9911796707
TMI Blog2018 (12) TMI 1562X X X X Extracts X X X X X X X X Extracts X X X X ..... AO has observed that the assessee has efiled its return of income on 30-09-2011 declaring income of Rs. 5.78 crores. During the year under consideration, the assessee has completed its on-going project named Chandivali Project, which was a SRA project (Slum Rehabilitation Scheme project). The assessee claimed deduction u/s 80IB(10) of the Act on the income derived from the above said project to the tune of Rs. 447.92 crores in the return of income filed by it. The assessee also declared interest income, income from generation of electricity from its Wind Mill project. 4. As per the SRA scheme, the assessee has borne construction cost of 12500 units along with shops, balwadis, school infrastructure etc., with inner roads. The assessee has also received TDR (Transferrable development rights) under this project. The assessee has followed Project Completion Method for offering income from this project. Since the project was completed during the year under consideration, the assessee declared income from this project during the instant year and has also claimed deduction u/s 80IB(10) of the Act. The income so declared by the assessee included the sale proceeds of TDR. The AO found the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hri Ramesh S Shah, partner of assessee firm, during the course of search and he, in the statement recorded from him u/s 132(4) of the Act, admitted that these receipts were not recorded in the books of accounts and also agreed to disclose the same in the return of income. With regard to the receipts mentioned in item (a) above, in reply to question no.20 posed to him, he stated that the cash receipts as receipts on sale of TDRs. With regard to receipts mentioned in item (b) above, the transactions mentioned under the name of M/s Satara Properties (India) P Ltd and M/s Khyati Realtors were identified as belonging to the assessee herein. He replied that they represent cash received for various miscellaneous transactions done by the assessee (M/s Sumer Corporation) with M/s Satara Properties (India) P Ltd & M/s Khyati Realtors. The transaction mentioned in item (c) above was stated to be the unaccounted amount realised on sale of scrap generated from the Chandivili project. The aggregate amount of all the three items was Rs. 60.91 crores. Besides the above, the assessee also accepted that purchases to the extent of Rs. 29.92 lakhs was bogus in nature, out of which Rs. 9,75,612/- was r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idered as mistakes apparent from record within the scope of sec.154 of the Act. The AO has also discussed the principles relating to rectification of mistakes apparent from record by placing reliance on certain case laws. The AO observed that he has given proper reasons for assessing the amount of Rs. 60.91 crores as income under the head Income from other sources. He further observed that the assessee has accepted the said findings given in the assessment order by not filing appeal and hence it has attained finality. He also observed that the assessee has not given valid reasons for not accounting these cash receipts in the regular books of accounts. Accordingly, he rejected the rectification petition filed by the assessee. The assessee challenged the same by filing appeal before Ld CIT(A). 12. In the appellate proceedings, the Ld CIT(A) upheld the view taken by the AO. In this regard, the Ld CIT(A) has also referred to certain decisions which explained the meaning of "mistakes apparent from record". The ld CIT(A) held that the AO has taken a plausible view in assessing the amount of Rs. 60.91 crores as income under the head Income from other sources. With regard to the addition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the question whether the amending Act applied to assessments which were already completed was a highly debatable question and, therefore, it was not a case of an error apparent on the face of the record which entitled the AAC to rectify his predecessor's order but the question, thus raised would, in our view, arise only if it is really a case of completed assessment in the literal sense of the word, it may be pointed out that this very aspect of the matter was pressed in service in the Bombay Dyeing & Mfg. Co. Ltd.'s case (supra)(34 ITR 143) and this Court while negativing the contention has taken the view that the assessment order that had been initially passed in that case (which was under section 18A(5) of the Indian Income-tax Act, 1922 ('the 1922 Act') could not be said to have become final in the literal sense of the word and in that behalf this Court pointed out that irrespective of the question whether any appeal had been preferred or not against it