S.B. BUILDERS & DEVELOPERS, NAVI MUMBAI v. ITO RG 22(3)-4, NAVI MUMBAI

ITA 1245/MUM/2010 | 2006-2007
Pronouncement Date: 14-05-2010 | Result: Allowed

Appeal Details

RSA Number 124519914 RSA 2010
Assessee PAN AAMFS3744H
Bench Mumbai
Appeal Number ITA 1245/MUM/2010
Duration Of Justice 2 month(s) 28 day(s)
Appellant S.B. BUILDERS & DEVELOPERS, NAVI MUMBAI
Respondent ITO RG 22(3)-4, NAVI MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 14-05-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted E
Tribunal Order Date 14-05-2010
Assessment Year 2006-2007
Appeal Filed On 16-02-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E MUMBAI BEFORE SHRI R V EASWAR SENIOR VICE PRESIDENT AND SHRI R K PANDA ACCOUNTANT MEMBER I T A NO: 1245/MUM/2009 (ASSESSMENT YEAR: 2006-07) S B BUILDERS & DEVELOPERS NAVI MUMBAI APPELLANT (PAN: AAMFS3744H) VS INCOME TAX OFFICER 22(3)-4 MUMBAI RESPONDENT APPELLANT BY: SHRI J D MISTRI RESPONDENT BY: SHRI HEMANT J LAL O R D E R R V EASWAR SENIOR VICE PRESIDENT: THE ASSESSEE-APPELLANT IS A PARTNERSHIP FIRM ENGAGE D IN THE BUSINESS OF BUILDING AND DEVELOPING HOUSING PROJECT S. WE ARE CONCERNED WITH THE ASSESSMENT YEAR 2006-07 IN THIS APPEAL WHICH ARISES OUT OF THE ASSESSMENT ORDER PASSED BY THE AS SESSING OFFICER U/S.143(3) OF THE INCOME TAX ACT ON 31-12-2008. 2. DURING THE RELEVANT ACCOUNTING YEAR THE ASSESSE E HAD ONLY ONE HOUSING PROJECT ON HAND WHICH WAS SHIVDARSHAN CO-O P. HSG. SOCIETY AT PALM BEACH ROAD NAVI MUMBAI. IN RESPECT OF THE HOUSING PROJECT THE ASSESSEE UNDISPUTEDLY WAS ENTITLED TO THE DEDUC TION U/S.80-IB(10). THE PROFITS FROM THIS PROJECT WERE SHOWN IN THE PRO FIT AND LOSS ACCOUNT AT RS.3 76 78 403 AND THE SAME WAS CLAIMED TO BE DE DUCTIBLE UNDER THE AFORESAID SECTION. THE CLAIM WAS ACCEPTED BY TH E ASSESSING OFFICER. HOWEVER HE FOUND THAT IN RESPECT OF CERTAI N PAYMENTS RELATING TO THE COST OF CONSTRUCTION RCC CONSULTANCY ARCHI TECTS FEES 2 COMMISSION AND PROFESSIONAL CHARGES AGGREGATING TO RS.4 50 12 485 THE ASSESSEE HAD NOT DEDUCTED TAX IN TIME THOUGH IT WAS REQUIRED TO DO SO AND THEREFORE THEY CANNOT BE ALLOWED AS A DEDUCT ION AS STIPULATED IN SECTION 40(A)(IA). THEREFORE WHILE COMPUTING THE INCOME FROM THE BUSINESS HE DISALLOWED AND ADDED BACK THE AFORESAID AMOUNT TO THE NET PROFIT SHOWN IN THE PROFIT AND LOSS ACCOUNT AND ARRIVED AT THE GROSS TOTAL INCOME AT RS. 8 26 90 888. HOWEVER WHILE ALL OWING DEDUCTION U/S.80-IB(10) HE ALLOWED DEDUCTION OF ONLY RS.3 76 78 403 AND ARRIVED AT A TOTAL INCOME OF RS.4 50 12 485 ON WHICH TAX WA S CHARGED. 3. THE ASSESSEE WENT IN APPEAL TO THE CIT(A) AGAINS T THE ASSESSMENT AND CLAIMED THAT THE ASSESSING OFFICER O UGHT TO HAVE ALLOWED DEDUCTION OF THE ENTIRE PROFITS OF RS.8 26 90 888 ARRIVED AT AFTER MAKING THE DISALLOWANCE U/S.40(A)(IA) SINCE HE HAD COMPUTED THE PROFITS OF THE BUSINESS (HOUSING PROJECT) AT THE AFORE-MENTIONED FIGURE. IT WAS ALSO CONTENDED THAT THE DISALLOWANCE MADE U/ S.40(A)(IA) WAS WRONG. THE CIT(A) DISAGREED WITH THE ASSESSEES CLA IM THAT THE DISALLOWANCE WAS ERRONEOUSLY MADE. AS REGARDS THE I SSUE AS TO WHETHER THE ASSESSEE WOULD BE ENTITLED TO THE DEDUC TION U/S.80-IB(10) IN RESPECT OF THE PROFITS COMPUTED AFTER MAKING THE DISALLOWANCE U/S.40(A)(IA) HE WAS OF THE VIEW THAT THIS ISSUE H AD NOT BEEN SPECIFICALLY RAISED BEFORE HIM BY WAY OF A GROUND O F APPEAL BUT WAS RAISED ONLY IN THE WRITTEN SUBMISSIONS FILED BEFORE HIM. HAVING SAID THAT HE HOWEVER PROCEEDED TO DECIDE THE ISSUE ALSO IN PARAGRAPH 4 OF THE IMPUGNED ORDER AND HELD THAT THE DISALLOWED EXP ENDITURE CANNOT BE CONSIDERED TO BE PROFITS GENERATED BY THE INDUST RIAL UNDERTAKING 3 THERE BEING NO NEXUS BETWEEN THE DISALLOWED EXPENDI TURE AND THE INDUSTRIAL UNDERTAKING. IN OTHER WORDS HE HELD THA T IN SO FAR AS THE DISALLOWED EXPENDITURE IS CONCERNED THE INDUSTRIAL UNDERTAKING IS NOT THE SOURCE OF THE SAME AND SECTION 80-IB(10) CAN AP PLY ONLY IN RELATION TO