2016 (1) TMI 808 - AT - Income Tax

Deduction under section 80-IA - rectification of mistake - Held that - The claim of the assessee for deduction under section 80IC was disallowed by him, inter alia, on the basis of condition laid down in section 80AB and a finding was recorded by him in this context that the said condition was not fulfilled by the assessee in the sense that the notional profit had never been included in the Credit Side of the Profit & Loss Account. In our opinion, it, therefore, cannot be said that this issue does not arise from the order of the Assessing Officer and there is a mistake in the order of the Tribunal in giving direction to the ld. CIT(Appeals) to verify the same, as alleged by the assessee. Moreover, as rightly pointed out by the ld. D.R., the ld. CIT(Appeals) is bound to give due opportunity to the assesese of being heard before deciding this issue as per the direction of the Tribunal and if the profit in question is already included in the gross total income of the assessee as claimed, the assessee cannot be said to have any material grievance on this issue. We, therefore, hold that there is no mistake in the order of the Tribunal while deciding the issue relating to the assessee s claim for deduction under section 80IC as alleged by the assessee. Disallowance under section 14A - Held that - Disallowance under section 14A was arrived at by the Assessing Officer by a categorical recording that he was not satisfied with the correctness of the disallowance made by the assesese with reference to the accounts, as the assesese had not maintained any separate details or accounts in respect of the incurrence of the expenditure. The affidavit of its Authorized Representative filed by the assessee thus is not only unsupported by anything on record but the same is contrary to the findings/ observations specifically recorded by the Tribunal in its order. In our opinion, the said affidavit, therefore, cannot be relied upon to say that there is a mistake in the order of the Tribunal as alleged by the assessee. Moreover, a specific view has been taken by the Tribunal in its order on this aspect of the matter and any interference with the same will amount to review, which is not permissible under section 254(2) of the Act. As such considering all the facts of the case, we are of the view that there is no mistake apparent from record in the order of the Tribunal as alleged by the assessee in the present Miscellaneous Applications. In that view of the matter, we dismiss these Miscellaneous Applications filed by the assessee.

Summary

Issues:
1. Rectification of mistakes alleged in the order of the Tribunal dated 12.09.2014 passed in ITA Nos. 1339/KOL/2012 and 1144/KOL/2012.
2. Alleged mistake in the order of the Tribunal regarding deduction under section 80IC.
3. Alleged mistake in the order of the Tribunal regarding disallowance made under section 14A read with Rule 8D.

Issue 1:
The assessee sought rectification of three alleged mistakes in the Tribunal's order. The first mistake regarding the claim for deduction under section 80-IA was not pressed by the assessee during the hearing. The second mistake involved the disallowance of the deduction under section 80IC. The Assessing Officer disallowed the claim based on the notional profit not being included in the Profit & Loss Account. The Tribunal directed the CIT(Appeals) to verify if the income from the eligible undertaking was included in the gross total income. The Tribunal found no mistake in this direction as the issue arose from the Assessing Officer's order. The third mistake related to the disallowance under section 14A read with Rule 8D.

Issue 2:
Regarding the alleged mistake in the order of the Tribunal concerning the deduction under section 80IC, the Tribunal found no error in directing the CIT(Appeals) to verify if the profit from the eligible undertaking was included in the gross total income. The Assessing Officer disallowed the claim based on the notional profit not being included in the Profit & Loss Account. The Tribunal held that the issue arose from the Assessing Officer's order, and the direction given was appropriate.

Issue 3:
Concerning the alleged mistake in the order of the Tribunal regarding the disallowance under section 14A read with Rule 8D, the assessee claimed that the Tribunal did not allow further arguments on the absence of objective satisfaction by the Assessing Officer. The Tribunal, however, found that the satisfaction was recorded objectively by the Assessing Officer. The assessee's representative filed an affidavit claiming otherwise. The Tribunal dismissed the claim of a mistake as there was no evidence to support the claim that the Tribunal did not allow further arguments on the issue. The Tribunal had discussed and decided on the satisfaction required for disallowance under section 14A.

In conclusion, the Tribunal dismissed the Miscellaneous Applications filed by the assessee as there were no apparent mistakes in the orders regarding the deductions under sections 80IC and 14A. The Tribunal found that the issues raised by the assessee were adequately addressed and decided upon in the original orders.