1985 (1) TMI 108 - AT - Income Tax

Summary

Issues:
1. Disallowance under section 80J in provisional assessment.
2. Rectification application under section 154 for relief under section 80J.

Detailed Analysis:
1. The case involved a dispute regarding disallowance of Rs. 29,87,768 in the provisional assessment under section 141A(3) of the Income-tax Act, 1961. The assessee contended that the adjustment regarding relief under section 80J was not a prima facie inadmissible deduction. The Commissioner (Appeals) partially accepted the assessee's contention, leading to the revenue disputing the decision. The revenue argued that the claim made by the assessee was not free from debate and cited relevant case laws to support their position (T.S. Balaram, ITO v. Volkart Bros. and R. A. Boga v. AAC).

2. The assessee, represented by their counsel, highlighted the background of the issue, emphasizing the cooperative attitude towards the department and the circumstances leading to the filing of the return and claim for refund. The counsel argued that the denial of relief under section 80J was not justified as it was not a prima facie disallowance. The counsel also referred to the order of the Commissioner (Appeals) and a relevant case (CIT v. Simpson & Co.) to support the assessee's position.

3. The Tribunal analyzed the arguments presented by both parties and examined the facts and provisions of section 141A. The Tribunal found that the denial of relief under section 80J in the provisional assessment was not a prima facie disallowance. The Commissioner (Appeals) had correctly dealt with the disallowances made by the ITO, confirming that the disallowance of Rs. 26,94,604 under section 80J was against the law and a mistake apparent from the record. The Tribunal upheld the decision of the Commissioner (Appeals) based on the facts and provisions of the case.

4. The Tribunal concluded that the denial of relief under section 80J in the provisional assessment was unjustified and constituted a mistake apparent from the record. The Tribunal found no grounds to interfere with the decision of the Commissioner (Appeals) and confirmed the action taken. The Tribunal dismissed the revenue's appeal, thereby upholding the decision in favor of the assessee.