PROFITS WHICH ARE DERIVED FROM THE INDUSTRIAL UNDERTAKING. IN THIS VIEW OF THE MATTER AND AFTER REFERRING TO CERTAIN AUTHORITIES INCLUDING THE JUDGMENTS OF THE SUPREME COURT IN CIT VS. STERL ING FOODS (1999) 237 ITR 579 (SC) PANDIAN CHEMICALS LTD VS. CIT (20 03) 262 ITR 278 (SC) AND LIBERTY INDIA VS. CIT (2009) 317 ITR 218 ( SC) HE HELD THAT THE ASSESSEE WAS NOT ENTITLED TO THE DEDUCTION U/S. 80-IB(10) IN RESPECT OF THE DISALLOWED EXPENDITURE OF RS.4 50 12 485 AND THE DEDUCTION WAS RIGHTLY RESTRICTED BY THE ASSESSING OFFICER TO THE PROFIT OF RS.3 76 78 403 SHOWN IN THE PROFIT AND LOSS ACCOUNT . 4. IN THE FURTHER APPEAL BEFORE THE TRIBUNAL THE A SSESSEE HAS TAKEN GROUNDS QUESTIONING THE DECISION OF THE CIT(A ) NOT TO ADMIT THE ADDITIONAL GROUND TAKEN BY THE ASSESSEE IN WRITING BEFORE HIM AGAINST THE NON-ALLOWANCE OF THE DEDUCTION U/S.80-IB(10) IN RESPECT OF THE AMOUNT OF RS.4 50 12 485 DISALLOWED U/S.40(A)(IA) A S WELL AS THE DECISION OF THE CIT(A) ON THE MERITS. THE GROUND AG AINST THE NON- ADMISSION OF THE GROUND RELATING TO THE CLAIM U/S.8 0-IB(10) IS ACADEMIC BECAUSE EVEN THOUGH THE CIT(A) HAD STATED INITIALLY THAT HE WOULD REFUSE TO ENTERTAIN THE CLAIM IN THE ABSENCE OF A S PECIFIC ADDITIONAL GROUND OF APPEAL ACTUALLY HE HAS PROCEEDED TO DECI DE THE CLAIM ON MERITS. WE WOULD THEREFORE PROCEED TO DISCUSS AND D ECIDE THE ISSUE ON MERITS. 4 5. SECTION 80-IB(1) SAYS THAT THE ASSESSEE WOULD BE ALLOWED A DEDUCTION IN RESPECT OF THE PROFITS AND GAINS DERI VED FROM ANY BUSINESS MENTIONED IN SUB-SECTION (10) WHICH IN TU RN REFERS TO A HOUSING PROJECT. THUS THE PRESCRIBED PERCENTAGE OF PROFITS AND GAINS DERIVED FROM A HOUSING PROJECT (SUBJECT TO OTHER CO NDITIONS OF SUB- SECTION (10) BEING SATISFIED) ARE DEDUCTIBLE FROM T HE GROSS TOTAL INCOME. THE SECTION FALLS UNDER CHAPTER VI-A OF THE ACT UN DER THE SUB-HEAD C-DEDUCTIONS IN RESPECT OF CERTAIN INCOMES. THERE IS NO INDICATION IN THE SECTION AS TO WHAT WOULD BE CONSIDERED AS PROFI TS AND GAINS DERIVED FROM THE ELIGIBLE BUSINESS. SECTION 80AB INTRODUCED BY THE FINANCE (NO.2) ACT 1980 W.E.F. 1-4-1981 HOWEVER ST ATES THAT WHERE ANY DEDUCTION IS REQUIRED TO BE MADE UNDER ANY SECT ION FALLING UNDER CHAPTER VI-A UNDER THE HEADING C DEDUCTIONS IN R ESPECT OF CERTAIN INCOMES IN RESPECT OF ANY INCOME OF THE NATURE REF ERRED TO IN THAT SECTION THEN NOTWITHSTANDING ANYTHING CONTAINED IN THAT SECTION FOR THE PURPOSE OF COMPUTING THE DEDUCTION UNDER TH AT SECTION THE AMOUNT OF INCOME OF THAT NATURE AS COMPUTED IN ACCO RDANCE WITH THE PROVISIONS OF THIS ACT (BEFORE MAKING ANY DEDUCTION UNDER THIS CHAPTER) SHALL ALONE BE DEEMED TO BE THE AMOUNT OF INCOME OF THAT NATURE WHICH IS DERIVED OR RECEIVED BY THE ASSESSEE AND WHICH IS INCLUDED I N HIS GROSS TOTAL INCOME. IN OUR HUMBLE OPINION THIS SE CTION AFFORDS A COMPLETE ANSWER TO THE PROBLEM POSED BEFORE US. 6. IN OTHER WORDS UNDER SECTION 80AB THE INCOME THAT IS DERIVED FROM THE ELIGIBLE BUSINESS MUST BE COMPUTED IN ACCO RDANCE WITH THE PROVISIONS OF SECTIONS 30 TO 43D AS PROVIDED IN SE CTION 29. SECTION 29 5 PROVIDES THAT THE INCOME CHARGEABLE TO TAX UNDER TH E HEAD PROFITS AND GAINS OF BUSINESS SHALL BE COMPUTED IN ACCORDANCE WITH THE PROVISIONS CONTAINED IN SECTIONS 30 TO 43D. UNQUESTIONABLY SECTION 40(A)(IA) IS A SECTION FALLING BETWEEN SECTIONS 30 TO 43D AND THEREFORE EFFECT MUST BE GIVEN TO THE SAME IN COMPUTING THE P ROFITS AND GAINS DERIVED FROM THE ELIGIBLE BUSINESS WHICH IN THIS C ASE IS A HOUSING PROJECT. IT FOLLOWS THAT IF THE ASSESSEE HAS NOT DE DUCTED TAX FROM ANY PAYMENT WHICH IT WAS REQUIRED TO OR HAS FAILED TO DEPOSIT THE TAX WITHIN THE PRESCRIBED TIME-LIMIT IT CANNOT CLAIM ANY DEDU CTION IN RESPECT OF THE PAYMENT WHILE COMPUTING THE PROFITS DERIVED FROM TH E ELIGIBLE BUSINESS. THE PAYMENT HAS TO BE DISALLOWED AND ADDED BACK TO THE PROFITS THEREBY SWELLING THE SAME. THE RESULTANT FIGURE OF PROFITS ENHANCED BY THE AMOUNT OF DISALLOWANCE WOULD BE ELIGIBLE FOR T HE DEDUCTION U/S.80- IB(10). 