M/S.lakshmi Card Clothing Mfg.co(P) Ltd v. The Deputy Commissioner Of Income Tax,Company Circle-Iv(1),Coimbatore-641 037

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 24.09.2018 CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAMandTHE HONOURABLE MRS.JUSTICE V.BHAVANI SUBBAROYAN Tax Case (Appeal) No.944 of 2008 M/s.Lakshmi Card Clothing Mfg.Co(P) Ltd.,No.1089, Avanashi Road,Coimbatore-641 037 ... Appellant -vs- The Deputy Commissioner of Income Tax,Company Circle-IV(1),Coimbatore-641 037 ... Respondent Tax Case (Appeal) filed under Section 260-A of the Income Tax Act, 1961 against the order of theIncome-tax appellate Tribunal Chennai �D� Bench, dated 07.01.2008 in ITA No.1606/Mds/2006, forthe assessment year 1994-95. For Appellant : Mr.M.P.Senthilkumar For Respondent :Mr.T.R.Senthilkumar ****** JUDGMENT [Judgement of the Court was Delivered by T.S.Sivagnanam, J.] This Tax Case Appal by the assessee under Section 260-A of the Income Tax Act, 1961 (the 'Act' forbrevity) is directed against the order passed by the Income Tax Appellate Tribunal, Chennai-D Bench('Tribunal' for brevity) in ITA No.1606/Mds/2006, dated 07.01.2008, for the assessment year1994-95. 2.This Appeal was admitted by order dated 16.7.2008, on the following Substantial Questions of Law. �1.Whether on the facts and in the circumstances of the case, the Tribunal was right in holding thatthe appellant was not entitled to the deduction under Section 80I of the Income Tax Act, 1961? 2.Whether on the facts and in the circumstances of the case, the Tribunal was right in law in holdingthat even if all the materials for allowing the deduction under Section 80I of the Act for the yearunder consideration was available on 'record' before the assessing officer, the same cannot beallowed for technical reason that the assessee had not made the claim for the deduction in its returnof income?� 3.We have heard Mr.M.P.Senthilkumar, the learned counsel for the Appellant and Mr.T.R.Senthilkumar, the learned Senior Standing Counsel for the Revenue. 4.The assessee filed its return of income for the assessment year 1994-95 on 29.11.1994. A noticeunder Section 143(1)(a) of the Act, dated 1.3.1995, was issued and the assessment was completedunder Section 143(3), by order dated 30.03.1995. The assessment order was received by theassessee on 05.04.1995. On 22.4.1996, the assessee filed a Petition under Section 154 of the Act,contending that the assessment suffers from a mistake apparent on the face of the record and isrequired to be rectified. In the said petition, the assessee contended that for the assessment year1995-96, the claim for deduction under Section 80-I of the Act was allowed by order dated29.03.1996 and based on the said order, the assessment order dated 30.03.1995, for the assessmentyear 1994-95, should be rectified. It was further submitted in the said petition that the claim whichwas allowed by the assessing Officer under Section 80-I of the Act, for the assessment year 1995-96,in its order dated 29.03.1996, was the 5th year of claim of the company under Section 80-I of theAct. While the petition under Section 154 of the Act was pending before the assessing officer, anotice was issued under section 148 of the Act, dated 07.04.1997, to reopen the assessment for theyear 1994-95 on certain grounds. In response to such notice, the assessee filed its return of incomedated 23.05.1997. However, in the said return of income, the assessee did not make a claim fordeduction under Section 80-I of the Act, as claimed by them in the petition for rectification dated22.04.1996. 5.The assessee filed a representation dated 21.07.1999, stating that they had filed a petition underSection 154 of the Act, dated 22.04.1996 and the same was pending and requested the petition to beconsidered. However, in the meantime, the re-assessment proceedings were concluded and theassessment order was passed on 27.12.1999 under Section 143(3) r/w. Section 147 of the Act. Theassessee filed appeal before the Commissioner of Income Tax (Appeals) (hereinafter referred to asCITA). It was dismissed by order dated 02.02.2002. Aggrieved by the same, the assessee filed anappeal before the Tribunal. The Tribunal, by order dated 12.06.2003, allowed the assessee's appealand quashed the re-assessment proceedings. The merits of the re-assessment were not gone into.The Revenue filed appeals before the Division Bench of this Court in T.C.A.Nos.568 and 666 to 668of 2005. The Hon'ble Division Bench, while dismissing the appeals, vide judgement dated 21.2.2012,held that the re-assessment was a clear case of change of opinion. However, the merits of the matteron the questions, which were framed by the Revenue, which include the claim for deduction underSection 80-I of the Act, were not gone into and the Court held that it is unnecessary. After theProceedings concluded before the Hon'ble Division Bench of this Court, the assessee sent remindersdated 20.08.2003 and 5.9.2003 stating that the petition for rectification dated 22.4.1996, filed underSection 154 of the Act, was pending. The assessing officer considered the petition and dismissed thesame by order dated 17.2.2004, which was confirmed by the CITA by order dated 17.3.2006 andconfirmed by the Tribunal by order dated 17.1.2008, which is impugned in this Appeal. 