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TMI Blog1996 (2) TMI 192X X X X Extracts X X X X X X X X Extracts X X X X ..... nited Phosphorous Ltd. As per the provisions of section 80HHC, Form No. 10CCAB was required to be filed along with the return of income which was filed by the assessee on 31-12-1991. The assessee, however, filed Form No. 10CCAB only with respect of M/s. Peico Electronics and Electrical Ltd. and M/s. United Phosphorous Ltd. The Assessing Officer, however, allowed the full claim of the assessee under section 80HHC of the Act. 3. The Assessing Officer perhaps realised that the claim of the assessee under section 80HHC had wrongly been allowed. The A.O. with a view to rectify the apparent mistake, issued a notice under section 154 dated 12-8-1993. The assessee replied to the said notice vide its letter dated 22-10-1993. The A.O. however, as it appears from the facts of the case, did not proceed with the rectification application. In other words, the A.O. did not pass any order under section 154 thereby rectifying the mistake, if there was any. 4. Thereafter, the Commissioner examined the records of the assessee and found that the A. O. had allowed the claim of deduction under section 80HHC of the Act for the year under consideration on the proportionate profit of Rs. 31,93,826 in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C dated 30-12-1991 signed by the Chartered Accountants M/s. H.N. Mehta Associates. The said report was accompanied by two disclaimer certificates in Form No. 10CCAB from M/s. United Phoshorous Ltd. and M/s. Peico Electronics and Electrical Ltd. for a sum of Rs. 16,96,887 and Rs. 10,51,754 respectively. The Commissioner, however, found that the Chartered Accountant's report was not accompanied by the certificates in Form No. 10CCAB in respect of the following six parties : (a) M/s. J.K. Industries Ltd. Delhi. (b) M/s. Pohoomal Kewalram Sons (Exports) Pvt. Ltd. Bombay. (c) M/s. Escorts Ltd., New Delhi. (d) M/s. Tata Exports Ltd. Worli, Bombay. (e) M/s. Dunlop India Ltd., Calcutta. (f) M/s. Exim Link Ltd. Bombay. 8. The Commissioner also found from the scrutiny of the records that the assessment proceedings were started by the A. O. by issue of notice u/s 143(2) on 3-1-1992. Such assessment proceedings ended on 13-1-1992 i.e., the date of assessment order. During these 10 days, the Commissioner found that the assessee had merely filed certain details of direct exports and indirect exports of Rs. 67,37,169 and Rs. 6,57,41,006. The assessee, however, did not file certifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1993] 201 ITR 325 (Guj.) (2) CIT v. Malayalam Plantations Ltd. [1976] 103 ITR 835 (Ker.) (3) R.D. Ram Nath Co. v. IAC [1991] 36 ITD 355 (Delhi) (SMC) (4) S.P. Rajagopala Iyer v. GTO [1991] 39 TTJ (Coch.) 43 (5) Mrs. Sudha Sharma v. ITO [1993] 44 ITD 351 (Delhi) (6) CIT v. Shivanand Electronics [1994] 209 ITR 63 (Bom.). 11. The learned counsel has also pleaded that the assumption of jurisdiction u/s 263(1) by the Commissioner is bad in law. He urged that it is more or less settled that an order of the A.O. cannot be termed as erroneous unless it is not in accordance with law. If the A.O. acted in accordance with law making certain assessment, the same cannot be branded as erroneous by the Commissioner simply because, according to him, the order should have been written more elaborately or some disallowance should have been made. In the case of the assessee, Form 10CCAB were filed during the course of assessment proceedings and were available before the A.O. at the time of completion of assessment. His assessment order was therefore, in accordance with law and against such an order, the assumption of jurisdiction under section 263(1) by the Commissioner is not justified ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ankappa v. ITO [1968] 68 ITR 760. The other decisions relied upon by the learned counsel for this proposition are as follows : (1) P.M. Bharucha Co. v. G.S. Venkatesan, ITO [1969] 74 ITR 513 (Guj.); (2) Giridharilal Jhajharia v. CIT [1970] 78 ITR 133 (Cal.); (3) Bihar State Road Transport Corpn. v. CIT [1986] 162 ITR 114 (Pat.). From these decisions, the learned counsel asserted that it is clear that the word "assessment" is used in the Income-tax Act in a comprehensive sense and includes all proceedings starting with filing of the return or issue of notice therefor and ending with determination of tax payable by the assessee. In other words, the proceedings for rectification of assessment of tax are thus the proceedings of assessment. The learned counsel has also drawn our attention to the observations of the learned authors Chaturvedi and Pithisaria in Income-tax Law, Fourth Edition, Vol. 3, page 3730 and Sampath Iyengar's Law of Income-tax, 8th Edition, Vol. 4, page 4481. 