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TMI Blog2016 (5) TMI 920X X X X Extracts X X X X X X X X Extracts X X X X ..... t on account of a "change of opinion". 3. The learned CIT(A) erred by upholding the action of the then Assessing Officer while passing the reassessment order in withdrawing the deduction under section 80-IB of the Act which was granted to the Appellant earlier. 4. The learned CIT(A) erred in not adjudicating on issue relating to denial of deduction under section 80IB of the Act by the then Assessing Officer in relation to certain items of income. 3. The first issue raised by the assessee vide grounds of appeal No.1 and 2 is jurisdictional issue of invoking jurisdiction under section 147 / 148 of the Act. The assessee is further aggrieved by the order of CIT(A) in withdrawal of deduction claimed under section 80IB of the Act vide ground of appeal No.3. The ground of appeal No.4 raised by the assessee is not pressed and hence, the same is dismissed as not pressed. 4. Briefly, in the facts of the present case, the assessee had in the original return of income claimed deduction under section 80IB of the Act at Rs. 2,59,88,592/-, which was allowed to the assessee vide order passed under section 143(3) of the Act. Thereafter, it was noted by the Assessing Officer that the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot be allowed. Further, in view of loss, the assessee was not entitled to claim the deduction and hence, the order of Assessing Officer on merits was also upheld. 6. The assessee is in appeal before us against the order of CIT(A). 7. The learned Authorized Representative for the assessee pointed out that in the return of income, no deduction was claimed under section 80IB of the Act because of brought forward losses. Our attention was drawn to the computation of income filed, in which a note was given vis-à-vis no claim of deduction under section 80IB of the Act on account of losses, which is placed at page 8 of the Paper Book. The learned Authorized Representative for the assessee pointed out that the Assessing Officer while passing the assessment order had rejected the claim of deduction as no audit report was filed in form No.10CCB, copy of which is placed at page 46 of the Paper Book. In furtherance, the assessee claims to have filed an application under section 154 of the Act as no opportunity was given during the course of assessment proceedings to file form No.10CCB, which is placed at pages 10 to 12 of the Paper Book along with copy of form No.10CCB at pages 14 to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 148 of the Act. In order to appreciate the issue, it is necessary to look at the sequence of events in the case, which has been filed by the assessee, which reads as under:- Sr. No. Key event Date Page No. 1 Date of filing the Return of Income declaring gross total income as 'nil' under normal provisions of Act on account of set-off of brought forward business losses of past years 31-Oct-03 Refer page 8 of the Paper Book for relevant extract of notes to return 2 Original Assessment Order passed under section 143(3) of the Act determining positive total income and rejecting the claim for deduction under section 80-IB of the Act 30-Marh-06 Refer page 32-48 of the Paper Book 3 Rectification application under section 154 of the Act filed with the AO along with accountant's report in Form 10CCB in support of its claim for deduction under section 80-IB of the Act 30-Aug-06 Page 10-23 of the Paper Book 4 Rectification Order passed under section 154 of the Act granting deduction under section 80- IB of the Act 28-Feb-07 Page 24-28 of the Paper Book 5 Second notice under section 148 of the Act initiating re-assessment for withdrawal of deduction under section 80- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Assessing Officer also observed that there were no losses as per record, which could be allowed to the assessee for the year under consideration. Pursuant to the assessment order being received by the assessee, the assessee furnished the rectification application under section 154 of the Act on 30.08.2006 along with copy of accountant's report in form No.10CCB, which is placed at pages 10 to 23 of the Paper Book. The Assessing Officer accepted the claim of the assessee and granted deduction under section 80IB of the Act vide order passed under section 154 of the Act on 28.02.2007, copy of the order is placed at pages 24 to 28 of the Paper Book. The Assessing Officer held that on verification of record, it was found that the assessee was eligible for deduction under section 80IB of the Act and since the mistake was apparent from the record, the assessee's plea of grant of deduction under section 80IB of the Act was allowed. Thereafter, notice under section 148 of the Act, dated 31.03.2009 initiating second reassessment proceedings for withdrawing deduction under section 80IB of the Act was issued, copy of which is placed at page 29 of the Paper Book and copy of reasons recorded f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er determined the positive income at Rs. 36,26,96,920/-. The Assessing Officer in the body of the assessment order notes that the assessee had made declaration in this regard that it would submit its claim for such deduction. However, no opportunity was allowed to the assessee to submit its claim. On the other hand, the Assessing Officer was of the view that since no audit report in form No.10CCB was filed along with return of income, the assessee is not entitled to the said claim. First of all, it has been held by various Courts and the Tribunals that the filing of form No.10CCB along with return of income is directary and not mandatory in nature. In the facts of the present case, where the income computed in the hands of assessee, because of adjustment of brought forward losses was Nil, the assessee made disclosure to the effect in its return of income and also submitted that in case any positive income was determined in his hands, then it should be allowed an opportunity to furnish audit report. Merely because, the audit report has not been filed along with return of income cannot be the basis for rejection of claim of deduction under section 80IB of the Act as held by the Hon'b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich has to be fulfilled in any event. Therefore, the basic question that needs to be addressed on facts is, as to whether there was any failure on the part of the petitioner, as the assessee, to disclose fully and truly all material facts necessary for the assessment." 13. The records of proceedings in the present case reflect that return of income was filed on 31.10.2003 along with which a note was appended vis-àvis its claim of deduction under section 80IB of the Act. The Assessing Officer during the course of original assessment proceedings failed to allow any opportunity to the assessee to furnish the audit report. However, after passing of assessment order under section 143(3) of the Act, dated 30.03.2006, the assessee moved rectification application under section 154 of the Act along with copy of accountant's report in form No.10CCB in respect of its claim of deduction under section 80IB of the Act. The Assessing Officer accepted the contention of assessee and observed that it was a mistake apparent from the record and passed rectification order under section 154 of the Act, dated 28.02.2007 granting deduction under section 80IB of the Act. These proceedings reflect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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