R.Natarajan, CHENNAI v. ACIT, CHENNAI

ITA 1058/CHNY/2010 | 2007-2008
Pronouncement Date: 17-02-2012 | Result: Allowed

Appeal Details

RSA Number 105821714 RSA 2010
Assessee PAN AABPN8427H
Bench Chennai
Appeal Number ITA 1058/CHNY/2010
Duration Of Justice 1 year(s) 7 month(s) 19 day(s)
Appellant R.Natarajan, CHENNAI
Respondent ACIT, CHENNAI
Appeal Type Income Tax Appeal
Pronouncement Date 17-02-2012
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted D
Tribunal Order Date 17-02-2012
Date Of Final Hearing 17-02-2012
Next Hearing Date 17-02-2012
Assessment Year 2007-2008
Appeal Filed On 28-06-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL BENCH D CHENNAI (BEFORE SHRI U.B.S. BEDI JUDICIAL MEMBER AND SHRI ABRAHAM P. GEORGE ACCOUNTANT MEMBER ) .. I.T.A. NO. 1058/MDS/2010 ASSESSMENT YEAR : 2007-08 SHRI R. NATARAJAN NEW NO.15 OLD NO.8 3 RD CROSS STREET R.K. NAGAR MANDAVELI CHENNAI 600 028. PAN : AABPN8427H (APPELLANT) V. THE ASSISTANT COMMISSIONER OF INCOME TAX SALARY CIRCLE V CHENNAI 600 034. (RESPONDENT) APPELLANT BY : SHRI R. KUMAR RESPONDENT BY : SHRI K.E.B. RENGARAJAN JUNIOR STANDING COUNSEL O R D E R PER ABRAHAM P. GEORGE ACCOUNTANT MEMBER : THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE O RDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-VI CHENNAI F OR THE IMPUGNED ASSESSMENT YEAR. THE GROUNDS RAISED BY TH E ASSESSEE ARE REPRODUCED AS UNDER:- THE APPELLANT AT THE TIME OF FILING THE RETURN FOR THE ASSESSMENT YEAR 2007-08 IN ADDITION TO THE REGULAR INCO ME ALSO ADMITTED A SUM OF ` 4 28 750/- AS PERFORMANCE INCENTIVE FROM HIS EMPLOYER. A SUM OF ` 1 28 625/- WAS CLAIMED AS TAX DEDUCTED AT SOURCE BY THE EMPLOYER FOR THE SAID PER FORMANCE INCENTIVE. THE CASE WAS SELECTED FOR SCRUTINY FOR T HE ASSESSMENT YEAR 2007-08 AND THE INCOME ADMITTED BY THE APPELLANT WAS ACCEPTED BY THE ASSESSING OFFICER END ED UP IN THE DEMAND OF ` 2 51 720/-. THE REASON FOR THE DEMAND IS NON AVAILABILITY FOR TDS CREDIT CLAIM OF ` 1 28 625/-. ON GOING THROUGH THE ASSESSMENT ORDER THE APPELLANT REALIZED THAT THE PERFORMANCE INCENTIVE WHICH WAS ADMITTED B Y HIM FOR THE ASSESSMENT YEAR 2007-08 ACTUALLY BELONG TO THE ASSESSMENT ORDER 2008-09. ON SEEING THE FORM 16 GIVEN BY THE COMPANY FOR THE ASSESSMENT YEAR 2008-09 THE PERFORMANCE INCENTIVE OF ` 4 28 750/- WAS INCLUDED THERE AND THE APPELLANT WITHOUT KNOWING THAT IT WAS ADMITTED IN THE ASSESSMENT YEAR 2007-08 ALSO ADMITTED IN THE ASSESSMENT YEAR 2008-09. IN EFFECT THE SAME PERFORMANCE INCENTIVE OF ` 4 28 750/- WAS ADMITTED BOTH IN THE ASSESSMENT YEAR 2007- 08 AND 2008-09 WHEREAS TDS CREDIT OF ` 1 28 625/- IS AVAILABLE ONLY FOR THE ASSESSMENT YEAR 2008-09. THE APPELLANT BEING AGGRIEVED BY THE ORDER FOR THE ASSESSMENT YEAR 2007-08 FILED ON APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS VI) THE COMMISSI ONER DISMISSED THE APPEAL INVITING REFERENCE TO 246 OF THE INCOME- TAX ACT 1961. THE FACT REMAINS THAT THE AMOUNT ` 4 28 750/- HAS BEEN TAXED TWICE BY THE INCOME TAX DEPARTMENT. HENCE THE APPEAL. 2. ASSESSEE HAS ALSO FILED AN ADDITIONAL GROUND WHE REIN IT ASSAILS THE ACTION OF THE CIT(APPEALS) IN DISMISSIN G THE APPEAL IN LIMINE. 3. SHORT FACTS APROPOS ARE THAT THE ASSESSEE HAD FI LED HIS RETURN OF INCOME FOR THE IMPUGNED ASSESSMENT YEAR DECLARIN G A TOTAL INCOME OF ` 14 86 210/-. THE SAID RETURN WAS ACCEPTED IN AN ASSESSMENT DONE UNDER SECTION 143(3) OF INCOME-TAX ACT 1961 (HEREINAFTER CALLED THE ACT) AND ASSESSMENT WAS C OMPLETED. APPEAL WAS FILED BY THE ASSESSEE AGAINST THE ORDER OF THE A.O. WHEREIN ITS MAIN SUBMISSION WAS AS UNDER:- THE ASSESSEE AT THE TIME OF FILING THE RETURN FOR T HE ASSESSMENT YEAR 2007-08 HAS ADMITTED AN INCOME OF ` 4 28 750/- BEING PERFORMANCE INCENTIVE RECEIVED FROM SSL TT LTD. CREDIT FOR TAX DEDUCTED AT SOURCE WAS ALSO CLAIMED FOR A SUM OF ` 1 28 625/- FOR THE SAME ASSESSMENT YEAR. NOW IT HAS BEEN NOTICED THAT THE ASSESSEES EMPLOYER M/S SSL TTK LTD. HAS CONSIDERE D THE SAID PERFORMANCE INCENTIVE IN THE SUBSEQUENT YE AR NAMELY ASSESSMENT YEAR 2008-09 AND HAS GIVEN TDS CERTIFICATE FOR THE ASSESSMENT YEAR 2008-09. THE ASSESSEE IN ADDITION TO ADMITTING THE INCOME OF ` 4 28 750/- IN THE ASSESSMENT YEAR 2007-08 ALSO ADMITTED THE SAME IN THE ASSESSMENT YEAR 2008-09. THEREFORE THE INCOME CANNOT BE TAXED IN THE ASSESSMENT YEAR 2007-08 AND IF IT IS DONE THE SAME AMOUNT WILL GET TAXED TWICE. 4. HOWEVER THE CIT(APPEALS) WAS OF THE OPINION THA T AN APPEAL WOULD LIE ONLY WHEN THE ASSESSEE DENIED HIS LIABILI TY TO BE ASSESSED. HERE THE ASSESSING OFFICER HAD ACCEPTED THE RETURNED INCOME. ACCORDING TO HIM THE CASE HAD BECOME INFR UCTUOUS AND HE DISMISSED THE APPEAL. 5. NOW BEFORE US THE LEARNED A.R. SUBMITTED THAT A SSESSEE HAD FILED HIS RETURN OF INCOME FOR THE IMPUGNED ASS ESSMENT YEAR WHEREIN HE HAD SHOWN SALARY RECEIVED FROM M/S SSL T TK LTD. ACCORDING TO HIM FORM 16 ISSUED BY THE SAID COMPAN Y PLACED AT PAGE NO.7 IN PAPER-BOOK CLEARLY SHOWS THAT THE INC OME CHARGEABLE UNDER THE HEAD SALARY WAS ` 11 67 780/-. HOWEVER THE ASSESSEE HAD AGGREGATED WITH THIS AMOUNT PERFO RMANCE INCENTIVE OF ` 4 28 750/- WHICH WAS GIVEN BY THE SAID COMPANY TO HIM IN FINANCIAL YEAR 2007-08 RELEVANT TO THE ASSES SMENT YEAR 2008-09 BY MISTAKE. ACCORDING TO HIM THE SAID CO MPANY VIDE ITS LETTER DATED 5 TH JULY 2007 PLACED AT PAGE NO.10 OF PAPER-BOOK HAD INFORMED HIM REGARDING PERFORMANCE INCENTIVE OF ` 4 28 750/-. SUCH LETTER HAVING BEEN RECEIVED BEFORE FILING OF T HE RETURN FOR THE IMPUGNED ASSESSMENT YEAR ASSESSEE BY MISTAKE INCLU DED THE PERFORMANCE INCENTIVE ALSO IN THE SALARY. THE CORR ESPONDING TAX WAS ALSO CLAIMED FOR CREDIT ALONG WITH TAX DEDUCTIO NS ON SALARY OF ` 11 67 780/-. LEARNED A.R. SUBMITTED THAT THE A.O. WHILE COMPLETING ASSESSMENT ACCEPTED THE RETURN BUT DID NOT GIVE CREDIT FOR THE TAX DEDUCTION MADE ON PERFORMANCE INCENTIVE OF ` 4 28 750/-. FOR ASSESSMENT YEAR 2008-09 THE ASSESS EE IN HIS RETURN OF INCOME ONCE AGAIN INCLUDED THE SAME AMOUN T OF ` 4 28 750/- AND FOR THIS LEARNED A.R. PLACED RELIANC E ON PAGE NO.17 OF PAPER-BOOK WHICH IS AN ANNEXURE TO FORM 16 ISSUE D BY M/S SSL TTK LTD. FOR ASSESSMENT YEAR 2008-09. ACCORDING TO HIM THOUGH THE ASSESSEE HAD RETURNED THE SAME AMOUNT AS A PART OF HIS INCOME FOR THE IMPUGNED ASSESSMENT YEAR THE ASSESS ING OFFICER IN THE ASSESSMENT FOR ASSESSMENT YEAR 2008-09 ALSO CONSIDERED IT AS A PART OF ASSESSEES INCOME WHEREAS AS HE OUGHT HAVE EXCLUDED IT CONSIDERING THE MISTAKE COMMITTED BY T HE ASSESSEE. THEREFORE ACCORDING TO HIM THE SAID AMOUNT OF PER FORMANCE INCENTIVE WAS INCLUDED TWICE BY THE ASSESSEE FOR AS SESSMENT YEAR 2007-08 AS WELL AS ASSESSMENT YEAR 2008-09 AND CRED IT FOR TDS ALSO CLAIMED BOTH THE