TMI Blog2012 (12) TMI 1056X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 1 and 3 are general in nature and, therefore, they do not survive for adjudication. Ground No.9 relates to the payment of cash of ₹ 4 lakhs for electrification work which did not attract TDS provisions of the Act. However, during the course of hearing, the Page 2 of 30 2 ITA No.386/Bang/2012 learned A R submitted that this ground is not pressed. Accordingly, ground No.9 is dismissed as 'not pressed'. Ground No.10 is not maintainable as levy of interest u/s 234B of the Act is mandatory and consequential in nature. The remaining grounds relate to the following issues, namely: (1) (Gr.No.2) that the order was passed without providing reasonable opportunity to the assessee; (2) (Gr.Nos.4 5) that the CIT (A) ought to have held that the assessee being a company need not file a return of income u/s 139(1)(b) of the Act; (3) (Gr.No.6, 7 8) that the CIT (A) erred in invoking the provisions of s. 80AC of the Act; - that the CIT (A) also erred in confirming the disallowance of deduction made u/s 80IB of the Act. 3. The issues, in brief, are discussed as under: The assessee company ['the assessee' hence-forth] is engaged in the construc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (i) that the provision under s.80AC of the Act as regards the time limit for filing the return of income is neither an inexorable rule of prescription nor an inviolable rule of restriction for allowance of deduction u/s 80IB of the Act; - that as per s. 80-IB, the deduction provided for therein shall be allowed in computing the total income of the assessee from the profits and gains derived from the business subject to certain conditions contained therein; - that the entire thrust of the tax concession u/s 80IB (10) is aimed at providing more dwelling units and providing tax incentives; that in every budget speech, the Finance Ministers have made every endeavour to address the problem of acute shortage of dwelling units - primarily for less privileged sections of the society. The predominant objective of this incentive provision is, therefore, to encourage better availability of the dwelling units at affordable rates for low and middle class segments of the society and, thus it is a beneficial provision for the assessees; - that s. 80AC of the Act provides that deduction u/s 80 IB shall be allowed to assessee only if the assessee furnishes a return of his income on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... akasabai (1973) 89 ITR 251 (SC); o Bajaj Tempo Ltd v. CIT (1992) 196 ITR 188 (SC); o ACIT v. Dhir Global Industrial (P) Ltd 133 TTJ (Del) 580; o ITO v. Sri S Venkataiah - ITA NO.984/Hyd/2011 dt..31.5.2012 of the Hyderabad Bench 'B'. (iv) that the section 80AC of the Act restricts deduction available u/s 80IB of the Act where the return of income is not filed within the due dates provided u/s 139(1) of the Act; that the s. 139(1) of the Act provides for due dates for filing the return of income. Accordingly, due date for filing the return of income for the AY 2008-09 was 31.10.2008; - that the assessee had filed its return of income electronically u/s 139(1B) of the Act. S. 139(1B) provides that a corporate entity may furnish the return of income u/s 139(1), at its option, on or before the due date electronically in accordance with the Electronic Furnishing of return of income Scheme, 2007 [EFRIS 2007] - Notification No.SO1281(E) dated 27.7.2007; - that the EFRIS 2007 provides that eligible person may at its option furnish his return of income which he is required to furnish u/s 139.....' of the Act for AY 2007-- 08 or any subsequent AY to an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, determining the income of the appellant at ₹ 1,09,58,731/-. A sum of ₹ 1,18,65,656/- being deduction claimed u/s 80IB of the Act was disallowed by the AO on the ground that the return of income was submitted beyond the due date specified u/s 139(1) of the Act as stipulated u/s 80AC of the Act. 3. In this connection, it is humbly submitted that there was sufficient reason for filing the return belatedly and in support of the same, we wish to submit an affidavit of Mr. Prabhu, Director and CBDT Circular No.4 of 2009 dated 30th June, 2009 as additional evidences. 4. The additional evidences sought to be filed now could not be filed before the AO and CIT (A) due to following reasons: (i) We were not properly advised in the proceedings before the lower authorities and it did not have the services of an Advocate at our command; (ii) During the relevant AY, there was confusion prevalent with regard to claim of deduction under sec. 80 IB of the Act. Assessee's, professionals and even for that matter the Income-tax Department was not very clear as to deduction u/s 80IB (10) would be available on a year to year basis where an assessee is showing profit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome admitting 'Nil' income and submissions were made to this effect before the learned Commissions of Income-tax (Appeals). 