TaxTMI 
TaxTMI 
2008 (2) TMI 567
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....n 143(1)(a) of the Income-tax Act? 2. Bereft of unnecessary details the facts are that the assessee had filed the return, and thereupon after taking recourse to the procedure provided under section 131, etc., and giving necessary opportunity of hearing to the assessee, the assessment order was made on August 26, 1996. In the return, the assessee had claimed deduction under section 80HHC, but then, the assessee did not enclose the required documents. This return was filed on October 31, 1995. On account of absence of the requisite report, the deduction was not allowed and addition was made in the income tothat extent, with all necessary consequences. Thereafter, the assessee filed an application under section 154 of the Act claiming, inter alia, that since the auditor of the assessee was of the opinion that since the sale proceeds were not received within six month and permission for extension has not been received from the Commissioner of Income-tax, the report cannot be given and regarding delay in receipt of payments on account of the exports, relied upon the Board's circulars dated August 24, 1994 and October 25, 1993. According to which, in case such requisite report is subs....
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.... submitted along with the application under section 154, which was before the Assessing Officer, while deciding the application. It was also held that there was reasonable cause with the appellant, for not filing the audit report along with the return of income, and that, since the claim of the appellant for deduction under section 80HHC was not found otherwise inadmissible, the Assessing Officer was not found to be justified in rejecting the application under section 154 and charging additional tax. Thus, the appeal was allowed and additional tax, as levied, was ordered to be deleted. This order has been upheld by the learned Tribunal by holding that the impugned adjustment made by the Assessing Officer was outside the purview of section 143(1)(a); this being a mistake of law apparent on record, the Assessing Officer ought to have accepted the application under section 154. 3. We have heard learned counsel for either side and have gone through the impugned orders, so also various judgments considered by the learned authorities below. 4. First of all we take up the cases considered by the learned Commissioner. So far as the first judgment relied upon, said to be in CIT v. Shi....
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....eld that this procedural requirement is directory and that if there is some defect in the declaration form the assessee is to be given an opportunity to rectify it under section 185(2) as it then existed. This again, in our view, has no bearing on the controversy. 7. Then, still the next case relied upon by the learned Commissioner is, in CIT v. Sitaram Bhagwandas [1976] 102 ITR 560. This is the judgment by the Patna High Court, again dealing with the same aspect of requirement of declaration under section 184(7) and taking the same view and, in our view, for the same reasons, this judgment also does not help the cause of the assessee. 8. Then, yet another judgment is the one relied upon by the learned Tribunal, being of the Calcutta High Court in Modern Fibotex Ind Ltd. v. Deputy CIT [1995] 212 ITR 496. This is single Bench judgment of the Calcutta High Court taking the view that the power under section 143(1) (a) cannot be exercised on a debatable point. In our view, this legal principle admits of no doubt. However, here the disallowance of the deduction is found to be not being relatable to a debatable point, in view of the authoritative judgment of this court in Loonkar T....
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....s established that a false verification was made and then the assessment was made under section 143(1)(a) on August 26,1996. It is much there after, that the assessee filed the revised return under section 139(5), along with the audit report, and in Form 10CCAC and that return was processed under section 143(1B) and in that assessment the deduction was allowed. It may be observed here, that a bare look at the language of section 143(1B) as it stood at that time would show that according to the proviso thereto, an assessee, who has furnished a revised return under sub-section (5) of section 139, after the service upon him of the intimation under sub-section (1) of section 143, does continue to remain liable to pay additional income- tax, in relation to the adjustments made under the first proviso to clause (a) of sub-section (1), and specified in the said intimation, whether or not he has made the said adjustments in the revised return. In our view, this proviso does make it dear that even the filing of the revised return under section 139(5), and its being processed and on such processing the assessee being found entitled to the adjustment on account of that return being accompanie....