7. IN CIT VS. ALBRIGHT MORARJI AND PANDIT LTD (1999 ) 236 ITR 914 (BOM) THE HONBLE BOMBAY HIGH COURT WAS CONCERNED WITH THE ASSESSMENT YEAR 1980-81 WHEN SECTION 80AB HAD NOT B EEN INTRODUCED INTO THE INCOME TAX ACT. THE CONTROVERSY CENTERED A ROUND THE DEDUCTION U/S.80HH WHICH PERMITTED DEDUCTION IN RES PECT OF PROFITS AND GAINS DERIVED FROM AN INDUSTRIAL UNDERTAKING. THE TRIBUNAL ALLOWED THE CLAIM OF THE ASSESSEE THAT WHILE COMPUTING SUCH PROFITS THE PROVISIONS OF SECTION 32A WHICH ALLOWED DEDUCTION F OR INVESTMENT ALLOWANCE SHOULD BE IGNORED. THE HONBLE HIGH COUR T REVERSED THE DECISION OF THE TRIBUNAL HOLDING THAT SINCE THE SE CTION HAS PROVIDED THAT THE PROFITS AND GAINS IN RESPECT OF WHICH DEDU CTION IS TO BE ALLOWED 6 ARE THOSE WHICH ARE INCLUDED IN THE ASSESSEES GROS S TOTAL INCOME AND SINCE GROSS TOTAL INCOME WAS DEFINED BY SECTION 8 0B(5) AS IT STOOD THEN TO MEAN THE TOTAL INCOME COMPUTED IN ACCORDAN CE WITH THE PROVISIONS OF THE ACT BEFORE MAKING ANY DEDUCTION UNDER CHAPTER VI-A OR UNDER SECTION 280-O THE PROFITS AND GAINS DER IVED FROM AN INDUSTRIAL UNDERTAKING INCLUDED IN THE GROSS TOTAL INCOME WOULD THEREFORE OBVIOUSLY BE THE PROFITS AND GAINS COMPU TED IN ACCORDANCE WITH THE PROVISIONS OF THE ACT (PAGE 918). THEREAF TER REFERENCE WAS MADE TO SECTION 29 OF THE ACT WHICH WE HAVE NOTED EARLIER AND IT WAS HELD THAT WHILE COMPUTING THE PROFITS AND GAINS OF THE BUSINESS IN THE MANNER PRESCRIBED BY SECTION 29 THE PROVISIONS OF S ECTION 32A CANNOT BE IGNORED AND THE PROFITS HAVE TO BE REDUCED BY TH E INVESTMENT ALLOWANCE. 8. IN THE ABOVE CASE THE HONBLE HIGH COURT HAS NO TICED THE PROVISIONS OF SECTION 80AB INSERTED BY THE FINANCE (NO.2) ACT 1980 WITH EFFECT FROM 1-4-1981 AND IT HAS BEEN HELD AT P AGE 919 THAT THE SECTION IS MERELY DECLARATORY AND SUPPORTS THE DECI SION TAKEN. 9. IN GRASIM INDUSTRIES LTD. VS. ACIT AND OTHERS (2 000) 245 ITR 677 (BOM) ANOTHER DIVISION BENCH OF THE HONBLE BO MBAY HIGH COURT TOOK THE SAME VIEW. THERE THE ASSESSMENT YEAR WAS 1 974-75. THE QUESTION AGAIN WAS THE MANNER OF COMPUTING THE PROF ITS AND GAINS DERIVED FROM THE INDUSTRIAL UNDERTAKING U/S.80HH T HE CONTENTION OF THE ASSESSEE BEING THAT THE DEVELOPMENT REBATE ALLOWABL E U/S 33A CANNOT BE DEDUCTED WHILE COMPUTING THE PROFITS FOR THE PUR POSE OF THE SECTION. THE HONBLE HIGH COURT HELD REJECTING THE CONTENTI ON THAT EVEN BEFORE 7 THE INSERTION OF SECTION 80AB IT WAS CLEAR ON A PL AIN READING OF SECTION 80HH AND SECTION 80B(5) THAT WHAT IS INCLUDED IN TH E GROSS TOTAL INCOME IS NOT ONLY A SPECIFIED CATEGORY OF INCOME B UT ALSO A PARTICULAR QUANTUM OF INCOME BELONGING TO THAT CATEGORY AND TH AT WHAT WAS IMPLICIT IN THE STATUTORY PROVISIONS WAS MERELY MAD E EXPLICIT BY SECTION 80AB. IT WAS THUS HELD THAT EVEN WITHOUT THE PROVIS IONS OF SECTION 80AB THE POSITION WOULD BE THAT THE PROFITS AND GAI NS DERIVED FROM THE INDUSTRIAL UNDERTAKING WILL HAVE TO BE COMPUTED IN ACCORDANCE WITH SECTIONS 30 TO 43A AS STIPULATED BY SECTION 29. 10. THE QUESTION AGAIN RECENTLY ENGAGED THE ATTENTI ON OF A FULL BENCH OF THE HONBLE BOMBAY HIGH COURT IN PLASTIBEN DS INDIA LTD VS. ADDITIONAL CIT AND OTHERS (2009) 318 ITR 352 (BOM) (FB). IN THIS CASE THE ASSESSEE CLAIMED THAT WHILE COMPUTING THE PROFI TS FOR THE PURPOSES OF SECTION 80-IA DEPRECIATION SHOULD NOT BE DEDUCT ED TO REDUCE THE PROFITS AS THE ASSESSEE HAD A CHOICE TO CLAIM OR NO T TO CLAIM DEPRECIATION AND THAT THE ASSESSEE (IN THAT CASE) H AD OPTED NOT TO CLAIM DEPRECIATION. REJECTING THE CLAIM THE FULL B ENCH OF THE HONBLE HIGH COURT HELD THAT (A) SECTION 80IA IS A CODE IN ITSELF AND THE DEDUCTION ALLOWABLE THEREUNDER IS A SPECIAL DEDUCTI ON LINKED TO THE PROFITS AND NOT TO THE INVESTMENT AS IN CHAPTER-IV; (B) THE SECTION CONTAINS BOTH SUBSTANTIVE AND PROCEDURAL PROVISIONS AND ANY DEVICE ADOPTED TO REDUCE OR INFLATE THE PROFITS OF THE ELI GIBLE BUSINESS SHOULD BE REJECTED; AND (C) THE QUANTUM OF DEDUCTION WOULD NOT DEPEND UPON THE ASSESSEE CLAIMING OR NOT CLAIMING CURRENT DEPRE CIATION AND IT 8 SHOULD BE ARRIVED AT AFTER COMPUTING THE PROFITS IN ACCORDANCE WITH THE SECTIONS 30 TO 43D AND AFTER ALLOWING ALL DEDUCTION S THEREUNDER. 