6.The learned counsel for the assessee strenuously contended that the authorities below as well asthe Tribunal having noted that the claim made for deduction under Section 80I of the Act for theassessment year 1994-95 being the 5th year, and the claim having been granted for the assessmentyears 1991-92, 1992-93, 1993-94 and 1995-96, ought to have considered the petition and allowed theclaim. In support of his contention, the learned counsel relied on the judgement of the Hon'bleDivision Bench of the High Court of Gujarat, in the case of Chokshi Metal Refinery v. Commissionerof Income TAx (reported in (1977) 107 ITR 0063. In the said decision, the Court referred to aCircular issued by the Central Board of Revenue in June 1955, which states that the officers of theDepartment must not take advantage of ignorance of an assessee as to his rights and it is one oftheir duties to assist a tax payer in every reasonable way, particularly in the matters of claiming andsecuring reliefs. In our considered view the assessee cannot plead any ignorance, especially whenthey admitted that they had made such a claim for the assessment years 1991-92, 1992-93, 1993-94and 1995-96. If the argument of the learned counsel for the assessee is accepted, then it will bestretching the assessee beyond what is required to be done by the Assessing officer. Admittedly, theassessee is a company registered under the Companies Act, having a large turnover and teem offinancial and legal experts and definitely the assessee cannot plead ignorance, nor can the assesseeargue that the assessing officer should have granted the relief, which the assessee himself has notclaimed in the return. Thus, in our considered view, the decision in Chokshi Metal Refinery does notrender any assistance to the case of the assessee. 7.The learned counsel for the assessee relied on the decision of the Division Bench of this Court inthe case of Commissioner of Income Tax v. Lakshmi Vilas Bank (reported in (2010) 329 ITR 0591),wherein, the Hon'ble Division Bench held that the word 'record' in the expression 'mistake apparentfrom record' having not been defined, the word will have to be given a wider import by including therecord that is available with the Assessing Officer. 7.The learned counsel for the assessee relied on the decision of the Division Bench of this Court inthe case of Commissioner of Income Tax v. Lakshmi Vilas Bank (reported in (2010) 329 ITR 0591),wherein, the Hon'ble Division Bench held that the word 'record' in the expression 'mistake apparentfrom record' having not been defined, the word will have to be given a wider import by including therecord that is available with the Assessing Officer. 8.In our considered view the argument of the learned counsel for the assessee, by placing relianceon the decision of Lakshmi Vilas Bank, is not acceptable for more than one reason. First of all, thefacts of the case clearly show that the assessee did not make any claim for deduction under Section80-I of the Act, for the relevant assessment year. Secondly, as pointed out by us in the precedingparagraph, while discussing about the applicability of the decision in Chokshi Metal Refinery, if theinterpretation sought to be given by the assessee is to be accepted, then it would mean that theAssessing Officer should virtually sit in the office of the assessee and help the assessee file thereturn. Nowhere under the provisions of the Act such a procedure is contemplated and it is for theassessee to file his return. Apart from that the power under Section 154 of the Act is exercisableonly when the mistake is manifest and could be identified by a mere look, which does not need along drawn out process of reasoning and a mere mistake by itself cannot be a ground to invokeSection 154 of the Act (Lakshmi Vilas Bank). The assessee has not been able to satisfy this Courtthat what has been pointed out in the petition dated 22.04.1996 under Section 154 of the Act, is amistake, which is apparent from the record. It is not a mistake which could be identified by a merelook, since there was no claim made by the assessee for deduction under Section 80-I of the Act.Thus, the decision in the case of Lakshmi Vilas Bank also does not render support to the assessee.We find that the reasons assigned by the Assessing Officer and confirmed by the Commissioner ofIncome Tax(Appeals) as well as the Tribunal, are sound, perfectly legal and valid and the orders donot call for any interference. For all the above reasons, the appeal filed by the assessee fails and the same is dismissed. Thesubstantial Questions of Law are answered against the assessee. No costs. [T.S.S., J.] [V.B.S., J.] msk Index:Yes/No Internet:Yes/No To 1.The Deputy Commissioner of Income Tax,Company Circle-IV(1),Coimbatore-641 037 2.The Income-tax appellate Tribunal Chennai �D� Bench. T.S.Sivagnanam, J.andV.Bhavani Subbaroyan, J. msk T.C. (Appeal) No.944 of 2008