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Income Tax Appellate Tribunal, CAMP AT SURAT
Before: SHRI RAJPAL YADAV & SHRI AMARJIT SINGH
PER RAJPAL YADAV, JUDICIAL MEMBER: Revenue is in appeal before the Tribunal against the order of the ld.CIT(A)-1, Surat dated 17.7.2013 passed for the Asstt.Year 2007-08. On receipt of notice in the Revenue’s appeal, the assessee has filed Cross Objection bearing CO No.52/Ahd/2014.
ITA No.2343/Ahd/2013 with CO 2
At the time of hearing, the ld.counsel for the assessee did not press CO, hence, it is rejected. 3. Sole grievance of the Revenue is that the ld.CIT(A) has erred in granting deduction admissible under section 80IB of the Income Tax Act, 1961 in spite of the fact that the assessee has not submitted audit report in Form No.10CCB along with return filed originally under section 139 of the Act. 4. Brief facts of the case are that the assessee has filed its return electronically on 31.12.2006. This return was revised under section 139(5) on 18.3.2008. Revised return was also filed electronically. The ld.AO has passed assessment order under section 143(3) and granted deduction admissible to the assessee under section 80IB of the Act. Thereafter, the AO has reopened the assessment on the ground that along with return the assessee did not file audit report in Form No.10CCB in support of its claim for deduction under section 80IB. In response to the notice received under section 148, the assessee has filed a return and submitted audit report in form No.10CCB. The case of the assessee is that in the original proceedings, the AO has never asked for copy of audit report in Form No.10CCB. While filing return electronically the assessee could not file audit report. Otherwise in the re-assessment proceedings, it has submitted audit report along with return. The ld.AO did not accept this explanation of the assessee and disallowed the claim.
ITA No.2343/Ahd/2013 with CO 3
On appeal, the ld.CIT(A) has accepted the claim of the assessee and made reference to a large number of decisions, including one of the decisions of the Hon’ble jurisdictional High Court in the case of CIT Vs. Gujarat Oil & Allied Industries, 201 ITR 325 (Guj). 6. With the assistance of the ld.representatives, we have gone through the record carefully. No doubt sub-section (7) of section 80IA requires the assessee to submit audit report along with return for claiming deduction under section 80IB. But in various authoritative pronouncements, it has been held that it is a directory requirement and not a mandatory one. If the assessee has submitted such report during the course of assessment proceedings, and the AO has benefit of such report while evaluating claim of the assessee about admissibility of such deduction, then such claim would not be rejected merely on the ground that audit report was not filed while filing return. The Hon’ble jurisdictional High Court in the case of Gujarat Oil & Allied Industries (supra) has considered this aspect while dealing with admissibility of deduction under section80IA. The Hon’ble Court was considering identical situation provided in section 80J(6A) and held that submission of audit report in support of claim admissible under section 80IB is a directory condition and if it is complied with even during the course of assessment proceedings, then deduction could not be disallowed to the assessee. The ld.CIT(A) has passed its decision relying
ITA No.2343/Ahd/2013 with CO 4 rightly on the decision of Hon’ble jurisdictional High Court. Therefore, we do not see any reason to interfere in the order of the CIT(A). Accordingly, appeal of the Revenue is dismissed.
In the result appeal of the Revenue and CO of the assessee, both are dismissed.
Order pronounced in the Court on 9th March, 2017 at Surat Camp.
Sd/- Sd/- (AMARJIT SINGH) (RAJPAL YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER Surat Camp; Dated 09/03/2017