YEARS. THE ASSESSING OFFICER HAD ACCEPTED THE RETURNS IN SO FAR AS IT RELATED TO THE SALARY I NCOME FOR BOTH THE YEARS BUT FOR ASSESSMENT YEAR 2007-08 HE DENIED TH E TAX CREDIT ON PERFORMANCE INCENTIVE. RELYING ON THE DECISION OF CO-ORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF ARK INVESTMEN TS LTD. V. ITO (1985) 13 ITD 65 (MAD) LEARNED A.R. SUBMITTED THAT AN APPEAL WAS MAINTAINABLE EVEN WHERE INCOME RETURNED WAS ACC EPTED BUT THERE WAS A SUBSEQUENT CLAIM THAT INCOME WAS NOT TA XABLE. RELYING ON PARA 5 OF THIS ORDER LEARNED A.R. SUBMI TTED THAT EVEN IF THE ASSESSEE BY MISTAKE HAD SHOWN CERTAIN RECEIPTS AS TAXABLE IT WOULD NOT PER SE MAKE HIM LIABLE FOR TAX THEREON. AS PER THE LEARNED A.R. AN ASSESSEE COULD BE TAXED ONLY ON IN COME WHICH CAN BE INCLUDED AS A PART OF THE TOTAL INCOME. REL YING ON CIRCULAR NO.14 (XL-35) DATED 11.4.1995 ISSUED BY CBDT LEARN ED A.R. SUBMITTED THAT REVENUE HAD WRONGLY TAKEN ADVANTAGE OF ASSESSEES IGNORANCE TO COLLECT MORE TAX OUT OF HI S INCOME THAN WAS LEGITIMATELY PAYABLE BY HIM. AT THIS JUNCTURE THE BENCH ASKED THE LEARNED A.R. AS TO WHY IN THE CERTIFICATE ISSUE D BY M/S SSL TTK LTD. PLACED AT PAGE 10 OF PAPER-BOOK IT WAS M ENTIONED THAT THE PERFORMANCE INCENTIVE WAS BEING AWARDED AS DON E IN THE PAST. OR IN OTHER WORDS QUERY POSED BY THE BENCH WAS WHETHER IN PRECEDING ASSESSMENT YEAR THERE WAS ANY PERFORMANC E INCENTIVE RECEIVED AND SHOWN BY THE ASSESSEE IN HIS RETURN OF INCOME. THERE UPON THE LEARNED A.R. FILED A COPY OF RETURN FILED BY THE ASSESSEE FOR ASSESSMENT YEAR 2006-07 AND SUBMITTED THAT ASSESSEE HAD JOINED M/S SSL TTK LTD. ONLY IN MARCH 2006 AS AN EMPLOYEE AND WAS NOT IN RECEIPT OF ANY PERFORMANCE INCENTIVE FOR FINANCIAL YEAR 2005-06 FROM THE SAID COMPANY. LEAR NED A.R. SUBMITTED THAT PRIOR TO MARCH 2006 ASSESSEE WAS WO RKING WITH T.V. SUNDARAM IYENGAR & SONS LTD. AND THE SALARY RE CEIVED THEREFROM ALONG WITH ONE MONTH SALARY RECEIVED FROM SSL TTK LTD. WAS DULY SHOWN IN THE RETURN OF INCOME FOR ASS ESSMENT YEAR 2006-07. COPY OF SARAL TAX RETURN FOR ASSESSMENT Y EAR 2006-07 WAS PLACED ON RECORD AT PAGE NO.22 OF PAPER-BOOK. IN SO FAR AS THE STATEMENT IN THE LETTER OF SSL TTK LTD. REGARD ING PAST PERFORMANCE INCENTIVE LEARNED A.R. SUBMITTED THAT THE SAID COMPANY WAS USING A STANDARDIZED TEMPLATE FOR ALL E MPLOYEES WHILE GIVING PERFORMANCE INCENTIVE AND HENCE THIS ABERRANCE. 6. PER CONTRA LEARNED D.R. SUBMITTED THAT A SAME A MOUNT WAS ADMITTEDLY TAXED TWICE BOTH FOR THE ASSESSMENT YEAR 2007-08 AND 2008-09. HE FURTHER STATED THAT TAX CREDIT COULD B E GIVEN TO THE ASSESSEE ONLY IN THE YEAR IN WHICH CORRESPONDING IN COME WAS ADMITTED. 7. WE HAVE PERUSED THE ORDERS AND HEARD THE RIVAL C ONTENTIONS. THERE IS NO DISPUTE THAT ASSESSEE HAD FILED RETURN FOR THE IMPUGNED ASSESSMENT YEAR WHICH WAS ACCEPTED IN A SC RUTINY ASSESSMENT DONE UNDER SECTION 143(3) OF THE ACT. A SSESSEE BY MISTAKE INCLUDED IN THE SAID ASSESSMENT YEAR A SUM OF ` 4 28 750/- RECEIVED AS PERFORMANCE INCENTIVE IN THE SUBSEQUENT YEAR. AS PER THE ASSESSEE SUCH AMOUNT WAS AGAIN I NCLUDED BY HIM IN THE RETURN FOR THE SUBSEQUENT YEAR AND A.O. WHILE COMPLETING ASSESSMENT FOR THE IMPUGNED ASSESSMENT Y EAR DID NOT GIVE CREDIT FOR THE TDS RELATABLE TO PERFORMANCE IN CENTIVE. RECORDS PLACED BY THE ASSESSEE WOULD SHOW THAT HE W AS IN THE EMPLOYMENT OF SSL TTK LTD. ONLY FROM MARCH 2006 (P APER-BOOK PAGE NO.28) AND PRIOR TO THAT HE WAS WITH T.V. SUND ARAM IYENGAR & SONS LTD. (PAPER-BOOK PAGE NOS.23 TO 27). IN ASS ESSMENT YEAR 2006-07 RELEVANT TO PREVIOUS YEAR ENDING 31.3.2006 ASSESSEE HAD SHOWN IN HIS RETURN OF INCOME SALARY RECEIVED F ROM BOTH THESE CONCERNS. PERFORMANCE INCENTIVE OF ` 4 28 750/- WAS RECEIVED BY THE ASSESSEE ON 5 TH JULY 2007 VIDE LETTER OF SSL TTK LTD. PLACED AT PAGE 10 IN PAPER-BOOK. RETURN FOR THE IMPUGNED ASSESSMENT YEAR WAS FILED BY THE ASSESSEE AFTER 5 TH JULY 2007. THEREFORE THERE IS EVERY CHANCE THAT THE ASSESSEE HAD BY MIST AKE INCLUDED THE SAID AMOUNT IN HIS INCOME FOR THE IMPUGNED ASSE SSMENT YEAR ON A MISTAKEN IMPRESSION THAT THE AMOUNT HAD TO BE CONSIDERED FOR ASSESSMENT IN THE IMPUGNED ASSESSMENT YEAR. TH E A.O. WHILE ACCEPTING THE RETURN AS FILED BY THE ASSESSEE OBVI OUSLY DID NOT GIVE CREDIT FOR TAX ON PERFORMANCE INCENTIVE. WHAT EVER BE THE SITUATION IT IS CLEAR THAT SAME AMOUNT WAS INCLUDE D TWICE AS INCOME OF THE ASSESSEE ONCE FOR ASSESSMENT YEAR 20 07-08 AND AGAIN FOR ASSESSMENT YEAR 2008-09. CO-ORDINATE BEN CH IN THE CASE OF ARK INVESTMENTS LTD. (SUPRA) HAS CLEARLY HE LD THAT AN ASSESSEE CAN FILE AN APPEAL IF HE CONSIDERS HIMSELF TO BE AGGRIEVED BY THE TOTAL INCOME ASSESSED OR TAX DETER MINED ON ACCOUNT OF SOME AMOUNT OF INCOME HAVING BEEN TAXED WHICH HE BELIEVED TO BE NOT TAXABLE EVEN THOUGH HE HAD RETU RNED IT AS HIS INCOME UNDER AN ERRONEOUS OR MISTAKEN VIEW OF THE L AW. HERE THE ASSESSEE WAS CLEARLY UNDER A MISTAKE WHEN HE INCLUD ED PERFORMANCE INCENTIVE IN HIS RETURN OF INCOME FOR T HE IMPUGNED ASSESSMENT YEAR WHILE THE SAID AMOUNT WAS RECEIVED IN THE SUBSEQUENT YEAR. AS RIGHTLY RELIED ON BY THE LEARN ED A.R. CIRCULAR NO.14 OF CBDT CLEARLY EMPHASIZES THAT THE REVENUE S HOULD NOT TAKE ADVANTAGE OF AN ASSESSEES IGNORANCE. ONE OF THE CANONS OF TAXATION IS THAT TAX IS TO BE COLLECTED FROM A SUBJ ECT AS PER LAW AND NOT A PIE MORE OR NOT A PIE LESS. THE A.O. OUGHT H AVE EXCLUDED THE SUM OF PERFORMANCE INCENTIVE WHILE COMPLETING A SSESSMENT UNDER SECTION 143(3) OF THE ACT SINCE THE SAID AMO UNT WAS RECEIVED BY THE ASSESSEE IN THE SUBSEQUENT YEAR. H E WAS AWARE THAT THE SAID AMOUNT WAS RECEIVED BY THE ASSESSEE I N THE NEXT YEAR AS IS CLEAR FROM THE FACT THAT TDS CREDIT WAS NOT GIVEN BY HIM FOR THE IMPUGNED ASSESSMENT YEAR ON THE PERFORMANCE INCENTIVE. THOUGH THE CIT(APPEALS) DISMISSED THE APPEAL OF THE ASSESSEE IN LIMINE WE ARE NOT INCLINED TO REMIT THE ISSUE BACK TO HIM ALL THE FACTS BEING ON RECORD AND NOT BEING DISPUTED BY THE D.R. IN ANY CASE THE PRIMARY DUTY OF ANY TRIBUNAL ESTABLISHED UNDER A STATUTE IS TO EASE THE REGOURS OF PROCEDURE AND RENDER SUBS TANTIAL JUSTICE WITHOUT TAKING REFUGE UNDER CUMBERSOME TECHNICALITI ES WHICH WOULD DEFEAT THE VERY PURPOSE OF ITS FORMATION. WE ARE THEREFORE OF THE OPINION THAT TO MEET THE ENDS OF JUSTICE TH E AMOUNT OF ` 4 28 750/- SHOWN BY THE ASSESSEE AS PERFORMANCE INC ENTIVE HAS TO BE EXCLUDED FROM THE ASSESSEES TOTAL INCOME FOR IMPUGNED ASSESSMENT YEAR. DIRECTED ACCORDINGLY. 8. