TaxTMI 
TaxTMI 
2025 (8) TMI 288
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....6/-: The Id. CIT(A) has grossly erred in law as well as on the facts of the case in confirming the disallowance/addition of Rs. 1,27,04,176/- made by the Id. AO by denying the deduction claimed u/s 80IBA, or 80IAB or other on wrong interpretation and not considering the evidences and material in their perspective and sense, without giving any show cause. Hence the addition/ disallowance so made by the AO and confirmed by the Id. CIT(A) is being totally contrary to the provisions of law and facts on the record and hence same may kindly be deleted in full. 3. The Id. AO has grossly erred in law as well as on the facts of the case in charging interest u/s 234A,234B and 234C. The appellant totally denies it liability of charging of any such interest. The interest, so charged, being contrary to the provisions of law and facts, may kindly be deleted in full. 4. The appellant prays your honour indulgences to add, amend or alter of or any of the grounds of the appeal on or before the date of hearing." 3. Succinctly, the fact as culled out from the records is that the assessee is a LLP and engaged in the business of real estate. The assessee has filed its return of inco....
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....ve no room for ambiguity. They emphatically establish that any deduction sought under Part C of Chapter VIA will be deemed admissible exclusively if the income tax return for that particular case is filed within the prescribed due date. Consequently, no claims under any of the provisions in Part C of Chapter VIA will be entertained in the instance of a belated return. Accordingly this ground raised by the assessee is dismissed. 7.2 On Grounds of Appeal No 3:- This ground of appeal relates to interest u/s 234A, 234B and 234C which is mandatory and consequential in nature. Accordingly this ground raised by the assessee is dismissed. 7.3 On Grounds of Appeal No 4: The appellant requested that The Appellant reserves its right to alter/ amend/delete/modify its grounds of appeal stated above. However, no such option was exercised during the appellate proceedings. Therefore, it is clear that this ground of appeal is academic in nature, and no decision is required. For statistical purposes, this ground of appeal is dismissed. 8. In the result, the appeal is dismissed." 5. As the assessee did not find any favour, from the appeal filed before the ld. CIT(A), the....
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....ction in respect of certain incomes." The claim for deduction under Section 80IBA falls under Part C of Chapter VIA of the Act. Therefore, the appellant's argument in this regard cannot be accepted. The provisions laid out in Section 80AC(ii), which came into effect on April 1, 2018, leave no room for ambiguity. They emphatically establish that any deduction sought under Part C of Chapter VIA will be deemed admissible exclusively if the income tax return for that particular case is filed within the prescribed due date. Consequently, no claims under any of the provisions in Part C of Chapter VIA will be entertained in the instance of a belated return. Accordingly this ground raised by the assessee is dismissed." And hence this appeal. SUBMISSIONS:- 1. Invalid action u/s 143(1):- Firstly it is submitted that the disallowance has been made u/s 143(1) and this is not an adjustment, it is the disallowance of a claim or deduction in a particular section and should not be disallowed u/s 143(1), the deduction if any is to be made only under scrutiny assessment. This is a legal and disputed issue and cannot be taken u/s 143(1). It is the settled legal....
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....d its return on 31.03.2014 showing a total income of Rs. 2.71 Crores after claiming deduction under Chapter VI-A (u/s 80IC) of Rs. 1,16,26,310/-. The said claim was supported by audit report in form No. 10CCB under Rule 18BBB of the IT Rules, 1961. The AO considering the fact that the return had not been filed within the time specified u/s 139(1) as admittedly it had been filed within the extended period as specified u/s 139(4). Accordingly, considering the statutory requirement as per provisions of Section 80AC required the assessee to explain the same. The assessee as per the submissions extracted in the assessment order gave the following explanation : "Income tax return along-with statement of income was filed on 31.03.2014 audit report through which we can avail the 80IC deduction is submitted on 28.10.2013. Book profit report in form 29B is submitted on 29.09.2013 and Tax Audit Report in form 3CA/3CD is submitted on 29.09.2013. Moreover, end of the year i.e. March 31 of the relevant A.Y. is also due date u/s 139 without penalty and ITR submitted on 31.03.2014". 3.2 The record shows that the explanation was rejected by the AO holding as under :- The ....