11. THE ARGUMENT OF THE REVENUE HOWEVER IS THAT ALL THE ABOVE JUDGMENTS OF THE HONBLE BOMBAY HIGH COURT WERE CON CERNED WITH DEDUCTIONS TO BE ALLOWED WHEREAS IN THE PRESENT CAS E THE DEDUCTION WAS NOT TO BE ALLOWED BECAUSE THE ASSESSEE HAD FAIL ED TO DEDUCT AND PAY THE TAXES WITHIN THE TIME-FRAME PRESCRIBED AND THUS IT WAS A CASE OF DISALLOWANCE OF A DEDUCTION AND ADD-BACK OF THE SAME TO WHICH THE RATIO OF THE JUDGMENTS CITED ABOVE CANNOT APPLY. TH E RATIO OF THE JUDGMENTS CITED ABOVE IN OUR HUMBLE OPINION IS TH AT THE PROFITS AND GAINS OF THE ELIGIBLE BUSINESS FOR THE PURPOSE OF THE SECTIONS FALLING UNDER THE HEADING C DEDUCTIONS IN RESPECT OF CER TAIN INCOMES HAVE TO BE COMPUTED IN ACCORDANCE WITH THE COMPUTAT ION PROVISIONS OF SECTIONS 30 TO 43D AS MANDATED BY SECTION 29. THERE FORE IT HARDLY MATTERS WHETHER WHILE COMPUTING THE PROFITS IN ACCO RDANCE WITH THE ABOVE SECTIONS AN AMOUNT IS ALLOWED AS A DEDUCTION OR IS DISALLOWED AND ADDED BACK TO THE PROFITS SINCE COMPUTATION W OULD INCLUDE BOTH ALLOWING A DEDUCTION AND DISALLOWING OR RESTRICTING A DEDUCTION IN ACCORDANCE WITH THE STATUTORY PROVISIONS. SECTION 4 0(A)(IA) AUTHORISES THE DISALLOWANCE OF THE DEDUCTION IF THE TAX HAS NO T BEEN DEDUCTED AND PAID IN TIME. IT IS PART OF THE PROVISIONS FOR COMP UTATION OF THE PROFITS. WE ARE UNABLE TO APPRECIATE HOW WHILE COMPUTING THE PROFITS AND GAINS IN ACCORDANCE WITH THE MANDATE OF SECTION 29 A DISTINCTION CAN BE MADE BETWEEN A SECTION WHICH ALLOWS THE DEDUCTIO N AND A SECTION WHICH DISALLOWS OR RESTRICTS THE DEDUCTION FOR FAILURE TO FULFILL CERT AIN 9 CONDITIONS. BOTH ARE PART OF THE COMPUTATION PROVIS IONS AND BOTH HAVE TO BE GIVEN EFFECT TO IN COMPUTING THE PROFITS OF T HE ELIGIBLE BUSINESS. SECTION 80AB ADVISEDLY USES THE EXPRESSION ..THE AMOUNT OF INCOME OF THAT NATURE AS COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF THIS ACT. (UNDERLINING OURS). THE SECTION WOULD HAVE B EEN DIFFERENTLY WORDED IF THE CONTENTION OF THE REVENUE IS TO BE AC CEPTED. 12. THE MEANING AND IMPLICATION OF THE WORDS COMPU TED IN ACCORDANCE WITH THE PROVISIONS OF THE ACT WERE CON SIDERED BY THE SUPREME COURT IN CAMBAY ELECTRIC SUPPLY INDUSTRIAL CO. LTD. VS. CIT (1978) 113 ITR 84 (SC). WHILE EXPLAINING THE STEPS INVOLVED IN ALLOWING THE DEDUCTION U/S 80E THE COURT OBSERVED THAT THE FIRST STEP INVOLVED WOULD BE TO COMPUTE THE TOTAL INCOME OF TH E ASSESSEE IN ACCORDANCE WITH THE OTHER PROVISIONS OF THE ACT TH AT IS WITHOUT CONSIDERING SECTION 80E. IT WAS THEN OBSERVED THAT THE WORDS AS COMPUTED IN ACCORDANCE WITH THE OTHER PROVISIONS OF THIS ACT CLEARLY CONTAIN A MANDATE THAT THE TOTAL INCOME OF THE CONCERNED ASSESSEE MUST BE COMPUTED IN ACCORDANCE WITH THE OTHER PROVI SIONS OF THE ACT WITHOUT REFERENCE TO SECTION 80E AND SINCE IN THE I NSTANT CASE IT IS INCOME FROM BUSINESS THE SAME AS PER SECTION 29 WIL L HAVE TO BE COMPUTED IN ACCORDANCE WITH SECTIONS 30 TO 43A WHIC H WOULD INCLUDE SECTION 41(2) (HIGHLIGHTING OURS) . WE WILL BE IGNORING THE MANDATE OF SECTION 80AB READ WITH SECTION 29 OF THE ACT IF WE ARE TO ACCEPT THE STAND OF THE REVENUE. THERE IS NO AUTHORITY GIVEN B Y THESE SECTIONS TO IGNORE THE EFFECT OF SECTION 40(A)(IA). THOSE SECTI ONS DO NOT SAY THAT THE ASSESSEE WILL BE ALLOWED ALL THE DEDUCTIONS FROM THE PROFIT S BUT 10 WHEN IT COMES TO DISALLOWING CERTAIN CLAIMS OF EXPE NDITURE SOMEHOW THOSE PROVISIONS WILL HAVE TO BE IGNORED. 