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TMI Blog2019 (4) TMI 2056X X X X Extracts X X X X X X X X Extracts X X X X ..... sment order of the ITO was passed on 28.03.1988, which was challenged before the leaned CIT (A) and the same was dismissed on 28.11.1988. Against the said order, the assessee filed an appeal before the ITAT, Cuttack Bench, Cuttack, which was dismissed on 19.01.1990. Thereafter, by order dated 13.12.1990 passed in a Misc. Application, the order dated 19.01.1990 was recalled and the matter was heard afresh. Again on 10.05.1991, learned Tribunal decided the matter and allowed the exemption to the assessee. The revenue filed writ petition before this Court challenging the rectification order dated 13.12.1990. This Court on 02.12.1991 allowed the writ petition and quashed the recalling order dated 13.12.1990 as well as its substantive order dated 10.05.1991. For ready reference, the said order dated 02.12.1991 of this Court passed in OJC No.2953 of 1991 is quoted hereunder: "The CIT, Orissa, in this writ application, questions legality of the order passed by the Income-tax Appellate Tribunal, Cuttack Bench (in short 'the Tribunal'), in purported exercise of the powers under s. 254(2) of the I.T. Act, 1961 (in short 'the Act'). 2. The background facts are as under : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f accounting, and the Tribunal has applied the provisions of s.11(4A) which were not raised before the authorities and, therefore, that was a clear and apparent error. Since the Tribunal applied the Section suo motu, it constituted a rectifiable mistake in terms of s.254(2). 3. The stand of the Revenue in essence in this writ application is that the approach of the Tribunal was erroneous. What is rectifiable under s.254(2) is a mistake apparent from the record and not any other mistake which may have crept into the Tribunal's order. The question whether s.11(4A) had on the facts application or not is not a mistake apparent from record. Merely because the authorities below have not specifically dealt with the section, it cannot be held that they had not considered the case in the background of the section. Mr. S. N. Rotho, learned counsel for the assessee, however, submitted that while dealing with the rectification application the Tribunal has recorded a categorical finding that the Tribunal made out a case suo motu and, therefore, the rectification is justified. 4. For resolution of the controversy, it is necessary to deal with the scope and ambit of rectification und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the order of the recall is interdicted, the subsequent order dated 10th May, 1991 (annexure-2) cannot also be maintained. 6. In the result, annexures-1 and 2 are quashed. Writ application is allowed. No costs." 4.1 Against the said order of this Court, the assessee filed SLP in SLP (Civil) No.2154 of 1992 before the Hon'ble Supreme Court and on 18.01.1993, the following interim order was granted by the Hon'ble Supreme Court: "Heard Shri G.L. Sanghi, learned senior counsel for the petitioner and learned Solicitor General for the respondents. Leave granted. As the point involved in a question of law, printing of record is dispensed with. Hearing of the appeal to be expedited. Additional papers, if any, to be filed by both side within eight weeks. In the meanwhile, while assessment proceedings to tax be proceeded with and demand notice issued, the collection of tax shall be stayed until further orders." 4.2 Finally, on 24.04.1996, the said SLP was disposed of with certain directions and in obedience to the direction contained therein, the Tribunal referred the matter to this Court under Section 256(2) of the I.T. Act for opinion on the following three questions: "(1) Whet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt: i) Whether on the facts and under the circumstances of the case, the Ld. ITAT is justified in unsettling a settled issues passed by an earlier bench vide order dtd.10.05.91? ii) Whether on the facts and under the circumstances of the case, the Ld. ITAT is justified to ignore its interim order dtd.05.05.2008, where there was a direction to the department to verify the accounts taking into consideration the practical aspects of the case i.e., whether the bill receivables for the assessment year 1985-86 has been accounted for in the succeeding year or not? iii) Whether on the facts and under the circumstances of the case, the Ld. ITAT is justified to ignore the direction of an earlier Bench and confirmed the first appeal order under the plea of "appellant has not advanced any arguments in terms of section 11(4A) of the I.T. Act so as to attract the income to be exempted u/s 11 of the Act. iv) Whether on the facts and circumstances of the case, the Hon'ble ITAT is justified to concur with the forum below that hybrid system of accounting adopted by the assessee, which was prevalent and legally permissible under the law at the given point of the time is prejudicial to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... drawn.xxx Rule-12 of the I.T. Rules [Return of income and return of fringe benefits. 