Vansda Taluka Sahkari K.V.Sangh Ltd.,, Dist.Valsad v. The Income tax Officer, Ward-4,, Navsari

ITA 3681/AHD/2007 | 2005-2006
Pronouncement Date: 26-02-2010 | Result: Allowed

Appeal Details

RSA Number 368120514 RSA 2007
Assessee PAN AACFB6130C
Bench Ahmedabad
Appeal Number ITA 3681/AHD/2007
Duration Of Justice 2 year(s) 5 month(s) 14 day(s)
Appellant Vansda Taluka Sahkari K.V.Sangh Ltd.,, Dist.Valsad
Respondent The Income tax Officer, Ward-4,, Navsari
Appeal Type Income Tax Appeal
Pronouncement Date 26-02-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 26-02-2010
Date Of Final Hearing 24-02-2010
Next Hearing Date 24-02-2010
Assessment Year 2005-2006
Appeal Filed On 12-09-2007
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL : A BENCH : A HMEDABAD (BEFORE HONBLE SHRI G.D. AGRAWAL VICE-PRESIDENT(A Z) & HONBLE SHRI T.K. SHARMA J.M.) I.T.A. NO. 3681/AHD./2007 ASSESSMENT YEAR : 2005-2006 VANSDA TALUKA SAHKARI K.V. SANGH LTD. -VS.- INC OME TAX OFFICER WARD-4 NAVSARI VALSAD (PAN : AACFB 6130 C) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI RAJESH M. UP ADHYAY RESPONDENT BY : SHRI GOVIND SINGHAL SR. D.R. O R D E R PER SHRI T.K. SHARMA JUDICIAL MEMBER : THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE O RDER DATED 18.06.2007 OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS) VALSAD FOR THE ASSESSMENT YEAR 2005-06. 2. BRIEFLY STATED THE FACTS ARE THAT THE ASSESSEE I S A COOPERATIVE SOCIETY. FOR THE ASSESSMENT YEAR UNDER APPEAL IT FILED THE RETURN OF INCOME ON 5.9.2005 DECLARING TOTAL INCOME OF RS.55 402/- . THROUGH OVERSIGHT THE ASSESSEE-COOPERATIVE SOCIE TY DID NOT CLAIM THE DEDUCTION ELIGIBLE UNDER VARIOUS SUB-CLAUSES OF 80 VIZ. 80P(2)(C) 80P(2)(D) 80P(2)(E). ON RETURNED 9INCOME THE ASSESSING OFFICER ISSUED INTIMATION UNDER SECTION 1 43(1) DEMANDING INCOME TAX AND INTEREST THEREON AMOUNTING TO RS.21 365/-. THIS INTIMATION W AS ISSUED ON 31.03.2006. AFTER THE RECEIPT OF INTIMATION UNDER SECTION 143(1)(A) THE ASSESSEE FI LED A REVISED RETURN ON 4.8.2006 CLAIMING DEDUCTION UNDER SECTION 80P(2)(C) WHICH WAS STATED TO BE OMITTED TO CLAIM IN THE ORIGINAL RETURN. SINCE THE ASSESSING OFFICER HAS NOT CONSIDERED THE REVISED RETURN THE ASSESSEE FILED AN APPLICATION OF RECTIFICATION UNDER SECTION 154 ON 1 .9.2006. THIS RECTIFICATION WAS REJECTED BY THE A.O. FOR THE REASONS GIVEN IN PARA 2 OF HIS ORDER D ATED 23.03.2007. THE RELEVANT PORTION OF THE ORDER IS AS UNDER :- 2. .I HAVE GONE THROUGH THE SUBMISSION OF THE ASSESSEE AND OBSERVED THAT THE AUDITOR IN HIS REMARKS ACCOMPANIED WITH T HE FORM 3CB & 3CD ON SIGNIFICANT ACCOUNTING POLICIES HAD COMMENTED THAT A FEW EXPENSES ARE NOT PROVIDED IN CONSONANCE WITH THE ACCOUNTING POLICY A DOPTED IN THE EARLIER YEARS. BESIDES THIS IN SR. NO. 26 OF FORM CD THE AUDITOR HAD STATED THAT IN ABSENCE OF ADEQUATE DETAILS OF DEALINGS WITH THE MEMBERS AMOU NT OF DEDUCTION IS NOT ASCERTAINABLE. UNDER THE CIRCUMSTANCES THE CLAIM U /S. 80P(2)(C) IS NOT ALLOWABLE AND ACCORDINGLY THE RECTIFICATION APPLICATION U/S. 154 IS HEREBY REJECTED. 