TaxTMI 
TaxTMI 
2018 (10) TMI 1908
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....d in law, the learned Commissioner of Income-Tax (Appeals)-39, Mumbai (hereinafter referred to as 'CIT(A)') has erred in holding that the DEPB benefit in the case of appellant was 'face value of DEPB' or 'profit on transfer of DEPB' was a debatable issue. 1.2. On the facts and circumstances of the case, the CIT(A} has failed to consider the fact that AO had not rejected the rectification petition on the above ground. Thus, the order passed by CIT(A) is in violation of principle of natural justice and bad in law. 1.3 The learned CIT(A) has further erred in stating that the learned AO would have to travel beyond the records to ascertain appellant's claim. 1.4 On the facts and circumstances of the case, the CIT(A) has failed to apply the decision of the Supreme Court in the case of 'Topman Exports v. CIT' which held that DEPB entitlement is 'cash assistance' covered by section 28(iiib) and only the profit on transfer of DEPB would get covered under section 28(iiid). The appellant respectfully craves leave to add, alter, modify or amplify any of the above stated Grounds of Appeal. 3. The assessee had claimed deduction u/s. 80HHC of R....
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....u/s 154 of the 1961 Act which also met with the same fate as the contentions of the assessee stood dismissed by learned CIT(A) vide appellate order dated 02-12-2016 by holding as under :- "5. I have carefully considered the facts and circumstances of the case. This is not a case where the decision of the Hon'ble Supreme Court in the case of Topman Exports v. CIT (supra) could be said to be squarely applicable so as to call for rectification of the assessment order u/s 154 of the Act. In fact as per aforecited decision of the Hon'ble Supreme Court only face value of DEPB will be classified as cash assistance and will fall under clause (iiib) of section 28 of the Act. Whereas in this case, the AO has considered DEPB benefit as profit on transfer of DEPB and hence falling u/s 28 (iiib) read with third proviso to section 80HHC(3). Thus finding that whether the DEPB benefit in the case of assessee has to be taken as profit on transfer of DEPB or face value of DEPB is debatable issue and applicability of provision of Hon'ble Supreme Court in the case of Topman Exports v. CIT (supra) comes in play only after this issue is decided. As pointed out by the Id.AO in the impugned ....
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....of Topman Exports(supra) on 08-02-2012 which was not available when the re-assessment order u/s 143(3) r.w.s. 147 was passed by the AO on 26-12-2008 and hence the said re-assessment order cannot be rectified u/s. 154 of the Act. 6. The Ld. Counsel for the assessee on the other hand in rejoinder relied upon CBDT circular no. 68 dated 17.11.1971 reproduced here under:- " Section 154- Rectification of Mistakes Mistakes apparent from records - Whether can be treated as such on the basis of subsequent decision of Supreme Court 1. The Board are advised that a mistake arising as a result of a subsequent interpretation of law by the Supreme Court would constitute "a mistake apparent from the records" and rectificatory action under section 35/154 of the 1922 Act/the 1961 Act would be in order. It has. therefore, been decided that where an assessee moves an application under section 154 pointing out that in the light of a later decision of the Supreme Court pronouncing the correct legal position, a mistake has occurred in any of the completed assessments in his case, the application shall be acted upon, provided the same has been filed within time and is otherwise in order. Where any ....
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.... against the returned income of Rs. 42,03,010/-. Subsequently , the assessment was reopened u/s. 148 of the Act on 28.03.2008 and re-assessment was completed on 26.12.2008 without any additions and the total income remained unchanged at Rs. 61,72,060/-. The assessee filed rectification application u/s. 154 of the Act on 11.02.2013 by relying on decision of Hon‟ble Supreme Court in the case of Topman Exports v. CIT (2012) 342 ITR 49(SC) praying for grant of deduction u/s 80HHC wherein the assessee pointed out that face value of DEPB is in the nature of "cash assistance‟ u/s 28(iiib) as held by Hon‟ble Supreme Court and accordingly 3rd proviso to Section 80HHC(3) has no application. The said rectification application was rejected by Ld. AO considering this as a debatable issue which as per AO cannot be rectified within limited mandate of Section 154 of the 1961 Act and as per AO there is no mistake apparent from record in an assessment order dated 26-12-2008 passed by the AO u/s 143(3) r.w.s. 147 of the 1961 Act which can be corrected within the limited mandate of Section 154 of the Act. The Ld. CIT(A) also dismissed the appeal of the assessee.The order of learned C....