TMI Blog2016 (12) TMI 880X X X X Extracts X X X X X X X X Extracts X X X X ..... is not barred by limitation provided u/s 154(7) of the Act. The case of the assessee is also supported by the decision of Peninsula Land Ltd Vs CIT (2008 (2) TMI 354 - BOMBAY HIGH COURT) in which it has been held that provisions of section 154(7) does not apply to order passing on the benefit allowed to the assessee by virtue of order passed by the appellate order but such power of the AO to pass order giving effect to any appellate order is inherent and traceable to section 143(3) and 144 of the Act. Accordingly we hold that the application of the assessee u/s 154 is not barred by limitation. On the second issue we are of the considered view that the provisions reversed of ₹ 3.50 Cr has to be reduced from the income under MAT as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be paid if the assessee fulfilled certain conditions as prescribed. The assessee fulfilled the said conditions and as a result the provisions for custom duty were no more payable and hence reversed in the financial year 1988-89. The said provisions are stated to be not allowed under the normal provisions of the Act as well as under the MAT provisions which were also upheld by the Tribunal vide order dated 9th March 2007. However these provisions were reversed in the subsequent year i.e. assessment year 1989-90 and credited to the profit and loss account. However while giving appeal effect to the order of tribunal dated 9th March 2007 , the AO while calculating the book profit for assessment year 1989-90 u/s 115 J did not exclude ₹ 3.5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .1991. Hon'ble ITAT, 'J' Bench, Mumbai vide ITA No. 119/Bom/1992 and ITA No.1006/Bom/1992 dated 09.03.2007 had confirmed such disallowances, both under the normal provisions of the Act as well as under the relevant provisions of sec. 115J of the Act. 5.3. It is also not disputed that the appellant had made provision of custom duty of ₹ 3.72 crores payable in its books of accounts for the previous year relevant to A.Y. 1989-90. The LAO had disallowed such provision of custom duty of ₹ 3.72 crores while computing total income of the appellant under the normal provisions of the Act as well as while computing book profit u/s. 115J of the Act in the scrutiny assessment order dated 30.09.1992 passed u/s. 143(3) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -91, the appellant has accepted such disallowance while computing book profit u./s. 115J of the Act in A.Y. 1990-91. No appeal preferred by the appellant on the identical issue in subsequent assessment year 1990-91. 5.6. Having regards to facts and circumstances of the case, the LAO's action is confirmed. Corresponding grounds of appeal are not allowed. 6. In the result, appeal is dismissed. Aggrieved by the order of CIT(A) , the assessee has preferred an appeal before the Tribunal. The ld AR for the assessee vehemently submitted before us that the CIT(A) has grossly erred by upholding the order of AO on the issue rectification application u/s 154 of the Act being time barred by taking the period of limitation from the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 9th March, 2007 the AO did not reduce the written back provisions of ₹ 3.50 Cr relating to AY 1988-89 while computing income under MAT in the order dated 23rd July, 2007 for AY 1989-90 as the assessee was entitled to consequential relief in view of the tribunal upholding the action of the revenue in disallowing the provisions in the calculation income under MAT. The ld AR submitted that when the assessee moved a rectification application on 3nd November, 2009 , the AO rejected the same as time barred not moved within the time as per the provisions of section 154(7) of the Act by taking the period of limitation from the date of assessment order and not from the order dated 23rd July 2007 giving appeal effect to tribunal order whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order dated 9th March 2007. The AO while passing the order dated 23rd July, 2007 giving appeal effect to tribunal order dated 9th March 2007 did not allow the consequential relief of reducing the reversed provisions of ₹ 3.50 Cr from income calculated for the purpose of MAT. Thereafter the assessee moved a rectification application u/s 154 of the Act on 3rd November, 2009 requesting the AO to correct the anomaly which crept in the order dated 23rd July 2007 resulting into assessing the provisions for custom duty of ₹ 3.50 Cr reversed during the year by not excluding the same thereby taxing the reversal of provisions of ₹ 3.50 Cr which was not allowed as deduction in the year of creation by the AO in AY 1988-89 and the acti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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