13. THE REVENUE REFERRED TO THE JUDGMENT OF THE SUP REME COURT IN THE CASE OF DISTRIBUTORS (BARODA) PVT. LTD VS. UOI (1985) 155 ITR 120 (SC). IN THIS CASE THE EARLIER JUDGMENT OF THE SAME COURT IN CLOTH TRADERS P. LTD. VS. ADDITIONAL CIT (1979) 118 ITR 2 43 (SC) WHERE IT WAS HELD THAT THE DEDUCTION U/S.80M WILL HAVE TO BE COMPUTED WITH REFERENCE TO THE GROSS AMOUNT OF DIVIDEND RECEIVED BY THE ASSESSEE WAS OVERRULED AND IT WAS HELD THAT THE DEDUCTION WI LL HAVE TO BE GIVEN ON THE NET AMOUNT OF DIVIDEND CALCULATED IN ACCORDA NCE WITH THE PROVISIONS OF THE INCOME TAX ACT. IT WAS ALSO OBSER VED THAT IT IS ONLY THE NET INCOME BY WAY OF DIVIDEND WHICH IS CALCULAT ED IN ACCORDANCE WITH THE PROVISIONS OF THE ACT THAT IS INCLUDED IN THE GROSS TOTAL INCOME OF THE ASSESSEE AND THEREFORE THE DEDUCTION U/S 80M HAS ALSO TO BE GIVEN ONLY WITH REFERENCE TO SUCH NET AMOUNT OF DIV IDEND INCOME. THE SUPREME COURT ALSO APPROVINGLY CITED ITS EARLIER JU DGMENT IN CAMBAY ELECTRIC SUPPLY COS CASE (1978) 113 ITR 84 WHERE I T WAS HELD WITH REFERENCE TO SECTION 80E THAT THE COMPUTATION OF T HE PROFITS OF THE ELIGIBLE BUSINESS FOR THE PURPOSE OF THAT SECTION H AS TO DONE IN ACCORDANCE WITH THE PROVISIONS OF THE ACT AND IN DO ING SO THE UNABSORBED DEPRECIATION AND UNABSORBED DEVELOPMENT REBATE BROUGHT FORWARD FROM EARLIER YEARS WILL HAVE TO BE DEDUCTED FROM THE PROFITS. WE DO NOT SEE HOW THE JUDGMENT IN DISTRIBUTORS (BARODA ) P. LTD. (SUPRA) CAN BE UNDERSTOOD TO SUPPORT THE STAND OF THE REVEN UE IN THE CASE BEFORE US. THE JUDGMENT ON THE CONTRARY WOULD SUP PORT THE ASSESSEE 11 WHO IS RELYING ON SECTION 80AB WHICH SAYS THE VERY SAME THING WHICH HAS BEEN SAID IN THE JUDGMENT. 14. IT WAS THEN SUBMITTED BY THE REVENUE RELYING O N THE RECENT JUDGMENT OF THE SUPREME COURT IN LIBERTY INDIA VS. CIT (2009) 317 ITR 218 (SC) THAT PROFITS DERIVED FROM THE ELIGIBLE BUS INESS (HOUSING PROJECT) IN SECTION 80-IB(1) WOULD ONLY MEAN THE OP ERATIONAL PROFITS AND SINCE THE AMOUNT DISALLOWED U/S.40(A)(IA) CANNOT FU LFILL THIS CONDITION IT CANNOT BE GIVEN THE DEDUCTION. SECTIONS 80-I 80-IA AND 80-IB WERE BEFORE THE SUPREME COURT. THE MAIN QUESTION FOR CON SIDERATION WAS WHETHER DEPB AND DUTY DRAWBACK (DDB) BENEFITS COULD BE CONSIDERED AS PROFITS DERIVED FROM THE INDUSTRIAL UNDERTAKING/ELIGIBLE BUSINESS. IT WAS IN THIS CONTEXT OBSERVED THAT THE EXPRESSION DERIVED FROM IS MUCH NARROWER THAN THE EXPRESSION ATTRIBU TABLE TO IN LINE WITH THE EARLIER VIEW TAKEN BY THE SUPREME COURT IN STERLING FOODS (SUPRA) AND PANDIAN CHEMICALS (SUPRA) AND THAT DEPB AND DDB WHICH FLOW FROM THE SCHEMES FRAMED BY THE CENTRAL G OVERNMENT OR FROM SECTION 75 OF THE CUSTOMS ACT 1962 BELONG TO THE CATEGORY OF ANCILLARY PROFITS. AT PAGE 232 IT WAS OBSERVED TH AT MERE OWNERSHIP OF A SHIP DOES NOT ATTRACT SUB-SECTION (6) OF SECTION 80IB AND THAT WHAT ATTRACTS THE SUB-SECTION IS THE GENERATION OF PROF ITS (OPERATIONAL PROFITS). IN THE PRESENT CASE APPLYING THE OBSERV ATION IT MUST BE HELD THAT MERE OWNERSHIP OF THE HOUSING PROJECT DOES NOT ATTRACT SUB-SECTION (10) OF SECTION 80IB AND THAT THE HOUSING PROJECT M UST ITSELF GENERATE THE PROFITS. IT MUST BE KEPT IN MIND THAT THE OBSERVATIONS WERE MADE TO CONTRAST THE PROFITS GENERATED BY THE WORKING OF TH E ELIGIBLE 12 BUSINESS/ASSET/UNDERTAKING WITH THE PROFITS WHICH A RE ENJOYED BY IT UNDER THE SCHEMES FRAMED BY THE CENTRAL GOVERNMENT OR THE CUSTOMS ACT. THE TRUE RATIO OF THE JUDGMENT IN OUR HUMBLE AND LIMITED UNDERSTANDING IS THAT PROFITS GENERATED BY THE WOR KING OF THE BUSINESS/ASSET/UNDERTAKING ALONE ARE ENTITLED TO BE HELD AS HAVING BEEN DERIVED FROM THE SAID BUSINESS/ASSET/UNDERTA KING AND NOT PROFITS WHICH THE ASSESSEE ENJOYS BECAUSE OF GOVERN MENTAL SCHEMES OR CONCESSIONS OR STATUTORY BENEFITS OR INCENTIVES . IN THE VERY NATURE OF THINGS THE RATIO OF THE JUDGMENT CAN BE APPLIED ON LY WITH REFERENCE TO RECEIPTS CLAIMED BY THE ASSESSEE TO BE ELIGIBLE FOR THE DEDUCTION AND TO TEST THEM AND FIND OUT IF THEY WERE GENERATED BY TH E WORKING OF THE ELIGIBLE BUSINESS SO THAT THEY CAN BE CONSIDERED A S OPERATIONAL PROFITS AND NOT MERELY ANCILLARY