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....s 80IC on form 10CCB was filed on 28.09.2013. These facts are coming from the record itself as extracted in the earlier part of the order from the assessment order. The return admittedly was uploaded only on 31.03.2014 and admittedly was late in terms of Section 139(1), though within the extended time as set out in Section 139(4) as far as the levy of penalty etc. was concerned. Section 80AC of the Income Tax Act specifically lays down that deduction is admissible or in-fact no deduction is permissible unless the return is furnished on or before the due date specified in sub-section (1) of Section 139.For ready reference, said provision of law is hereby reproduced : "80AC -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 80IA or section 80IAB or section 80IB or section 80IC [or section 80ID or section 80-IE], no such deduction shall be allowed to him unless he furnishes a return of his income for such assessment year on or before the due date specified under sub-section (1) of section 139. " 3.....
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....e cause for delay in filing of the return. The return which is well within the extended period as considered under sub section 4 of Section 139 of the Act, it was submitted, stands on a higher footing, then the return which is filed even beyond this period. The arguments of the Revenue that return filed late can only be considered if the delay is attributable to the Revenue, cannot be concurred with. In the face of decisions which hold that the said provision is a machinery provision, then this interpretation cannot apply only to cases where delay is attributable only to the Revenue. The said interpretation would be universally available as per facts to both the sides. To hold that the cause for delay can be gone into, only if delay is attributable to the Revenue in the facts of the case would necessitate a judicial forum to first require the Department to demonstrate how it can claim itself to be on higher footing qua the tax payer because reasons for delay can be gone into and condoned for adequate reasons demonstrated by the Revenue then even where delay occurs for reasons not attributable to the Revenue also. In the absence of any other argument, we do not see how in the facts ....
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....29-9-2013 and report u/s 80-IC on Form 10CCB was filed on 28.10.2013 and the return of Income was uploaded only on 31.03.2014. 3. That filing of Income Tax return, audit report etc on Income Tax portal as a matter of routine is handled by Tax Consultant and in our case CA. A.S.Malhotra and as a normal practice digital signatures were also handed over to him alongwith Board Resolution authorizing him to use and affix our Digital Signatures on the documents to be submitted to Income Tax Department. 4. That our aforementioned Company is having 77.30% shares in another Company "Saitech Medicare Private Limited". CA. A.S. Malhotra was Auditor of that Company also. Besides Symbiosis Pharmaceuticals (P) Ltd. and a few other shareholders, this Company is also having two shareholders namely Sh. Rajat Bhalotia and his father Sh. P.D. Bhalotia with 12.66% and 3.82% shares respectively. These shareholders have filed a suit with Company Law Board, Delhi against the major shareholder i.e. Symbiosis Pharmaceuticals (P) Ltd. and other shareholders including the Deponent. We suspected collusion of our Auditors with these two dissenting shareholders as our Auditor was also....
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....that the delay in filing of the return in the facts of the present case was for reasons beyond the control of the assessee and in fact, there was reasonable cause in the late filing of the return within the extended period as statutorily available under sub-section (4) of Section 139 of the Act. The decision rendered in the case of P.Bhavani, we find, on facts is not applicable and is entirely distinguishable since we concur with the arguments advanced by the ld. AR thereon same are not being repeated here. Similarly, we find that the decision in the case of M/s Lakshmi Energy & Foods Ltd. also has no role to place as in the facts of that case, not only the return was filed beyond the extended period of time statutorily available under sub-section (4) of Section 139 but even otherwise, the said return was not supported by Tax Audit Report and Audit Report u/s 80IC prior to the filing of the return and infact they were filed during the assessment proceedings. 6.6 In the facts of the present case, as is evident from the assessment order itself, the supporting documents for the claim u/s 80IC was filed well within the extended time prescribed u/s 139(4). The said fact is evid....
