ACIT, New Delhi v. M/s The Delhi State Co-op Bank Ltd., New Delhi

ITA 2437/DEL/2011 | 2007-2008
Pronouncement Date: 11-11-2011 | Result: Allowed

Appeal Details

RSA Number 243720114 RSA 2011
Assessee PAN AAAAT9998D
Bench Delhi
Appeal Number ITA 2437/DEL/2011
Duration Of Justice 5 month(s) 30 day(s)
Appellant ACIT, New Delhi
Respondent M/s The Delhi State Co-op Bank Ltd., New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 11-11-2011
Appeal Filed By Department
Order Result Allowed
Bench Allotted H
Tribunal Order Date 11-11-2011
Date Of Final Hearing 09-11-2011
Next Hearing Date 09-11-2011
Assessment Year 2007-2008
Appeal Filed On 12-05-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H DELHI BEFORE SHRI I.P. BANSAL AND SHRI K.G. BANSAL ITA NO. 2437(DEL)/2011 ASSESSMENT YEAR: 2007-08 ASSTT. COMMISSIONER OF THE DELHI STATE COOPERATIVE INCOME-TAX CIRCLE 30(1) VS. BANK LTD. 31 DARYA GANJ DELHI. NEW DELHI. PAN: AAAAT9998D (APPELLANT) (RESPONDENT) APPELLANT BY : DR. B.R.R. KUMAR SR.DR RESPONDENT BY : S HRI S.L. GUPTA C.A. DATE OF HEA RING : 09.11.2011 DATE OF PRO NOUNCEMENT : 11.11.2011 ORDER PER K.G. BANSAL : AM THE REVENUE HAS TAKEN UP TWO GROUNDS IN THIS APP EAL THE GIST OF WHICH IS THAT THE LD. CIT(APPEALS) ERRED IN AL LOWING THE DEDUCTION OF RS. 1 64 69 916/- U/S 36(1)(VIIA) OF THE INCOME-TAX A CT 1961 (THE ACT FOR SHORT) IN RESPECT OF PROVISION FOR BAD AND DOUB TFUL DEBTS. IT IS MENTIONED THAT THE CLAIM WAS NOT MADE BY FILING A REVISED RETURN AND THE FINDING IS AGAINST THE DECISION OF THE APEX COURT IN THE CAS E OF CIT VS. SHELLY PRODUCTS & ANOTHER (2003) 261 ITR 367. ITA NO. 2437(DEL)/2011 2 2. THE FACTS OF THE CASE ARE THAT THE ASSESSEE FILED ITS RETURN ON 31.10.2007 DECLARING TOTAL INCOME OF RS. 21 95 48 880/-. THE RETURN WAS PROCESSED U/S 143(1) ON 24.01.2008. SUBSEQUENTLY NOTICE UNDER SECTION 143(2) DATED 24.09.2008 WAS SERVED ON THE ASSE SSEE. IN THE COURSE OF ASSESSMENT THE ASSESSEE SUBMITTED REVISED COM PUTATION OF TOTAL INCOME ON 18.12.2009 IN WHICH FURTHER DEDUCTION OF RS . 1 64 69 916/- WAS CLAIMED U/S 36(1)(VIIA). THE AO REFUSED TO GR ANT THE DEDUCTION BY RELYING ON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. VS. CIT (2006) 284 ITR 323. THE LD. CIT(APPEALS) GRANTED THE DEDUCTION BY INTER-ALIA RELYING ON BOARD CIRCULAR NOS. (EL- 35) DATED 11.04.2005 AND F. NO. 81/27/65-IT(B) DATED 18.5.1965 TO THE EFFECT THAT THE AO SHOULD NOT TAKE ADVANTAGE OF THE IGNORANCE OF THE ASSESSEE AND IN FACT HE SHOULD ASSIST THE ASSE SSEE IN GRANTING GENUINE RELIEF DUE TO HIM. THE CASE OF GOETZE (INDIA) LTD. WAS DISTINGUISHED BY MENTIONING THAT THE ASSESSMENT WAS NOT PENDING I N THAT CASE. 3. BEFORE US THE LD. DR RELIED ON THE DECISION IN THE CASE OF GOETZE (INDIA) LTD. (SUPRA) IN WHICH IT IS MENTIONED THAT ON 12.01.1998 THE ASSESSEE SOUGHT TO CLAIM DEDUCTION BY WAY OF A LETTER BEFORE THE AO. THE ITA NO. 2437(DEL)/2011 3 DEDUCTION WAS DISALLOWED ON THE GROUND THAT THERE WAS NO PROVISION UNDER THE ACT TO MAKE AMENDMENT IN THE RETURN OF INCO ME BY A MODIFIED APPLICATION AT THE ASSESSMENT STAGE WITHOUT REVISI NG THE RETURN. HIS CASE IS THAT THE AO RIGHTLY DISALLOWED THE CLAIM BY FOLL OWING THIS DECISION AND THE LD. CIT(A) WAS WRONG IN DISTINGUISHING THE FACT WHEN NO DISTINCTION EXISTED AS A MATTER OF FACT. FURTHER IT IS SUB MITTED THAT THE POWERS OF THE CIT(APPEALS) ARE CO-TERMINUS WITH THE POWERS OF THE AO THEREFORE HE ALSO COULD NOT HAVE ALLOWED THE DEDUCTION. 