12.(1) The return of income required to be furnished under sub-section (1) or sub-section (3) or sub-section (4A) or sub-section (4B) or sub-section (4C) or sub-section (4D) of section 139 or clause (i) of sub-section (1) of section 142 or sub-section (1) of section 148 or section 153A relating to the assessment year commencing [on the 1st day of April, [2013]] shall,- [(a) in the case of a person being an individual where the total income includes income chargeable to income-tax, under the head,- (i) "Salaries" or income in the nature of family pension as defined in the Explanation to clause (iia) of section 57; or (ii) "Income from house property", where assessee does not own more than one house property and does not have any brought forward loss under the head; or (iii) "Income from other sources", except winnings from lottery or income from race horses, [and does not have any loss under the head] be in Form [SAHAJ] (ITR-1) and be verified in the manner indicated therein:] [Provided that the provisions of this clause shall not apply to a person who,- (I) is a resident, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be verified in the manner indicated therein; (e) in the case of a person not being an individual or a Hindu undivided family or a company or a person to which clause (g) applies, be in Form No. ITR-5 and be verified in the manner indicated therein; (f) in the case of a company not being a company to which clause (g) applies, be in Form No. ITR-6 and be verified in the manner indicated therein; (g) in the case of a person including a company whether or not registered under section 25 of the Companies Act, 1956 (1 of 1956), required to file a return under sub-section (4A) or sub-section (4B) or sub-section (4C) or sub-section (4D) of section 139, be in Form No. ITR-7 and be verified in the manner indicated therein; (h) omitted, ibid. [(2) The return of income required to be furnished in Form SAHAJ (ITR-1) or Form No. ITR-2 or Form No. ITR-3 or Form SUGAM (ITR- 4S) or Form No. ITR-4 or Form No. ITR-5 or Form No. ITR-6 shall not be accompanied by a statement showing the computation of the tax payable on the basis of the return, or proof of the tax, if any, claimed to have been deducted or collected at source or the advance tax or tax on self-assessment, if any, claimed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or clause (iii);] [(ab) a company required to furnish the return in Form ITR-6 shall furnish the return for assessment year 2010-11 and subsequent assessment years in the manner specified in clause (ii);] (b) a person required to furnish the return in Form ITR-7 shall furnish the return in the manner specified in clause (i) [for clause-(ii) or clause-(iii)]. (4) The Director-General of Income-tax (Systems) shall specify the procedures, formats and standards for ensuring secure capture and transmission of data and shall also be responsible for evolving and implementing appropriate security, archival and retrieval policies in relation to furnishing the returns in the manners specified in clauses (ii), (iii) and (iv) of sub-rule (3). [and the report of audit in the manner specified in proviso to sub-rule (2)] (5) Where a return of income [words "or return of fringe benefits" omitted by the IT (Third Amdt.) Rules, 2011 w.r.e.f. 1-4-2011] relates to the assessment year commencing on the 1st day of April [2012] or any earlier assessment year, it shall be furnished in the appropriate form as applicable in that assessment year.]" 8. We have perused the impugned order of the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Finance Act, 1983, w.e.f. 1st April, 1984. 12. In the result, we answer question No.(3) in favour of the assessee and against the Revenue. The references are returned unanswered in respect of question Nos.(1) and (2) in view of our direction to the Tribunal as mentioned above." 2. Paragraph-2.7 Ld. DR on the other hand, placed reliance on the original order dated 19.1.1990 by the Tribunal in which the method of accounting adopted by the assessee was not accepted and the exemption u/s.11 was denied. He also placed reliance on the following decisions: Samajbadi Society-vs-ACIT 79 ITD 112, ACIT-Vs-Thanthi Trust 247 ITR 785 and Sole Trustee, Loka Sikshana Trust-Vs-CIT 101 ITR 234. 3. Paragraph-5 "Ground Nos.2 and 3 relate to applicability of Section 11(4A) to the facts of assessee's case. The assessee is aggrieved by applying the provisions of section 11(4A) of the Act to the facts of this case by the lower authorities. We find no merit in these grounds as the AO was specifically directed by the Tribunal to keep in view the provision of section 11(4A) of the Act which came to the inserted by the Finance Act, 1983 w.e.f. 1st April, 1984 when the matter was restored ..... X X X X Extracts X X X X X X X X Extracts X X X X
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