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....lectronically filed return was not filed within time therefore, deduction claimed by assessee u/s. 80IC has been disallowed by taking recourse to s. 80AC of the Act-Held, s. 80AC provides that where assessee has claimed deduction u/s. 80IC such deduction shall not be allowed unless assessee furnishes a return on or before the due date specified u/s. 139(1) of the Act-Filing of return electronically is a directory provision and if the return is filed manually on or before due date, such return cannot be ignored- AO at best could ask assessee to file electronic return again, so that the technicality of processing is satisfied-Claim of assessee for deduction u/s. 80IC cannot be denied on the ground of law stated in s. 80AC of the Act. 4. In the case of Lunidhar Seva Sahkari Mandali Ltd. vs. ASSESSING OFFICER (CPC) ITA No. 202/Rjt/2022 February 20, 2023 (2023) 67 CCH 0398 Rajkot Trib (2023) 200 ITD 0014 (Rajkot-Trib) Asst. Year 2019-20. Held as under: "7. We have heard the rival contentions and perused the material on record. In the instant facts, admittedly the assessee did not file return of income within the time permissible under section 139(1) of the Act. However....
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....on 139(1) of the Act w.e.f. assessment year 2018-19 onwards. However, we also note that amendment has been introduced in section 143(1)(a)(v) of the Act to provide that the claim of deduction under section 80P of the Act can be denied to the assessee, in case the assessee does not file its return of income within the time prescribed under section 139(1) of the Act with effect from 01-04-2021 and does not apply to the impugned assessment year i.e. assessment year 2019-20 relevant to financial year 2018-19. Accordingly, in our considered view, denial of claim under section 80P of the Act would not come within the purview of prima facie adjustment under section 143(1)(a)(v) of the Act, for the simple reason that the section was not in force during the period under consideration i.e. assessment year 2019-20. 7.2 The second issue for consideration is that whether the case of the assessee would fall within the purview of prima facie adjustment under section 143(1)(a)(ii)(an incorrect claim, if such incorrect claim is apparent from any information in the return). In our view, the scope of the adjustments that can be made under the said provision has been elaborated in the Explana....
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.... return of income by the assessee for the assessment year 2019-20 and return of income was filed within due date permissible u/s 139(4) of the Act, in which the claim for deduction u/s 80P of the Act was made. Therefore, looking into the totality of facts, we are of the view that claim of deduction u/s 80P of the Act cannot be denied to the assessee only on the basis that the assessee did not file return of income its return of income within due date u/s 139(1) of the Act, in light of the discussion and judicial precedents highlighted above. 8. In the result, appeal of the assessee is allowed. Order pronounced in the open court on 22-02-2023." Also refer Ambaradi Seva Sahkari Mandali Ltd. vs. DEPUTY COMMISSIONER OF INCOME TAX ITAT RAJKOT SUCHITRA KAMBLE, JM & WASEEM AHMED, AM.ITA No. 186/RJT/2022, 197/RJT/2022, 203/RJT/2022 February 10, 2023(2023) 67 CCH 0104 RajkotTrib Looking the facts of the present case there is also a sufficient reasons and beyond control to the assessee. The ratio of the above judgment is also applicable in the present case. However further there is no loss to revenue because the assessee had already paid AMT which....
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..... 80IBA of the Act. Based on those arguments ld. DR supported the order of lower authority. 9. We have heard the rival contentions and perused the material placed on record. Vide ground no. 2 the assessee challenges the finding of ld. CIT(A) while confirming the disallowance / addition of Rs. 1,27,04,176/- made by the Id. AO by denying the deduction claimed u/s 80IBA, or 80IAB or other on wrong interpretation and not considering the evidences and material in their perspective and sense, without giving any show cause notice and thereby the confirmation of addition/ disallowance so made by the AO and confirmed by the Id. CIT(A) is being totally contrary to the provisions of law. The brief facts related to the dispute are that the assessee-appellant filed his return of income declaring NIL income on 31.03.2022 in that ITR so filed the assessee claimed deduction u/s 80IBA for an amount of Rs. 1,27,13,930/- the said claim was denied to the assessee because the ITR was required to be filed on or before 15.03.2022 as per provision of section 139(1) of the Act. When the matter carried before the ld. CIT(A) the said claim was also denied to the assessee on the following finding given ....