2 ITA NO. 3681/AHD/2007 3. ON APPEAL IN THE IMPUGNED ORDER THE LEARNED CO MMISSIONER OF INCOME TAX(APPEALS) UPHELD THE ACTION OF ASSESSING OFFICER FOR THE DETA ILED REASONS GIVEN IN PARA 5.3 WHICH READS AS UNDER :- I HAVE CONSIDERED THE CONTENTIONS OF THE APPELLANT AS WELL AS THE OBSERVATION OF THE A.O. IN THE ASSESSMENT ORDER. SI NCE THE APPELLANT HAS FAILED TO PROVE BEFORE THE A.O. THAT THE CONDITIONS REQUIRED TO BE FULFILLED FOR A CLAIM OF DEDUCTION U/S. 80P HAS BEEN FULFILLE D OR NOT AS THE AUDITOR OF THE APPELLANT HIMSELF HAS EXPRESSED HIS DOUBTS F OR SUCH CLAIM IN HIS COMMENTS GIVEN IN THE AUDITORS REPORT IN FORM NO. 3CB AND 3CDENCLOSED WITH THE RETURN OF INCOME I AM OF THE CONSIDERED VIEW THAT THE A.O. HAS RIGHTLY REJECTED THE APPLICATION U/S. 154 OF THE ACT. EVEN THE REVISED RETURN FILED BY THE APPELLANT AFTER THE PRO CESSING OF THE RETURN AND ISSUE OF INTIMATION ORDER U/S. 143(1) WAS INVAL ID AND THEREFORE THE A.O. HAS RIGHTLY REJECTED THE CLAIM OF THE APPELLAN T. THEREFORE THE APPELLANTS GROUND NO. 1 AND 2 ARE DISMISSED. 4. AGGRIEVED BY THE ORDER OF LEARNED COMMISSIONER O F INCOME TAX(APPEALS) THE ASSESSEE IS IN APPEAL BEFORE US ON THE FOLLOWING GROUNDS :- (1) LD. A.O. HAS ERRED IN LAW AND ON FACTS TO REJEC T APPELLANTS APPLICATION MADE U/S. 154(2)(B) DATED 1.9.2006 TO RECTIFY INTIM ATION ENT U/S. 143(1) ON DATED 31.3.2006. APPELLNT THROUGH OVERSIGHT FAILED TO CLAIM DEDUCTION U/S. 80P(2)(C) WHICH WAS CLAIMED AND ALLOWED IN EARLIER YEARS AND ALSO IN SUBSEQUENT YEAR. LD. CIT.(A) VALSAD HAS ALSO ERRED TO CONFIRM A.O.S ORDER. (2) APPELLANT ALSO FILED REVISED RETURN U/S. 139(5) CLAIMING DEDUCTION OF RS.57 880/- U/S. 80P(2)(C) ON DATED 4.3.2006 WHICH WAS IN ORDER CONSIDERING THE FACT THAT ORIGINAL RETURN WAS FILED ON DT. 5.9.2005 BEFORE THE END OF THE STATUTORY TIME LIMIT. LD. A.O. AND C IT.(A) IGNORED THIS LEGITIMATE REVISED RETURN AND DID NOT ALLOW DEDUCTI ON U/S. 80P(2)(C) CLAIMED BY THE APPELLANT. 5. AT THE TIME OF HEARING ON BEHALF OF THE ASSESSEE SHRI RAJESH M. UPADHYAY APPEARED AND CONTENDED THAT CONTROVERSY INVOLVED IN BOTH THE AFO RESAID GROUNDS IS SQUARELY COVERED BY THE DECISION OF TRIBUNAL IN THE CASE OF SMT. BHNUBEN CH IMANLAL MALAVIA VS.