14. The learned counsel also pointed out that the assessee had already filed Forms 10CCAC. He took us through the various columns of the said form and pointed out that the information contained in F ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee even during the assessment proceedings. He vehemently contended that there is no evidence on record and even the assessee denies to have any evidence to support the contention that Forms 10CCAB were furnished during the course of assessment proceedings. Thus, in view of the facts of the case, it cannot be said that the assessee did file Forms 10CCAB during the course of assessment proceedings. In the absence of such forms, the assessee was not entitled to the deduction under section 80HHC of the Act. Since the A.O. had allowed such deduction, the order of the A.O. was erroneous and also prejudicial to the interest of revenue. The CIT was thus justified in assuming the jurisdiction under section 263 of the Act. 18. The learned departmental representative has also analysed the decision of the Bombay High Court in the case of Shivanand Electronics. He conceded that the Bombay High Court has laid down that the forms could be filed before completion of assessment. He however, pointed out that in the said decision, it has also been laid down that if the forms could not be filed along with the return of income, the assessee has to explain the reasons for the delay in filing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were never filed by the assessee. He had also pleaded that the rectification under section 154/155 cannot be the part of assessment proceedings. The appeal or rectification are part of assessment machinery but these are not the part of assessment order. In the case of the assessee, the disclaimer certificates should have been filed before the completion of assessment and not after receipt of notice under section 154 of the Act. The learned departmental representative therefore, prayed that the order of the CIT should be maintained. 21. In reply, the learned counsel pleaded that the requirement of section is that the assessee should only obtain the certificates. Obtaining the certificate is sufficient compliance of the income-tax provision. As is evident from page 62 of the paper book, the assessee in fact, had obtained the certificates before filing of the return. The learned counsel, therefore, reiterated that the CIT was not justified in rejecting the claim of the assessee. 22. We have heard the rival submissions in the light of the judicial decisions relied upon by the parties. Under section 80HHC an Indian company or a person resident in India engaged in the business of exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid forms along with the return of income. However, the fact remains that there is no evidence on record to show that the assessee had, in fact, filed the disclaimer certificate in Form 10CCAB during the course of assessment proceedings. As already mentioned above, the assessment proceedings continued for about 10 days and during this period except filing certain details regarding the exports, no such forms were filed. The learned counsel for the assessee fairly conceded that the assessee had no evidence to prove that the disclaimer certificates in Form 10CCAB were filed during the course of assessment proceedings. Thus, the admitted position is that (1) the disclaimer certificates were not filed along with the return of income; and (2) there is no evidence that these were filed before the assessment was completed. 23. The assessee alleged to have filed these certificates during the course of assessment proceedings. The filing of disclaimer certificates therefore, was admittedly delayed. For delayed certificates the assessee is required to give the reasonable explanation for the delay. As a matter of fact, the jurisdictional High Court in the case of Shivanand Electronics has cle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay proceed to decide the allowability or otherwise of the relief on the basis of the facts and material available before him. The position may, however, be different where an assessee does a particular act not within the specified time but after the expiry thereof and makes an application for condonation of delay. In such cases, depending on the language of the statute and the object sought to be achieved by prescribing the time-limit, it would be the duty of the officer to consider the documents even submitted belatedly, if there is reasonable explanation for the delay. Sub-section (6A) of sec. 80J of the Act lays down two conditions which should be fulfilled in order to get the benefit of deduction under the section. The first condition is that the accounts should be audited by an accountant. This condition is mandatory. The second condition is that the assessee should furnish to the ITO a report of the accountant who had audited the accounts, in the prescribed form duly signed and verified by such accountant and such report should be filed along with the return of income. The requirement of filing the report is mandatory. Failure to file it is fatal. But that is not so insofar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... times determination of the amount of tax payable and sometimes the whole procedure laid down in the Act for imposing the liability on the taxpayer. In some sections, it is used in a wide sense and in some sections, it is used in a restricted sense. The words 'assessment' has been used in section 147, section 265, section 273 (before amendment) and section 297 in a restricted sense. In some of the sections, for instance section 297 the expression "proceedings for assessment" has been used to include also the proceedings for rectification of an assessment already completed. The word 'assessment' therefore, has no any fixed connotation or meaning in all the cases. The words used, the assessment, reassessment, fresh assessment, etc., are all of variable import and may carry different meaning depending upon the context in which the words have been used. It therefore, emerges that one particular manner cannot be assigned to the word 'assessment'. The assessee's contention that rectification proceeding is the assessment proceeding, in our view, does not apply to the completion of assessment under section 143(1), 143(3) or section 144. The judicial decisions cited by the assessee in this r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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