that original order was liable to be modified or rectified under section 35 of the 1957 Act and, therefore, could not be said to have become final or complete and as such the contention raised would not be o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal had been preferred against that order or that the requisite period for appeal was allowed to expire. The said order was and continued to be liable to be modified under section 35(7) and in this view of the matter the assessee herein also would not be in a position to invoke the principle of finality of orders or the sanctity of the existing rights which are said to have been acquired by her under the initial order. In view of the above said decision of Hon'ble Supreme court, we agree with the contentions of the assessee that there is no bar in moving rectification petition against an assessment order within the period prescribed under the relevant provisions, which has not been appealed against. In the instant case, there is no dispute that the assessee has moved the rectification petition within the period prescribed u/s 154 of the Act. 15. The Ld A.R submitted that the assessee has been executing only one project, viz., Chandivali Housing Project and has claimed deduction u/s 80IB(10) of the Act in respect of that project only. Accordingly he submitted that all the receipts are related to the above said project only. He submitted that the Ld CIT(A) was not correct in o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs. 1,12,79,442/- from sale of scrap as mentioned on page no. 1 of Annexure A-5 pertains to receipts from sale of scrap as on the seized page no. 1 against s. no 3 to 6, aggregating to Rs. 1,12,79,442/- "Rahim Bhai Chandaivali - SCORP" is mentioned. ii. Thus, the same should be taxed under the head "Profit and Gains of Business or Profession" instead of the residuary hear being "Income from Other Sources". 4.4. Application of Income of Rs. 9,00,00,000/- towards Chandivali Housing Project: i. Application of Income of Rs. 9,00,00,0007- towards Chandivali Housing Project which is disallowed by the Assessing Officer vide order u/s. 143(3) of the Act ' dated 28.03.2013. Thus the deduction u/s. 80-18(10) should be increased by the same amount. 4.5. Bogus Purchase of Rs. 29,92,087/-: i. Bogus Purchase of Rs. 29,92,0877- declared in the hands of the Assessee should added back to the profit of the Chandivali Project. Thus, the deduction u/s. 80-18(10) increases by the same amount. 4.6. Double Taxation of Rs. 2,00,00,000/- on account of Sale of Scrap: i. During the course of search the Assessee declared sale of scrap of Rs. 2,00,00,0007- generated from Chandivali ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Co-op Bank Ltd vs. CIT (39 ITR 115)(SC). Non-consideration of above said decisions is an error apparent from record. (VII) The deductions under Chapter VIA should be restricted to the amount of Gross Total income, if Gross total income works out to less than the eligible amount of deduction. (a) CIT vs. J.B.Boda & Co. P Ltd (ITA No.3224 of 2009)(Bom) (b) CIT vs. Tridoss Laboratories Ltd (2010)(328 ITR 448)(Bom) (c) CIT vs. Eskay K'nit (India) Ltd (ITA No.184 of 2007)(Bom) The AO has not followed the above cited binding decisions. (VIII) If an order has been passed on mistaken assumption and without considering the materials available on record, then it deserves to be rectified. (a) Neeta Shah and Ors vs. CIT (191 ITR 77)(Kar) (b) Kesoram Industries Ltd vs. CIT (271 ITR 501)(Cal) (IX) A rectification is maintainable in order to correctly decide an issue as per law. If it is apparent from record that the assessee is entitled to a particular relief, then the same is allowable by way of rectification u/s 154 of the Act. (a) CIT vs. Ballabh Prasad Agarwalla (233 ITR 354)(Cal) (b) CIT vs. K.N. Oil Industries (142 ITR 13)(MP) 18. The question that needs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts pertain to sale of TDRs. We also notice that the seized document also contains TDR number, area and amount received alongwith computation. Accordingly, the learned AR submitted that there cannot be two views in this respect. He submitted that the said document was put to Mr. Ramesh S. Shah, partner of the assessee and he has admitted the said receipts as undisclosed income of the assessee-firm. Accordingly, the Ld A.R submitted that the view taken by the Assessing Officer is not in accordance with evidence available on record and hence there is no scope for assessing the same as income from other sources. The Ld A.R further submitted that the Hon'ble Bombay High Court in the case of Sheth Developers (supra) has held that on money receipts are also eligible for deduction u/s. 80IB(10) of the Act. Accordingly, learned AR submitted that the view so taken by the Assessing Officer is a mistake apparent from record and hence it should be rectified. 