPUGNED ORDER U/S. 154, AS THE CLAIM FOR DEDUCTION U/S. 80P STOOD FILED BY THE ASS ESSEE ONLY AT THE TIME OF FILING OBJECTION/S TO THE PRE-ASSESSMENT PROPOSAL, I.E., W AS NOT PREFERRED PER THE RETURN OF INCOME FOR THE BLOCK PERIOD, SO THAT THE DECISION B Y THE HONBLE APEX COURT IN THE CASE OF GOETZE (INDIA) LTD. VS. CIT, 284 ITR 323 (SC) WOULD APPLY. THE LD. CIT(A), IN APPEAL, ALLOWED RELIEF TO THE ASSESSEE FOLLOWING THE DECISI ON IN THE CASE OF ANBU TEXTILE VS. ACIT, 262 ITR 684 (MAD.), WHEREIN THE HONBLE COURT, NOTI NG THE AMENDMENT TO SECTION 158BB IT(SS)A.NO. 06/COCH/2007 2 BY FINANCE ACT, 2002 W.R.E.F. 1.7.1995, HELD THAT T HE UNDISCLOSED INCOME FOR THE BLOCK PERIOD HAD TO BE COMPUTED IN ACCORDANCE WITH THE PR OVISIONS OF THE ACT. AS SUCH, THE PROVISIONS OF CHAPTER VI-A OF THE ACT (WHICH CONTAI NS SECTION 80P) WOULD APPLY AND, CONSEQUENTLY, THE ASSESSEE IS ELIGIBLE TO DEDUCTION , WHERE EXIGIBLE, QUA ASSESSMENT U/C XIV-B OF THE ACT. RELIANCE WAS ALSO PLACED BY HIM ON THE DECISIONS BY THE TRIBUNAL NOTED AT PG. 4 OF HIS ORDER. AGGRIEVED, THE REVENU E IS IN APPEAL. 3. BEFORE US, WHILE THE REVENUE RELIED ON THE DECIS ION IN THE CASE OF GOETZE (INDIA) LTD. V. CIT (SUPRA), THE LD. AR WOULD SUBMIT THAT THE SAID DEC ISION LIMITS THE POWER OF THE ASSESSING AUTHORITY AND NOT THAT OF THE TRIBUNAL, A S HELD BY IT IN THE CASE OF ASHEESH SECURITIES VS. DCIT, 111 ITD 108 (DELHI D). 4. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATER IAL ON RECORD. THE LD. CIT(A) HAS ALLOWED RELIEF TO THE ASSESSEE ON THE BASIS THAT TH E UNDISCLOSED INCOME FOR THE BLOCK PERIOD HAS TO BE COMPUTED IN ACCORDANCE WITH THE PR OVISIONS OF THE ACT, SO THAT SECTION 80P WOULD APPLY. THE PROPOSITION IS UNDISPUTED, BE ING PROVIDED BY THE CLEAR TERMS OF THE STATUTE (SECTION 158BB) ITSELF. THE REVENUE CASE, HOWEVER, IS THAT THE ASSESSEE DID NOT CLAIM ANY DEDUCTION U/S. 80P EITHER PER ITS REGULAR RETURN OF INCOME OR EVEN PER THAT FOR THE BLOCK PERIOD (IN FORM 2B), SO THAT NO GRIEVANCE ON ACCOUNT OF WITHDRAWAL OR - IN EFFECT - DENIAL OF DEDUCTION U/S. 80P CAN HOLD. THE REVENUES CASE, THUS, CONCERNS THE PROCEDURAL ASPECT OF THE DEDUCTION UNDER REFERENCE. TOWARD THIS, IT WAS SUBMITTED BY THE LD. AR THAT THE ASSESSEES RETURN FOR THE BLOCK PER IOD WAS FOR A LOSS OF ` 56,88,509/-. AS SUCH, THERE WAS NO OCCASION FOR IT TO CLAIM DEDUCTI ON U/S. 80P, WHICH WAS CLAIMED AT THE EARLIEST POINT IN TIME, I.E., AT THE PRE-ASSESSMENT PROPOSAL STAGE. WE FIND CONSIDERABLE MERIT IN THE ASSESSEES ARGUMENT. THE FACT OF NON-C LAIM OF DEDUCTION U/S. 80P BY THE ASSESSEE PER THE REGULAR RETURN OF INCOME (U/S. 139 ) IS OF NO CONSEQUENCE; THE IMPUGNED ASSESSMENT BEING UNDER CHAPTER XIV-B. THE RELEVANT RETURN FOR THE BLOCK PERIOD STOOD FILED ON 6.7.2005 AT A LOSS OF ` 56.89 LAKHS. THERE IS NO PROVISION