PARADEEP PHOSPHATES LIMITED,BHUBANESWAR vs. PRINCIPAL CIT-1, BHUBANESWAR

Shri B.K.Mahapatra, CA appeared for the assessee and Shri Shri B.K.Mahapatra, CA appeared for the assessee and Shri Shri B.K.Mahapatra, CA appeared for the assessee and Shri M.K.Gautam, ld CIT DR appeared for the revenue. M.K.Gautam, ld CIT DR appeared for the revenue.

It was submitted by ld AR that the assessee company had started a new unit for manufacture of fertilizers. It was the submission that the original return of income was filed on 29.11.2016, wherein, the assessee had claimed investment allowance u/s 32AC and the additional depreciation. It was the submission that subsequently, it was noticed that the assessee is entitled to the benefit of deduction u/s.35AD and consequently, the assessee had filed the revised return, wherein, the assessee had made its claim u/s.35AD instead of investment allowance u/s.32AC and the additional depreciation. It was the submission that the Assessing Officer while completing the assessment considered the revised return and denied the assessee the claim of deduction u/s.35AD. It was the submission that however, the Assessing Officer allowed the assessee the claim of deduction in respect of investment allowance u/s.32AC and the additional depreciation. It was the submission that the assessment order passed u/s.143(3) on 18.12.2018 was revised by the Pr. CIT by invoking his powers u/s.263 by holding that the assessment order passed by the Assessing Officer on 18.12.2018 was erroneous and prejudicial to the interest of the Revenue insofar as the Assessing Officer considered the revised return when completing the assessment, wherein, there was no claim of deduction of investment allowance u/s.32AC nor the claim of additional depreciation. It was the submission that consequently granting of the investment allowance and the additional depreciation was held to be erroneous and P a g e 2 | 5 prejudicial to the interest of the revenue. It was the submission that the assessee had, in the course of assessment proceedings, made an alternate claim of deduction u/s.32AC and the additional depreciation, as the assessee’s claim for deduction u/s.35AD had been denied by the Assessing Officer. It was the submission that the assessee was entitled to the deduction u/s.32AC and the additional depreciation insofar as the assessee had complied with the requirements for the said claim. It was the submission that the order passed u/s.263 is liable to be quashed. On a specific query by the Bench, what has happened to the consequential order passed as a consequence to the revisionary order u/s.263 of the Act, it was submitted that the Assessing Officer has completed the consequential order withdrawing the benefit of section u/s.32AC and the additional depreciation granted to the assessee. It was the submission that the assessee is in appeal against the said consequential order before the ld CIT(A).

In reply, ld CIT DR submitted that in view of the decision of the Hon’ble Allahabad High Court in the case of Dhampur Sugar Mills Ltd vs CIT (1973) 90 ITR 236 (All), wherein, it has been held that when a revised return has been filed, the effective return for the purpose of assessment is revised return and the original return stands effaced, the assessee though entitled to the claim of deduction u/s.32AC and the additional depreciation, could not be granted the same, as the assessee has not claimed deduction in its return which was considered for the purpose of assessment. He

We have considered the rival submissions. Without going into the merits of the allowance of deduction u/s.32AC and the additional depreciation as also without going into the merits as to whether it is revised return that is to be considered or whether it is original return that is to be considered, nor going into the principles of the decision of the Hon’ble Supreme Court in the case of Goetze (India) Ltd. vs CIT, 284 ITR 323 (SC), as it is noticed that the consequential order to the order passed u/s.263 has already been passed and the assessee is in appeal against the said order, we are of the view that our findings here could prejudice the mind of the ld CIT(A) and consequently, we decline to interfere with the order passed u/s.263 by the Pr. CIT.

In the result, appeal filed by the assessee stands dismissed.