TMI Blog1998 (2) TMI 611X X X X Extracts X X X X X X X X Extracts X X X X ..... r computation of income 80HHC working is not required. It will be submitted at the time of hearing, if need be. 3. The Assessing Officer completed the assessment under section 143(3) vide his order dated 30-3-1994 and determined the total income at ₹ 57,95,640. As the appellant had not furnished the report in Form No. 10CCAC along with the return nor in the course of the hearing, the Assessing Officer denied deduction under section 80HHC. The assessee appealed against the order and the CIT(Appeals) vide his order dated 26-9-1994 held as follows:- The next ground is against no deduction under section 80HHC on the ground that the appellant has not furnished Form No. 10CCAC along with the return/during the course of hearing. Shri Ramasethu submitted that since the appellant filed nil income, therefore, audit report was not necessary whereas the Assessing Officer has computed taxable income. Therefore the appellant is eligible for deduction under section 80HHC in view of the fact that the appellant had substantial export sales of ₹ 3.16 crores. So far as the audit report is concerned it is filed for the purposes of being the entitlement of the appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owing observations :- 2. The first and only ground of the assessee is with regard to rejection of application for rectification made for non-allowance of deduction under section 80HHC regarding which it was submitted that the Assessing Officer failed to make a note of the fact that the assessee s return of income was a loss. Therefore, as per the computation of income, section 80HHC working was not required but for this purpose, in the return of income, an endorsement was made and it was also mentioned that the working if required will be submitted at the time of hearing. It was also submitted that there is no omission or lapse on the appellant s part with regard to compliance of provisions of section 80HHC relating to furnishing of audit report in view of the endorsement made in the return of income drawing the attention of the Assessing Officer to the reasons for not furnishing of audit report. At the same time, the Assessing Officer also gives no specific opportunity for claiming relief under section 80HHC. Therefore, the application under section 154 for rectification of the same was rightly filed and in view thereof, the appellant s claim should have been allowed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee. In view of this footnote, it is pleaded that the ratio of the decision of the jurisdictional High Court, in the case of Shivanand Electronics (supra), does not apply. It is also pleaded that it has been held that filing of the relevant audit report is only procedural formality and it is only of a directory nature and the compliance with the provisions in this regard of filing the audit report by the stipulated date is not of a mandatory nature. In this context, reliance is placed upon the decision of the Tribunal, Bombay Bench in the case of Salim Abbasbhai v. First ITO [1993] 47 TTJ (Bom.) 570. Reliance is also placed upon the decision of the Hon ble Kerala High Court in the case of CIT v. Malayalam Plantations Ltd. [1976] 103 ITR 835 which dealt with analogous provisions in the context of development allowance under section 33A read with Rule 8A(d) of the I.T. Rules. In this case, it was held that though filing of the relevant certificate is mandatory, the failure to file it along with the return will not result in forfeiture of the claim to development allowance. Reliance is also placed upon the decision of the Apex Court in the case of Bajaj Tempo Ltd. v. CIT [1992] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relevant portion of this circular reads as follows :- If the audit report specified under section 80HHC(4), which is required to be filed along with the return of income is not so filed, the deduction claimed under that section can be disallowed as a prima facie adjustment. Some more examples in this regard are the non-filing of audit reports of other evidence along with the return of income as required under sections 12A(b), 33AB(2), 35E(6), 43B (first proviso), 54B(2), 54D(2), 54F(2), 80HH(5), 80HHA(4), 80HHB(5), 80HHD(6), 80HHE(4), 80-I(7), 80LA(8) and the like. But if evidence is subsequently furnished, rectification under section 154 should be carried out to the extent permitted by the Board s Circular No. 669, dated 25-10-1993. No prima facie disallowance shall, however, be made if any evidence, required to be filed along with the return of income only in pursuance of the non-statutory guidance notes for filing in the return of income, is not filed. It may be observed that the above circular refers to an earlier Circular No. 669, dated 25-10-1993 which reads as follows : Subject : Interpretation of section 43B of the Income-tax Act, 1961 - Cl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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