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED. THE ORDER WAS PRONOUNCED IN THE COURT ON SD/ (U.B.S. BEDI) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI DATED THE MAY 2011. AS PER SEPARATE ORDER DATED 06.09.2011 SD/- 6.9.2011 (U.B.S. BEDI) JUDICIAL MEMBER KRI. COPY TO: (1) APPELLANT (2) RESPONDENT (3) CIT(A)-VI CHENNAI-34 (4) CIT CHENNAI-V CHENNAI (5) D.R. (6) GUARD FILE 12 ITA NO . I058 / MD S / 2010 PER U.B.S. BEDI J.M. 09 . DESPITE BEST PERSUASION OF MYSELF I AM NOT ABLE TO AGREE WITH THE FINDING AND CONCLUSION AS DRAWN BY THE ID . ACCOUNTANT MEMBER AND I WRITE MY ORDER AS UNDER : 10. FACTS INDICATE THAT THE ASSESSEE DECLARED INCO ME OF RS . 14 86 210/- IN HIS RETURN FILED ON 09 . 07 . 2007 RELEVANT TO THE ASSESSMENT YEAR 2007-08. THE S AID RETURN WAS PROCESSED UNDER SECTION 143(1) AND THE CASE WAS SELECTED FOR SCRUTINY AND THE NOTICE UNDER SECTION 143(2) WAS ISSUED . THE ID. AR OF THE ASSESSEE APPEARED BEFORE THE ASSESSING OFFICER ON THE DATES OF HEARING ON 07 . 12.2009 11 . 12 . 2009 AND 15 . 12.2009 DETAILS WERE FURNISHED AS CALLED FOR IN RE SPECT OF MUTUAL FUND INVESTMENT WHICH WAS CLAIMED TO BE OUT OF SALARY EARNING AND A CCUMULATION OF SAVING BANK ACCOUNT ABOUT WHICH NECESSARY DOCUMENTARY EVIDENCES WERE PRODUCED. THE ASSESSMENT WAS COMPLETED ACCEPTING THE RETURNED INC OME VIDE ORDER DATED 31 . 12 . 2009 GIVING CREDIT OF TAXES TO THE EXTENT OF RS . 2 29 841/- AS TDS AND RS . 71 690/- AS SELF-ASSESSRNENT TAX THEREBY DEMAND OF RS . 2 51 720/- WAS RAISED AS PER CALCULATION SHEET ATTACHED IN THE ASSESSMENT ORDER . 11. THE ASSESSEE FILED APPEAL AGAINST THIS ORDER THROUGH WHICH THE ASSESSEE CHALLENGED THE ORDER OF THE ASSESSING OFFICER BY RA ISING A GROUND THAT THE ASSESSING OFFICER SHOULD TAX THE INCENTIVE AMOUNT IN THE ASSE SSMENT YEAR 2008-09 AND NOT FOR THE ASSESSMENT YEAR 2007-08 AND FOLLOWING REASONS W ERE GIVEN : ' THE ASSESSEE AT THE TIME OF FILING THE RETURN FOR THE ASSESSMENT YEAR 2007 - 08 HAS ADMITTED AN INCOME OF RS . 4 28 750/ - BEING PERFORMANCE INCENTIVE RECEIVED FROM SSL TTK LTD . CREDIT FOR TAX DEDUCTED AT SOURCE WAS ALSO CLAIMED FOR A SUM OF RS . 1 28 625/ - FO R THE SAME ASSESSMENT YEAR . NOW IT HAS BEEN NOTICED THAT THE ASSESSEE'S EMPLOYER M/S. SSL TTK LTD . HAS CONSIDERED THE SAID PERFORMANCE INCENTIVE IN THE SUBSEQUENT YEAR NAMELY ASSESSMENT YEAR 2008-09 AND HAS GIVEN TDS CERTIFICATE FOR THE ASSESSMENT YEAR 2008-09 . THE ASSESSEE IN ADDITION TO ADMITTING THE INCOME OF RS . . 4 28 750/- IN THE ASSESSMENT YEAR 2007-08 ALSO ADMITTED THE SAME IN THE ASSESSMENT YEAR 2008-09 . THEREFORE THE INCOME 13 ITA NO.1058 / MD S / 201 0 CANNOT BE TAXED IN THE ASSESSMENT YEAR 2007-08 AND IF IT IS DONE THE SAME AMOUNT WILL GET TAXED TWICE .' 11 . 1 DURING THE HEARING OF THE APPEAL THE ID . COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS WRONGLY PAID TAX AND SHOWN IN COME WITH RESPECT TO INCENTIVE AMOUNT IN THE RETURN . THE ASSESSEE ALSO CLAIMED THAT ALTHOUGH THE ASSESSI NG OFFICER HAS ACCEPTED THE RETURN ON THE SAME INCOME BUT AMOUNT IS ADDED TWICE AS THE ASSESSEE HAS OFFERED SUCH INCOME FOR THE ASSESS MENT YEAR 2008-09 ALSO . 12 . THE ID. CIT(A) WHILE CONSIDERING BUT NOT ACCEPTING THE APPEAL OF THE ASSESSEE HAS CONCLUDED TO DISMISS THE APPEAL AS PER PARA 4 . 1 OF HIS ORDER WHICH IS REPRODUCED BELOW : ' 4 . 1 REFERENCE IS INVITED TO SECTION 246A OF THE I . T . ACT AND IT IS NOT I CED THAT CIT(A) CAN ONLY ALTER REDUCE ANNUL AND ENHANCE THE ORDER OF THE ASSESSING OFFICER . THE APPEAL LIES ONLY WHEN THE ASSESSEE DENIES HIS LIABILITY TO BE ASSESSED AND IN THE INSTANT CASE TH E AO HAS ACCEPTED THE RETURNED INCOME AND THERE IS NO DENIAL OF LIABILITY . WHEN THERE IS NO LIABILITY THE CASE BECOMES INFRUCTUOUS AND THE APPEAL IS DISM ISSED. ' 13 . STILL AGGRIEVED THE ASSESSEE FILED FURTHER APPEAL AND CONTESTED IN THE MEMORANDUM OF APPEAL THAT THE ASSESSEE AT THE TIME OF FILING OF THE RETURN FOR 2007 - 08 IN ADDITION TO REGULAR INCOME ALSO ADMITTED A SUM O F ` 4 28 750/ - AS PERFORMANCE INCENTIVE FROM HIS EMPLOYER . A SUM OF RS . 1 28 625/- WAS CLAIMED AS TAX DEDUCTED AT SOURCE BY THE EMPLOYER FOR THE SAID PERFORMANCE INCENTIVE. THE CASE WAS SELECTED FOR SCRUTINY FOR THE ASSESSMENT Y EAR 2007-08 AND THE INCOME ADMITTED BY THE ASSESSEE WAS ACCEPTED BY THE ASSESS ING OFFICER WHICH ENDED UP IN THE DEMAND OF RS.2 51 720/- . THE REASON FOR THE DEMAND IS NON-AVAILABILITY FOR TDS CREDIT CLAIM OF RS . 1 28 625/- . ON GOING THROUGH THE ASSESSMENT ORDER THE ASSESSEE IS STATED TO HAVE REALIZED THAT THE PERFOR MANCE INCENTIVE WHICH WAS ADMITTED BY HIM FOR THE ASSESSMENT YEAR 2007-08 ACT UALLY BELONGS TO THE ASSESSMENT ORDER 2008-09 . ON SEEING THE FORM 16 G I VEN BY THE COMPANY FOR THE ASSESSMENT YEAR 2008-09 THE 14 I TA NO . 1 I05 8 / M D S/ 2 010 PE R FORMANCE INCENTIVE OF RS . 4 28 750/- WAS INCLUDED THERE AND THE ASSESSEE WITHOUT KNOWING THAT IT WAS ADMITTED IN THE ASSESSMENT YEAR 2008-09 ALSO ADMIT T ED I N THE ASSESSMENT YEAR 2007-08. IN EFFECT THE SAME PERFORM ANCE INCENTIVE OF RS . 4 28 750/- WAS ADMITTED BOTH IN THE ASSESSMENT YEAR 2007-08 AN D 2008-09 WHEREAS TDS CREDIT OF RS . 1 28 625/- IS AVAILABLE ONLY FOR THE ASSESSMENT YEAR 200 8 - 09 . THE ASSESSEE BEING AGGRIEVED BY THE ORDER FOR THE ASSES SMENT YEAR 2007 - 08 FILED AN APPEAL BEFORE THE ID . CIT(A) AND THE ID . CIT(A) DISMISSED THE APPEAL INVITING REFERENCE TO SECTION 246A OF THE INCOME-TAX ACT 19 61 . THE FACT REMAINS THAT THE AMOUNT RS . 4 28 750/ - HAS BEEN TAXED TWICE BY THE INCOME TAX DEPARTMENT THEREFORE THE ASSESSEE PREFERRED THE APPEAL . 14 . AT THE T I ME OF HEARING OF THE APPEAL THE ASSESSEE ALSO FILED ADDITIONAL GROUND . BASED ON THE TRIBUNAL ' S DECISION THE SAME WAS FOUND TO CONTAIN SAME I SSUE AS RA I SED I N THE MEMO OF APPEAL EXCEPT RELYING UPON OUR TR I BUNAL DECISION WH I CH THE ASSESSEE COULD OTHERWISE RAISE SO THE SAME I S NOT CONSIDERED . 15 . AT THE TIME OF HEARING OF THE APPEAL THE ASSESSEE ' S COUNSEL HAS RELIED UPON THE WRITTEN SUBMISSION AS WELL AS AUTHOR I TIES CITED THEREIN TO PLEAD THAT THE SAME AMOUNT WHICH HAS BEEN TAXED DURING THE ASSESSMENT YEAR 200 7-08 HAS AGAIN BEEN OFFERED FOR TAXATION IN 2008-09 AND ASSESSED THEREFORE THE SAME IS BEING TAXED TW I CE WHICH IS NOT PERMISS I BLE UNDER LAW OTHERWISE ALSO THOUGH INTIMATION ABOUT I NCENTIVE AMOUNT PERTAINING TO THE FINANC I AL YEAR 2006 - 07 WAS COMMUNICATED TO THE ASSESSEE BY H I S EMPLOYER V I DE LETTER DATED 05 . 07 . 