UNDER THE ACT F OR REVISING THE RETURN FOR THE BLOCK PERIOD, SO THAT T HE CLAIM COULD EVEN OTHERWISE BE MADE ONLY DURING THE COURSE OF THE RELEVANT ASSESSMENT P ROCEEDINGS, AS HAS BEEN THE CASE. THE DECISION IN THE CASE OF GOETZE (INDIA) LTD. (SUPRA) WOULD NOT APPLY IN THE FACTS OF THE CASE IT(SS)A.NO. 06/COCH/2007 3 AS IT IS NOT A QUESTION OF THE ASSESSEE HAVING FAIL ED OR OMITTED TO CLAIM DEDUCTION AGAINST OR IN RESPECT OF ITS RETURNED INCOME, AND WHICH UND ER THE SCHEME OF THE ACT CAN ONLY BE PER THE RETURN (OR A REVISED) RETURN OF INCOME. THE ASSESSEE, IN THE FACTS OF THE CASE, HAD FILED A RETURN OF LOSS. ON THE REJECTION OF ITS CLA IM FOR LOSS, PROPOSING THE ASSESSMENT AT A POSITIVE SUM (INCOME), IT BROUGHT TO THE NOTICE OF THE ASSESSING AUTHORITY THAT ITS ENTIRE INCOME IS LIABLE FOR EXEMPTION U/S. 80P, SATISFACTI ON OF THE CONDITIONS FOR THE ALLOWANCE OF WHICH STOOD EXAMINED BY THE ASSESSING AUTHORITY DUR ING THE ASSESSMENT STAGE, AND FINDING IT AS SO, ALLOWED RELIEF TO THE ASSESSEE IN ITS RES PECT ( REFER PARA 11.5 TO 11.8 OF THE ASSESSMENT ORDER ). WITHDRAWAL OF THE SAME SUBSEQUENTLY, CITING NON -CLAIM OF DEDUCTION PER THE RETURN, WHICH IS NOT MAINTAINABLE IN TERMS OF THE RETURN FURNISHED, IS, THUS, NOT TENABLE IN LAW; THE ASSESSMENT AS FRAMED BEING ADMI TTEDLY IN ACCORDANCE WITH LAW AND ALSO PROCEDURALLY FIRM. NO DOUBT, THE ASSESSEE OUG HT TO HAVE PREFERABLY RESERVED ITS RIGHT TO CLAIM DEDUCTION U/S. 80P BY WAY OF A NOTE TO ITS RETURN FOR THE BLOCK PERIOD. SO HOWEVER, NOT DOING SO CANNOT BE FATAL TO ITS CLAIM, AS THE SAME WOULD ONLY HAVE BEEN BY WAY OF AN ABUNDANT CAUTION, BEING NOT WARRANTED BY THE RETURN FURNISHED, WITH THE ASSESSEE, AS AFORE-NOTED, BRINGING THE SAME TO THE NOTICE AND PURVIEW OF THE A.O. AT THE EARLIEST POINT IN TIME, AND ONLY UNDER THE REGULAR PROCEDURE OF ASSESSMENT, WHICH, THUS, IS ALSO PROCEDURALLY COMPLIANT (WITH LAW), AND REQUIRE S NO INTERFERENCE IN THE MATTER. FURTHERMORE, WE MAY ALSO ADD, ALBEIT WITHOUT PREJUD ICE, THAT AT ANY RATE IT IS NOT A MATTER AMENABLE TO AMENDMENT U/S. 154, AS STANDS PROVED BY THE VERY FACT OF THE IMPUGNED WITHDRAWAL GENERATING A DEBATE AND RESULTING IN DIF FERENCE/S OF OPINION. WE DECIDE ACCORDINGLY. 5. IN THE RESULT, THE REVENUES APPEAL IS DISMISSED . SD/- SD/- (N.VIJAYAKUMARAN) (SANJAY ARORA) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: ERNAKULAM DATED: 18TH JANUARY, 2011 GJ IT(SS)A.NO. 06/COCH/2007 4 COPY TO: 1. M/S. SREE VELLAYANI HANDLOOM WEAVERS CO-OP SOCI ETY LTD., NO. H. IND (T)-328, KALLIYOOR P.O., TRIVANDRUM. 2. THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL C IRCLE, THIRUVANANTHAPURAM. 3. THE COMMISSIONER OF INCOME-TAX (APPEALS)-I, KOCH I 4. THE COMMISSIONER OF INCOME-TAX, CENTRAL, KOCHI. 5. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR)