5.2. Yet again, in the subsequent hearing, the assessee through its petition dated 13.11.2012 sought the permission of this Bench to place further additional evidences. The contents of petition dated 13.11.2012 read as follows:- 1. The Statutory audit of accounts of the appellant for the previous year 2007-08 relevant to the AY 2008-09 are completed on 12.09.2008. However, tax audit u/s 44AB of the Act was completed on 22.4.2009; 2. Audit report under Sec. 80 IB of the Act in Form 10CCB was obtained on 22.09.2008; 3. The appellant has filed the return of income on 25.04.2010 (sic) 25.04.2009 through electronic filing mechanism. As no enclosures to be given while e-filing of the returns, the same has been not filed along with the return of income; 4. During the course of the hearing before the AO and the Ld. CIT (A), sufficient opportunity was not provide to the appellant to furnish the Form 10CCB. Ld. AO completed the assessment under sec. 144 of the Act where as Ld. CIT (A) dismissed the appeal only on the ground that the ret ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Rule 29 of Appellate Tribunal Rules 1963, it was contended that the assessee was disentitled to file the additional evidence before the Hon'ble Tribunal unless the Tribunal requires the assessee to do so; and that the mere fact that the evidence sought to be produced was vital and important did not provide a substantial reason to allow its admission at the appellate stage, especially, when the evidence was available to the party at the initial stage and had not been produced by it, without any reason. Relies on the following case laws: o CIT v. Jaipur Udyog Ltd. - 227 ITR 345 (Raj); o Velji Deoraj Co., v. CIT - 68 ITR 708 (Bom); o A.K. Babu Khan v. CIT - 102 ITR 757 (AP); o Ram Prasad Sharma v. CIT - 119 ITR 867 (All) It was, therefore, urged not to admit the additional evidence and to reject the same. - that from the petition, there does not appear to be existence of any reasonable cause for filing the return of income belatedly; and that the reasons advanced in the affidavit are not acceptable for the following: (i) that the assessee was not properly advised in the proceedings before the AO / CIT (A) was too simplistic to be accepted/bel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ught which was supported by the fact that the assessee had brought no reason for the delay either before the AO or before the CIT (A); (v) there was no such problem which was beyond the control of the assessee; (vi) it appears the assessee was in the habit of filing its returns belatedly. For the AY 2007-08, the return was filed after issuance of a notice u/s 148 and, hence, the delay for filing the return be construed as intentional and not a mere technical flaw - that in the case of ACIT v. Dhir Global Industrial Pvt. Ltd [133 TTJ (Del) 580 relied on by the assessee, in fact, this case deals with s. 10B (1) of the Act, that the assessee could not pay self-assessment tax on time due to some financial problems; that the new provision regarding e-filing of return was introduced in this first year, the software did not accept the return, if self assessment was not paid and thus, there was a delay of nearly 45 days for filing the return and the Hon'ble Tribunal after due consideration of the same as genuine and valid reason for the delay in filing the return. However, in the case of the present assessee, the claim for deduction was u/s 80IB ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the disallowance of deduction u/s 80IB of the Act: (i) The assessee furnished its return of income for the assessment year under dispute on 25.4.2009, admitting a total income of ₹ 1.05 crores and also claiming of deduction of ₹ 1.18 crores under section 80IB of the Act. Admittedly, the return of income was belated. As there was no proper compliance to the notices as detailed above, the assessment was concluded by the AO u/s 144 of the Act on the basis of details/materials on record. While doing so, the assessee's claim, among others, for deduction u/s 80-IB of the Act was turned down on the premise that the return of income of the assessee was belated and, thus, the assessee was disentitled for such a claim. (ii) When the issue was taken up before the first appellate authority for relief, the CIT (A), placing reliance on the provisions of section 80AC of the Act, confirmed the stand of the AO with an observation that there was no any infirmity with the order of the AO on this account and the denial of deduction u/s 80IB (10) of the Act was, accordingly, sustained. (iii) The stand of the CIT (A) was challenged by the assessee in this appeal. D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nical meanings are to be attributed to those words only when the context requires such meanings to be given. The normal rule is to give that meaning which to persons engaged in dealing with that subject matter attribute to that term, describing the subject. It is also true that a beneficial provision in a fiscal stature should be liberally construed to advance the purpose behind the Legislation......... (3) The Hon'ble 'B' Bench of the Delhi Tribunal in the case of ACIT v. Dhir Global Industrial (P) Ltd reported in (2011) 43 SOT 640 recorded its finding which is extracted as below: A proviso has been inserted during the current year in s. 10B(1) which provides that no deduction under this section shall be allowed to an assessee if the return of income is not furnished on or before the due date specified under sub-section (1) of s. 139. This proviso in s. 10B(1) is directory and not mandatory. In the present case, there was only a marginal delay of 1 month infilling the return of income. The return filed was valid one. The same has also been accepted as a valid return by the AO. The reasonable cause attributed by the assessee for the delay is that new provisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evenue had, among others, approached the Hon'ble Tribunal with the following relevant grounds: 1.The order of the CIT(A)............................................................... 