GUJARAT STATE ELECTRICITY CORPORATION LTD.,VADODARA vs. THE DY.CIT.,CIRCLE-1(1),, VADODARA

The brief facts of the case are that the assessee had filed its return of income for A.Y. 2005-06 on 30.10.2005 declaring total income of Rs.Nil and income u/s. 115JB of the Act at Rs. 44,21,43,000/-. The case was selected for scrutiny and the assessment was completed u/s. 143(3) of

Aggrieved with the order of the AO, the assessee had filed an appeal before the first appellate authority, which was decided by the learned CIT(A) vide the impugned order and the appeal of the assessee was partly allowed. Th

Now the assessee is in second appeal before us. The following grounds have been taken in this appeal:

The First ground pertains to addition of Rs. 1691 lakhs on account of extraordinary items. The assessee had claimed deduction of Rs.35,31,23,000/- under the head extraordinary items which included a sum of Rs. 1691 lakhs being provision for write-back of sale of power. The AO had disallowed the entire claim for extraordinary items. The Ld. CIT(A) had, however, confirmed the addition in respect of Rs. 1691 lakhs pertaining to provision for write back of sale of power.

Shri Mehul K Patel, the Ld. AR of the assessee submitted that the sales of earlier years were written back in the current year due to short admittance of sales on reconciliation process taken by GEB (promoter). He requested that the matter may be set aside to the file of the AO to verify the reconciliation of earlier year sales.

Per contra, the Ld. CIT-DR, supported the order of the lower authorities on this issue.

We have considered the rival submissions. The assessee had claimed deduction for provision of Rs. 1691 lakhs for write back of sale of power. The basis of this provision was neither explained before the AO nor before the Ld. CIT(A). No documentary evidence in this regard was brought on record before us as well. In the course of hearing, the assessee was required to furnish the reconciliation statement in respect of provision for write back of sale of power vis-à-vis the earlier year sales. However, no such reconciliation or any other evidence in respect of this claim has been brought on record. In the absence of any evidence pertaining to provision for write back of sale of power, there is nothing for the AO to verify. The assessee has not been able to brought on record

The grounds taken by the assessee regarding initiation of penalty u/s. 271(1)(c) of the Act and against charging of interest u/s. 234B, 234C and 234D of the Act, being consequential in nature, are dismissed.

The additional grounds taken by the assessee pertains to application of provision of section 115JB of the Act. According to the assessee, this provision was not applicable in its case and it was not liable to be taxed on book profit u/s. 115JB of the Act. In the present case, the assessee had suo moto filed its return of income declaring income of Rs.44,21,43,000/- u/s. 115JB of the Act and paying taxes accordingly. As per provision of section 253 of the Act, an assessee can file an appeal if he is aggrieved with the order of the AO on any issue on which addition was made or the claim which was not allowed. Here, it is not the case that the assessee has disclosed Nil income u/s. 115JB of the Act, and the AO had made assessment u/s. 115JB of the Act on any positive income. The assessee had itself admitted the applicability of provision of section 115JB of the Act in its return of income, which was merely accepted by the AO. Now the assessee cannot claim before us after lapse of 20 years, that it was not exigible to tax u/s. 115JB of the Act. No such plea was taken by the assessee either before the AO or before the Ld. CIT(A). If according to the assessee, the provision of section 115JB of the Act was not applicable in its case, then the assessee should have filed a revised return, by invoking the provision of section 119(2)(b) of the Act, disclosing

In the result, the appeal of the assessee is dismissed.