TMI Blog2010 (2) TMI 805X X X X Extracts X X X X X X X X Extracts X X X X ..... ble Supreme Court in the case of CIT vs. Mahendra Mills reported in 243 ITR 56. It is the stand of the revenue that the decision of the Hon'ble Supreme Court in the case of Mahendra Mills (supra) related to the assessment year 1974-75 prior to the deletion of sub-section (1) and (2) of section 34 by the Taxation laws (Amendment and Misc. Provisions) Act, 1986 w.e.f. 1.4.1988 and therefore, the ratio of the concerned decision is not applicable to the facts of the assessee's case for the AY 1999-2000. 4. Facts leading to the dispute as narrated by the Assessing Officer are as under: "The assessee filed on 30.12.99 (extended date) declaring a total loss of Rs.62,34,39,507 and claiming a refund of TDS of Rs.31,52,550. The Return of Income was finalized u/s. 143(1)(a) on 18.12.2000 and a refund of Rs.28,87,583 was finalized of interest u/s 244A of Rs.46,953-. The reduction in refund given was due to certain defects in TDS Certificates. But the refund voucher was returned by the assessee on reasons that the assessee was contemplating filing a revised return. Accordingly, another return captioning it as 'revised' return was filed on 30.3.2001. In this return, the assessee show ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... turn would enable the assessee to file a revised return. Instance of such 'omission' or 'wrong statement' would be not claiming a bona fide deduction, or omitting to include an income purely unintentional, etc., Here, in the instant case, what assessee has given as reasons as to - 1) With draw the depreciation allowances for the year, another grant that he has such an option. 2) Shifting certain incomes to capital/revenue, thereby intending to capitalize the same and adding the certain assets to form basis for depreciation in subsequent years. A critical examination of the so-called Revised Return of Income indicate the following. a) The assessee had unabsorbed depreciation right from A.Y. 1997-98 to 1999-2000 aggregating to Rs.1,97,28,66,330 as per Return of Income filed on 30.12.1999, out of which for A.Y. 1999-2000 it is Rs.61,68,68,632/-. Because of no positive income available and also considering the capital assets that are acquired, there could be no possibility of getting depreciation adjusted in the immediately succeeding years, visualizing the remote chances of getting the unabsorbed depreciation in the such subsequent years, in view of the limitat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd. (64 ITR 67). Accordingly, a mistake which was apparent from record would constitute an error/omission on the part of the assessee in the original R/I and therefore, filing of revised R/I was justified. Further, even if the appellant had not computed income in accordance with law laid down by the Supreme Court, the AO was obliged to compute the taxable income in accordance with correct principles of law laid down by the Supreme Court. It was submitted that the revised R/I filed by the appellant was a valid one relying on the decision of the Supreme Court in the case of Dhampur Sugar (90 ITR 236) which held as under: "The effective return for purposes of assessment is thus the return which is ultimately filed by an assessee on the basis of which he wants his income to be assessed .... But, when an assessment has to be made the assessee is given a right to file a correct and complete return if he discovers an error or omission in the return filed earlier. The assessment can be completed only on the basis of the correct and complete return .....once a revised return is filed, the original return must be taken to have been withdrawn and to have been substituted by a fresh retu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same view is expressed by the Ahmedabad Bench of the Tribunal in the case of Uvifort Metalizers vs. DCIT 73 TTJ (Mum) 381. In the case of CCIT and Anr. vs. Machine Tools Corporation of India Ltd. 201 ITR 101(Kar), the Hon'ble Karnataka High Court held that allowing of depreciation is subject to provisions of section 34 and if the assessee chooses not to furnish particulars, it is not mandatory for ITO to impose the benefit. If the assessee withdrew claim of depreciation in revised return, ITO cannot allow depreciation adverting to particulars furnished in original return. In the light of the above decisions, we are of the view that there is no case made out by the revenue to interfere with the order of the ld. CIT(Appeals). The grounds fail and are dismissed. 9. Coming to grounds 4 and 5, according to revenue, the CIT(Appeals) failed to appreciate that the interest income of Rs.18,62,545 declared under the head "Income from other sources" in the revised return as against Rs.1,61,68,218 declared in the original return was not in accordance with law. Further, the deduction of interest of Rs.1,25,61,464 on margin money placed with banks for opening letters of credit, from the pre ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