2007 THE AMOUNT OF I NCENT I VE W AS DETER M INED I N THE NEXT YEAR RELEVANT TO THE ASSESSMENT YEAR 200 8-09 THE ASSESSMENT WITH RESPECT TO THE SAID AMOUNT COULD ON LY BE MADE IN THE ASSESSMENT YEAR 2008-09 AND NOT IN 2007-08 . THE ASSESSEE MISTAKENLY OFFERED THE SAID AMOUN T IN THE ASSESSMENT YEAR UNDER CONS I DERATION AND CLAIMED TDS WITH RESPECT TO THE 15 IT A NO. L0 58 / MDS / 20 1 0 SAID AMOUNT AND THE ASSESSING OFFICER HAS ACCEPTED THE RETURNED INCOME BUT D I D NOT GIVE CREDIT TO THE TOS PERTAINING TO THE INCENT IVE AMOUNT AND IT IS A SETTLED LAW THAT CREDIT OF TOS COULD BE GIVEN IN THE YEAR IN WH ICH THE INCOME HAS BEEN ASSESSED . SO ON THIS SCORE ALSO THE ORDER OF THE ASSESSING OFFICER IS NOT PROPER AN D JUSTIFIED. AS FAR AS FIRST APPELLATE AUTHORITY IS CONCERNED THE ASSESSEE IS DENYING ITS LIABILITY TO TAX WITH RESPECT TO THE INCENTIVE AMO UNT SO THE APPEAL WAS MAINTAINABLE AND EVEN IF THE CLAIM IS MADE BEFORE THE FIRST APP ELLATE AUTHORITY THE SAME COULD BE ALLOWED . AT THIS JUNCTURE THE ASSESSEE ' S COUNSEL WAS ASKED TO CLARIFY IF HE WAS OF THE OPINION THAT THIS AMOUNT IS NOT TAXABLE IN 2007-0 8 THEN WHY A REVISED RETURN WAS NOT FILED TO EXCLUDE SUCH AMOUNT WHEN THE ASSESSEE HIMSELF OFFERED THE SAME AMOUNT FOR THE ASSESSMENT YEAR 2008-09 IN THE RETURN FO R THAT YEAR FILED ON 15.07 . 2008 WITH TDS CERTIFICATE ETC. THE ASSESSEE SIMPLY INSIS TED THAT SINCE INCENTIVE AMOUNT THOUGH PERTAINING TO THE YEAR UNDER CONSIDERATION IT IS TAXABLE IN THE SUBSEQUENT YEAR BECAUSE THE SAME WAS DETERMINED AND COMMUN I CATED TO THE ASSESSEE IN THE SUBSEQUENT YEAR. SINCE LEGITIMATE AND PROPER T AX HAS TO BE COLLECTED FROM THE ASSESSEE THEREFORE EVEN IF REVISED RETURN WAS NOT FILED AND SUCH AM OUNT WAS NOT EXCLUDED FROM THE TOTAL INCOME BEFORE THE ASSE SSING OFFICER THE ID . CIT(A ) COULD VERY WELL DECIDE THE ISSUE WITHOUT GOING INTO THE GROUND OF NON - MAINTAINABILITY OF THE APPEAL AND THE ASSESSEE ' S APPEAL SHOULD NOT HAVE BEEN DISMISSED. IT WAS P RAYED FOR EXCLUSION OF INCOME TAXED TWICE . 16 . THE ID . DR SUBMITTED THAT THE BEST COURSE FOR THE ASSESSE E WAS TO FILE REVISE RETURN IF HE WANTED TO EXCLUDE SUCH INCOME WHEN HE CAME TO KNOW ABOUT TDS ON SUCH AMOUNT I N NEXT YEAR ON FILING OF HIS RETURN FOR THE SUB SEQUENT YEAR WHICH EVENT TOOK PLACE ON 15 . 07.2008 SO HE COULD REVISE HIS INCOME BY FILING REVISE D RETURN BUT HE OPTED NOT TO DO SO DESPITE HAVING ATTENDED ON NUMBER OF OCCAS I ON 16 ITA NO. 1058 / MD S/2 010 DURING HEARING BEFORE THE ASSESSING OFFICER DUR ING THE PROCEEDINGS FOR THE ASSESSMENT YEAR 2007-08 WHEN THE ASSESSMENT ORDER UNDER SECTION 143(3 ) WAS PASSED ON 31 . 12 . 2009 . THE ASSESSEE ALSO COULD NOT BE ABLE TO ESTABLISH T HAT THERE IS NO TAX LIABILITY IN HIS CASE . THEREFORE THE ACTION OF THE ID . CIT(A) IN DISMISSING THE APPEAL OF THE ASSESSEE IS PROPER AND JUSTIFIED WHICH SHOULD BE FURTHER CONFIRMED . THE ID . DR HAS RELIED UPON THE DECISION IN THE CASE OF GOET ZE (INDIA) LTD . V . CIT [284 ITR 323 (SC)] TO PLEAD THAT IN THE ABSENCE OF HAVI NG FILED REVISED RETURN OF INCOME THE ASSESSEE COULD NOT CLAIM ANY DEDUCTION EXCLUS ION BY WAY OF LETTER ADDRESSED TO THE ASSESSING OFFICER OR LETTER ADDRESSED TO THE AR . SO THE ACTION OF AUTHORITIES BELOW SHOULD BE CONFIRMED . 16 . 1 TO COUNTER THE SUBMISSION OF THE ID. DR THE ID . COUNSEL FOR THE ASSESSEE SUBMITTED THAT THIS DECISION PERTAINS TO THE PROC EEDINGS BEFORE THE ASSESSING OFFICER AND NOT BEFORE THE ID . CIT(A) OR ANY HIGHER FORUM . SO IT CANNOT BE HELD TO BE APPLICABLE IN THIS CASE. 17 . AFTER HAVING CONSIDERED THE ARGUMENTS OF BOTH THE SIDES MATERIAL ON RECORD AND PRECEDENTS AS RELIED UPON BY RIVAL SIDES IT IS FOUND THAT THE ASSESSEE DECLARED INCOME OF RS . 14 86 210/- IN HIS RETURN FILED ON 09 . 07 . 2007 RELEVANT TO THE ASSESSMENT YEAR 2007 -08 . THE SAID RETURN AS PROCESSED UNDER SECTION 143(1) A ND THE CASE SELECTED FOR SCRUTINY AND AFTER DUE N OTICE AND CONSIDERING THE REPLY AND MATERIAL ON RECORD THE ASSESSING OFFICER ACCEPTED THE RETURNED INCOME . IT IS NOT IN DISPUTE THAT THE ASSESSEE HIMSELF DECLARED THE IN CENTIVE INCOME OF RS . 4 28 750/- AS PERFORMANCE INCENTIVE FOR THE FINANCIAL YEAR 2006 -07 RELEVANT TO THE ASSESSMENT YEAR 2007-08 MAKING A CLAIM OF TDS IN RESPECT TO THE SA ID INCOME AT RS . 1 28 625/- ON THE BASIS OF COMMUNICATION RECEIVED BY THE ASSESS EE FROM SSL TTK LTD . DATED 1 7 I TA NO . I 058 / MD S / 20 1 0 05.07 . 2007 WHICH LETTER HAS BEEN PLACED BY THE ASSESSEE IN HIS PAPER BOOK A T PAGE 10 AND THE SAME READS AS UNDER : S SL - TTK L IM I T E D JUL Y 5 200 7 M R . R N ATA R AJAN C H E NNAI D EA R MR . N ATARA J AN AS IN TH E PA S T WE AR E P L E A SE D TO AW A RD PERFORMA N CE IN CE NTIV E F OR Y OUR P ERF ORM A N CE DURIN G 2006-0 7 A S FO LL OW S : 30 % O N BA S I C S ALA RY A S P E RFORMAN CE BO N US ( APR ' 06 - AU G ' 06 30 % O N BA S I C SA L AR Y AS P E RFORMA NCE BONUS ( S E P ' 06 - M A R ' 0 7 I N R ECOG N I TION AND APPR EC IATION O F TH E E X C EPTI O NAL O VE R A LL P E RFORMAN CE OF T H E C O M PAN Y D U R I N G 2006 - 0 7 TH E MANAG E M E NT I S P L EAS E D T O G R A NT A O N E T I M E E X - G R A TI A A MOUNTING T O T OT A L L ESS : T AX D E DU C T E D AT SO UR CE @ 30 % NE T AFT E R T AX ( RUP EES THR EE LAKH S O NE HUNDR E D AND TW E NT Y F IVE ON L Y) R S . 1 05 000 / - RS . 1 5 2 2 50 / - R S . 1 7 1 5 00 / - RS . 4 28 7 5 0 / - R S . 1 28 62 5 / - R S . 3 00 125 1 - WE H A V E NO DOUBT Y OU WILL E ND E AVOUR TO MAK E E V E N MOR E S I G N I FI C AN T C O NTRIB U TI O N T O TH E G ROWT H AND B E TT E RM E NT OF TH E COMPAN Y W ITH B ES T W ISH ES YO UR S S IN CE R E L Y SD / - T R VE NK A T E SH N B: TH E A MOUNT IS CREDITED TO Y OUR SB A LE W ITH I C I C I BANK . ' THE ASSESSE IS STATED TO HAVE OFFERED SAME AM OUNT OF RS . 4 28 750/- IN THE RETU R N FILED BY HIM FO R THE ASSESSMENT YEAR 2008-09 ON 15.07 . 2008 AND ALSO CLA I MED TDS OF RS . 1 28 625/- THERE . 17 . 1 THE ASSESSMENT PROCEEDINGS FOR THE AS S ESSMENT YEAR 2007 - 08 AS PE R ASSESSMENT ORDER COL.11 STARTED ON 07.12.2009 AND THE ASSESSMENT ORDER WAS ___ _ __ . 18 I TA NO. I 058/MDS / 2010 PASSED ON 31.12.2009 WHEREAS THE ASSESSEE HAS FILED THE RETURN F O R T HE ASSESSMENT YEAR 2008-09 ON 15 . 07 . 2008 AND TDS CERTIFICATE ENCLOSED W I T H TH A T R ETURN AS STATED TO HAVE FILED WITH THE RETURN OF I NCOME CLEARLY I NDICATES THA T T HE PAYMENT OF INCENTIVE AS WELL AS TDS WITH RESPECT TO THE SAID INCENT I VE I NCOME . SO I F ASSESSEE WAS OF THE OPINION THAT THE INCOME ON ACCOUNT OF I NCENT I VE BO NU S D OES NOT PERTAIN TO A .Y 2007 -08 WHICH HE HAS ALREADY OFFERED OTHERWISE PE R TAINS TO THE ACCOUNTING PERIOD 2007-08 RELEVANT TO ASSESSMENT YE AR 2008-09 HE CO UL D VE RY WE LL EXCLUDE SUCH INCOME FROM THE RETURN OF INCOME BY FILING A REVISED RETURN FOR 2007 - 08 F O R WHI CH T HE HE HAD TIME UPTO 31 . 03.2009 BUT HE D I D NOT DO SO AND THAT APAR T T H E ASSESSMENT PROCEED I NGS STARTED FROM 07.12.2009 WHICH WERE CONCLUDED O N 3 1 . 1 2 . 