TaxTMI 
TaxTMI 
2001 (7) TMI 262
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....idual capacity till 30th Sept., 1991, also under the name and style of Black Jaguar which was continued in the same name and the application made by the to the CIT for grant of extension for bringing exchange was signed for Black Jaguar by her as (Paramjit) assessee. (iii) That the CIT(A) had condoned delay under s. 80HHC(2)(a) in respect of the transactions where foreign exchange could not be realized and the CIT(A) erred in not appreciating that the disallowances of the claim under s. 80HHC in respect of the said transactions was not justified. (iv) That the CIT(A) has erred in concluding that the appellant did not fulfil requirements under s. 80HHC. (v) That the learned CIT(A) erred in not appreciating the law and erred in disallowing the deduction under s. 80HHC. 3. Any other ground as may be urged at the time of hearing." 2.1. The assessee raised an additional ground in the following manner: "The appellant wants to raise following additional ground of appeal. It is requested that permission of the same may pleased be accorded. It could not be raised earlier because the judgment of Supreme Court in the case of CIT(A) & Ors. vs. Ranchi Club Ltd. (2000) 164 CTR ....
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....r, a revised return was filed on 30th March, 1994, declaring an income of 6,845. The revised return was accompanied with another report under s. 80HHC dt. 10th Jan., 1994, and in this return the assessee made a claim for Rs. 3,94,849 under s. 80HHC. The report included a remark in column 18 as mentioned below: "Remarks, if any out of the total foreign exchange realisation one bill was realised on 31st March, 1993, for a total amount of Rs. 4,07,798." The AO noticed that the report dt. 10th Jan., 1994, was different from the earlier report dt. 30th Oct., 1991, and also pointed out that the report under s. 80HHC(4) submitted by the assessee was not correct, and asked the assessee to give clarification as per detailed letter dt. 8th March, 1995, which is discussed at pp. 2 & 3 of the assessment order. There was further correspondence as mentioned on p 3, 4 and 5 of the assessment orders between the AO and the assessee. The AO came to the conclusion that the assessee filed a return under s. 139(5) of the IT Act but the assessee was not entitled to correct the wrong statement while filing the revised return. The AO relied on the decision of Hon'ble Allahabad High Court in the case....
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....t report dt. 30th Oct., 1991, was filed by the assessee along with the return for the period from 1st April, 1991, to 30th Sept., 1991, when the assessee was proprietor of M/s Black Jaguar. It was further submitted that the report was in the form which was in force as on 30th Oct., 1991, as the change of the proforma was effective from 1st April, 1992, vide notification dt. 13th July, 1992. In view of that audit report was in prescribed proforma. As an alternative, the learned counsel of the assessee argued that even if it was not in the prescribed proforma, the AO was duty bound to allow deduction under s. 80HHC. The reliance was placed on the decision of predecessor of the CIT(A) vide order dt. 21st Feb., 1994, in the case of Shri Satinder Paul Shoor in appeal No. 276/93-94/CIT(A)/TAL. It was also pointed out that the audit report had been prepared within the prescribed period of six months and unrealised amounts were reflected in the list of sundry debtors although the auditor had not remarked about the foreign exchange bill receivable in his audit report. It was also argued that in the revised audit report dt. 10th Jan., 1994, it had been clearly mentioned that the foreign exch....
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....ntitled to exemption under s. 10B of the IT Act. As far as deduction under s. 80HHC was concerned, it was observed that: the first return was filed on 30th Oct., 1992, and the report under s. 80HHC(4) submitted along with the return was not in prescribed proforma but in the earlier proforma which had been changed w.e.f. 1st April, 1992, and the notification for the change had already been issued in July, 1992. As such it could at best be concluded that there was no valid audit report under s. 80HHC filed with the original return. The learned CIT(A) further observed that the discrepancy was pointed out by the AO but it was not possible to accept that the assessee's revised return in those circumstances could not be entertained. The provision of s. 139(5) clearly provide that the assessee might have furnished a revised return at any time from the end of the relevant assessment year or before the completion of assessment if the assessee discovered any omission or wrong statement made in the report earlier under s. 139(1) or in response to notice under s. 142(1), there was no dispute that the assessee had made a wrong claim of exemption under s. 10B and there was also virtually no disp....
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....d style of M/s Black Jaguar. The export was made by the assessee in the capacity of proprietor, vide invoice No. BJ/Exp/29/91 dt. 8th June, 1991, amounting to Rs. 4,07,798. The documents were sent through Bank of Baroda, B.M.M. Jalandhar Branch, vide letter No. BR/7/953, dt. 8th July, 1991 (copy of record) and foreign remittance as collected by Bank of Baroda, G.T. Road, Jalandhar Bench on 31st Oct., 1993. The learned authorised representative admitted that the exemption under s. 10B was wrongly claimed under the bona fide belief that being engaged in the business of hundred per cent export oriented undertaking, the assessee was entitled to exemption under s. 10B of the IT Act. However, on subsequently, when the assessee came to know that in order to entitle her for exemption under s. 10B, there was supposed to be an approval by the Board as appointed by the Central Government and as the said approval was not obtained in the case of the assessee, revised return under s. 139(5) on 30th March, 1994, was filed which was well within the stipulated time prescribed under s. 139(5) and the said revised return was accompanied by the audit report under s. 80HHC, dt. 10th Jan., 1994. In the ....
