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2021 (1) TMI 470

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....may please be deleted and the claim made by the appellant may please be accepted. 3. It may please be held that since the appellant was prevented by reasonable cause from filing the return of income for the A.Y.2012-13 within the statutory time limit prescribed u/s.139[l] of the I.T. Act 1961, the claim of deduction u/s.80IC as made by the appellant deserves to be accepted. Consequently the deduction u/s.80IC as claimed by the appellant in his return of income be allowed. 4. That the conclusion of the Ld CIT(A) that provisions of sec. 8OAC are mandatory and not directory is erroneous and against judicial pronouncements of various benches of the tribunal, courts including the apex court. 5. In the facts and circumstances of the case and in law the learned C.I.T.[A] has erred in not construed the reasonable cause & genuine hardship in Section 119(2){b) of the Act liberally by not granting substantial justice because of a non deliberate delay. 3. Brief facts of the case are that the assessee company is engaged in the business of manufacturing and exporing all types of precision nuts, bolts, washers, hinges and industrial/domestic fasteners. The assessee company filed its return....

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....der sub-section (1) of Section 139.]" The explanatory notes to the Circular No. 14/2006 dated 28-12-2006 expresses the intention of the Section 80AC- "Circular No. 14/2006, Dated 28-12-2006. Benefits of certain deductions not to be allowed in cases where return is not filed within the specified time limit. Section 139(1) casts an obligation on every assesses to furnish the return of income by the due date. With a view to enforce the compliance this regard by the assessees who are entitled for deduction under Section 1 OB from their income, a proviso (fourth proviso) to sub-section (1) of Section 10B has been inserted so as to provide that no deduction under Section 1 OB shall be allowed to an assessee who does not furnish a return of his income on or before the due date specified in sub-section (1) of Section 139. Similarly. with a view to enforce the compliance for furnishing Deduction in respect of Profits and gains from Chapter - 14 certain Industrial Undertakings - Sections 80IA/ 801B 307 the return of income by the due date by the assessees who are entitled for deductions under Section 80-1A or Section 80-IAB or Section 80- IB or Section 80- IC from their income, a new....

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.... Directors could not concentrate due to severe illness of the Director who happens to be mother of all other three Directors. 5.19 From the details furnished by the appellant it is seen that 'Infor' software was purchased on 24/2/2011. As per law, books of account are to be maintained on a day to day basis. If the Books of account arc ready by 31.03.2012, there should not be any difficulty for auditors to audit the books of account. After the end of financial year, assessee is given five months time to file the return of income. That is sufficient to audit the books and filing the return of income. Further, new software was introduced in 2011 and appellant had sufficient time to check whether the new software is acceptable or not. Importantly, appellant is aware that return of income has to be filed by 30/9/2012. Not being able to fix an issue for more than an year cannot be said to be problem beyond the control of the appellant company. The appellant should have planned his business belter. Without prejudice to the above, it is observed that the last mail received from Infor' was dated 20/9/2012 wherein it was stated that Bank Book, Cash Book and Sales report issue....

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....eturn of income was filed belatedly. However, he referred to the Hon'ble Supreme Court decision in the case of Vegetable Products 88 ITR 1924, the proposition that when two views are possible, the view favourable to the assessee should be adopted. He submitted that several benches of ITAT have followed this proposition stop. He further referred to case laws for the proposition that furnishing of return of income as per section 139 (1) subject to the extended period provided u/s. 139(4). 11. Per contra, the learned departmental representative relied upon the orders of the authorities below. He submitted that as per the clear provisions of the act, as contained in section 80AC, the assessee cannot claim the deduction unless return is filed within the time of specified for filing the return u/s.139(1). Hence, the ld departmental representative submitted that there is no ambiguity in this regard. He submitted that when the provisions of the act are clear, there is no scope of any other interpretation. He submitted that assessee himself aware of this and hence, the assessee has filed application before the CBDT for condonation in this regard. There is no information that the CBDT has c....

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.... same has distinguished the various decision which claimed to be in favour of the assessee. We may refer to the decision of ITAT as under: 8. We have considered rival submissions and perused material on record. We have also examined in detail the relevant case laws cited before us. The issue in dispute lies in a very narrow compass. To be precise, the issue for consideration is, whether the condition imposed under section 80AC of the Act is mandatory and if so, whether for non-fulfillment of condition of section 80AC of the Act the assessee would be ineligible to claim deduction under section 80IB(10) of the Act. Before, we proceed to deal with the issue at hand, it is necessary to have a look at the provision contained under section 80AC of the Act (applicable to A.Y.-2012-13), which reads as under:- "80AC. Deduction not to be allowed unless return furnished.- Where in computing the total income of an assessee of the previous year relevant to the assessment year commencing on the 1st day of April, 2006, or any subsequent assessment year, any deduction is admissible under section 80-IA or section 80- IAB or section 80-IB or section 80-IC or section 80-ID or section 80-IE, no su....

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....ity, the Court is entitled to determine the meaning of the word in the context in which it is used keeping in view the legislative purpose. Further, if the plain construction leads to anomaly and absurdity, the Court having regard to hardship and consequence that flow from such a provision can even explain the true intention of the legislature. The Hon'ble Court observed, the 'plain meaning' suggests that when the language is plain and unambiguous, the Court has to read and understand the plain language as such and there is no scope for any interpretation. The Hon'ble Supreme Court went on to observe that strict interpretation of a statute certainly involves literal or plain meaning test. The other tools of interpretation, namely, contextual or purposive interpretation cannot be applied nor any resort to be made to look to other supporting material especially in taxation statute. The Hon'ble Court observed, it is well settled that in a taxation statute, there is no room for any intendment, that regard must be had to the clear meaning of the words and that the matter should be governed wholly by the language of the notification. Equity has no place in Uma Develop....

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....g plain and simple, leave no room for a different interpretation. Therefore, as per the ratio laid down by the Hon'ble Supreme Court in the decision cited supra, the provision contained under section 80AC of the Act has to be construed strictly as per the language used therein. Otherwise, the very purpose of enacting the provision would be defeated and the provision would be rendered otiose. 13. No doubt, the decision of the Tribunal, Pune Bench, in M/s. Anand Shelters Developers and Builders Pvt .Ltd. (supra), supports the contention of the learned Authorised Representative that the provision of section 80AC of the Act is directory. However, the foundation of this decision is the decision of the Hon'ble Andhra Pradesh High Court in ITO v/s S. Venkataiah, ITA no.114/2013, dated 26th June 2013, as well as some other decisions of the Tribunal. Whereas, the Hon'ble Calcutta High Court in Shelcon Properties Pvt. Ltd. (supra) and the Hon'ble Uttarakhand High Court in Umeshchandra Dalakot (supra) have clearly and categorically held that the provision contained under section 80AC of the Act is mandatory. Further, the Special Bench of the Tribunal in Saffire Garments (s....