- ITO REPORTED IN (2006) 100 TTJ 337 (RAJ.) WHEREIN IT WAS HELD AS U NDER :- VALIDITY ; - REVISED RETURN FILED BY THE ASSESSEE W ITHIN THE PRESCRIBED TIME - LIMIT COULD NOT BE IGNORED MERELY ON THE GROUND THAT THE ORIGINAL RETURN WAS ALREADY 3 ITA NO. 3681/AHD/2007 PROCESSED UNDER S 143(1); THERE IS NO RESTRICTION THAT REVISED RETURN CANNOT BE FAILED FOR SHOWING LOSS FOR THE FIRST TIME. HELD- THE ORIGINAL RETURN OF INCOME WAS FURNISHED O N 30 LH OCT.. 2001 DISCLOSING THE TOTAL INCOME AT RS. 1 39 829. AS SUCH THE ASSE SSEE WAS LEGALLY ENTITLED TO REVISE HIS RETURN OF INCOME LATEST BY 31 ST MARCH 2003 OR BEFORE COMPLETION OF THE ASSESSMENT WHICHEVER IS EARLIER. THE ASSESSMENT OF THE CASE WAS COMPLETED AS LATE AS ON 26 TH MARCH.2004. WHEREAS THE RETURN OF INCOME FURNISHED ORIGINALLY WAS REVISED ON 31 ST OCT..2002 IT WAS THUS A VALIDLY REVISED RETURN OF INCOME AND CANNOT BE IGNORED OR OBJECTED ON THIS GROUND. S O FAR AS DEPARTMENTAL REPRESENTATIVE'S ARGUMENT OF FILING OF RETURN AFTER THE ORIGINAL RETURN WAS PROCESSED UNDER S. 143(1) IS CONCERNED BY THE FIN ANCE ACT 1999 W E F. L SL JUNE 1999 SEC. I43(1)|(A) HAS BEEN SUBSTITUTED BY THE N EW S. 143(1) WHEREBY THE POWERS OF THE AOS HAVE BEEN FURTHER RESTRICTED SO A S NOT TO ALLOW THEM EVEN TO CARRY OUT THE PRIMA FACIE ADJUSTMENTS WHILE PROCESS ING THE RETURN OF INCOME. THUS WHEN EVEN THE ORDER OR THE INTIMATION UNDER S. 143(L)(A) IS NOT BEING TREATED AS AN ASSESSMENT PROCESSING OF THE RETURN OF INCOME UNDER S. 143(1) COULD NOT BE TREATED AS AN ASSESSMENT EITHER AND TH E MERE FACT OF THE RETURN OF INCOME HAVING BEEN ALREADY PROCESSED CANNOT DISENTI TLE THE ASSESSEE FROM FURNISHING THE REVISED RETURN OF INCOME WITHIN THE OTHERWISE PRESCRIBED TIME- LIMIT. - S.R. KOSHTI VS CIT (2005) 193 CTR (GUJ) 5 18: (2005) 276 I1R 165 (GUJ) FOLLOWED. FURTHERMORE S. 139(5) CLEARLY SPEAKS OF 'ANY OMISSI ON OR ANY WRONG STATEMENT MEANING THEREBY THAT THE OMISSION OR THE WRONG STAT EMENT MAY BE OF ANY TYPE AND THERE CANNOT BE ANY RESERVATION OR RESTRICTIONS IN THE MEANING OF THESE TERMS. THE PURPOSE OF S. 139(5) IS TO ENABLE THE AS SESSEE TO VOLUNTARILY AND SUO MOTU CORRECT ANY OMISSION OR ANY WRONG STATEMENT S O AS NOT TO DAMAGE A PERSON ACTING WITHOUT MALA FIDE INTENTIONS. THE ONL Y CONDITION TO BE TAKEN CARE OF WHILE DOING THIS IS THAT SAME CAN BE DONE ONLY B EFORE THE COMPLETION OF THE ASSESSMENT AND WITHIN THE SPECIFIED TIME FRAME. THE VERY PURPOSE OF THE STATUTE IS THUS TO ENSURE THAT ANY ADMISSION OF OMISSION OR WRONG STATEMENT HAS TO BE VOLUNTARY ONE WITHIN THE SPECIFIED LIME-LIMIT AND MUST HAVE BEEN MADE BEFORE THE SAME HAS BEEN DETECTED BY THE DEPARTMENT IN THE ASSESSMENT ORDER. NOWHERE IN THE SECTION OR ANYWHERE ELSE IN THE IT ACT FOR THAT MATTER IT HAS BEEN PROVIDED THAT THE RETURN OF INCOME TO BE REVIS ED MUST NOT BEAR THE CHARACTER OF THE RETURN OF WHICH INCLUDES A LOSS IN IT-EITHER FROM BUSINESS OR PROFESSION OR FROM CAPITAL GAIN. THE AO HAS NOT CON SIDERED THE FILING OF LOSS RETURN BELATEDLY AND THEREFORE DECLINING THE CLAI M OF CARRY FORWARD OF SHORT- TERM CAPITAL LOSS. IN THE INTEREST OF JUSTICE THE I SSUE OF REVISED RETURN WHICH WAS OF LOSS BUT FILED WELL WITHIN THE STATUTORY PROVIS IONS OF S. 139(5) IS RESTORED TO THE FILE OF THE AO FOR DECIDING DE NOVO KEEPING IN VIEW ABOVE OBSERVATIONS. 