TaxTMI 
TaxTMI 
2018 (10) TMI 1090
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....me Tax Act, 1961. (b) That the tax audit report was filed by the assessee company well in time, along with the audited financial statements. The deduction of Rs. 88,51,859/- admissible to the assessee company under section 80IA was duly mentioned in the tax audit report and thus, the assessee company had made substantial compliance of the provisions of section 80IA, read with section 80AC. (c) That the huge amount of self-assessment tax could not be deposited in time due to shortage of funds. Therefore, it was not possible to furnish a valid return of income on or before the due date. As a result, there was a marginal delay of 31 days in filing the Return of Income. (d) That in CIT v. Jagriti Aggarwal(2011) 339 ITR 610 and many other cases, it has been held that section 139(4) is an extension of section 139(1) and in Asstt. CIT v. Noel Pharma (Appeal No. ITA No. 1664/Hyd/2012) which involves similar facts, the Hon'ble Hyderabad Tribunal made the following observations: "In view of the mitigating circumstances, the delay can be condoned. Further, as rightly held by the learned CIT (A), the Courts have held that due date for f....
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....restrictions. He has also cited several case laws mentioning that provisions of section 80AC are not mandatory but directory in nature. Therefore a substantial claim or benefit should not be denied to the company for this technical default beyond their control. It has also been emphasized that as per some judgments, it has been accepted that section 139(4) is an extension of section 139(1) and since in the instant case, the return was filed within the time allowed 80IA should be allowed to them. Coming to the facts, if the appellant had e-filed the return within the prescribed time limit also, it could have at best become defective in the absence of non-payment of entire self-amounted tax for which later remedy would be available, so this could not fall as a bonafide reason non-filing of the return within the due date prescribed u/s 139(1) of the I.T. Act. Filling of return in time to get claim of deduction is the basic precondition under section 80AC and a number of courts have upheld the interpretation that the provision is mandatory in nature. The issue was examined at length and settled in special Bench Judgment in the case of Saffire Garments where THE ITAT RAJKOT BEN....
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....08-09 * The Assessing Officer, however, noted that the assessee had filed its return on 31.01.2007 whereas the extended due date for filing return of income for the assessee, being a firm, under the provisions of section 139(1) was 31.12.2006. * The Assessing Officer, further noted that as per proviso to subsection (1A) of section 10A, introduced with effect from 1 -4-2006, no deduction should be allowed to assessee who does not furnish return of income on or before the due date. Accordingly, applying proviso to section 10A(1A), Assessing Officer denied deduction under section 10A. On appeal by the assessee, the Commissioner (Appeals) upheld the order of Assessing Officer. On further appeal by the assessee. the Tribunal held provisions of the proviso to subsection (1A) of section 10A to be merely directory and. not mandatory and, therefore, on that basis held that even if return of income was not filed within the time-limit prescribed by section 139(1), the assessee could not be denied deduction under section 10A. Instant Special Bench of the Tribunal was constituted to consider the following questions. 15. On the aforementioned facts, t....
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....re we are of the opinion that the decision of CIT Vs. MS Jagriti Aggarwal (supra) is not applicable particularly because there is a specific provision u/s 80AC which prohibits deduction under Part "C" of Chapter VIA unless the returns are filed within time prescribed u/s 139(1). When a specific provision is there in the statute same cannot be interpreted in a way to make the provision redundant. Therefore in our opinion, principle laid down by the Hon'ble High Court in case of CIT Vs. MS. Jagriti Aggarwal (Supra) cannot be applied while interpreting the provision of Sec 80AC. 32 The Ld. Counsel for the assessee has also relied on the decision of ACIT Vs. Dhir Global Industrial Pvt. Ltd (supra) wherein it was observed that though the . A.Y. 2008- 09 proviso to Sec 10B for filing of return u/s 139(1) for claiming deduction but the same was of directory nature and not mandatory. In our opinion, this judgment of Division Benches is no more valid after pronouncement of the decision of Special Bench in case off Saffire Garments Vs. ITO (supra). Similarly in ITO Vs. S. Venktaya(supra), Hyderabad Bench of the Tribunal held that if return was filed late then despite th....
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.... Thus in view of the principle as enumerated in the above case, it is clear that the case laws for extended time limit relied upon by the appellant do not apply on cases involving provisions as envisaged per section 80AC. Still further, The Income Tax Appellate Tribunal - Bangalore in the case of M/S Pooja Reality Pvt. Ltd., vs Assessing officer on 29 July, 2016 held on this issue as under- ..11. So far as the appeal on merits is concerned, we find that the assessee has claimed deduction u/s. 80IB of the Act, but it was denied on the ground that the return was not filed before the due date prescribed u/s 139(1) of the Act. The provisions of section 80AC are very clear that if the return is not filed before the due date specified under subsection (1) of section 139 of the Act, no deduction u/s. 80IB can be allowed to the assessee. The contention of the assessee that the provisions of section 80AC is directory and not mandatory was examined by the Tribunal in the case of ITO v. Dr. K. Balaraman (supra) and the Tribunal has conclusively held that the provisions of section 80AC were mandatory and not only directory. The relevant observations of the Tribunal are....
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....on that provisions of Sec.80AC have to be construed as directory and that the provisions of Sec.80IB(10) of the Act are beneficial provisions and need to be interpreted liberally to further the object of the section. 09. We are of the view that in the light of the aforesaid decision of the Special Bench in the case of Saffire Garments (supra) and Avasarala Technologies Ltd.(supra), the plea raised on behalf of the Assessee cannot be accepted. Accordingly, we hold that provisions of Sec.80AC of the Act were mandatory and not directory, thus deduction U/S 80-IB(10) of the Act could not be allowed to an assessee who fails to furnish a return of income on or before the due date specified u/s 139(1) of the Act. We therefore reverse the order of CIT(A) and restore the order of the AO. The appeal of the Revenue is accordingly allowed." ...12. Since the impugned issue is covered by the aforesaid judgments, the deduction u/s. 80IB of the Act cannot be allowed as the claim of the assessee is hit by the provisions of section 80AC of the Act. Therefore, we confirm the order of the CIT(Appeals) in this regard. THE ITAT MUMBAI BENCH 'D' in Dwarakadas G....
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....as filed late (31.12.2013), the A.O. has rightly rejected the claim. The disallowance of Rs. 88, 51,589/- made is therefore confirmed. This ground of appeal is dismissed." 5. The ld AR of the assessee has reiterated the submissions as made before the ld. CIT(A) and prayed to allow the appeal. 6. On the other hand, the ld DR has relied on the orders of the authorities below. 7. The Bench have heard both the sides on this issue and perused the material available on the record. The assessee company has claimed deduction of Rs. 88,51,859/- U/s 80IA of the Act. However, the return was not filed within the time prescribed U/s 139(1) of the Act. There was clear violation of provisions of Section 80AC of the Act. The delay was of 31 days in filing the return of income. After considering the various case laws relied upon by both the sides, we are of the view that the benefit U/s 80IA of the Act cannot be claimed without fulfilling the conditions laid down in Section 80AC of the Act. The provisions of Section 80AC of the Act are read as under: "[Deduction not to be allowed unless return furnished. 80AC. Where in computing the total income of an assessee of any prev....