2009 WHEN THE ORDER OF THE ASSESSMENT WAS PASSED THE ASSESSEE D I D N O T OP T F O R EXCLUDING SUCH INCOME WHEN HIS RETURNED I NCOME WAS ACCEPTED . TH E HO N' B L E SUP R EME COURT IN THE CASE OF GOETZE ( IND I A) LTD . V . CIT [2006] 284 I T R 323 ( SC ) HAS HELD AS UNDER: 'THE QUESTION RAISED IN THIS APPEAL RE L ATES TO WHETHER THE APPELLANT ASSESSE COULD MAKE A CLAIM FOR DEDUCTION OTHER T HAN BY FILLING A R E VISED RETURN . THE ASSESSMENT YEAR IN QUESTION WAS 1995 - 96 . THE RETURN WAS FILED ON NOVEMBER 30 1995 BY THE AP P E LL ANT FOR THE ASSESSMENT YEAR IN QUESTION . ON JANUARY 12 1998 THE APPELLANT SOUGHT TO CLAIM A DEDUCTION BY WA Y OF A L E TT E R BEFOR E THE ASSESSING OFFICER. THE DEDUCTION WAS DISALLOWED B Y TH E ASS ES SIN G OFF ICE R ON THE GROUND THAT TH E RE WAS NO PROVI S ION UND E R THE INCOM E -TA X AC T TO MAK E AMENDMENT IN THE RETURN OF INCOME BY MODIFYIN G AN APPLICATION AT TH E ASSESSMENT STAGE WITHOUT REVISING THE RETURN . THI S APPELLANT ' S APPEAL BEFORE THE COMMISSIONER OF INCOM E- TA X (A PPEALS ) WAS ALLOWED . HOWEVER THE ORDER OF THE FURTHER APP E AL OF THE DEPARTMENT BEFORE THE I NCOME-TAX APPE LL ATE TRIBUNAL WAS AL L OWED . THE APP E LLANT HAS APPROACHED THIS COURT AND HAS SUBMITTED T HAT TH E TRIBUNAL W A S W RON G IN UPHOLDING THE ASSESSING OFFICER ' S ORDER . HE HAS RELI E D UPON TH E DECI S ION OF THIS COURT IN NATIONAL THERMA L P OWER COMPANY LTD . V . CIT [1 99 8 ] 229ITR 383 TO CO N TEND T HAT IT WAS O PEN T O T H E ASSESSEE TO RAISE TH E POINTS OF LAW EVEN BEFORE THE APPELLATE TRIBUNAL. . . 1 9 I TA NO . 1 058 / MDS / 20 1 0 TH E D E CISION I N QU ES TION I S THAT THE PO WE R O F TH E TRIBUNAL UND E R SEC T I O N 2 5 4 OF TH E INCOM E - TA X ACT 1961 IS TO ENTERTAIN F O R TH E FIRST TIM E A POINT O F L AW PRO V ID E D THEFACT ON TH E BASIS OF W HICH TH E ISSU E OF LA W CAN BE RAI SED B EF OR E TH E TRIBUNAL . THE DECISION DOE S NOT IN AN Y W A Y R E LAT E TO TH E PO W ER OF TH E ASSESS I NG OF FI C E R TO E NTERTAIN A C LAIM FOR DEDUCTION OTHERWIS E THAN B Y F ILIN G A R E VI SE D R E TURN . I N THE C I RCUMSTANCES OF THE CASE WE DISMISS THE CIVIL APP E AL . HO WEVE R W E MAKE IT CLEAR THAT THE ISSUE IN T H IS CASE IS LIMITED TO TH E PO WE R OF TH E A S S ES SING AUTHORITY AND DOES NOT IMP ING E ON THE POWER OF TH E IN C OM E -TA X APP E LLATE TRIBUNAL UNDER S E CTION 2 5 4 O F THE I NCOME - TAX ACT 1961 . TH E R E SH A LL B E NO ORDER AS T O COSTS . ' SINCE THE ASSESSEE HAS NOT FILED ANY REVISED RETURN AND DID NOT MAKE ANY SUCH CLA I M BEFO R E THE A . O . DURING ASSESSMENT PROCEEDINGS DESPITE HAVING FILED A RETUR N OF INCOME FO R THE SUBSEQUENT YEAR I . E . FOR A Y 2008 - 09 ON 15 . 07 . 2008 WHEN T IME LIMI T WAS AVA I LABLE UPTO 31.03 . 2009 TO REVISE THE RETURN FOR THE ASSESSMENT YEA R 200 7 - 08 FILE D O N 09 . 07 . 20077 THEREFORE IN MY CONS I DERED V I EW THE CLA I M OF THE ASS E SS E E F O R EX CLU S I ON O F THE I NCENT I VE I NCOME OFFERED BY THE ASSESSEE PERTA I N I NG T O T H E F IN A NCI A L YEA R 2006 - 07 RELEVANT TO THE ASSESSMENT YEAR 2007-08 EVEN I F RECE I VED I N F Y 200 7 - 0 8 R E LEV AN T T O THE ASSESSMENT YEAR 2008-09 I N THE ABSENC E H AV I NG EXC LUD ED S UCH I NCO M E U NDER THE PROCESS ENVISAGED UNDER LAW (THERE WAS NO CHANGE IN IN C OME A S DECLARED AND ASSESSED) COULD NOT BE ALLOWED (T O BE EXCLUDED) I N 2 ND APPEAL . AS SUCH IT I S HELD THAT THE ACTION OF THE AUTHORITIES BELO W IS JUSTIFIED AND CALLS FO R N O I NTERFERENCE AT TH I S LEVEL . THIS VIEW IS FURTHER FORTIFIED BY THE HO N ' BLE MAD R AS HIGH CO URT ' S D E C I S I ON DATED 123.06 . 2011 I N TAX CASE ( APPEAL ) NO . 223 O F 200 5 IN WHICH T HE CO N C LU S I ON HAS BEEN DRAWN AS PER PA R A 8 AND 9 OF THE SA I D ORDER WH I CH R EA D S A S UNDER : '8 . A S FAR AS THE S E COND QUESTION I S CONC E RN E D L E ARNED STAN D IN G C O U N SE L FOR THE R E VENU E PLACED BEFORE US TH E D E CI S ION IN THE C ASE O F GO E T ZE ( INDIA ) LT D V . COMMISS I ONER OF I NCOME T A X R E PORT E D IN 2 8 4 I T R 323 ( SC ) WHER E IN UNDER S I MI L A R CI R C UM S T ANCES THE APEX COURT REJ EC T E D TH E APP E A L PREFERR E D BY T H E ASSESSEE THERE I N . I T SH O WS THA T IN T H E C AS E R EFE RR E DTO THE ASSESSE MAD E A C L A IM F O R D EDUC TI ON NOT BY FI L I N G A R E VI SE D R E TURN B U T B Y MER E L Y B Y FI LI NG A L E TT ER B EF OR E T H E ASS E SS I NG OF FIC E R . TH E AS SE S S IN G OFFI C ER R E JECTED TH E C L AI M ON T H E G RO UN D T H A T TH E R E I S N O PO WE R 2 0 I TA NO. L058 / MDS/2010 FOR TH E ASSESSING OFFICER TO ENTERTAIN A C L AIM FOR DEDUCTION OTHERWI SE TH A N BY FILING A REVISED R E TURN . THE TRIBUNAL REJECT E D TH E C LAIM OF TH E A SSESSEE W HICH ON FURTHER APPEAL BEFORE THE H IGH COURT WA S ONC E A G AIN CONFIRMED AND ON FURTHER APPEAL BEFORE THE APE X COURT W H ERE TH E D E CISION OF THE H IGH COURT WAS CONFIRMED THAT THE C LAIM FOR D E DU C TION NOT MADE ON THE REVISED RETURN COU L D NOT BE ENTERTAINED BY THE AS SESS IN G OFF I C E R OTHERWISE THAN BY FILING A REVISED RETURN . 9 . FOL L OWING THE SAID DECISION WE HAVE NO HESITATION IN CONF I RM I N G TH E ORDER OF THE TRIBUNA L BY ANSWERING T H E SU B STANTIAL QUESTIONS IN FAVOUR OF TH E R EVENUE . CONSEQU E NT . L Y T H E T AX CASE (APPEA L ) STANDS P A RTL Y ALLOW E D . NO COS T S . ' THEREFORE THE APPEAL OF THE ASSESSEE BEING DEVOID OF ANY MERIT IS REJECTED. SD/- (U.B.S.B EDI) JUDICIAL MEMBER DATED: 06.09.2011 VM/- I.T.A. NO. 1058/MDS/10 19 IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH CHENNAI BEFORE DR. O.K.NARAYANAN VICE-PRESIDENT THIRD MEMBER ITA NO.1058(MDS)/2010 ASSESSMENT YEAR : 2007-08 SHRI R.NATARAJAN NEW NO.15 OLD NO.8 3 RD CROSS STREET R.K.NAGAR MANDAVELI CHENNAI-600028. PAN AABPN8427H. VS. THE ASSISTANT COMMISSIONER OF INCOME-TAX SALARY CIRCLE V CHENNAI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI R.KUMAR ADVOCATE RESPONDENT BY: SHRI KEB RENGARAJAN JR.STAND ING COUNSEL. DATE OF HEARING : 18 TH JANUARY 2012 DATE OF ORDER : 23 RD JANUARY 2012 O R D E R PER DR.O.K.NARAYANAN VICE-PRESIDENT: THIS APPEAL IS FILED BY THE ASSESSEE. THE RELEVAN T ASSESSMENT YEAR IS 2007-08. THE APPEAL IS DIRECTED AGAINST THE I.T.A. NO. 1058/MDS/10 20 ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS)-VI AT CHENNAI DATED 21-4-2010 AND ARISES OUT OF THE ASSESSMENT CO MPLETED UNDER SECTION 143(3) OF THE INCOME-TAX ACT 1961. 2. THE ASSESSEE IN THIS CASE IS A SALARIED EMPLOYE E WORKING FOR SSL-TTK LIMITED. HE FILED HIS RETURN O F INCOME FOR THE IMPUGNED ASSESSMENT YEAR 2007-08 ON A TOTAL INC OME OF ` 14 86 210/-. THE ASSESSMENT WAS COMPLETED UNDER S ECTION 143(3) ACCEPTING THE RETURN FILED BY THE ASSESSEE. 