TaxTMI 
TaxTMI 
2019 (11) TMI 1717
X X X X Extracts X X X X
X X X X Extracts X X X X
....ppreciating the fact that the assessee made no such claim in its return u/s 139(1) which was mandatory in view of the provisions of section 80A(5) read with section 80AC. ii. Whether on the facts and in the circumstances of the case and in law the Ld.CIT(A) was justified in deleting the addition made under Rule 8D(2) of the Income Tax Rules, 1962 holding that no exempt income has been earned, during the year without appreciating the fact that CBDT after analyzing section 14A vis-à-vis Rule 8D has clarified in circular no.5/2014 dated 11.02.2014 that 'Rule 8D read with section 14A of the Income tax Act, 1961 provides for disallowance of the expenditure even where taxpayer in a particular year has not earned any exempt income. iii. Whether on the facts and circumstances of the case and I Law the Ld. CIT(A) erred in not confirming the disallowance made u/s 14A r.w.s. 8D to Boo Profit as per clause (f) to Explanation 1 u/s 115JB of the Income Tax Act, 1961 overlooking the judgment of Hon'ble Delhi High Court in the case of CIT (Central Circle-II) Vs. Goetz (India) Ltd in ITA No.1179+/2010, dated 09.12.2013 1. The appellant prays that the order of the L....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the assessee preferred an appeal before the Ld. CIT(A). Before the Ld. CIT(A), the assessee has challenged additions made by the Ld. AO towards disallowance of deduction claimed u/s 80IA, in respect Jaigarh undertaking, in light of certain judicial precedents. The assessee has also challenged additions made by the AO towards disallowances of expenditure incurred in relation to exempt income u/s 14A, on the ground that the assesee has not earned any exempt income for the year under consideration and hence, no disallowance could be made towards expenditure incurred in relation to exempt income. The Ld. CIT(A) after considering relevant submissions of the assessee and also by relied upon various judicial precedents, including in the decision of ITAT, Chennai Bench, in the case of ACIT vs Precot Meridian Limited (2014) 148 ITD 229 deleted additions made by the AO towards disallowances of deduction claimed u/s 80IA of the I.T. Act, 1961 by holding that a plain reading of section 80AC makes it clear that from the AY 2006-07 on wards deduction claimed u/s 80IA shall not be allowed, unless the assessee furnished a return on or before the due date specified under sub section (1) of section....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r section 139(1). The section speaks of filing a return within the, time specified under section 139(1) and nothing else. Here the assessee fifed a return under section 139(1) within due date specified but no claim was made under section 80IA in such return. However, a revised return was filed under section 139(5) on 30.03.2010 claiming deduction under section 80IA at 37,27928/.r The section says unless the assessee files a return under section 139(10 within The due date, deduction under section 80IA/80IB/80IC/80ID/80IE shall not be allowed and at the same time section 139(5) provides for filing a revised return, when the assessee discovers any omission or any wrong statement made in the return already filed under sub-section (1) of Section 139 or return filed under sub-section(1) of section 142. This revised return can be filed at any time before expiry of one year from the end of the relevant assessment year or before the completion of assessment, whichever is earlier". 10. In the case of the assessee, it had filed a revised return on 30/03/2010 which is before expiry of one year from the relevant assessment year and therefore the return filed is a valid return as per th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....on 29/11/2013 claiming a deduction u/s 80IA of Rs. 37,1320,551/- and the return was revised on 30/12/2014 claiming an enhanced deduction of Rs. 48,46,38,926/- (Difference being additional claim of Jaigarh undertaking). The original return was filed well within the time limit prescribed under the law and the revised return filed before the AO completing the assessment Hence, the decision of Mumbai Tribunal in the case of Dwarkadas G. Panchatiya vs. ACIT-25(1), is distinguishable on facts since in that case the assessee had failed to file a valid return of income u/s. 139(1) within the time limits and hence it was held that the requirement of law i e. section 80AC rw s. 139{1) & 139(1B) was not satisfied. 6.3.6 Thus The facts of the case in the present case are identical to the facts of the case before the Hon'ble Tribunals as discussed above. Therefore the appellant is eligible for deduction u/s 80IA of the Act. The Hon'ble Supreme Court in The case of Anchor Pressings (P) Ltd vs CIT (1986) 161 ITR 159 has held that if on the basis of material placed on the record, the assessee s entitled to claim any deduction but forget to make his claim in the return or in the co....