21. Learned DR, on the contrary, relied upon the order passed by Ld CIT(A). He also raised a legal issue with regard to eligibility of the assessee to claim deduction u/s 80IB(10) of the Act. He submitted that the assessee has filed it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessing Officer u/s. 154 of the Act. The Scope of provisions of section 154 of the Act is only to find out as to whether there are mistakes apparent from record in the assessment order passed by the Assessing Officer or not. The question as to what constitutes "mistakes apparent from record" is well settled and the various propositions submitted by the assessee has been discussed supra. Before us, the Ld D.R has raised a legal contention, as discussed in the preceding paragraph. Subsequently, the revenue has also filed Cross objection raising very same legal contentions. However, we prefer to deal the contentions of revenue with regard to the legal issue urged by them separately. 23. We shall deal with the grounds urged in the appeal filed by the assessee. With regard to receipt of Rs. 33.99 crores, there is no dispute that the said addition has been made on the basis of document bearing Page No. 3 of Annexure-5 seized from the assessee-firm. The said document, which is extracted in earlier paragraph, is titled as "cash receipts on sale of TDRs from 1.4.2010". As submitted by learned AR, the said document gives details of TDR number, area sold, amount received and calculations ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (10) of the Act on the above said income. The foregoing discussions would show that the decision so taken by the Assessing Officer is contrary to the decision rendered by Hon'ble Supreme Court in the case of Lakhmichand Baijnath (supra). The fact that the assessee has completed only one project, viz., Chandivali project and further the TDR was received in connection with that project is not denied, in which case, the impugned receipts have to considered as business income only as per the decision rendered by Hon'ble Supreme Court in the above said case. Hence non-consideration of decision rendered by Hon'ble Supreme Court results in mistake apparent from record. The claim of the assessee also gets support from the decision rendered by Hon'ble jurisdictional High Court in the case of Sheth Developers (supra). Non-consideration of decision rendered by jurisdictional High Court also constitutes mistake apparent from record. Further, we notice that the evidences found during the course of search clearly indicate that the impugned income is related to the building project executed by the assessee. Hence the decision taken by the AO to assess the income under the head Income from oth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied in taking the view that the assessee might not have received the amounts. Secondly, the Ld A.R submitted that the following materials available on record has been completely ignored by the assessing officer:- (A) Transactions with M/s Satara Properties India Ltd:- (a) MOU/Agreement entered between the assessee and the above said party for sale of TDR (Pages 89, 97 to 110, 111 and 157 to 162 of Paper book) seized from the assessee. (b) Seized Ledger a/c of Satara Properties India Ltd showing receipts from sale of TDR (Pg 111 and 163 to 166 of Paper book) (c) Letter dated 26-06-2012 filed before the AO (Pages 251 to 253 of paper book) (B) Transactions with M/s Khyati Realtors (a) Seized Ledger account showing amounts received on sale of TDR to M/s Khyati Realtors (Pages 180 and 181 of paper book) (b) Seized Agreements on sale of TDR between assessee and Khyati Realtors (Pages 182 to 186 of paper book) The above documents would show that the transactions entered between the assessee and M/s Satara Properties India Ltd and M/s Khyati Associates were in connection with sale of TDR by the assessee to them. The sale proceeds of TDR accounted by the assessee has already ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he AO has also observed that there is a possibility that scrap might have been generated from windmill farm also. 29. It is the submission of the assessee that the assessee has generated scrap from its construction activities only and this fact has been accepted by the AO in AY 2009-10. Further the receipts on sale of scrap was assessed as business income in AY 2009-10. The Ld A.R further submitted that there is no material available on record to show that the assessee could have generated scrap from any other source, since the assessee was executing only one project, viz., Chandivali project. There is also no material to show that these scraps were generated from Wind mill operations. The Ld A.R