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.... appellate authority which was originally not claimed owing to the fact that the audit of the books of accounts of the assessee has been delayed and the deduction was claimed after the completion of the audit." Regarding the issue as to whether the deduction claimed under section 80IB in a non-est return be allowed or not, learned ITAT held that non-est return does not exist in the eyes of law, hence no beneficial use or adverse conclusion can be drawn from such return. It is a return on which none can act upon. It is simply not there. No views, interpretation, derivation can be taken or given on such legally non-existing document. However, learned ITAT also held that the CIT ought to have considered the claim of assessee in exercise of its appellate jurisdiction under section 250 of the Act. If the assessee is otherwise entitled to deduction under section 80IB(10), but due to its ignorance or for some other reason could not claim the same in the return of income, but has raised its claim before the Appellate Authority, then the Appellate Authority should have looked into the same. The assessee cannot be burdened with taxes which it otherwise is not liable to pay ....
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.... the total income of any other person in respect of which he is assessable under this Act during the previous year exceeded the maximum amount which is not chargeable to income-tax, shall, on or before the due date, furnish a return of his income or the income of such other person during the previous year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed : Provided that a person referred to in clause (b), who is not required to furnish a return under this sub-section and residing in such area as may be specified by the Board in this behalf by notification in the Official Gazette, and who 4 during the previous year incurs an expenditure of fifty thousand rupees or more towards consumption of electricity or at any time during the previous year fulfils any one of the following conditions, namely:- (i) is in occupation of an immovable property exceeding a specified floor area, whether by way of ownership, tenancy or otherwise, as may be specified by the Board in this behalf; or (ii) is the owner or the lessee of a motor vehicle other than a two-wheeled motor vehicle, whether having any ....
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.... Provided also that every person, being an individual or a Hindu undivided family or an association of persons or a body of individuals, whether incorporated or not, or an artificial juridical person, if his total income or the total income of any other person in respect of which he is assessable under this Act during the previous year, without giving effect to the provisions of clause (38) of section 10 or section 10 or section 10B or section 10BA or Chapter VIA exceeded the maximum amount which is not chargeable to income-tax, shall, on or before the due date, furnish a return of his income or the income of such other person during the previous year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed. Explanation 1.-For the purposes of this sub-section, the expression "motor vehicle" shall have the meaning assigned to it in clause (28) of section 2 of the Motor Vehicles Act, 1988 (59 of 1988). Explanation 2.-In this sub-section, "due date" means,- (a) where the assessee other than an assessee referred to in clause (aa) is- (i) a company ***; or (ii) a perso....
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....nstruction of the housing project on or after the 1st day of October, 1998 and completes such construction,- (i) in a case where a housing project has been approved by the local authority before the 1st day of April, 2004, on or before the 31st day of March, 2008; (ii) in a case where a housing project has been, or, is approved by the local authority on or after the 1st day of April, 2004 but not later than the 31st day of March, 2005, within four years from the end of the financial year in which the housing project is approved by the local authority; (iii) in a case where a housing project has been approved by the local authority on or after the 1st day of April, 2005, within five years from the end of the financial year in which the housing project is approved by the local authority. Explanation.-For the purposes of this clause,- (i) in a case where the approval in respect of the housing project is obtained more than once, such housing project shall be deemed to have been approved on the date on which the building plan of such housing project is first approved by the local authority; (ii) the date of completion of construction....
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....ssessee has been held entitled to, have been specifically calculated by the CIT(A) & the ITAT. There is no challenge in this appeal to these factual findings of the CIT(A) as confirmed by the ITAT in respect of admissibility of precise deductions under section 80IB(10) to the assessee. The only contention is that since the original return of income was filed by the asessee beyond the period prescribed in section 139(1), therefore, the embargo placed by section 80AC on the entitlement of the assessee to the deduction claimed under section 80IB of the Act comes into play. Section 139 (4) allows "any person who has not furnished return within the time allowed to him under sub-section (1) may furnish the returns for any previous year at any time before the end of the relevant assessment year or before the completion of the assessment, whichever is earlier". Section 139(5) provides that "if any person, having furnished a return under sub-section (1) or sub-section (4), discovers any omission or any wrong statement therein, he may furnish a revised return at any time before the end of the relevant assessment year or before the completion of the assessment, whichever is earlier."....