X X X X Extracts X X X X
X X X X Extracts X X X X
....iled, but if you go through the provision of section 80AC, the main purpose behind insertion of said provision into the statue book is to deny the benefit or deduction, if the person claims said deduction without filing return within due date specified u/s 139(1) of the I.T. Act, 1961. He further submitted that the Ld. CIT(A) without considering these aspects deleted additions made by the AO, on the ground that once, return has been filed u/s 139(1), then the assesee can claim deduction by filing revised return within due date specified u/s 139(5) of the I.T. Act, 1961. 8. The Ld. AR for the assesse, on the other hand, strongly supporting order of the Ld. CIT(A) submitted that the issue is squarely covered in favour of the assessee by the decision of ITAT in number of case, where the law has been explained in light of provision of section 80AC and held that as per the provision of section 80AC filing of return within due date specified u/s 139(1) is mandatory, but there is no stipulation as to claiming deduction in the return of income, as long as, the claim is within due date specified under sub section (5) of section 139, then the assessee is entitled for deduction u/s 80IA of....
X X X X Extracts X X X X
X X X X Extracts X X X X
....espect of second unit was not made, however a revised return was filed u/s 139(5) within due date specified under the Act and made additional claim for deduction, in respect of second unit. When original return was filed within due date specified u/s 139(1), then any revised return filed within the due date specified u/s 139(5) to rectify any mistakes or omissions or wrong statements made in the return already filed u/s 139(1), then the revised return takes, the nature of the original return filed within due date specified u/s 139(1) and consequently, the assessee fulfills the conditions prescribed u/s 80AC of the Act, in order to be eligible for deduction u/s 80IA of the I.T. Act, 1961. The Ld. CIT(A) after considering relevant facts has rightly deleted additions made by the AO towards disallowances of deduction claimed u/s 80IAof the I.T. Act 1961. We do not see any reasons to interfere in the order of the Ld. CIT(A) and hence, we are inclined to uphold the findings of the Ld. CIT(A) and reject ground taken by the revenue. 10. The next issue that came up of our consideration from ground No.2 of revenue appeal is disallowance of expenditure incurred in relation to exempt income....
X X X X Extracts X X X X
X X X X Extracts X X X X
....lso relied upon the decision of ITAT special bench, Delhi, in the case of ACIT vs Vireet Investment Pvt. Ltd. 82 taxmann.com 415, where it was held that computation under clause (f) of Explanation (1) to section 115JB(2) is to be made without resorting to computation as contemplated u/s 14A r.w.s. Rule 8D. We find that the finding of facts recorded by the Ld. CIT(A), in light of above two decisions is in accordance with law and does not called for any interference from our side and hence, we are inclined to uphold the findings of Ld. CIT(A) and reject ground taken by the revenue. 12. In the result, appeal filed by the revenue is dismissed. ITA No.3708/Mum/2018 13. The revenue has raised the following grounds of appeal. i. Whether on the facts and in the circumstances of the case and in law the Ld. CIT(A) was justified in deleting the addition made under Rule 8D(2) of the Income Tax Rules 1962 holding that no exempt income has been earned, without appreciating the fact that CBDT after analyzing section 14A vis-à-vis Rule 8D has clarified in circular no.5/2014 dated 11.02.2014 that 'Rule 8D read with section 14A of the Income -tax Act, 1961 provides for disal....