2014 (6) TMI 439 - AT - Income Tax

Allowability of unabsorbed depreciation of amalgamating company Form No. 62 not filed Statutory requirement under Rule 9C(b) r.w section 72A of the Act Held that - The claim of the assessee for the set-off of brought forward losses and unabsorbed depreciation pertaining to the amalgamating company was allowed by the AO in the original assessment completed u/s 143(3) even in the absence of the prescribed form No.62 filed by the assessee the assessment was set aside by the CIT by exercising his powers u/s 263 and the AO was directed by him to decide this afresh after giving the assessee an opportunity of being heard - availing the opportunity given to it for the first time, the assessee company duly filed the prescribed form No.62 before the AO but the same was overlooked by the AO and the claim of the assessee was disallowed by him - CIT(A) took cognizance of the form and allowed the claim of the assessee Relying upon Commissioner Of Income-Tax Versus Shivanand Electronics 1993 (9) TMI 30 - BOMBAY High Court - filing of form is only directory and not mandatory thus, there was no infirmity in the order of CIT(A) allowing the claim of the assessee for the setting off of brought forward losses and unabsorbed depreciation pertaining to the amalgamating company and upholding the same Decided against Revenue.

Summary

Issues:
Appeal against order of CIT(A) regarding allowance of unabsorbed depreciation of amalgamating company without filing Form No.62 along with return of income.

Analysis:
1. The appeal was filed by the Revenue against the order of the ld. CIT(A) regarding the allowance of unabsorbed depreciation of an amalgamating company without filing the prescribed Form No.62 along with the return of income.
2. The assessee, a manufacturing company, filed its return of income for the relevant year on 20.10.2005, declaring total income. The AO computed the total income and allowed the claim for set-off of unabsorbed loss and depreciation of the amalgamating company, even though Form No.62 was not filed initially.
3. The CIT set aside the original assessment, directing the AO to reframe it after giving the assessee an opportunity. During this process, the assessee filed Form No.62, but the AO overlooked it and disallowed the claim in the fresh assessment.
4. The CIT(A) deleted the disallowance made by the AO, stating that the conditions under section 72A were complied with and Form No.62 was filed during reassessment proceedings, which the AO ignored.
5. The Revenue contended that Form No.62 should have been filed along with the return of income, and the CIT(A) erred in allowing the claim based on a belated filing.
6. The assessee argued that the original assessment was set aside, providing the opportunity to file Form No.62 during reassessment, which was duly done. The CIT(A) rightly considered the form and allowed the claim.
7. The Tribunal found that the initial assessment allowed the claim without Form No.62, and the CIT(A) decision was in line with a High Court ruling stating that filing the form is directory, not mandatory. Therefore, the appeal by the Revenue was dismissed.

This judgment highlights the importance of procedural compliance in tax matters, the significance of filing necessary forms, and the discretion of authorities in allowing claims based on the specific circumstances of each case.