PROFITS. IN THE JUDGMENT SECTION 80AB HAS BEEN NOTICED AT PAGES 226-227 AS PART OF THE RELEVA NT PROVISIONS OF THE INCOME TAX ACT 1961 BUT THE ULTIMATE DECISION DID NOT TURN ON THAT SECTION OBVIOUSLY BECAUSE THAT SECTION DEALT WITH HOW THE PROFITS ELIGIBLE FOR THE DEDUCTION HAVE TO BE COMPUTED; THE DECISION TURNED ON THE FUNDAMENTAL FACTUAL ASPECT WHETHER THE RECEIPT IN QUESTION CAN BE REFERRED IN THE FIRST DEGREE TO THE WORKING OF BUSI NESS/ASSET/ UNDERTAKING AND THUS BE CONSIDERED TO BE PART OF TH E OPERATIONAL PROFITS OR IT WAS REFERABLE TO SOME OTHER IMMEDIATE SOURCE SUCH AS THE SCHEMES FRAMED BY THE CENTRAL GOVERNMENT OR A STATU TE SUCH AS THE CUSTOMS ACT OR SOME OTHER SCHEME FOR THE PROVISION OF INCENTIVES TO THE BUSINESSMAN IN WHICH CASE THE RECEIPT IN QUEST ION CAN ONLY BE CONSIDERED AS ANCILLARY PROFIT AND NOT OPERATIONA L PROFIT AND THEREFORE 13 WOULD NOT BE ENTITLED TO THE DEDUCTION. IN OUR HUMB LE UNDERSTANDING OF THE JUDGMENT THE REVENUE CANNOT DERIVE SUPPORT FRO M THE SAME ON THE QUESTION ARISING IN THE CASE BEFORE US. 15. WE MAY AGAIN REFER TO THE JUDGMENT OF THE SUPRE ME COURT IN CAMBAY ELECTRIC SUPPLY INDUSTRIAL COS CASE (SUPRA) IN CONNECTION WITH THE ARGUMENT OF THE REVENUE THAT THE DISALLOWED EXP ENDITURE CANNOT BE CONSIDERED TO BE PROFITS DERIVED FROM THE HOUSING PROJECT. IN THAT CASE THE COURT WAS CONCERNED WITH SECTION 80E WHICH PROV IDED FOR DEDUCTION IN RESPECT OF PROFITS AND GAINS FROM SPEC IFIED INDUSTRIES IN THE CASE OF CERTAIN COMPANIES. IT WAS PROVIDED THAT IN THE CASE OF AN ELIGIBLE COMPANY WHERE THE TOTAL INCOME (AS COMPUTED IN ACCORDANCE WITH THE OTHER PROVISIONS OF THIS ACT) INCLUDED ANY PROFITS AND GAINS ATTRIBUTABLE TO THE BUSINESS OF G ENERATION OR DISTRIBUTION OF ELECTRICITY OR ANY OTHER FORM OF PO WER ETC. THERE SHALL BE ALLOWED A DEDUCTION FROM SUCH PROFITS AND GAINS OF AN AMOUNT EQUAL TO 8% THEREOF IN COMPUTING THE TOTAL INCOME OF THE COM PANY. THE INCOME- TAX AUTHORITIES DID NOT ACCEPT THE CONTENTION OF TH E ASSESSEE THAT IN COMPUTING THE PROFITS THE UNABSORBED DEPRECIATION U /S 32(2) AND THE UNABSORBED DEVELOPMENT REBATE U/S 33(2) SHOULD NOT BE DEDUCTED. THEIR VIEW WAS AFFIRMED BY THE GUJARAT HIGH COURT A GAINST WHICH THE ASSESSEE WENT IN APPEAL TO THE SUPREME COURT. IT WA S CONTENDED BY THE ASSESSEE BEFORE THE SUPREME COURT (PL. SEE PAGE 94-95 OF THE REPORT) THAT THE EXPRESSION TOTAL INCOME APPEARIN G IN SEC.80E HAS BEEN USED IN ITS COMMERCIAL SENSE AND SINCE NEITHER THE UNABSORBED DEPRECIATION NOR THE UNABSORBED DEVELOPMENT REBATE HAS ANYTHING TO 14 DO WITH COMMERCIAL PROFITS ATTRIBUTABLE TO THE BUSI NESS THE SAID TWO ITEMS WOULD NOT BE DEDUCTIBLE BEFORE ARRIVING AT TH E FIGURE THAT WOULD BE ELIGIBLE TO THE 8% DEDUCTION. THE SUPREME COURT SPEAKING THROUGH HONBLE JUSTICE TULZAPURKAR REJECTED THE C ONTENTION AND OBSERVED AS FOLLOWS: (PAGE 95) IT IS NOT POSSIBLE TO ACCEPT THIS CONTENTION FO R MORE THAN ONE REASON. FIRST IN SUB-SECTION (1) OF SECTION 80E THE EXPRESSION TOTAL INCOME IS FOLLOWED BY T HE WORDS AS COMPUTED IN ACCORDANCE WITH THE OTHER PROVISIONS OF THIS ACT IN PARENTHESIS AND THE MAND ATE OF THESE WORDS CLEARLY NEGATIVES THE ARGUMENT THAT THE EXPRESSION TOTAL INCOME HAS BEEN USED IN THE SENS E OF COMMERCIAL PROFITS. SECONDLY THE EXPRESSION TOTA L INCOME HAS BEEN DEFINED IN SECTION 2(45) OF THE AC T AS MEANING THE TOTAL AMOUNT OF INCOME REFERRED TO IN SECTION 5 COMPUTED IN THE MANNER LAID DOWN IN THIS ACT AND WHEN THIS DEFINITION HAS BEEN FURNISHED BY THE ACT ITSELF THE EXPRESSION AS APPEARING IN SECTION 80E(1 ) MUST IN THE ABSENCE OF ANYTHING IN THE CONTEXT SUGGESTIN G TO THE CONTRARY BE CONSTRUED IN ACCORDANCE WITH SUCH DEFINITION. SINCE THE WORDS IN THE PARENTHESIS OCC URRING IN SUB-SECTION (1) LAY DOWN THE MANNER IN WHICH THE TOTAL INCOME OF THE CONCERNED ASSESSEE IS TO BE COMPUTED THERE WOULD BE NO SCOPE FOR EXCLUDING ITEMS LIKE UNABSORBED DEPRECIATION AND