3. IN HIS RETURN OF INCOME FILED FOR THE IMPUGNED ASSESSMENT YEAR 2007-08 THE ASSESSEE HAD ADMITTED AN INCOME OF ` 4 28 750/- BEING THE PERFORMANCE INCENTIVE RECEIV ED FROM SSL-TTK LIMITED. THIS AMOUNT WAS IN FACT RECE IVED BY THE ASSESSEE ON 5-7-2007 AFTER THE CLOSE OF THE RELEVA NT PREVIOUS YEAR BUT BEFORE THE DUE DATE OF FILING OF THE RETU RN. AS THE INCENTIVE WAS GIVEN TO THE ASSESSEE FOR HIS EFFORTS MADE IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2007- 08 THE ASSESSEE OFFERED THE SAID AMOUNT OF ` 4 28 750/- AS HIS INCOME FOR THE IMPUGNED ASSESSMENT YEAR 2007-08. BUT THE TWIST OF THE SITUATION CAME WHEN HIS EMPLOYER COMPANY M/S.SSL-TT K I.T.A. NO. 1058/MDS/10 21 LIMITED CONSIDERED THE SAID AMOUNT OF PERFORMANCE I NCENTIVE ONLY FOR THE SUBSEQUENT ASSESSMENT YEAR 2008-09. T HE RESULT IS THAT THE ASSESSEES EMPLOYER ISSUED THE TDS CERTIFI CATE FOR THE ASSESSMENT YEAR 2008-09. IT WAS IMPERATIVE UPON TH E ASSESSEE TO CO-RELATE THE INCOME GENERATED AND THE TDS MADE THEREON FOR THE PURPOSE OF CLAIMING CREDIT OF THE TDS AGAIN ST THE TAX LIABILITY. THEREFORE THE ASSESSEE HAD TO RETURN T HE PERFORMANCE INCENTIVE OF ` 4 28 750/- AS HIS INCOME AGAIN FOR THE ASSESSMENT YEAR 2008-09. ONCE HE INCLUDED THIS INCENTIVE INCO ME OF ` 4 28 750/- IN HIS TOTAL INCOME FOR THE ASSESSMENT Y EAR 2008-09 THE MATCHING OF THE TDS CERTIFICATE WAS SATISFIED A ND HE WAS GIVEN CREDIT OF THE TDS MADE BY HIS EMPLOYER. IN T HAT WAY THE ASSESSMENT FOR THE SUBSEQUENT ASSESSMENT YEAR 2008- 09 WAS COMPLETED AND NOW RESTS ON RECORD. THE ASSESSMENT FOR THE ASSESSMENT YEAR 2008-09 HAS COME TO FINALITY. 4. NOW THE ORDEAL OF THE ASSESSEE BEGINS. THE AMOUNT OF PERFORMANCE INCENTIVE OF ` 4 28 750/- WAS OFFERED FOR TAXATION BY THE ASSESSEE TWO TIMES THAT IS FOR TH E ASSESSMENT YEARS 2007-08 AND 2008-09. THEREFORE TO COME OUT OF ABOVE I.T.A. NO. 1058/MDS/10 22 SITUATION THE ASSESSEE FILED AN APPEAL BEFORE THE COMMISSIONER OF INCOME-TAX(APPEALS) FOR THE ASSESSMENT YEAR 2007 -08. THE ASSESSEE ARGUED BEFORE THE COMMISSIONER OF INCOME- TAX(APPEALS) THAT THE INCENTIVE INCOME OF ` 4 28 750/- HAS ALREADY BEEN OFFERED BY THE ASSESSEE AS PART OF HIS TAXABLE INCOME FOR THE ASSESSMENT YEAR 2008-09 AND THE SAID ASSESSMENT HAS BEEN COMPLETED AND BECOME FINAL AND THE ASSESSEE HAS ALSO RECEIVED THE BENEFIT OF CREDIT OF THE TDS MADE BY HIS EMPLOYER FOR THAT ASSESSMENT YEAR. THE FACT BEING SO THERE IS NO NEED FOR THE ASSESSEE TO OFFER THE VERY SAME AMOUNT FOR THE ASSESSMENT YEAR 2007-08 AND THEREFO RE THAT MUCH OF INCOME MAY BE EXCLUDED FROM THE ASSESSMENT OF THE IMPUGNED ASSESSMENT YEAR 2007-08. 5. THE FIRST APPEAL FILED BY THE ASSESSEE WAS DISMISSED WITH THE FOLLOWING OBSERVATIONS BY THE CO MMISSIONER OF INCOME-TAX(APPEALS):- REFERENCE IS INVITED TO SECTION 246A OF THE I.T.AC T AND IT IS NOTICED THAT CIT(A) CAN ONLY ALTER REDUCE ANNU L AND I.T.A. NO. 1058/MDS/10 23 ENHANCE THE ORDER OF THE ASSESSING OFFICER. THE AP PEAL LIE ONLY WHEN THE ASSESSEE DENIES HIS LIABILITY TO BE ASSESSED AND IN THE INSTANT CASE THE ASSESSING OFFI CER HAS ACCEPTED THE RETURNED INCOME AND THERE IS NO DE NIAL OF LIABILITY. WHEN THERE IS NO LIABILITY THE CAS E BECOMES INFRUCTUOUS AND THE APPEAL IS DISMISSED. 6. AGGRIEVED BY THE ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS) SECOND APPEAL WAS FILED BEFORE THE TRIBUNAL. 7. THE LEARNED ACCOUNTANT MEMBER AUTHORED THE ORDE R FOR THE TRIBUNAL. AFTER EXAMINING THE FACTS OF THE CASE IN A DETAILED MANNER THE LEARNED ACCOUNTANT MEMBER FOUN D THAT THE ASSESSEE WAS UNDER A MISTAKE WHEN HE DID INCLUDE TH E PERFORMANCE INCENTIVE IN HIS RETURN OF INCOME FOR T HE IMPUGNED ASSESSMENT YEAR 2007-08 WHERE IN FACT THE SAME AMO UNT WAS RECEIVED BY THE ASSESSEE ONLY IN THE SUBSEQUENT PRE VIOUS YEAR. HE OBSERVED THAT ONE OF THE CANNONS OF TAXATION IS THAT TAX IS TO BE COLLECTED FROM A SUBJECT AS PER LAW AND NOT A PI E MORE OR NOT I.T.A. NO. 1058/MDS/10 24 A PIE LESS. HE FOUND THAT THE ASSESSING AUTHORITY OUGHT TO HAVE EXCLUDED THE PERFORMANCE INCENTIVE WHILE COMPLETING THE ASSESSMENT UNDER SECTION 143(3) FOR THE IMPUGNED AS SESSMENT YEAR AS HE WAS AWARE THAT THE INCENTIVE AMOUNT WAS RECEIVED BY THE ASSESSEE ONLY IN THE SUBSEQUENT PREVIOUS YEA R AND MORE PARTICULARLY WHEN THE ASSESSING AUTHORITY HAS NOT G IVEN THE TDS CREDIT FOR THAT AMOUNT FOR THE IMPUGNED ASSESSMENT YEAR EVEN THOUGH THE INCENTIVE AMOUNT WAS OFFERED FOR TAXATIO N. HE HELD THAT THE PRIMARY DUTY OF THE TRIBUNAL IS TO EASE TH E RIGOURS OF PROCEDURE AND RENDER SUBSTANTIAL JUSTICE WITHOUT TA KING REFUGE UNDER THE CUMBERSOME TECHNICALITIES. HE ACCORDINGL Y HELD THAT THE AMOUNT OF ` 4 28 750/- OFFERED FOR TAXATION BY THE ASSESSEE FOR THE IMPUGNED ASSESSMENT YEAR IS TO BE EXCLUDED FROM THE ASSESSEES TOTAL INCOME. ACCORDINGLY THE APPEAL W AS PROPOSED TO BE ALLOWED BY THE LEARNED ACCOUNTANT MEMBER. 8. BUT THE LEARNED JUDICIAL MEMBER COULD NOT AGREE WITH THE ORDER PROPOSED BY THE LEARNED ACCOUNTANT M EMBER. THE LEARNED JUDICIAL MEMBER RELIED ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF GOETZE(INDIA) LTD. VS. CIT I.T.A. NO. 1058/MDS/10 25 284 ITR 323 WHEREIN THE HONBLE APEX COURT HAS HEL D THAT ADDITIONAL CLAIMS OF RELIEF CANNOT BE MADE BY AN AS SESSEE IN THE COURSE OF ASSESSMENT PROCEEDINGS UNLESS HE HAS FILE D A REVISED RETURN OF INCOME. THE LEARNED JUDICIAL MEMBER ALSO RELIED ON THE JUDGMENT OF THE HONBLE MADRAS HIGH COURT DATED 12-6-2011 IN TAX CASE (APPEAL) NO.223 OF 2005 (AS MENTIONED B Y THE LEARNED JUDICIAL MEMBER) IN SUPPORT OF HIS CONCLUS ION. HE ACCORDINGLY REJECTED THE GROUNDS RAISED BY THE ASS ESSEE AND PROPOSED TO DISMISS THE APPEAL. 9. IN VIEW OF THE ABOVE DIFFERENCE OF OPINION BETW EEN THE HONBLE MEMBERS WHO HEARD THE CASE A REFERENCE WAS MADE TO THE HONBLE PRESIDENT OF THE INCOME-TAX APP ELLATE TRIBUNAL UNDER SECTION 255(4) OF THE INCOME-TAX ACT 1961 TO NOMINATE A THIRD MEMBER TO ANSWER THE FOLLOWING QUE STIONS FRAMED BY THE HONBLE MEMBERS:- IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CAS E WHETHER INCOME ON ACC OUNT OF INCENTIVE PERTAINING TO ASSESSMENT YEAR 2007-08 RECEIVED IN T HE ASSESSMENT I.T.A. NO. 1058/MDS/10 26 YEAR 2008-09 AND OFFERED BY THE ASSESS EE HIMSELF IN THE RETURN FOR THE YEAR UNDER CONSIDERATION WHEN RETURNED INCOME CAME TO BE ACCEPTED COULD BE D IRECTED TO BE DELETED AS HELD BY THE ACCOUNTANT MEMBER OR COULD THE ASSESSMENT FRAMED BY ACCE PTING THE RETURNED INCOME IN THE ABSENCE OF FILING OF R EVISED RETURN EXCLUDING SUCH INCENTIVE IN VIEW OF TH E DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF GOETZE(INDIA) LTD. V CIT (2006) 284 ITR 323 (S C) BE UPHELD AS HELD BY JUDICIAL MEMBER? 10. THE HONBLE PRESIDENT NOMINATED ME AS THE THIR D MEMBER AND IT IS HOW THESE QUESTIONS HAVE BEEN PLAC ED BEFORE ME FOR ADJUDICATION. 