COMMISSIONER OF INCOME TAX vs. SHIV AGRO GRAMODYOG INDUSTRIES

ITR/27/1995HC GujaratGJHC24022352199505 December 2005Author: HONOURABLE MR. JUSTICE D.A.MEHTA,HONOURABLE MS. JUSTICE HARSHA DEVANI4 pages
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What were the facts?

The assessee, Shiv Agro Gramodyog Industries Pvt. Ltd., filed its return of income for Assessment Year 1985-86 (accounting period calendar year 1984) on May 21, 1986, declaring a loss of Rs. 1,45,600. The due date for filing was June 30, 1985. The assessee had sought extensions, with the last application on April 24, 1986, requesting an extension until May 31, 1986. The Assessing Officer (AO) claimed to have communicated the refusal of extension on May 8, 1986, while the assessee contended it was received on May 25, 1986, and the return was filed before this date. Both the Commissioner of Income-tax (Appeals) and the Tribunal found that the rejection letter was served on May 25, 1986, a fact accepted by the Revenue.

What did the High Court hold?

The High Court held that the question referred to it was concluded by the ratio laid down in the previously decided cases of Commissioner of Income-tax Vs. R B Masturlal and Sons P. Ltd., Commissioner of Income-tax, Gujarat-IV Vs. Gordhanbhai Jethabhai, and Mehsana Ice & Cold Storage Pvt. Ltd. Vs. Commissioner of Income-tax. Following these precedents, the Court answered the question in the affirmative, in favour of the assessee and against the Revenue. The Tribunal was therefore justified in law in directing the Assessing Officer to allow the carry forward of the business loss determined. The operative direction is that the reference stands disposed of accordingly, with no order as to costs. No issue was expressly left undecided.

What were the issues?

1. Whether, in the facts and circumstances of the case, the Tribunal is right in law in directing the Income Tax Officer (ITO) to carry forward the business loss? (Question of law) Assessee's Contention: The judgment does not record any specific contentions made by the assessee, other than the factual assertion that the return was filed on May 21, 1986, before receiving the rejection letter on May 25, 1986. The Tribunal's decision was in favour of the assessee. Revenue's Contention: The Revenue, represented by Mrs. M.M. Bhatt, relied on a decision of the High Court in the case of Commissioner of Income-tax Vs. R B Masturlal and Sons P. Ltd. (Income Tax Reference No.26 of 1994), which in turn followed decisions in Commissioner of Income-tax, Gujarat-IV Vs. Gordhanbhai Jethabhai, [1983] 142 ITR 84 (Guj.) and Mehsana Ice & Cold Storage Pvt. Ltd. Vs. Commissioner of Income-tax (Income Tax Reference No.107 of 1993). The Revenue submitted that the controversy was concluded by these decisions.

Which sections of the Income-tax Act were involved?

Section 256(1)

AI-generated summary — verify with the full judgment below

ITR/27/1995 1/4 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD INCOME TAX REFERENCE No.27 of 1995 For Approval and Signature: HONOURABLE MR.JUSTICE D.A.MEHTA HONOURABLE MS.JUSTICE H.N.DEVANI ======================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether

this case

involves

a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ======================================================= COMMISSIONER OF INCOME TAX - Applicant(s) Versus SHIV AGRO GRAMODYOG INDUSTRIES Pvt. Ltd.- Respondent(s) ======================================================= Appearance : MRS MM BHATT for Applicant(s) : 1, NOTICE UNSERVED for Respondent(s) : 1, ======================================================= CORAM : HONOURABLE MR.JUSTICE D.A.MEHTA and HONOURABLE MS.JUSTICE H.N.DEVANI Date : 05/12/2005 ORAL JUDGMENT (Per : HONOURABLE MS.JUSTICE H.N.D

The order continues below.

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