accordingly submitted that the view so taken by the AO was not on the basis of any material available on record and, in fact, it is contrary to the facts available on record as well as the decision taken by the AO himself in AY 2009-10. Accordingly he submitted that the AO has committed a mistake apparent from record in assessing the cash receipts on sale of scrap as income under the head income from other sources, thereby denying deduction u/s 80IB(10) of the Act. 30. On the contrary, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... crores as application of income out of Rs. 60.91 crores. Since the income has already been taxed, it is the contention of the assessee, that the same would result in double taxation, if the claim of application is rejected. Even though the Ld CIT(A) has expressed the view that this issue may fall outside the scope of sec.154 of the Act, he has not given any specific direction to the AO. The assessee, in the alternative contended that where an expenditure is disallowed, it will go to increase the profits eligible for deduction u/s 80IB(10) of the Act. In this regard, the assessee placed its reliance on the decision rendered by Hon'ble jurisdictional Bombay High Court in the case of CIT vs. Sunil Vishambharnath Tiwari (2016)(388 ITR 630). We notice that the AO has not considered the binding decision of the jurisdicitonal High Court and the same constitutes mistake apparent from record. Accordingly we direct the AO to allow deduction u/s 80IB(10) of the Act on the disallowance of Rs. 9.00 crores made by him. 34. We shall now take up the Cross Objection filed by the revenue. The revised or reframed grounds of objections urged by the revenue read as under:- Grounds Of Cross Objection ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tation by 4 days. In response thereto, the AO has filed a petition requesting the bench to condone the delay. The said petition reads as under:- 1. I, Manoj Tripathi, Dy CIT Central Circle 5(3), Mumbai having my office at Pr CIT Central 3,Mumbai do hereby solemnly affirmed and state as under : 2. The assesse had filed the copy of Return of Income vide ack no 34552817130092011 dated 30.09.2011. Subsequently the assessee had filed another ack of return of income 345528171290212 dated 29.02.2012. 3. The AO accepted the Return of Income filed by the Ack. No 34552817130092011 dated 30.09.2011 under the bonafide belief that the hard copy of ack of return of income e-filed by the assessee was genuine and accordingly the 80 IB (10) claim of the assessee was allowed. 4. However, during the appellate proceeding this fact was verified from the CPC, Bangalore and the CPC, Bangalore vide their communication dated 31.05.2018 has confirmed that no 'e- Return' of Income was filed through e filing portal with ack no 34552817130092011 dated 30.09.2011. 5. The return of Income filed by the assessee vide ack no 345528171290212 dated 29.02.2012 is a belated 'original' retu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eframed grounds of Cross objection filed by the AO. 38. Be that as it may, the only issue urged by the revenue is that the return of income claimed to have been filed by the assessee on 30-09-2011 is forged one and the assessee has actually filed its return of income for the year under consideration only on 29-02-2012, i.e., beyond the due date prescribed u/s 139(1) of the Act. Hence the assessee's claim for deduction u/s 80IB(10) of the Act is liable to rejected in toto in view of the provisions of sec. 80AC of the Act. 39. Before considering the petition filed by the revenue requesting the bench to condone the delay, we prefer to extract the provisions of sec.253(4) and sec. 253(5) of the Act as available during the year under consideration, which deals with filing of Cross objection:- "(4) The Assessing Officer or the assessee, as the case may be, on receipt of notice that an appeal against the order of the Deputy Commissioner (Appeals) or, as the case may be, the Commissioner (Appeals) or the Assessing officer in pursuance of the directions of the Dispute Resolution Panel has been preferred under sub-section (1) or sub-section (2) or sub-section (2A) by the other party, may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opositions, we shall now examine the cross objection filed by the revenue. For this purpose, it is necessary to dwell upon the facts of the case, while led the revenue to file this Cross Objection. As per the facts available on record, (a) the assessee has claimed to have filed its return of income for the year under consideration on 30-09-2011 vide e-acknowledgement number 34552817130092011. (b) The assessee furnished a letter dated 30-09-2011 to the AO furnishing a copy of manual return, computation of income, financial statements, tax audit report u/s 44AB of the Act, Report in Form No.10CCB. (The contention of the revenue is that the letter of assessee does not bear officer seal, acknowledgement number and signature of the recipient.) (c) The AO issued a notice u/s 142(1) of the Act to the assessee on 09- 02-2012 which reads as under:- "The return of income for Assessment year 2011-12 has not been filed u/s 139(1) of the I T Act, 1961. You are hereby required to furnish the return of income for assessment year 2011-12 within 7 days of receipt of this notice. 