9911796707
TMI Blog1986 (8) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... he company on 2-6-1977. In response, the company paid two instalments of Rs. 5,334 each on 12-6-1977 and 22-9-1977. However, before the date of the third instalment the company filed an estimate on 12-12-1977 showing nil liability on account of advance tax. This the company did by making an adjustment in respect of claim under section 35B of the Act of Rs. 14,63,304 against an income of Rs. 11,04,071 thus arriving at a figure of loss amounting to Rs. 3,59,233. 3. The assessee-company also filed a return of loss showing an identical figure, namely Rs. 3,59,233, after claiming the aforesaid deduction under section 35B. The assessment order was finalised by the ITO on 18-3-1981 determining net income of Rs. 10,68,058. A substantial portion o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... up such claim of substantial amount and the ITO, in his order dated 28-10-1976 had turned down the assessee's claim and even the Commissioner (Appeals), relying decision of Tribunal, Special Bench, Bombay in case of J. H. Co. v. Second ITO [1982] 1 SOT 150 gave deductions at 50 per cent only on minor amount of Rs. 19,395 out of which the Tribunal on account of department's appeal has knocked down deduction, granted of Rs. 8,852. Thus, claim under section 35B is considered finally an amount of Rs. 10,543 in assessment year 1974-75. Same facts existed for assessment years 1975-76, 1976-77 and 1977-78. Thus, it proves beyond a shadow of doubt that the estimate filed by assessee-company was untrue and incorrect and I am fully satisfied that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax Officer in his order under section 273(a) of the Act, the Income-tax Officer had issued notice under section 210 demanding tax payable at Rs. 16,002 on the basis of the income of the assessee for the assessment year 1976-77. The assessment of the appellant company for the assessment years 1974-75, 1975-76, 1976-77 and 1977-78 were also finalised by the ITO. The claim of the assessee for the assessment year 1974-75 in respect of weighted deduction was negatived by the Income-tax Officer. So when the assessee was aware of the department's viewpoint as the assessment order of the Income-tax Officer of the assessment year 1974-75 was available to the assessee. In spite of it, if the assessee has made higher deduction on account of export mar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A reference was also made to the decision of the Hon'ble Gujarat High Court in the case of CIT v. Bharat Machinery Hardware Mart [1982] 136 ITR 875. 8. We have weighed the arguments advanced on both sides and have also perused the paper book filed by the appellant. It is apparent that the ITO and the Commissioner (Appeals) have been swayed by the fact that the claim of the assessee under section 35B for earlier assessment years had been turned down. They also considered the judgment in the case of J.H. Co. as going against the appellant-company in respect of a substantial portion of the expenditure claimed for weighted deduction under section 35B. However, they failed to appreciate the fact that the judgment in the case of J. H. Co. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der in the assessee-company's own case, it is dated 10-4-1980. As for the decision of the Tribunal, Special Bench, Bombay in the case of J.H. Co. v. Second ITO [1982] 1 SOT 150, it was delivered on 17-6-1978." 9. We also observe that in the course of assessment proceedings the ITO has nowhere opined that the claim under section 35B was false. Even at the time of filing the estimate on 12-12-1977, the assessee had clearly indicated the claim under section 35B which was quantified by him according to what he felt was the correct basis. Even his returned figure was the same as the figure shown in the estimate, namely, a loss of Rs. 3,59,233. It also does not appear to us to be a case where legitimate dues of the Government in the form of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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