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....he CIT, Jalandhar. Vide his office letter dt. 1st/3rd June, 1994, in response to the application under s. 80HHC(2)(a) filed by the assessee, Smt. Paramjit Kaur as on 25th March, 1994, i.e., during the course of her assessment proceedings. The learned authorised representative brought our attention towards p. 6 of the assessment order under s. 143(3) wherein the AO stated that the assessee moved to CIT under s. 80HHC(2)(a) on 25th March, 1994". He, therefore, stressed that the AO in the assessment order accepted that the application for extension under s. 80HHC(2)(a) was moved by the assessee, Smt. Paramjit Kaur. The learned authorised representative further brought our-attention towards the application moved by the assessee to the CIT, Jalandhar, for granting extension of time under s. 80HHC(2)(a) which is reproduced below: "Subject: Application under s. 80HHC(2)(a). Dear Sir, 1. The firm had exported goods to USA and the documents were negotiated through Bank of Baroda, G.T. Road, Jalandhar City, on 10th July, 1991, and the proceeds of the documents were realised on 31st March, 1993. 2. Assessment of the firm for the claim of deduction under s. 80HHC is pending before ....
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.... on the judgment of the Hon'ble Punjab & Haryana High Court in the case of Mayor & Co. vs. CIT & Anr. (2001) 166 CTR 114 (P&H) wherein while discussing the powers of the Chief CIT/CIT in granting extension on an application filed under s. 80HHC(2)(a), it was held that: "For exercise this power the Chief CIT or CIT, as the case may be, has to record reasons in writing. This means that the power vested in the competent authority to grant extension of time, which necessarily includes the power to refuse extension of time beyond the period of six months, is quasi judicial in nature. The statutory embodiment of the requirement of recording reasons in writing is clearly indicative of the legislature's intention that the power vested in the Chief CIT/CIT to grant or refuse extension of time must be exercised reasonably and fairly and must not be exercised arbitrarily and the order passed by the concerned authority must reflect objective application of mind to the factors relevant to the determination of the issue as to whether the assessee could not bring or receive the sale proceeds of the exported goods due to reasons beyond his control." 7.4. The learned authorised representative....
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....s to be examined on the basis of the facts of each case. Under cl. (a) where the CIT is satisfied that the assessee, for reasons which are beyond his control could not receive the sale proceeds of such goods or merchandise in convertible foreign exchange within the period of six months from the end of the previous year. Of course, the burden is on the assessee to show that he could not receive such amount within the aforesaid period and delay was on account of facts which were beyond his control." The learned authorised representative further emphasised that the partnership firm M/s Black Jaguar had not carried out any export during the period 1st Oct., 1991, to 31st March, 1992, for which payment had not been received within the stipulated period under s. 80HHC(2)(a), and therein had never filed any application for extension or condonation of delay of receipt of foreign exchange. However, the learned CIT(A) had confused the application filed by Smt. Paramjit Kaur proprietor of M/s Black Jaguar on 25th March, 1994, as that of partnership firm, but what is very strange and rather beyond imagination is that how could deduction under s. 80HHC be allowed by the learned CIT(A) to a p....
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....realisation of the foreign exchange. The claim of the assessee is that the export was carried out by her in individual capacity because there was no partnership firm at that time. It is undisputed fact that the export was carried out vide invoice No. BJ/Exp./29/91, dt. 8th June, 1991, and the partnership firm came into existence w.e.f. 1st Oct., 1991, which supports the contention of the assessee that the export was carried out by the assessee in the individual capacity as a proprietor of the firm M/s Black Jaguar. As far as the extension of time under s. 80HHC(2)(a) is concerned, the extension upto 31st March, 1993, is not disputed by the learned Departmental Representative. The only dispute is that the AO was of the view that extension was granted to the partnership firm and not to the individual. On perusing the contents of the application dt. 25th March, 1994, under s. 80HHC(2)(a) it is noticed that the extension was sought in Bill of lending No. HOLU-0108 DEL NY 015, dt. 14th June, 1991, pertaining to the invoice No. BJ/Exp/29-91, dt. 8th June, 1991, for Rs. 4,07,798 which clearly shows that the goods were exported by the individual Smt. Paramjit Kaur because there was no part....
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....mand notice under s. 156 is silent as regards chargeability of interest under s. 234B is concerned. The learned authorised representative brought our attention towards page Nos. 27 to 34 & 35 of his paper book which are copies of the assessment order and demand notice respectively. He further emphasised that in the assessment orders as well as demand notice, the AO did not mention charging of the interest under ss. 234A and 234B which can be charged only after passing the specified order. The reliance was placed on the following judgments: (1) CIT & Ors. vs. Ranchi Club Ltd. (2000) 164 CTR (SC) 200; (2) Smt. Tej Kumari vs. CIT & Ors. (2000) 164 CTR (Pat)(FB) 201; (3) Dy. CIT vs. Amir Morani (2000) 70 TTJ (Mumbai) 950; and (4) Multi Chemicals vs. Asstt. CIT (2001) 73 TTJ (Del) 124 : (2001) 76 ITD 367 (Del). 10.1. After hearing both the, parties and perusing the assessment order under s. 143(3) and demand notice under s. 156, it is noticed that the AO did not pass specific order as far as charging of interest under ss. 234A and 234B is concerned. The AO in his assessment order placed at page No, 27 of 34 of the paper book mentioned as under: "Issue demand notice and....