2. Failure to furnish the return of income within the specified time would result in initiation of penalty pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee, the Ld D.R brought a new fact that the assessee's claim of filing its return of income within the due date is found to be wrong and the assessee has, for the first time, has filed its return of income on 29-02-2012 in response to the notice issued by the AO u/s 142(1) of the Act. Since the return of income was filed beyond the due date prescribed u/s 139(1) of the Act, the Ld D.R submitted that the assessee is not eligible for deduction u/s 80IB(10) of the Act as per the provisions of sec.80AC of the Act. After conclusion of hearing of the appeal filed by the assessee, the revenue has filed this cross objection, wherein also the revenue has questioned as to whether the claim of deduction u/s 80IB(10) of the Act is allowable in the hands of the assessee?. In the grounds, it is submitted that assessee has claimed to have filed its return of income within the due date prescribed u/s 139(1) of the Act and fradulently prepared an e-acknowledgement also. It is submitted that the assessee is not eligible for deduction in view of the provisions of sec.80AC of the Act. 42. The Cross objection filed by the revenue was posted for hearing. For the sake of convenience, the app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m of filing of return of income within the due date was found to be fraudulent one after receipt of report from Central Processing Centre (CPC). By placing reliance on the decision rendered by Hon'ble Gauhati High Court in the case of CIT vs. Purbanchal Pribahan Gosthi (1998)(234 ITR 663), the Ld D.R submitted that the cross objections filed by the assessee need not be confined to the points taken by the opposite party in the main appeal. The Ld D.R further submitted that the Cross objection is also an appeal. He submitted that so long as the issue contested in the Cross objection is relevant to the issue decided by the Ld CIT(A), the same can be considered and decided. He further submitted that the issue contested by the revenue in Cross objection is a legal issue and it goes to the root of the matter and hence the same should be admitted as held by Hon'ble Supreme Court in the case of NTPC vs. CIT (1998)(229 ITR 382). 47. With regard to the delay, the ld D.R submitted that the revenue has cited proper reasons for the delay. He submitted that the details of fraud committed by the assessee came to be proved only after receipt of confirmation by the revenue from CPC, Bangalore, i.e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny (Civil Appeal No.3327 of 2007), that the tax exemption clause/notification should be read strictly and if there is ambiguity, it must be interpreted in favour of revenue. 50. The Ld A.R, on the contrary, submitted that the revenue is only alleging that the assessee has committed a fraud by claiming that it has filed its return of income before the due date prescribed u/s 139(1) of the Act by furnishing a copy of e-acknowledgement of return of income, which was not found in the records of CPC, Bangalore. Further, the CPC, Bangalore has found fault with the e-acknowledgement number also. He submitted that the allegation of fraud, howsoever strong it may be, cannot take place of "established fraud". He submitted that the various case laws relied upon by the revenue are not applicable to the facts of the present case, since in those case, the fraud was either admitted or established. In support of this proposition, the ld A.R placed his reliance on the decision rendered by Hon'ble Supreme Court in the case of Bishundeo Narain & another vs. Seogeni Rai & others (AIR (38) 1951 Supreme Court 280). The Ld A.R also placed his reliance on the following observations made by Hon'ble Suprem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion u/s 80IB(10) of the Act, if the return is filed beyond the due date prescribed under the Act. However, there are number of decisions rendered by High Courts and Tribunal, wherein it has been held that the condition prescribed in sec.80AC of the Act is only directory. The Ld A.R submitted that the paper book filed by the revenue would show that the assessee has also filed return of income manually with the Assessing officer before the due date prescribed u/s 139(1) of the Act for filing return of income. Hence the assessee should be eligible for deduction u/s 80IB(10) of the Act on the strength of manual return of income also. Accordingly he submitted that the contentions urged by the revenue, at the most, would give rise to a legal issue. Accordingly, he submitted that the Cross objection filed by the revenue is liable to be rejected on this reason alone. 