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TMI Blog2018 (10) TMI 1090X X X X Extracts X X X X X X X X Extracts X X X X ..... sub-section (1) of Section 139 of the Act - Decided against assessee - ITA No. 100/JP/2017 - - - Dated:- 27-7-2018 - Shri Vijay Pal Rao, JM And Shri Bhagchand, AM For the Assessee : Shri B.L. Bhojwani (CA) For the Revenue : Smt. Seema Meena (JCIT) ORDER PER: BHAGCHAND, A.M. The appeal filed by the assessee emanates from the order of the ld. CIT(A), Kota dated 26/12/2016 for the A.Y. 2013-14, wherein the assessee has raised following grounds of appeal: 1.(a) That the learned Commissioner of Income Tax (Appeals), on the facts and in the circumstances of the case and in law, has erred in upholding the disallowance made by the learned assessing officer of the deduction of ₹ 88,51,859/- claimed by the assessee company under section 80IA, due to the reason that there was a delay of 31 days in the filing of the return of income and the deduction is not allowable under section 80IA read with section 80AC, if the return of income is filed beyond the due date under section 139(1) of the Income Tax Act, 1961. (b) That the tax audit report was filed by the assessee company well in time, along with the audited financial statements. The deduction of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act. Therefore, the Assessing Officer disallowed deduction U/s 80IA of the Act. The ld. CIT(A) has confirmed the action of the Assessing Officer. 4. Now the assessee is in appeal before the ITAT. The main issue involved in the appeal is confirming the disallowance by the ld. CIT(A) of ₹ 88,51,589/- disallowed U/s 80IA of the Act. The ld. CIT(A) has dealt the issue by holding as under: I have gone through assessee s submission and AO s findings. From a perusal of the documents available on record it is seen that the appellant s tax audit report was e-filed on 30.09.2013 with the financial statements claiming a deduction u/s 80IA of ₹ 88,51,859/- in the TAR u/s 44AB in form 3CD. However, the return due on 30.11.2013 was filed late by 31 days i.e. on 31.12.2013. The reason cited by the appellant A/R was that due to shortage of funds, huge amount of self-assessment tax could not be deposited in time. Therefore, it was not possible to e-file the return due to system related restrictions. He has also cited several case laws mentioning that provisions of section 80AC are not mandatory but directory in nature. Therefore a substantial claim or benefit sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered opinion, provisions of Section 80AC of the Act squarely apply on the facts of the case in hand, Section 80AC reads as under:- 80AC. Where in computing the total income of an assessee of the previous year relevant to the assessment year commencing on the 1st day of April, 2006 or any subsequent assessment year, any deduction is admissible under section 80IA or section 80-IAB or section 80-IB or section 80-IC [or section 80-ID or section 80- IE], no such deduction shall be allowed to him unless he furnishes a return of his income for such assessment year on or before the due date specified under subsection (1) of section 139]. 14. The Special Bench of the Tribunal at Rajkot had the occasion to consider the following facts in the case of Saffire Garments (supra):- The assessee, a partnership firm, filed its return of income claiming deduction under section 10A in respect of its profit derived from the export of articles produced in SEZ. . A. Y. 2008-09 The Assessing Officer, however, noted that the assessee had filed its return on 31.01.2007 whereas the extended due date for filing return of income for the assessee, being a firm, under the provisions of section 139 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y him after reducing advance tax and TDS/TCS if any paid by him apart from some other reductions. Such interest is payable from the date immediately following the due date for filing the return of income and is payable up to the date on which such return of income was furnished by the assessee and if the assessee has not furnished any return of income then the interest is payable till the date of completion of the assessment under section 144. It is held that above is also one of the consequences of not filing return of income by the assessee within the due date. [Para 11] 16. A similar issue was also considered by the Co-ordinate Bench of Chandigarh in the case of Lakshmi Energy Foods Ltd. (supra), the relevant facts and findings of the Co-ordinate Bench read as under:- However, Hon'ble Supreme Court in case of Prem Nath Khanna (supra) held - that due date would mean due date as provided u/s 139(1). Therefore we are of the opinion that the decision of CIT Vs. MS Jagriti Aggarwal (supra) is not applicable particularly because there is a specific provision u/s 80AC which prohibits deduction under Part C of Chapter VIA unless the returns are filed within time prescribe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fits and gains from industrial undertaking other than infrastructure development undertakings - Assessment year 2006-07 and 2007-08 - where an assessee wants to avail deduction u/s 80IB, he has to necessarily furnish his return of income containing such claim before due date specified in Sec 139(1) - held Yes A.Y. 2008-09 Therefore in view of the above legal position and discussion it is clear that once the return is filed late beyond due date provided u/s .139(1) in Section 80ACthen deduction u/s 80IB cannot be allowed. 17. If, we consider the facts of the case in hand in the light of the decisions mentioned hereinabove, we find similarity in the facts. Therefore, respectfully following the decisions of the Special Bench and the Co-ordinate Bench (supra), we set aside the findings of the Id. CIT(A) and restore that of the A.O. Ground nos. 1 2 taken together are allowed. Thus in view of the principle as enumerated in the above case, it is clear that the case laws for extended time limit relied upon by the appellant do not apply on cases involving provisions as envisaged per section 80AC. Still further, The Income Tax Appellate Tribunal - Bangalore in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on or before the due date specified u/s 139(1). The decisions rendered by the division bench of Tribunal on which the CIT(A) placed reliance are no longer good law in view of the later decision of the Special Bench referred to above. 07. The learned. DR also brought to our notice the decision rendered by the ITAT Bangalore Bench in the case of Avasarala Technologies Ltd. Vs. DCIT wherein in the context of deduction u/s.80-IB(10) of the Act, the decision of the Special Bench in the case of Saffire Garment (supra) was followed and it was held that the provisions of Sec.80AC of the Act were mandatory and not directory, thus deduction u/s 80-IB(10) of the Act could not be allowed to an assessee who fails to furnish a return of income on or before the due date specified u/s 139(1). 08. The Id. counsel for the Assessee however reiterated his submission that provisions of Sec.80AC have to be construed as directory and that the provisions of Sec.80IB(10) of the Act are beneficial provisions and need to be interpreted liberally to further the object of the section. 09. We are of the view that in the light of the aforesaid decision of the Special Bench in the case of Saffire Garment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view, it is a mandatory direction which prescribes the consequence of omission to file the return in time. The Courts cannot rewrite the law to do what is just according to them... .. We are inclined to think that the benefit can only be availed by the assessee if he has filed his return on time. If he has not filed his return on time, the benefits cannot be claimed. 16 For the aforesaid reasons, both the questions framed above are answered in favour of the revenue. The appeal thus succeeds and is allowed. Under the facts of the case and in view of an entire gamut of legal precedents available as discussed above, I am of the view that since the claim of deduction by the appellant was not accompanied by a return filed u/s 139(1) within the due date prescribed (being 30.11.2013) and was filed late (31.12.2013), the A.O. has rightly rejected the claim. The disallowance of ₹ 88, 51,589/- made is therefore confirmed. This ground of appeal is dismissed. 5. The ld AR of the assessee has reiterated the submissions as made before the ld. CIT(A) and prayed to allow the appeal. 6. On the other hand, the ld DR has relied on the orders of the authorities below. 7. The B ..... X X X X Extracts X X X X X X X X Extracts X X X X
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