TMI Blog2014 (11) TMI 562X X X X Extracts X X X X X X X X Extracts X X X X ..... mere non-filing of the auditors' report along with the return of income, the assessee does not stand to gain anything nor does the Revenue stand to lose, as even after the return is filed, it is obvious that it may take time before the Income-tax Officer applies his mind to the merits of the return, when he sits down to frame the assessment - the requirements of Section 80J(1) read with subsection (6A) can be taken into consideration - the main purpose and object of section 80J(1) is to give incentive and development benefit to the new industries covered by the provisions of the Act - the word ‘shall’ as employed by the Legislature in sub-section (6A) of Section 80J(1) will have to be read as ‘may’ – Decided in favour of revenue. - INCOME TAX REFERENCE NO. 8 of 2001 - - - Dated:- 13-10-2014 - MR. KS JHAVERI AND MR. K.J.THAKER, JJ. MRS MAUNA M BHATT, ADVOCATE FOR THE APPELLANT ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) By way of the present Reference, the following questions of law are referred to this Court by the Tribunal at the instance of Revenue for consideration of this Court: 1. Whether on the facts and in the circumst ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 154 of the Act, the learned CIT(A) confirmed the action of the Assessing Officer vide his order dated 27.12.1991 by placing reliance on Section 29 of the Act. On second appeal, the Tribunal vide its order dated 10.9.1997 deleted the prima facie adjustment made by the Assessing Officer holding that the prima facie adjustment cannot be made after the case is selected for scrutiny. However, on merits of the case, the Tribunal did not make any observation. 3. In the scrutiny assessment made under Section 143(3) of the Act which is subject matter of the appeal, the Assessing Officer allowed the deductions under Section 80HHA and 80-I of the Act without deducting deduction under Section 32AB of the Act on the basis of his earlier prima facie adjustment and assessee s failure in appeal before the CIT(A). 4. The assessee preferred appeal before the CIT(A) and reiterated his earlier submissions made in the course of proceedings under Section 154 of the Act and also before the CIT(A) in the appeal against the order under Section 154 of the Act. The learned CIT(A) accordingly dismissed assessee s appeal following his earlier order dated 27.12.1991 pertaining to appeal against o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f deduction u/s. 32AB of ₹ 7,76,947/-. The assessee filed revised return along with signed audit report on 27.9.97 but before this, assessment u/s. 143(1)(a) was completed, therefore, the said deduction was not allowed by the Assessing Officer. The ld. CIT(A) had allowed the claim of the assessee holding that the appellant s claim for deduction u/s. 80HHC and 32AB cannot be disallowed on the ground that the appellant has enclosed only the unsigned copy of the CA s audit report along with the return of income. The ITAT has also decided the facts in favour of the assessee holding that audit report can be filed in the course of assessment proceedings as the filing of audit report along with the return of income is to mandatory. Relevant portion of the Tribunal s order with regard to the unsigned audit report reads as under: para 12 The Revenue came up in appeal before the Tribunal against both the orders of the CIT(A) dated 27.12.91 (against order u/s. 154) and 27.12.92. In the appellate order (ITA No. 793/Ahd/1992) relating to Revenue s appeal against the order of the CIT(A) dated 27.12.91 this Tribunal vide order dated 17.4.97 held that on perusal of sec. 80H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t part of sub-section (6A) lays down that the deductions under sub-section (1) from profits and gains shall not be admissible unless the accounts for the previous year relevant to the assessment year for which deduction is claimed have been audited by an accountant. The first part of section 80J is mandatory in nature but the second part thereof which is procedural in nature and requires the assessee to submit the report of the audit along with the return is merely directory in nature and it calls for only substantial compliance. The reasons are obvious. It is possible that at the time when the return of income is filed, by some mischance or negligence of the clerk or for any other reason, even though the audited report is available, it might not have been annexed to the return and on such mistake being found out, the report may be tendered on the next day or even a few days thereafter to the Income-tax Officer. If any literal compliance with the words assessee furnishes report along with his return of income is insisted upon, then, in such an unforeseen contingency, the assessee would be denied the benefit of Section 80J. Moreover, while an assessee who waits till the end of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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