UNABSORBED DEVELOPMENT REBATE WHILE COMPUTING THE TOTAL INCOME ON THE BASI S THAT THE TOTAL INCOME SPOKEN OF BY SUB-SECTION (1) MEANS COMMERCIAL PROFITS. THE IMPLICATION OF THE WORDS COMPUTED IN THE MANNE R LAID DOWN IN THIS ACT HAS BEEN EXPOUNDED AND IT HAS BEEN OPINED THAT IT MUST TAKE PRECEDENCE OVER SUCH NOTIONS AS COMMERCIAL PROFITS . THIS DECISION SUPPORTS THE PLEA OF THE ASSESSEE BEFORE US THAT WH ILE GIVING EFFECT TO THE COMPUTATION PROVISIONS CONTAINED IN SECTIONS 30 TO 43D ONE SHOULD NOT BE BOGGED DOWN BY THE THEORY THAT THE DISALLOWE D EXPENDITURE CANNOT BE CONSIDERED AS PROFITS DERIVED FROM THE HOUSING PROJECT OR AS OPERATIONAL PROFITS. 15 16. IN THE SAME JUDGMENT I.E. CAMBAY ELECTRIC SUP PLY (SUPRA) ONE MORE QUESTION THAT CAME UP FOR DECISION WAS WHETHER WHILE COMPUTING THE PROFITS ELIGIBLE FOR THE DEDUCTION U/S 80E THE BALANCING CHARGE TAXABLE U/S 41(2) WOULD BE INCLUDED. SECTION 41(2) PROVIDED FOR RECALL OF THE DEPRECIATION ALLOWANCE EARLIER GRANTED TO TH E ASSESSEE IF AND WHEN THE ASSET IS SOLD. THE SECTION FELL WITHIN SEC TIONS 30 TO 43A OF THE ACT AND PROVIDED THAT THE DEPRECIATION ALLOWED IN R ESPECT OF THE ASSET WHICH WAS SOLD WOULD BE CALLED BACK AND ASSESSED AS PROFITS AND GAINS OF THE BUSINESS. THE ARGUMENT OF THE REVENUE BEFORE THE SUPREME COURT WAS THAT THE REAL NATURE OF THE BALAN CING CHARGE WAS THAT IT WAS A RETURN OF CAPITAL AND NOT A RETURN OF REVENUE AND HENCE CANNOT BE CONSIDERED AS PART OF THE PROFITS ELIGIBL E FOR THE DEDUCTION NOTWITHSTANDING THE LANGUAGE EMPLOYED IN SECTION 80 E TO THE EFFECT THAT THE TOTAL INCOME SHALL BE COMPUTED IN ACCORDAN CE WITH THE PROVISIONS OF THE ACT EXCEPT SECTION 80E AND THE L ANGUAGE EMPLOYED IN SECTION 29 THAT THE PROFITS OF THE BUSINESS SHAL L BE COMPUTED IN ACCORDANCE WITH SECTIONS 30 TO 43A. IN OTHER WORDS THE SUPREME COURT WAS POSED WITH THE QUESTION AS TO WHETHER THE LANGUAGE OF THE STATUTORY PROVISIONS HAS TO BE GIVEN PRIMACY OVER T HE REAL NATURE OF THE PROFITS A QUESTION WHICH HAS ALSO ARISEN BEFORE US IN SUBSTANCE THOUGH SLIGHTLY IN A DIFFERENT FORM THE DIFFERENCE IN THE FORM BEING THAT IN THE PRESENT CASE THE QUESTION IS WHETHER THE STATUTORY PROVISIONS SHALL BE GIVEN EFFECT TO ASSUMING THAT THE DISALLOWED EXPEND ITURE MAY NOT REPRESENT OPERATIONAL PROFITS OF THE HOUSING PROJ ECT. THERE ARE AT LEAST THREE PLACES IN THE JUDGMENT OF THE SUPREME COURT I N CAMBAYS CASE 16 (SUPRA) IN WHICH THE REVENUES CONTENTION THAT THE NATURE OF THE PROFITS MUST BE SUCH THAT IT CAN PROPERLY BE DESCRIBED AS C OMMERCIAL PROFITS WAS EXAMINED AND REJECTED. FIRSTLY IN PAGE 90 OF T HE REPORT THE SUPREME COURT CLEARED THE DECK BY OBSERVING THAT IN OUR VIEW THE ANSWER TO THE QUESTION RAISED BEFORE US REALLY TURNS UPON THE PROPER CONSTRUCTION OF THE PROVISION CONTAINED IN SECTION 80E(1) OF THE ACT RATHER THAN ON WHAT IS THE REAL NATURE OR CHARA CTER OF A BALANCING CHARGE ARISING UNDER SECTION 41(2) OF THE ACT.. (HIGHLIGHTING OURS) . SECONDLY AT PAGE 91 OF THE REPORT IT WAS HELD THA T IT IS OBVIOUS THAT IN COMPUTING THE TOTAL INCOME OF THE CONCERNED ASSESSEE THE BALANCING CHARGE ARISING AS A RESULT O F THE SALE OF OLD MACHINERY AND BUILDINGS AND WORKED OUT AS PER SECTI ON 41(2) IRRESPECTIVE OF ITS REAL CHARACTER WILL HAVE TO BE TAKEN INTO ACCOUNT AND INCLUDED AS INCOME OF THE BUSINESS ( HIGHLIGHTING OURS). THIRDLY AT PAGE 92 OF THE REPORT THE SUPREM E COURT AFTER NOTICING THE DIVERGENCE OF VIEWS AS TO THE REAL NAT URE OF THE BALANCING CHARGE EXPRESSED IN TWO EARLIER JUDGMENTS OF THEIR OWN SUMMARISED THE POSITION THUS: IT IS UNNECESSARY IN THIS CASE TO GO INTO THE QUES TION WHETHER THE DIVERGENCE IS REAL OR MERELY APPARENT FOR AS WE HAVE SAID ABOVE THE ANSWER TO THE QUESTION RAIS ED BEFORE DOES NOT DEPEND UPON THE REAL NATURE OR TRUE CHARACTER OF THE BALANCING CHARGE BUT UPON PROPER CONSTRUCTION OF THE SUB-SECTION (1) WHICH CONTAINS THE LEGISLATIVE MANDATE WITH REGARD TO THE MANNER IN 17 WHICH THREE STEPS INDICATED THEREIN ARE REQUIRED TO BE TAKEN FOR COMPUTING THE DEDUCTION OF 8% CONTEMPLATE D BY THAT PROVISIONS (HIGHLIGHTING OURS) . 