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....uclid", Judge Learned Hand said, "but words must be construed with some imagination of the purposes which lie behind them". (See Lenigh Valley Coal Co. v. Yensavage (218 FR 547). The view was re-iterated in Union of India v. Filip Tiago De Gama of Vedem Vasco De Gama (AIR 1990 SC 981), and Padma Sundara Rao (dead) and Ors. V. State of Tamil Nadu and Ors. (2002 (3) SCC 533). 14-15. ** ** ** 16. Two principles of construction- one relating to casus omissus and the other in regard to reading the statute as a whole -appear to be well settled. Under the first principle a casus omissus cannot be supplied by the court except in the case of clear necessity and when reason for it is found in the four corners of the statute itself but at the same time a casus omissus should not be readily inferred and for that purpose all the parts of a statute or section ....
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....to issue a notice requiring furnishing of a return within the time indicated therein. That means the infractions which are covered by section 276-CC relate to non-furnishing of return within the time in terms of sub-section (1) or indicated in the notice given under sub-section (2) of section 139. There is no condonation of the said infraction, even if a return is filed in terms of sub-section (4). Accepting such a plea would mean that a person who has not filed a return within the due time as prescribed under sub-sections (1) or (2) of section 139 would get benefit by filing the return under section 139(4) much later. This cannot certainly be the legislative intent." Therefore, a return of income filed under section 139(4) cannot be said to be meeting the requirements of section 139(1) in context of section 80AC of the Act, which specifically insists upon filing of return by the due date prescribed under section 139(1) for availing the admissible deductions. 4.(iv)(b) In B.U. Bhandari Nandgude Patil Associates v. Central Board of Direct Taxes [2018] 91 taxmann.com 241/255 Taxman 60 (Delhi)/[Writ Petition (Civil) No. 6537 of 2017, dated 12-3-2018], by the Delhi Hi....
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.... it from the auditor at the relevant time. In this connection, it is noted that the auditor has mentioned that it was a big audit assignment and it needed his personal attention. Yet such an assignment is the only delayed without any memory of the extraordinary medical exigency which had caused it. It is also noted that the delay in audit is of five months and not a few days and therefore, a general explanation of medical exigency without any details does not explain the justification for long delay. 12. The assessee has also not been able to show that it pursued the matter with any diligence after all the responsibility of filing the return in time is the assessee and he is expected to be even more diligent if a large claim of deduction is involved. There is nothing to show that the assessee pursued the matter with auditor to get audit done. The fact that all other audit were done timely by the auditor except for this audit also does not help the as-sessee's case as any medical exigency of the magnitude being claimed would have delayed at least a few more audits." 15. We have considered the said findings recorded by the CBDT, which are primarily factual and a....
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.... (vii) Contention that medical evidence had dissipated and therefore not produce is unacceptable, for the petitioner cannot take benefit and advantage of the delay and failure. (viii) CBDT has refused to grant extension of time for filing of return in view of the vague assertions, absence of details and adequate proof. (ix) Delay of 5 months was substantial. 17. Statutory time limits fixed have to be adhered to as it ensures timely completion of assessments. Discipline on time limits regarding filing of returns have to be complied and respected, unless compelling and good reasons are shown and established for grant of extension of time. Extension of time cannot be claimed as a vested right on mere asking and on the basis of vague assertions without proof. Statutory audits it is a common knowledge are not undertaken by one person but by a team consisting of auditor(s), article clerks and others. 18. In the present case, we do not know the nature of illness or medical emergency suffered by the auditor and how long the auditor was incapacitated and could not work. The assertions made to justify extension of time have to be proved and establish....