TMI Blog2012 (7) TMI 661X X X X Extracts X X X X X X X X Extracts X X X X ..... the matter back to the Assessing officer to examine the issue once again as regards the valuation - against revenue. - Tax Case (Appeal) Nos.1615 and 1616 of 2005 - - - Dated:- 6-7-2012 - Mrs.Justice CHITRA VENKATARAMAN, Mr.Justice K.RAVICHANDRABAABU, JJ. For Appellant : Mr.T.R.Senthilkumar, Standing Counsel for Income Tax Dept. For respondent : Mr.C.V.Rajan COMMON JUDGMENT CHITRA VENKATARAMAN, J. The Revenue has come up on appeals as against the common order of the Income Tax Appellate Tribunal, Madras 'A' Bench dated 13.12.2002 in ITA.Nos.1019/Mds/2002 and 1265/Mds/2002 raising the following substantial questions of law:- " 1.Whether in the facts and circumstances of the case, the Tribunal was right in remanding the matter to the assessing officer to consider claims made in the revised return, when such return was filed beyond the time limit prescribed under Section 139(5)? and 2. Whether in the facts and circumstances of the case, the Tribunal was right in not giving a finding on how the assessing officer could consider claims made in a revised return which was filed beyond time?" 2.The assessee is engaged in the business of manufacture a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of the assessment under Section 143(2), the assessee requested the Assessing Officer to take cognizance of revised return of income filed for the purpose of arriving at the tax liability under Section 115JA and to arrive at the taxable income under the provisions of the Income Tax Act, excluding Section 115A provisions also. Reiterating the view already taken by the Assessing Officer that the revised return of income was non est in the eye of law, the Assessing officer rejected the revised returns filed by the assessee and the amount was computed based on the materials gathered from various sources after giving opportunity to the assessee. 7.On a perusal of the revised balance sheet, the Assessing Officer further noticed that the assessee reduced its sales turnover with respect to inter divisional transfer of 24 windmills from Rs.10,261 lakhs to Rs.1,890 lakhs. The assessee submitted that the same had been carried out in view of the objection raised by the Registrar of Companies, by invoking the provisions of Section 209A of the Companies Act, 1956. The Assessing Officer pointed out that during the course of assessment proceedings, the assessee was asked to produce the book o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nies and objection to the depiction of inter divisional transfer of windmills as sales, the assessee revised its profit and loss account and balance sheet. The corrected accounts were placed before the shareholders for their approval. Note no.7 of the Notes attached and forming part of the accounts was approved by the shareholders in the annual general meeting. After considering the said position, the Tribunal considered the sale price of WTG as well as cost price of WTG. Taking note of the above said facts and that the revised profit and loss account and balance sheet were the result of the objection raised by the Regional Director of Company Affairs, the Tribunal remanded the assessment to the Assessing Officer to examine the issue, as to whether the accounts was revised solely with a view to wriggle away from the demand of tax. The Tribunal further pointed out that inter divisional transfer should not have been shown as sales. In any event, if such attempt was made only to do away with the tax being demanded on the basis of 30% of book profits, such issue had to be looked into once again by the officer. Aggrieved by the same, the Revenue preferred the present appeals before this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which is acceptable to the authorities under the Companies Act. There cannot be two incomes, one for the purpose of the Companies Act and another for the purpose of income tax, both maintained under the same Act. If the legislature intended the Assessing Officer to reassess the company's income, then it would have stated in Section 115-J that income of the company as accepted by the Assessing Officer ." 13.The said observation was again reiterated by the Apex Court in the decision reported in (2008) 300 ITR 251 (SC) (Malayala Manorama Co. Ltd. v. Commissioner of Income Tax). 14.Thus, applying the decision to the facts of the present cases, once the assessee has filed revision of balance sheet and profit and loss account, on the basis of what has been objected to by the Regional Director, Department of Company Affairs and the same had been placed before the annual general meeting and approved, it is not open to the Assessing Officer to reject the accounts or rescrutinize the accounts to satisfy himself that these accounts have been maintained in accordance with the provisions of the Companies Act. Once the book results show negative, the question of invoking the provisions u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. Even if the revised return is treated as a time barred one, when once the assessment is made under Section 143(2) based on the materials gathered, the department cannot fight shy of considering the materials coming in the form of the Regional Director's direction and its effect on the account results. The revised profit and loss account and balance sheet were approved by the shareholders in the annual general meeting to be treated as revised claim. In this, we do not find any ground to read an intention that the revision was done with a view to revise the liability of the assessee under the Act. Even though, the assessee has not filed any Tax Appeal before this Court, on this observation of the Tribunal, we are bound to observe that the said statement is without any basis. In the light of what we have observed in the preceding paragraph, we have no hesitation in remanding the matter back to the Assessing officer to examine the issue once again, uninfluenced with any of the observations made by the Tribunal as regards the valuation, but looked into the claim of the assessee in the background of the nature of transaction i.e. inter divisional transfer of WTG from manufacturing un ..... X X X X Extracts X X X X X X X X Extracts X X X X
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