2. The CIT (A) erred in allowing the additional evidence without giving a reasonable opportunity to the AO to examine the evidence which is in contravention to the rule 46A(3) of IT Rules 1962; 3. The CIT (A) ought to have appreciated that the AO had rightly disallowed the deduction claimed u/s 80IC following the provisions of section 80AC; 4. The CIT (A) ought to have held that the explanation offered by the assessee was nothing but an after thought and devoid of any merit as no effort was made by him to take recourse u/s 119(2)(b) for extension of time for filing the return of income; 5. The CIT (A) erred in coming to a conclusion that the assessee was prevented by a genuine reason in filing the return belatedly; 6. The CIT (A) ought to have appreciated that the intention of the Legislature behind incorporating s. 80AC was to impose stringent guidelines on the assessee who claim exemption of profits u/s 80IA to 80IE. (i) Taking into account the submission of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n by the parties. It is an undisputed fact that the assessee in the present case has filed the audit report in Form 10CCB during the course of re-assessment proceedings. The issue that arises for consideration is whether the assessing officer was justified in disallowing the assessee's claim for deduction under s.80IB on the ground that the audit report in Form 10CCB was not filed along with the return of income; or whether the CIT (A) was correct in proceeding on the basis of Form 10CCB filed during the course of re-assessment proceedings and directing the assessing officer to allow the claim of the assessee for deduction under s. 80IB of the Act. It is settled position of law, as consistently held by various Benches of this Tribunal and as held in various decisions referred to by the CIT (A) in the impugned order, that though filing of audit report in Form 10CCB is mandatory and pre-requisite for deduction under s. 80IB, non-filing of the same along with the return of income is only a curable defect, and assessee's claim for deduction has to be considered on its merits as sand when the defect is cured by filing Form 10CCB. We are fortified in this behalf by the decis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of income was filed beyond the due date as specified u/s 139(1) of the Act. Since the assessment was concluded under section 144 of the Act, neither the AO had an occasion to verify the cause for such a delay in filing the return of income nor the assessee had an opportunity to defend itself for having furnished its return belatedly. In this connection, as narrated supra, the assessee, during the course of hearing, sought the permission of this Bench to adduce additional evidence and also an affidavit explaining the reason for delayed filing of return. According to the assessee, the additional evidence could not be furnished either before the AO or before the CIT (A) since the return was e-filed and no enclosures were to be attached and neither the Assessing Officer nor the CIT(A) called for 44AB audit or Form 10CCB, as the claim of the assessee under section 80IB was denied prima facie without much deliberation for the reason that return was filed belatedly. This attempt of the assessee was objected to by the Revenue for the reasons also recorded supra. 7.2. We have carefully considered the assessee's submission as well as the objection raised by the Revenue. 7.2.1. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (supra) wherein the Hon'ble Bench had, after taking cognizance of the peculiar situation in which that assessee was placed, observed that 'Act does not prohibit relief in this regard when genuine hardship is faced. ' 7.4. Furthermore, in the affidavit(s) furnished, the director of the present assessee had affirmed on oath that - 1. Return of income of the appellant company for the AY 2008-09 was filed belatedly on 25.4.2009. The delay was due to the following reasons: (a) Mr. Lokesh, Accountant who was working with us for quite long quit abruptly without providing prior intimation while finalizing the accounts for the financial year 2007-08; (b) We could not trace the password of the system despite our best efforts; (c) We tried to retrieve the data from the system with the help of hardware engineers, in the process lost couple of important data. Financial information of the company was one such data that was lost; (d) We tried to reconstruct the data with available information on hand. We could not succeed in reconstructing the data as the Income-tax Department had impounded many of the vital documents in pursuance to survey carried on in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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