3.1 IN REPLY THE LD. COUNSEL ALSO RELIED ON THE DECISION IN THE CASE OF GOETZE (INDIA) LTD. (SUPRA). IN PARAGRAPH NO. 4 IT IS MENTIONED THAT THE POWER OF THE TRIBUNAL U/S 254 TO ENTERTAIN FOR T HE FIRST TIME A POINT OF LAW IS NOT RESTRICTED BY THE AFORESAID FINDING. S UCH A QUESTION OF LAW CAN BE RAISED BEFORE THE TRIBUNAL AND THE POWER OF THE AO DOES NOT IN ANY MANNER IMPINGE ON THE POWER OF THE TRIBUNAL U/S 254 O F THE ACT. THEREFORE HIS CASE IS THAT THE QUESTION REGARDING DEDUCTION U /S 36(1)(VIIA) MAY BE ADMITTED BY THE TRIBUNAL AT THIS STAGE AS IT IS PURELY A QUESTION OF LAW. 4. WE HAVE CONSIDERED THE FACTS OF THE CASE AND SUBMISSIONS MADE BEFORE US. WE FIND THAT THE HONBLE SUPREME COU RT HAS COME TO THE ITA NO. 2437(DEL)/2011 4 CONCLUSION THAT A CLAIM CAN BE PREFERRED BEFORE TH E AO BY WAY OF A REVISED RETURN ONLY AND NOT BY WAY OF A LETTER M ODIFYING THE COMPUTATION OF INCOME. THE CLAIM BY THE ASSESSEE HAS BEEN MAD E BY FILING A REVISED COMPUTATION. THIS IS IN THE NATURE OF MAKING THE C LAIM THROUGH A LETTER AND NOT A REVISED RETURN. THEREFORE IT IS HELD THA T THE AO HAS RIGHTLY DISALLOWED THE CLAIM. HOWEVER IT IS ALSO A FAC T THAT THE QUESTION IS PURELY ONE OF LAW AND THE TRIBUNAL WILL BE JUSTIFIED IN ENTERTAINING THE CLAIM FOR THE PURPOSE OF ADJUDICATING THE APPEAL. THE CLAI M HAD BEEN MADE IN THE COURSE OF ASSESSMENT PROCEEDINGS AND THEREFORE I T HAS TO BE TAKEN AS A BONA FIDE CLAIM AS MENTIONED IN THE DECISION IN THE CASE OF NATIONAL THERMAL POWER CO. LTD. VS. CIT (1998) 229 ITR 383. THEREFORE WE THINK IT FIT TO ADMIT THE CLAIM. 4.1 THE FURTHER CASE OF THE LD. COUNSEL IS THAT THE AFORESAID PROVISION CONTAINED IN SECTION 36(1)(VIIA) WAS AMENDED BY FINANCE ACT 2007 WITH EFFECT FROM 01.04.2007 BY WHICH THE WORDS OR A COOPERATIVE BANK OTHER THAN A PRIMARY AGRICULTURAL CREDIT SOCIETY OR A PRIMARY COOPERATIVE AGRICULTURAL AND RURAL DEVELOPMENT BANK WERE INSERTED. THIS AMENDMENT IS APPLICABLE TO ASSESSMENT YEAR 2007 -08 AND SUBSEQUENT YEARS. ACCORDINGLY IT APPLIES TO THE CASE OF T HE ASSESSEE FOR THIS YEAR. WE ITA NO. 2437(DEL)/2011 5 FIND THAT THIS ISSUE HAS NOT BEEN ADJUDICATED ON MERITS BY THE AO. THE LD. CIT(APPEALS) HAS CONSIDERED THE AMENDED PROVISIO N WITHOUT OBTAINING THE REPORT OF THE AO. THEREFORE WE THINK IT FIT TO RESTORE THE MATTER TO THE FILE OF THE AO TO ADJUDICATE THE ADMISSIBILITY OF THE AMOUNT U/S 36(1)(VIIA) ON MERITS. 4.2 WE ALSO FIND THAT THE DECISION IN THE CASE OF SHELLY PRODUCTS & ANOTHER (SUPRA) INVOLVES DIFFERENT FACTS. THERE FORE WE DO NOT THINK IT NECESSARY TO GO INTO THE DETAILS OF THE CASE FOR THE SIMPLE REASON THAT THE WHOLE ISSUE STANDS COVERED BY THE DECISION IN T HE CASE OF GOETZE (INDIA) LTD. (SUPRA). 5. IN THE RESULT THE APPEAL IS TREATED AS ALLO WED FOR STATISTICAL PURPOSE. SD/- SD/- (I.P. BANSAL) (K.G.BANSAL) JUDICIAL MEMBER ACCOUNTANT MEMBER 11.11.11 SP SATIA COPY OF THE ORDER FORWARDED TO:- 1. THE DELHI STATE COOPERATIVE BANK LTD. NE W DELHI. 2. ACIT CIRCLE 30(1) NEW DELHI. 3. CIT 4. CIT(A) 5. THE DR ITAT NEW DELHI. ASSISTANT REGISTRAR.