M/S SHILPA CARTONS,SOLAN vs. ITO, W-1, SOLAN

Per Sanjay Garg, Judicial Member:

The present appeal has been preferred by the assessee against

the order dated 30.11.2016 of the Commissioner of Income Tax

[hereinafter referred to as CIT(A)], Shimla.

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80IC of the Income-tax Act, 1961 (in short 'the Act') because of the

non compliance of the provisions of section 80IC of the Act as the

return for the assessment year under consideration was filed beyond

the last date of filing of the income tax return.

the Ld. Counsel for the assessee is that in fact there was no

deliberate act of delay on the part of the assessee in filing the return

late. That the said return has to be uploaded on the website of the

income Tax Department. That due to some technical error, the return

could not be uploaded on 30.9.2011. The concerned C.A. of the

assessee was able to upload the same only on the next day. The Ld.

AR has also relied on the decision of the Coordinate Bench of the

Tribunal in the case of ‘M/s Symbiosia Pharmaceuticals P. Ltd vs.

DCIT’ ITA No. 501/Chd/2017 vide order dated 4.10.2017, wherein,

the Tribunal has discussed this issue in para 6.3 onwards. In that

case, the Tribunal deliberated upon the reasons beyond the control of

the assessee in filing the return by due date of filing as provided u/s

139(1) of the Act. The facts of the case were that the return was filed

in the extended period u/s 139(4) of the Act that too on the last day

i.e. 31st March of the year. The Tribunal considered the reasons

explained by the assessee and have also taken into consideration the

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various other decisions of the Coordinate Benches of the Tribunal as

discussed in para 6.6 of the said order and held that the claim of the

assessee was not ousted on the fact that the return was filed within

the extended period u/s 139(4) of the Act. The facts of the case of the

assessee when compared to the aforesaid decision of the Tribunal

seem to be on better footing. There is only one day’s delay in this

case. The case in hand pertains to assessment year 2011-12 for which

due date of filing of the return u/s 139(1) of the Act was 30.9.2011.

The return was uploaded on 1.10.2011. It is also a commonly fact

that the return is required to be uploaded on the website of the

Department and sometimes technical glitch / errors do occur. The

other fact which can also be taken note of is that not each and every

person is so technically conversant with the knowhow of uploading

the return and sometimes some errors do occur.

Counsel for the assessee that due to aforesaid unavoidable reasons

beyond the control of the assessee, the filing of the return was

delayed for one day. In the light of the decision of the coordinate

Bench of the Tribunal in the case of M/s Symbiosia Pharmaceuticals

P. Ltd vs. DCIT’ (supra) and other decisions relied upon therein, we

hold that the denial of the claim of the assessee for the aforesaid

reasons is not justified. In view of this, we allow ground No.1 of the

appeal and direct the lower authorities to allow the claim of the

assessee, if otherwise admissible.

of the Act to the tune of Rs. 13.71 lcas on account of sale of scrap.

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The lower authorities held that the income from sale of scrap was

not linked to the manufacturing activity of the unit.

aforesaid scarp was generated out of the manufacturing activity of

the assessee. He explained that the assessee is engaged in the

manufacturing of corrugated boxes and cartons and card boards etc.

That the generation of scarp was essentially linked to the

manufacturing activity of the assessee. That the scarp was generated

out of the remnants of the material used for manufacturing of

corrugated boxes. That the generation of scrap was so intrinsically

linked with the manufacturing activity of the assessee that if the

manufacturing is stopped, the generation of scrap will automatically

stop. We find force in the aforesaid contention of the Ld. Counsel for

the assessee. Since the generation of scrap was intrinsically linked

with the manufacturing activity of the assessee and generation of the

finished goods as well as scrap go side by side and are dependent to

each other, hence, the income from sale of such scrap can be safely

said to be related to the manufacturing activity of the unit of the

assessee. In view of this, we direct the Assessing officer to allow the

claim on income from sale of scarp as per the relevant provisions of

section 80IC of the Act. In view of this, the appeal of the assessee is

hereby allowed.

Order pronounced in the Open Court.

Sd/- Sd/- (B.R.R.KUMAR) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated : 09.04.2018 Rkk

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Copy to: • The Appellant • The Respondent • The CIT • The CIT(A) • The DR