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2022 (5) TMI 852 - AT - Income TaxDenial of claim u/s 80IA for want of sec.10CCB - not filing Form NO.10CCB within the due date - quantum of deductions - Assessee revised return everytime receiving Form No.10CCB - HELD THAT - Since the assessee had filed its return of income before the due date, as specified u/s 139(1) of the Act for the relevant asst. year and in the return of income he has also claimed deduction. The tax Auditor has also certified the deduction claimed as per Sl.No.33 of the Form No.3CD therefore, only for want of not filing Form NO.10CCB within the due date the claim of deduction should not be disallowed, to which, the assessee had filed revised return within the due date. In view of this, the assessee is eligible to claim deduction u/s 80IA. Whenever the assessee received Form No.10CCB, he revised his return of income. On observation of the above trading profit and loss account, we notice that there is no any amount debited into the profit and loss account towards administrative expenditure whereas the administrative expenditures are necessary to keep and maintain for smooth running of the business. How and why the assessee has not debited any administrative expenses even no any salary expenditures have been shown in the profit and loss account. Therefore, it would be proper to send back the issue to the file of the AO for determining the actual profit computed in the above trading and profit and loss account without incurring of any expenditures. Needless to say that the reasonable opportunity of being heard to be given to the assessee and the assessee is directed not to seek unnecessary adjournments for early disposal of the case.Appeal of the assessee is allowed for statistical purposes.
Issues Involved:
1. Eligibility for deduction under Section 80IA of the Income Tax Act. 2. Filing of Form No. 10CCB within the due date specified under Section 139(1). 3. Invocation of Section 154 for rectification of mistakes apparent from the record. 4. Examination of the quantum of deductions claimed. Detailed Analysis: 1. Eligibility for Deduction under Section 80IA: The primary issue in this case is whether the assessee is eligible for a deduction under Section 80IA despite not filing Form No. 10CCB along with the original return. The assessee filed the original return within the due date but did not include Form No. 10CCB. It was later filed with a revised return. The CIT(A) and ITAT both concluded that the assessee is eligible for the deduction since the original return was filed within the due date, and the revised return included the necessary form. The ITAT referenced similar cases, such as DCIT Vs Mackintosh Burn Ltd, where deductions were allowed even when claimed in revised returns. 2. Filing of Form No. 10CCB within the Due Date: The CIT(A) held that the provision of Section 80AC clearly states that no deduction under Section 80IA shall be allowed unless the return of income is furnished on or before the due date specified under Section 139(1). The assessee did not file Form No. 10CCB with the original return, which was a requirement. However, the ITAT found that the filing of Form No. 10CCB is a procedural aspect and should not bar the deduction if the original return was filed within the due date, as supported by the Hyderabad Bench in the case of Delhi MSW Solutions Ltd. 3. Invocation of Section 154 for Rectification: The CIT(A) noted that Section 154 can only be invoked to correct an error apparent from the record, not to disturb a concluded finding. The ITAT upheld this view, referencing the Hon'ble Kerala High Court and the Supreme Court, which stated that a mistake apparent from the record must be obvious and patent, not something requiring extensive reasoning. The ITAT concluded that the AO rightly disallowed the claim under Section 80IA, and the CIT(A) dismissed the appeal. 4. Examination of the Quantum of Deductions Claimed: The ITAT observed that the quantum of deductions had not been examined by the lower authorities. The assessee submitted financial statements for verification, showing a net profit of Rs. 3,502,815. The ITAT noted discrepancies, such as the absence of administrative expenses in the profit and loss account, which are necessary for the smooth running of the business. The case was remanded back to the AO for determining the actual profit, with instructions to provide the assessee a reasonable opportunity to be heard. Conclusion: The ITAT allowed the assessee's appeal for statistical purposes, directing the AO to re-examine the quantum of deductions and the actual profit, considering the procedural aspects of filing Form No. 10CCB. The decision emphasized that procedural lapses should not bar legitimate claims if the substantive requirements are met within the stipulated time frame.
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