11. I HEARD SHRI R.KUMAR THE LEARNED COUNSEL APPEARING FOR THE ASSESSEE AND SHRI KEB RENGARAJAN THE LEARNED STANDING COUNSEL APPEARING FOR THE REVENUE. I.T.A. NO. 1058/MDS/10 27 12. THE FACTS AND CIRCUMSTANCES OF THE CASE HAVE B EEN ELABORATELY DISCUSSED BY THE HONBLE ACCOUNTANT MEM BER IN HIS ORDER AND OTHER PARTICULARS ARE VERY MUCH AVAILABLE IN THE ORDERS OF THE ASSESSING AUTHORITY THE COMMISSIONER OF INC OME- TAX(APPEALS) AND IN THE STATEMENT OF FACTS AND THE GROUNDS OF APPEAL FILED BEFORE THE DIFFERENT AUTHORITIES. 13. THE ISSUE IS AS TO WHETHER THE ASSESSEE SHOULD BE SUBJECTED TO TAX ON A SUM OF ` 4 28 750/- FOR TWO ASSESSMENT YEARS 2007-08 AND 2008-09 EVEN THOUGH THE ASSESSEE HIMSELF HAS OFFERED THE SAID AMOUNT AS HIS INCOME FOR BOTH THE ABOVE ASSESSMENT YEARS. 14. THE CASE OF THE ASSESSEE IS THAT THE ABOVE STA TED AMOUNT OF ` 4 28 750/- WAS OFFERED BY HIM AS INCOME FOR THE IMPUGNED ASSESSMENT YEAR 2007-08 BY MISTAKE WHEREA S THE SAID AMOUNT WAS RIGHTLY OFFERED AS INCOME FOR THE S UBSEQUENT ASSESSMENT YEAR 2008-09 AND THE SAME WAS ASSESSED A FTER GETTING THE TDS CREDIT AND ASSESSMENT HAS BECOME FI NAL. IN ORDER TO RECTIFY HIS MISTAKE OF OFFERING THE INCOME OF ` 4 28 750/- FOR TAXATION FOR THE ASSESSMENT YEAR 20 07-08 THE I.T.A. NO. 1058/MDS/10 28 ASSESSEE HAS NOT FILED ANY REVISED RETURN. IN THE SE CIRCUMSTANCES THE QUESTION IS WHETHER THE ASSESSEE IS ENTITLED FOR RELIEF SO THAT THE AMOUNT OF ` 4 28 750/- MAY BE EXCLUDED FROM THE TAXABLE INCOME OF THE ASSESSEE FOR THE IMP UGNED ASSESSMENT YEAR 2007-08. FOR THE SAKE OF CLARITY IT IS TO BE MADE CLEAR THAT THERE IS NO DISPUTE WHATSOEVER AS F AR AS THE ASSESSMENT YEAR 2008-09 IS CONCERNED. THE DISPUTE IS ONLY WITH REFERENCE TO THE IMPUGNED ASSESSMENT YEAR 2007-08 A S TO WHETHER THE SAID AMOUNT OF ` 4 28 750/- SHOULD BE AGAIN TAXED FOR THE IMPUGNED ASSESSMENT YEAR OR IT SHOULD BE EX CLUDED FROM TAXATION FOR THE IMPUGNED ASSESSMENT YEAR. 15. ARTICLE 265 OF THE CONSTITUTION OF INDIA READS AS BELOW:- TAXES NOT TO BE IMPOSED SAVE BY AUTHORITY OF LAW.- NO TAX SHALL BE LEVIED OR COLLECTED EXCEPT BY AUTHORITY OF LAW. I.T.A. NO. 1058/MDS/10 29 16. IN THE LIGHT OF THE ABOVE STATED CONSTITUTIONA L MANDATE ON COLLECTION OF TAX IT IS INCUMBENT UPON PUBLIC AUTHORITIES VESTED WITH THE DUTY OF COLLECTING TAX TO SEE THAT WHAT IS DEMANDED IS ONLY THE LEGITIMATE TAX DUE FROM AN ASSESSEE. THE ABOVE CONSTITUTIONAL MANDATE IS PROFOUNDLY REFL ECTED IN THE CIRCULAR ISSUED BY THE CENTRAL BOARD OF DIRECT TAXE S TO GIVE ADMINISTRATIVE INSTRUCTIONS FOR GUIDANCE OF INCOME- TAX OFFICERS ON MATTERS PERTAINING TO ASSESSMENT. THAT PARTICULAR CIRCULAR IS NUMBERED AS CIRCULAR NO.14(XL-35) DATED 11-4-1955. ALTHOUGH THE CIRCULAR WAS ISSUED EVEN BEFORE THE PRESENT INC OME-TAX ACT OF 1961 THE PRINCIPLES SURVIVE FOR ALL THE TIME. THE MOST RELEVANT EXTRACTS FROM THE ABOVE CIRCULAR ARE REPRODUCED BEL OW:- 1. THE BOARD HAVE ISSUED INSTRUCTIONS FROM TIME TO TIME IN REGARD TO THE ATTITUDE WHICH THE OFFICERS OF THE DEPARTMENT SHOULD ADOPT IN DEALING WITH ASSESSEES I N MATTERS AFFECTING THEIR INTERESTS AND CONVENIENCE. IT APPEARS THAT THESE INSTRUCTIONS ARE NOT BEING UNIFO RMLY FOLLOWED. I.T.A. NO. 1058/MDS/10 30 2. COMPLAINTS ARE STILL BEING RECEIVED THAT WHILE I NCOME- TAX OFFICERS ARE PROMPT IN MAKING ASSESSMENTS LIKEL Y TO RESULT INTO DEMANDS AND IN EFFECTING THEIR RECOVERY THEY ARE LETHARGIC AND INDIFFERENT IN GRANTING REFUNDS A ND GIVING RELIEFS DUE TO THE ASSESSEES UNDER THE ACT. DILATO RINESS OR INDIFFERENCE IN DEALING WITH REFUND CLAIMS (EITH ER UNDER SECTION 48 OR DUE TO APPELLATE REVISIONAL ETC. OR DERS) MUST BE COMPLETELY AVOIDED SO THAT THE PUBLIC MAY F EEL THAT THE GOVERNMENT ARE ACTUALLY PROMPT AND CAREFUL IN THE MATTER OF COLLECTING TAXES AND GRANTING REFUNDS AND GIVING RELIEFS. 3. OFFICERS OF THE DEPARTMENT MUST NOT TAKE ADVANTA GE OF IGNORANCE OF AN ASSESSEE AS TO HIS RIGHTS. IT IS O NE OF THEIR DUTIES TO ASSIST A TAXPAYER IN EVERY REASONABLE WAY PARTICULARLY IN THE MATTER OF CLAIMING AND SECURING RELIEFS AND IN THIS REGARD THE OFFICERS SHOULD TAKE THE INI TIATIVE IN GUIDING A TAXPAYER WHERE PROCEEDINGS OR OTHER PARTI CULARS BEFORE THEM INDICATE THAT SOME REFUND OR RELIEF IS DUE TO HIM. THIS ATTITUDE WOULD IN THE LONG RUN BENEFIT THE I.T.A. NO. 1058/MDS/10 31 DEPARTMENT FOR IT WOULD INSPIRE CONFIDENCE IN HIM T HAT HE MAY BE SURE OF GETTING A SQUARE DEAL FROM THE DEPAR TMENT. ALTHOUGH THEREFORE THE RESPONSIBILITY FOR CLAIMIN G REFUNDS AND RELIEFS RESTS WITH ASSESSEE ON WHOM IT IS IMPOS ED BY LAW OFFICERS SHOULD (A) DRAW THEIR ATTENTION TO ANY REFUNDS OR RELIEFS TO WHICH THEY APPEAR TO BE CLEARLY ENTITLED BUT WHICH THEY H AVE OMITTED TO CLAIM FOR SOME REASON OR OTHER; (B) FREELY ADVISE THEM WHEN APPROACHED BY THEM AS T O THEIR RIGHTS AND LIABILITIES AND AS TO THE PROCEDUR E TO BE ADOPTED FOR CLAIMING REFUNDS AND RELIEFS. 4. . . . 5. WHILE OFFICERS SHOULD WHEN REQUESTED FREELY AD VISE ASSESSEES THE WAY IN WHICH ENTRIES SHOULD BE MADE I N VARIOUS FORMS THEY SHOULD NOT THEMSELVES MAKE ANY IN THEM ON THEIR BEHALF. WHERE SUCH ADVICE IS GIVEN IT SHOULD BE CLEARLY EXPLAINED TO THEM THAT THEY ARE RESPONSIBLE FOR THE ENTRIES MADE IN ANY FORM AND TH AT THEY CANNOT BE ALLOWED TO PLEAD THAT THEY WERE MADE UNDE R I.T.A. NO. 1058/MDS/10 32 OFFICIAL INSTRUCTIONS. THIS EQUALLY APPLIES TO THE PUBLIC RELATION OFFICERS. 6. THE INTENTION OF THIS CIRCULAR IS NOT THAT TAX D UE SHOULD NOT BE CHARGED OR THAT ANY FAVOUR SHOULD BE SHOWN T O ANYBODY IN THE MATTER OF ASSESSMENT OR THAT WHERE INVESTIGATIONS ARE CALLED FOR THEY SHOULD NOT BE M ADE. WHATEVER THE LEGITIMATE TAX IT MUST BE ASSESSED AND MUST BE COLLECTED. THE PURPOSE OF THIS CIRCULAR IS MERE LY TO EMPHASIS THAT WE SHOULD NOT TAKE ADVANTAGE OF AN ASSESSEES IGNORANCE TO COLLECT MORE TAX OUT OF HIM THAN IS LEGITIMATELY DUE FROM HIM. 17. THE BOARD HAS GIVEN CLEAR INSTRUCTION TO ASSES SING AUTHORITIES THAT THEY SHOULD NOT TAKE ADVANTAGE OF IGNORANCE OF AN ASSESSEE AS TO HIS RIGHTS. IN THE PRESENT CASE THE ASSESSEE VOLUNTARILY OFFERED THE INCENTIVE INCOME OF ` 4 28 750/- FOR TAXATION IN THE ASSESSMENT YEAR 2007-08 ON A BONA F IDE BELIEF THAT THE INCENTIVE RELATED TO THE SAID ASSESSMENT Y EAR AND HE WOULD ALSO GET THE BENEFIT OF TDS MADE BY HIS EMPLO YER ON THAT I.T.A. NO. 1058/MDS/10 33 AMOUNT OF INCENTIVE IN THE VERY SAME ASSESSMENT YEA R 2007-08. BUT IT HAPPENED THAT THE ASSESSEES EMPLOYER ACCOUN TED FOR THE TDS FOR THE ASSESSMENT YEAR 2008-09 AND THE DEPARTM ENT GRANTED CREDIT OF SUCH TDS ONLY FOR THE ASSESSMENT YEAR 2008-09. THEREFORE THE ASSESSEE HAD TO OFFER THE INCENTIVE AGAIN FOR TAXATION FOR THE ASSESSMENT YEAR 2008-09 FOR OTHERWISE THE ASSESSEE WOULD LOSE HIS LEGITIMATE RI GHT OF AVAILING CREDIT OF TDS MADE OUT OF THE INCOME