52. The Ld A.R submitted that the assessing officer has allowed the claim for deduction u/s 80IB(10) of the Act in the original assessment proceedings as well as in the reassessment order passed u/s 143(3) r.w.s 263 of the Act. He submitted that the assessing officer has examined the matter twice, the Ld Pr. CIT has examined ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the legal issues permitted to be raised by Hon'ble Supreme Court should pertain to same proceedings. However, in the instant case, the revenue is attempting to raise a legal issue relating to original assessment proceedings and the same is not related to the rectification order passed u/s 154 of the Act, rejecting the rectification petition filed by the assessee. Hence the theory of merger also would not apply in the instant case. 56. He further submitted that the Hon'ble Supreme Court has only allowed making of additional submissions on the already existing issue in the case of Bimal Gurung (supra), relied upon by the revenue, where as in the instant case, the revenue is attempting to raise altogether new issue, divorced from the issues urged by the assessee in the appeal filed by it. 57. The Ld A.R submitted that the original assessment order passed by the AO would retain its sanctity and the same can be upset only as per the legal process known to law. He further submitted that the period of limitation shall apply even to a void order. In support of these propositions, the Ld A.R placed his reliance on paragraph 18 of the decision rendered by Hon'ble Bombay High Court in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on provisions should be construed strictly. He said that it is so held by Hon'ble Rajasthan High Court in the case of Pr. CIT vs. Shankar Lal Saini (2018)(89 taxmann.com 235). He further submitted that the Hon'ble Supreme Court has held in the case of UOI vs. Wood Papers Ltd (1990)(4 SCC 256) that "Truly speaking liberal and strict construction of an exemption provision are to be invoked at different stages of interpreting it. When the question is whether a subject falls in the notification or in the exemption clause, then it being in nature of exception is to be construed strictly and against the subject, but once ambiguity or doubt about applicability is lifted and the subject falls in the notification then fully play should be given to it and it calls for a wider and liberal construction..." The Ld A.R submitted that the above said decision was followed by Hon'ble Supreme Court in the case of Dilipkumar & Co (supra) in civil appeal No.3327 of 2007. The Ld A.R submitted that, in the instant case, there is no difference of opinion that the assessee is eligible for deduction u/s 80IB(10) of the Act and the revenue is pleading for its withdrawal only for the reason that the retu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... riginal assessment proceedings. We have earlier noticed that the (a) AO himself allowed the deduction in the original assessment order passed on 28-03-2013 u/s 143(3) r.w.s 153A of the Act. (b) Subsequently the said order was revised by Ld Pr. CIT u/s 263 of the Act, vide his revision order dated 30.03.2015, directing the AO to examine the eligibility of the assessee to claim deduction u/s 80IB(10) of the Act. (c) The assessing officer passed reassessment order on 31.3.2016 to given effect to the revision order passed u/s 263 of the Act, wherein also, the assessing officer allowed deduction u/s 80IB(10) of the Act. (d) Thereafter, the assessee filed a rectification petition before the AO u/s 154 of the Act seeking rectification of order passed on 28-03-2013. (e) The Ld CIT(A) passed order on 14.09.2017 against the appeal filed by the assessee challenging the rectification order passed by the AO u/s 154 of the Act. (f) The present appeal before us has been filed by the assessee challenging the order passed by Ld CIT(A) against the order passed by the AO u/s 154 of the Act. (g) In the present proceedings, the AO has filed the cross objection praying that the deduction g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... something indirectly which it is not entitled to achieve directly, which is not permissible. 