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Income Tax Appellate Tribunal, “F” BENCH, MUMBAI
आदेश / O R D E R
PER AMARJIT SINGH, AM:
The present appeal filed by the revenue is directed against the order passed by the CIT(A)-16, Mumbai, which in turn arises from the order passed by the A.O. u/s 143(3) of the Income Tax Act, 1961 for A.Y. 2014-15. The revenue has assailed the impugned order on the following grounds before us:
2 ITA No.6529/Mum/2019 A.Y. 2014-15 ACIT, Circle 9(3)(2) Vs. M/s Future Enterprises Limited
“1. Whether on the facts and in the circumstances of the case and in law. the Ld.CIT(A) has erred in directing AO to allow the claim of the assessee for loss brought forward or unabsorbed depreciation whichever is lower in the assessed book profit U/S.115JB of the Act despite the fact that the assessee has not made this claim in return of income? 2. Whether on the facts and in the circumstances of the case and in law. the Ld. CIT(A) has erred in directing AO to allow the claim of the assessee for loss brought forward or unabsorbed depreciation whichever is lower in the assessed book profit u/s 115JB of the Act despite the fact that the assessee has not made this claim in return of income which is otherwise mandatory considering the ruling of Hon’ble Apex Court in the case of M/s. Goetz (India) Ltd. Vs. CIT 284 ITR 0323 (SC)? 3. The appellant prays that the order of the Ld. CIT(A) on the above ground be set aside and that of the AO be restored. 4. The appellant craves leave to amend or alter any grounds or add a new ground which may be necessary.”
Fact in brief is that return of income declaring loss at Rs.3,62,17,84,357/- and showing book profit u/s 115JB at Rs.5,90,50,246/- was filed on 30.11.2014. The case was subject to scrutiny assessment and notice u/s 143(2) of the Act was issued on 31.08.2015. The assessment u/s 143(3) of the Act was finalized on 28.12.2016 computing book profit u/s 115JB at Rs.16,55,30,878/-. Subsequently, the A.O has passed order u/s 154 of the Act on 23.12.2017 on the issue that assessee has filed rectification application on 16.02.2017 stating that while assessing the book profit u/s 115JB, the amount of brought forward loss or unabsorbed depreciation which average less as per the books of accounts aggregating to Rs.312.01 crore was not added back under clause (iii) of Explanation (1) to Section 115JB of the Act. The A.O stated that assessee had correctly mentioned the aforesaid fact, however, it did not file the revised return of income, therefore, the claim of deduction in respect of brought forward loss/depreciation was not allowed.
3 ITA No.6529/Mum/2019 A.Y. 2014-15 ACIT, Circle 9(3)(2) Vs. M/s Future Enterprises Limited
Aggrieved, the assessee filed the appeal before the ld. CIT(A). The ld. CIT(A) has allowed the appeal of the assessee by referring the judicial pronouncements i.e (i) NTPC Ltd. Vs. CIT 229 ITR 383 (SC); (ii) Jute Corporation of India Vs. CIT (SC); (iii) CIT Vs. Smt. Pruthvi Brokers & Shareholders Pvt. Ltd. (Bom) Income Tax Appeal No. 3908 of 2010; and (iv) CIT Vs. Jai Parabolic Springs ltd., 306 ITR 0042 (Delhi).
During the course of appellate proceedings before us the ld. D.R stated that ld. CIT(A) has not discussed the order u/s154 of the Act and also placed reliance on the decision of Mrs Freny S. Contractor Vs. DCIT (1999) 68 ITD 93 (Mum); Hon’ble Supreme Court in the case of Anchor Pressings (P) Ltd. Vs. CIT (1986) 27 Taxman.com 295 (SC); Hon’ble High Court in the case of Lakshmi Card Clothing Mfg. Co. (P) Ltd. Vs. D CIT, Company Circle-IV(1), Coimbatore (2018) 98 taxman.com 445 (Madras); Delhi ITAT in the case of Pawan Kumar Aggrawal Vs. ACIT, Circle 30(1), New Delhi (2013) 40 taxmnan.com 489 (Delhi -Trib).
On the other hand, the ld. Counsel has supported the order of CIT(A) and also placed reliance on the decision of Delhi ITAT in the case of Fiserv India P. Ltd. Vs. ACIT Vs. ACIT (2020) 80 ITR (Trib) (S.N.) 3 (Delhi)
Heard both the side and perused the material on record. Assessment u/s 143(3) of the Act in the case of the assessee was passed on 28.12.2016 determining the total loss at Rs.1,42,60,01,613/- under the normal provision of the Act and Rs.89,57,11,253/- u/s 115JB of the Act by making addition of Rs.83,57,11,253/- on account of disallowance u/s 14A r.w.rule 8D of the I.T. Rules 1962. Subsequently, the assessee has filed a rectification application dated 16.02.2017 pointing out that
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while filing the return of income as well as during assessment the amount of loss brought forward or unabsorbed depreciation whichever is less was not added back under clause (iii) of explanation (1) to Section 115JB of the Act. In the rectification application the assessee stated that an amount of Rs.312.01 crore to be adjusted against book profit calculated u/s 115JB of the Act. The A.O has rejected the claim of the assessee company stating that it has failed to file revised return of income. The ld. CIT(A) has allowed the claim of the assessee after following the judicial pronouncements i.e (i) NTPC Ltd. Vs. CIT 229 ITR 383 (SC); (ii) Jute Corporation of India Vs. CIT (SC); (iii) CIT Vs. Smt. Pruthvi Brokers & Shareholders Pvt. Ltd. (Bom) Income Tax Appeal No. 3908 of 2010; and (iv) CIT Vs. Jai Parabolic Springs ltd., 306 ITR 0042 (Delhi). We have perused the judicial pronouncements referred by the ld. D.R and observed that thse judicial pronouncements are related to the jurisdiction of the A.O to rectify mistake apparent from record but not pertained to the legal issue which can be entertained at the appellant stage. The fact in the case of the assessee is distinguishable as in the case of the assessee, the CIT(A) has allowed the impugned claim of undisputed deduction after entertaining the claim at the appellate stage in accordance with decision of Hon’ble Supreme Court in the case of NTPC Ltd. Vs. CIT (229) ITR 0383. In this regard, we consider that Hon’ble Supreme Court in the case of National Thermal Power Corporation Ltd. Vs. CIT (229) ITR 0383 (SC) held that legal issue which does not involve disputed fact can be entertained at the appellate stage. Following the decision of Hon’ble Supreme Court as supra, we consider that ld. CIT(A) has not made any error in allowing the claim of deduction of the assessee, therefore, we don’t find any force in the appeal of the revenue the same stand dismissed.
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In the result, the appeal of the revenue is dismissed.
Order pronounced in the open court on 17.03.2022
Sd/- Sd/- (AMARJIT SINGH) (AMARJIT SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER
Mumbai, Dated 17.03.2022 PS: Rohit
आदेश की �ितिलिप अ�ेिषत/Copy of the Order forwarded to : अपीलाथ� / The Appellant 1. ��थ� / The Respondent. 2. संबंिधत आयकर आयु� / The CIT(A) 3. आयकर आयु�(अपील) / Concerned CIT 4. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Mumbai 5. गाड� फाईल / Guard file. 6. आदेशानुसार/BY ORDER, स�ािपत �ित //True Copy//
( Asst. Registrar) ITAT, Mumbai