EARNED BY HIM. ALL THESE FACTS WERE VERY MUCH AVAILABLE BEFORE THE ASSESSING AUTHORITY WHILE COMPLETING THE ASSESSMENT FOR THE IMPUGNED AS SESSMENT YEAR 2007-08. THE ASSESSING AUTHORITY WAS ALL THE MORE AWARE THAT THOUGH HE HAS ASSESSED THE SUM OF ` 4 28 750/- AS THE INCOME OF THE IMPUGNED ASSESSMENT YEAR HE HAS NOT GIVEN THE ASSESSEE THE BENEFIT OF THE CREDIT OF THE CORRESPON DING TDS. INSPITE OF SUCH A SITUATION WHERE THE ASSESSEE WAS DENIED CREDIT OF THE TDS IT IS VERY EVIDENT FOR THE ASSESSING AU THORITY TO UNDERSTAND THAT THE AMOUNT OF ` 4 28 750/- WAS OFFERED FOR THE IMPUGNED ASSESSMENT YEAR BY MISTAKE AND IT WAS OFFE RED FOR THE ASSESSMENT YEAR 2008-09 FOR WHICH ASSESSMENT YEAR THE I.T.A. NO. 1058/MDS/10 34 ASSESSMENT HAS BEEN COMPLETED AND IT HAS BECOME FIN AL. INSPITE OF THIS FACTUAL KNOWLEDGE THE ASSESSING AU THORITY THOUGHT TO ASSESS THE AMOUNT OF ` 4 28 750/- AS THE INCOME OF THE ASSESSEE FOR THE IMPUGNED ASSESSMENT YEAR 2007-08 O NLY ON THE TECHNICAL GROUND THAT THE SAID AMOUNT WAS OFFER ED FOR ASSESSMENT BY THE ASSESSEE HIMSELF VOLUNTARILY. 18. THE COMMISSIONER OF INCOME-TAX(APPEALS) AFTER UNDERSTANDING THE FACTS OF THE CASE WITHOUT ANY CON FUSION DISMISSED THE PLEA OF THE ASSESSEE ON THE GROUND TH AT WHEN THERE IS NO LIABILITY AS A RESULT OF THE ASSESSMENT THERE IS NO SCOPE FOR APPEAL. IT IS THE CASE OF THE COMMISSION ER OF INCOME- TAX(APPEALS) THAT AN APPEAL LIES ONLY WHEN THE ASSE SSEE DENIES HIS LIABILITY TO BE ASSESSED AND IN THE PRESENT CAS E AS THE ASSESSING AUTHORITY HAS ACCEPTED THE RETURNED INCOM E THERE IS NO DENIAL OF LIABILITY FROM THE SIDE OF THE ASSESSE E. THESE ARE ALL REASONINGS FOR SELF CONSUMPTION. THE INCOME-TAX AC T DOES NOT AUTHORIZE LEVY OF TAX ON THE SAME AMOUNT OF INCOME MORE THAN ONCE. A PARTICULAR AMOUNT OF INCOME CAN BE ASSESSE D ONLY FOR ONCE FOR A PARTICULAR ASSESSMENT YEAR. THIS IS VER Y CERTAIN. IN I.T.A. NO. 1058/MDS/10 35 THE PRESENT CASE THE SUBJECT INCOME HAS ALREADY BEE N ASSESSED FOR THE ASSESSMENT YEAR 2008-09 AND THAT ASSESSMENT HAS BECOME FINAL. THEREFORE IT IS CLEAR THAT IT IS NO T AT ALL POSSIBLE TO ASSESS THE SAME INCOME AGAIN FOR THE ASSESSMENT YEA R 2007-08. THERE IS NO SUCH ENABLING PROVISION ANYWH ERE IN THE INCOME-TAX ACT; FOR THAT MATTER NOT UNDER ANY OTHER TAXING STATUTE. 19. THE INCOME-TAX DEPARTMENT IS COLLECTING TAX NO T FOR ITSELF. IT IS COLLECTING TAX FOR THE SOVEREIGN STA TE THAT IS UNION OF INDIA. UNION OF INDIA AS THE SOVEREIGN AUTHORITY D OES NOT REQUIRE TO LEVY TAX ON AN AMOUNT RETURNED BY MISTAKE. THE SOVEREIGN AUTHORITY DOES NOT WANT TO TAKE ADVANTAGE OF A MIST AKE COMMITTED BY AN INNOCUOUS ASSESSEE. IT IS NOT THE POLICY OF THE SOVEREIGN STATE TO CRAVE FOR UNDUE ENRICHMENT. 20. WHEN UNDER THESE CIRCUMSTANCES LEVY OF TAX O N THE SUM OF ` 4 28 750/- IS ALTOGETHER IMPERMISSIBLE FOR THE ASSESSMENT YEAR 2007-08 HOW THE PRAYER OF THE ASSE SSEE COULD BE BRUSHED ASIDE? IF THE INCOME-TAX ACT AUTHORIZES A DESIGNATED AUTHORITY TO COLLECT TAX FOR STATE THE SAME ACT ALWAYS I.T.A. NO. 1058/MDS/10 36 PERMITS THE SAID AUTHORITY TO RECTIFY ANY PROCEEDIN GS WHICH HAS RESULTED IN DOUBLE TAXATION. WHEN THE INCOME OF ` 4 28 750/- HAS BEEN ASSESSED FOR THE ASSESSMENT YEAR 2008-09 THE ASSESSMENT OF THE SAME AMOUNT FOR THE IMPUGNED ASSE SSMENT YEAR 2007-08 IS A MISTAKE APPARENT FROM THE RECORDS . THE ASSESSING AUTHORITY COULD HAVE CORRECTED IT AND IF NOT THE COMMISSIONER OF INCOME-TAX(APPEALS) COULD HAVE GIVE N A DIRECTION TO RECTIFY SUCH A MISTAKE APPARENT FROM T HE RECORDS. THERE IS NO GREAT QUESTION OF LAW INVOLVED IN THIS. 21. THE DECISION OF THE HONBLE SUPREME COURT IN T HE CASE OF GOETZE(INDIA) LTD. VS. CIT 284 ITR 323 HA S NO APPLICATION IN THIS CONTEXT. THE ASSESSEE IS NOT A SKING FOR ANY EXEMPTION OR ANY OTHER CONCESSION. THE ASSESSEE HA S NOT ASKED FOR ANY CONCESSION AT ALL. THE ENTIRE SUM OF ` 4 28 750/- HAS ALREADY BEEN ASSESSED FOR THE ASSESSMENT YEAR 2 008-09. THEN WHERE IS THE QUESTION OF CONCESSION OR EXEMPT ION? THE PRAYER OF THE ASSESSEE IS THAT HIS RETURNING OF THE SAID AMOUNT AS TAXABLE INCOME FOR THE ASSESSMENT YEAR 2007-08 WAS A BONA FIDE MISTAKE AND HE BE NOT SUBJECTED FOR TAXATION T WICE ON THE I.T.A. NO. 1058/MDS/10 37 SAME AMOUNT. IS IT NOT A LEGITIMATE CLAIM MADE BY THE ASSESSEE? 22. IN THE FACTS AND CIRCUMSTANCES OF THE CASE I FIND THAT THE ASSESSMENT OF ` 4 28 750/- TO INCOME-TAX FOR THE ASSESSMENT YEAR 2007-08 IS AGAINST LAW. THEREFORE I AGREE WITH THE ORDER OF THE LEARNED ACCOUNTANT MEMBER IN GIVIN G DIRECTION TO THE ASSESSING AUTHORITY TO DELETE THE SAID AMOUNT O F ` 4 28 750/- FROM THE ASSESSMENT RELATING TO THE ASSESSMENT YEAR 2007-08. I AGREE WITH THE LEARNED ACCOUNTANT MEMBER THAT THE A PPEAL OF THE ASSESSEE IS TO BE ALLOWED. 23. IT IS A SETTLED PRINCIPLE OF JURISPRUDENCE THA T DELIVERY OF JUSTICE SHOULD NOT BE FETTERED BY TECHNICALITIES . WHERE THERE IS A GLARING INSTANCE OF INJUSTICE WRIT LARGE ON THE F ACE OF THE RECORDS IT IS THE BOUNDEN DUTY OF THE TRIBUNAL TO STAND BY THE SIDE OF JUSTICE TO REDRESS THE GRIEVANCE OF A HAPLE SS ASSESSEE. 24. NOW THIS FILE WILL BE PLACED BEFORE THE REGULA R BENCH FOR PASSING ORDERS TO FINALLY DISPOSE OF THE CASE O N A MAJORITY VIEW. I.T.A. NO. 1058/MDS/10 38 SD/- (DR.O.K.NARAYANAN) VICE-PRESIDENT THIRD MEMBER CHENNAI DATED THE 23 RD JANUARY 2012. V.A.P. I.T.A. NO. 1058/MDS/10 39 IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH CHENNAI BEFORE SHRI ABRAHAM P. GEORGE ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN JUDICIAL MEMBER I.T.A. NO. 1058/MDS/2010 (ASSESSMENT YEAR : 2007-08) SHRI R. NATARAJAN NEW NO.15 OLD NO.8 3 RD CROSS STREET R.K. NAGAR MANDAVELI CHENNAI - 600 028. PAN : AABPN8427H (APPELLANT) V. THE ASSISTANT COMMISSIONER OF INCOME TAX SALARY CIRCLE V CHENNAI. (RESPONDENT) APPELLANT BY : SHRI R. KUMAR ADVOCATE RESPONDENT BY : SHRI K. GOPALAK RISHNA JCIT DATE OF HEARING : 17.02.2012 DATE OF PRONOUNCEMENT : 17.02.2012 ORDER GIVING EFFECT PER ABRAHAM P. GEORGE ACCOUNTANT MEMBER : THERE BEING A DIFFERENCE OF OPINION AMONG THE MEM BERS CONSTITUTING THE ORIGINAL BENCH ON THE ISSUES RAIS ED IN THIS APPEAL A REFERENCE WAS MADE BY HONBLE PRESIDENT UNDER SECTI ON 255(4) OF INCOME-TAX ACT 1961. I.T.A. NO. 1058/MDS/10 40 2. HONBLE VICE PRESIDENT SITTING AS THIRD MEMBER H AS AGREED WITH THE VIEW TAKEN BY THE ACCOUNTANT MEMBER. ACCORDING LY IN VIEW OF THE MAJORITY OPINION APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT AFTER CONCLUSION OF HEARING ON 17 TH FEBRUARY 2012. SD/- SD/- (GEORGE MATHAN) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI DATED THE 17 TH FEBRUARY 2012. KRI. COPY TO: (1) APPELLANT (2) RESPONDENT (3) CIT(A) (4) CIT (5) D.R. (6) GUARD FILE