65. We have noticed that the order appealed before the Tribunal is the order passed by Ld CIT(A) against the rectification order. The scope of rectification proceedings is only to rectify mistake apparent from record. We have noticed that the revenue has urged altogether new ground challenging the decision taken by the AO in the original assessment order, i.e., the grievance of the revenue urged in the CO relates to the deduction granted by the AO in the original assessment order and not in the rectification order, which is challenged before us now. Under these facts, the question that arises is whether the revenue is entitled to urge the impugned grounds in the appeal filed by the assessee against rectification orders?. The revenue has sought to support its decision by contending that (a) as per the decision rendered by Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd vs. CIT (229 ITR 383), the legal issues can be urged afresh in any of the appeal proceedings. (b) the assessee has obtained deduction by committing a fraud and hence the order so obtained by fraud is n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that an appellate authority has all the powers which the original authority may have in deciding the question before it subject to the restrictions or limitations, if any, prescribed by the statutory provisions. In the absence of any statutory provision, the appellate authority is vested with all the plenary powers which the subordinate authority may have in the matter. There is no good reason to justify curtailment of the power of the Appellate Assistant Commissioner in entertaining an additional ground raised by the assessee in seeking modification of the order of assessment passed by the Income-tax Officer. This Court further observed that there may be several factors justifying the raising of a new plea in an appeal and each case has to be considered on its own facts. The Appellate Assistant Commissioner must be satisfied that the ground raised was bona fide and that the same could not have been raised earlier for good reasons. The Appellate Assistant Commissioner should exercise his discretion in permitting or not permitting the assessee to raise an additional ground in accordance with law and reason. The same observations would apply to appeals before the Tribunal also. 7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llenging the rejection of the rectification petition filed by the assessee. Since the rectification petition has been rejected, the doctrine of merger also does not apply to the instant case. The Ld D.R contended that the question of fraud could be raised in collateral proeedings also. However, there is only allegation of fraud at this stage and the same has not been established in the proper forum. Accordingly, we find merit in the contentions of the Ld A.R that the revenue could not raise this legal issue in the appeal preferred by the assessee against rectification proceedings. Hence, in our view, the revenue cannot take support of this decision of Hon'ble Supreme Court, referred supra. 68. The next reasoning given by the revenue is that the assessee has committed a fraud by furnishing a copy of e-acknowledgement, which has been found to be bogus. First of all, as submitted by Ld A.R, there is only allegation of fraud, if any, committed by the assessee. Secondly, the Income tax Appellate Tribunal is not the authority empowered to decide about the allegation of fraud. Thirdly, as submitted by Ld A.R, the alleged fraud, even if it is proved to be true, would give rise to only a l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he limitation would apply for all orders, even if it is a wrong order. We have also noticed that, what cannot be achieved directly cannot be achieved indirectly. In the instant case, the revenue has fairly admitted that the time limit for reopening of assessment has already expired, meaning thereby, the AO could not disturb the assessment order already passed by him, even if any wrong is found therein. By filing this CO before the Tribunal, that too in an appeal proceeding challenging the rectification order passed u/s 154 of the Act, the revenue is trying to achieve its objectives, which could not be achieved by it directly. The said objectives are sought to be achieved indirectly on the basis of allegation of fraud, since the AO could not take direct action due to expiry of limitation period. 71. The Ld A.R also submitted that the assessee has filed its return of income for AY 2012-13 also beyond the due date prescribed u/s 139(1) of the Act claiming deduction u/s 80IB(10) of the Act. It was submitted that the AO has allowed the said deduction in AY 2012-13. Accordingly, it was submitted by Ld A.R that there is no merit in the allegation of fraud, if any, committed by the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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