17. THE LAST ARGUMENT OF THE REVENUE PUT FORTH BEFORE U S WITH CONSIDERABLE VEHEMENCE BY THE LEARNED SENIOR DR IS THAT IF THE ASSESSEES CONTENTION IS ACCEPTED THE RESULT WOULD BE THAT THERE IS AN ARTIFICIAL INFLATION OF THE PROFITS FROM THE HOUSIN G PROJECT WHICH WOULD BE AGAINST COMMON SENSE AND REALITY AND WOULD AMOUNT T O SAYING THAT AN EXPENDITURE DISALLOWED WOULD AMOUNT TO INCOME OF TH E ASSESSEE A PROPOSITION WHICH CANNOT AT ALL BE ACCEPTED. WE HAV E TO INTERPRET THE STATUTORY PROVISIONS AS THEY STAND AND IN THE LIGHT OF THE BINDING AUTHORITIES. AS ALREADY POINTED OUT IT IS BECAUSE OF THE LANGUAGE OF SECTION 80AB READ WITH SECTION 29 THAT THE PROFITS OF THE HOUSING PROJECT ARE TO BE COMPUTED AT RS.8 26 90 888 AFTER APPLYING SECTION 40(A)(IA) AND DISALLOWING THE PAYMENTS AGGREGATING TO RS. 4 50 12 485 ON WHICH TAX HAS NOT BEEN DEDUCTED IN TIME. THIS PO SITION HAS BEEN ADUMBRATED BY THE SUPREME COURT IN THE CASE OF CAMB AY ELECTRICAL (SUPRA). WE HAVE ALSO REFERRED TO THE BINDING JUDGM ENTS OF THE HONBLE BOMBAY HIGH COURT ON THE INTER-RELATIONSHIP BETWEEN SECTION 80AB AND THE OTHER SECTIONS UNDER THE HEAD C DEDUCTIO NS IN RESPECT OF CERTAIN INCOMES FALLING IN CHAPTER VI-A. WE MAY AL SO HIGHLIGHT THAT SECTION 80AB HAS OVER-RIDING EFFECT IN AS MUCH AS I T WOULD APPLY NOTWITHSTANDING ANYTHING CONTAINED IN THAT SECTION THE REFERENCE BEING TO ANY SECTION UNDER THE AFORE-MENTIONED HEAD ING IN CHAPTER VI- 18 A IN SO FAR AS THE COMPUTATION OF THE INCOME ELIGI BLE FOR THE DEDUCTION IS CONCERNED. WHEN SUCH IS THE STATUTORY BACKGROUND SUPPORTED BY BINDING PRECEDENTS IT WOULD BE IMPERMISSIBLE FOR U S TO DEVIATE FROM THEM AND UPHOLD THE STAND OF THE REVENUE. ONE CAN O NLY SPECULATE WHETHER SECTION 80AB AS IT STANDS NOW AND WITH THE LANGUAGE EMPLOYED THEREIN HAS PROVED TO BE ADEQUATE IN DEAL ING WITH THE PRECISE CONTROVERSY THAT HAS ARISEN IN THE PRESENT CASE BUT THE REMEDY FOR THAT LIES ELSEWHERE. WE MAY NOTICE THE FIRST P ROVISO TO SECTION 92C OF THE ACT WHICH SAYS THAT NO DEDUCTION UNDER SECT IONS 10A 10AA AND SECTION 10B OR UNDER CHAPTER VI-A SHALL BE ALLOWED IN RESPECT OF THE AMOUNT OF INCOME BY WHICH THE TOTAL INCOME OF THE A SSESSEE IS ENHANCED AFTER COMPUTATION OF INCOME UNDER THIS SUB -SECTION. THE SECTION PROVIDES FOR COMPUTATION OF ARMS LENGTH PRI CE IN RELATION TO AN INTERNATIONAL TRANSACTION AND THE EFFECT OF THE PRO VISO IS THAT IF AN ADDITION IS MADE ON THE GROUND THAT THE PRICE CHARG ED IS NOT AT ARMS LENGTH THE ADDED AMOUNT WILL NOT ENJOY THE EXEMPTI ON UNDER THE AFOREMENTIONED SECTIONS. 18. WE MAY ADD THAT THE ORDER OF THE AMRITSAR BENCH OF THE TRIBUNAL IN THE CASE OF M/S KASHMIR TUBES VS. ITO [ITA NO: 1 45(ASR)/2005 DATED 07.12.2007) ON WHICH RELIANCE WAS PLACED BY THE REVENUE SEEMS TO DEAL WITH THE QUESTION WHETHER A DISALLOWE D EXPENDITURE CAN BE CONSIDERED TO BE PROFITS DERIVED FROM THE ELIGIB LE BUSINESS FOR THE PURPOSE OF SECTIONS 80IA/80IB. BUT IN THE LIGHT OF THE JUDGMENTS OF THE HONBLE SUPREME COURT AND THE BOMBAY HIGH COURT CIT ED SUPRA AND 19 THE RATIO LAID DOWN THEREIN WE ARE WITH RESPECT UNABLE TO GIVE EFFECT TO THE SAID ORDER IN THE PRESENT CASE. 19. IN THE RESULT WE HOLD THAT THE ASSESSEE WOULD BE ENTITLED TO THE DEDUCTION U/S.80IB IN RESPECT OF THE PROFITS OF RS. 8 26 90 888 COMPUTED AS PROFITS OF THE HOUSING PROJECT FOR THE YEAR UNDER APPEAL. ORDER PRONOUNCED IN THE OPEN COURT ON 14 TH MAY 2010. SD/- SD/- (R K PANDA) (R V EASWAR) ACCOUNTANT MEMBER SENIOR VICE PRESI DENT MUMBAI DATED 14 TH MAY 2010 SALDANHA COPY TO: 1. S B BUILDERS & DEVELOPERS 211 RAHEJA ARCADE PLOT NO. 61 SECTOR - 11 CBD BELAPUR NAVI MUMBAI 400 614 2. ITO 22(3)-4 3. CIT-22 4. CIT(A)-33 5. DR E BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR ITAT MUMBAI