5.1. LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT INT IMATION UNDER SECTION 143(1)(A) IS MERELY ACKNOWLEDGMENT. IT CANNOT TAKE AWAY THE RIGHT OF TH E ASSESSEE TO FURNISH THE REVISED RETURN OF INCOME WITHIN THE TIME PROVIDED IN SECTION 139(5) O F THE INCOME TAX ACT I.E. WITHIN ONE YEAR FROM THE END OF THE ASSESSMENT YEAR. THROUGH OVERSI GHT IN THE ORIGINAL RETURN DEDUCTION UNDER SECTION 80P WAS NOT CLAIMED. THIS HAS BEEN CLAIMED IN THE REVISED RETURN. THE REVISED RETURN IS 4 ITA NO. 3681/AHD/2007 VALID THEREFORE THE ASSESSING OFFICER BE DIRECTED TO ALLOW THE DEDUCTION CLAIMED UNDER SECTION 80P OF THE INCOME TAX ACT 1961. 6. SHRI GOVIND SINGHAL SR. D.R. APPEARING ON BEHAL F OF THE REVENUE SUPPORTED THE ORDER OF AUTHORITIES BELOW. 7. HAVING HEARD BOTH THE SIDES WE HAVE GONE THROUG H THE ORDERS OF AUTHORITIES BELOW. IT IS PERTINENT TO NOTE THAT THE ASSESSEE HAS FILED THE R EVISED RETURN WITHIN THE TIME PRESCRIBED IN THE SECTION 139(5) OF THE INCOME TAX ACT 1961. THE A.O . CANNOT REFUSED TO PROCESS SAID REVISED RETURN ON THE GROUND THAT THE ORIGINAL RETURN IS AL READY PROCESSED UNDER SECTION 143(1)(A) IN OUR OPINION ON RECEIPT OF THE REVISED RETURN THE A.O. EITHER OUGHT TO HAVE ISSUED NOTICE UNDER SECTION 143(2) OR ACCEPTED THE RETURN. SINCE NO NOTICE UNDE R SECTION 143(2) WAS ISSUED THE A.O. WAS HAVING NO OPTION BUT TO ALLOW THE DEDUCTION UNDER S ECTION 80P AS CLAIMED BY PASSING APPROPRIATE ORDER UNDER SECTION 154 OF THE INCOME TAX ACT 1961 . CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE WE ARE OF THE OPINION TH AT THE ASSESSING OFFICER CLEARLY ERRED IN REJECTING THE APPLICATION OF THE ASSESSEE UNDER SEC TION 154. WE ACCORDINGLY SET ASIDE THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS) AS WELL AS ASSESSING OFFICER AND DIRECT HIM TO PASS FRESH ORDER ALLOWING DEDUCTION UNDER SECTION 8 0P OF THE INCOME TAX ACT AS CLAIMED BY THE ASSESSEE IN THE REVISED RETURN OF INCOME. 8. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. THE ORDER WAS PRONOUNCED IN THE COURT ON 26.02.201 0 SD/- SD/- (G.D. AGRAWAL) (T.K. SHARMA ) VICE-PRESIDENT (AZ) JUDICIAL MEMBER DATED : 26 / 02 / 2010 COPY OF THE ORDER IS FORWARDED TO : 1) THE ASSESSEE (2) THE DEPARTMENT. 3) CIT(A) CONCERNED (4) CIT CONCERNED (5) D.R. ITAT AHMEDABAD. TRUE COPY BY ORDER DEPUTY REGISTRAR ITAT AHMEDABAD LAHA/SR.P.S.