Income Tax Appellate Tribunal - Mumbai
Pratibha Industries Ltd , Mumbai vs Assessee on 1 November, 2012
IN THE INCOME TAX APPELLATE TRIBUNAL
MUMBAI BENCH "C", MUMBAI
BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER
AND SHRI VIVEK VARMA, JUDICIAL MEMBER
ITA nos. 2197 to 2199/Mum/2008
(Assessment years: 2000-01 to 2002-03)
ITAs no. 2200 to 2201/Mum/2008
(Assessment years: 2003-04 to 2004-05)
ITA no. 2202/Mum/2008
(Assessment years: 2005-06)
Asst. Commissioner of Vs M/s Pratibha Industries
Income-tax(CC)-45, Ltd,
Room No.659, 6th Floor, 574, Usha Kamal,
Aayakar Bhavan, M K Road, Chambur Naka, Chembur,
Mumbai - 400 020 Mumbai - 400 071
PAN:AAACP 4709 N
(Appellant) (Respondent)
C.O. Nos. 117 to 121/Mum/2008
(Arising out of ITAs no. 2197 to 2001/Mum/2008
Assessment years:2000-01 to 2004-05)
M/s Pratibha Industries Ltd, Vs Asst. Commissioner of
574, Usha Kamal, Income-tax(CC)-45,
Chambur Naka, Chembur, Room No.659, 6th Floor,
Mumbai - 400 071 Aayakar Bhavan, M K Road,
PAN:AAACP 4709 N Mumbai - 400 020
(Cross Objector) (Respondent)
Cross Objector Appellant by : Shri Tralashwala and
Shri Harshvardhana
Respondent-revenue by : Shri Pravin Kumar
Date of Hearing: 01.11.2012
Date of Pronouncement: 19.12.2012
ORDER
PER BENCH :
The revenue has filed six appeals against the order of CIT(A)-III, Mumbai, dated 23.01.2008, covering assessment years 2000-01, 2001-02, 2002-03, 2003-04 & 2004-05 and assessment year 2005-06
2 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 also dated 23.01.2008 wherein CIT(A) has deleted the additions on account of disallowances under section 153A of the Income Tax Act, 1961.
2. The assessee has also filed Cross objections (CO) against the same orders of the CIT(A), covering assessment years 2000-01, 2001- 02, 2003-03, 2003-04 & 2004-05.
3. The following grounds have been raised by the department in the appeals, filed :
(i) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance of deduction under section 80IA of the I.T. Act without appreciating the fact that the assessee is not eligible for deduction under section 80IA in most of the infrastructure projects where the assessee is merely a work contractor and not a developer.
(ii) The appellant prays the order of the CIT(A) on the above ground be set aside and that of the Assessing Officer be restored.
(iii) The appellant craves to amend or alter any ground and/or add new grounds which may be necessary.
4. The following grounds have been raised by the assessee in the Cross Objections (COs), filed :
1. The Learned Commissioner of Income Tax (A) erred in sustaining the order under section 153A of the Act without appreciating the fact that there was no evidence or material found in the course of search action in respect of the year under consideration and hence, the assessment order passed invoking the provisions of section 153A of the Act is bad in law and liable to be quashed.
2. The Learned Commissioner of Income Tax (A) failed to appreciate that no material or evidence was found in the course of search action and hence, the underlying purpose of making assessment under section 153A of the Act i.e. to assessee income which is not disclosed or would not have been disclosed in terms of the provisions of section 132 of the Act failed and thus, the assessment made under section 153A of the Act as if it were a regular scrutiny assessment is without any justification and liable to be quashed.
3. The responded craves leave to add, amend, alter or delete all or any of the aforesaid grounds of appeal.
5. Appeal filed by the department for assessment year 2005-06 is dealt with separately.
6. In total there are eleven appeals for our consideration.
3 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008
7. Since all the appeals and COs, filed by the department and the assessee, covering assessment years 2000-01 to 2004-05, emanate from the one consolidated order of the CIT(A), we are disposing off the appeals and the COs through one common and consolidated order for the sake of convenience and brevity.
8. At the time of hearing, the AR submitted that the grounds taken up by the department are on merits, whereas, the grounds taken by the assessee in COs are on legality and applicability of section 153A on the assessee, in the impugned assessments. He, therefore, submitted that it would be appropriate, if the issue on legality be heard first, because if the assessments framed under section 153A read with 143(3) of the Income Tax Act, are held to be without jurisdiction, the assessments would fall and grounds filed by the department would become infructuous.
9. We, therefore, proceed and take up COs filed by the assessee. The AR pointed out that in assessment years 2000-01 to 2004-05, there is just one solitary ground and that is against the legality and applicability of provisions of section 153A on the assessee for the assessment years in question. According to the AR, though, it is a case of search and seizure, provision of section 153A would not be applicable on the assessee.
10. The facts in brief are that the assessee is a company engaged in the development of projects, both, infrastructure and non infrastructure. In the current year, the assessee, besides having its normal business of development of projects also was in the development of water supply projects and other connected infrastructure facilities for government, semi government departments. In development of such infrastructure facilities, the assessee utilizes 4 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 its own designs/plans, as feasible for the location of site, specifications and technical expertise through its own human, financial & material resources. Being in development of infrastructure facilities the assessee uses its own assets which include sophisticated earth excavation machineries, tower cranes, stocks of steel, cement and banking and financial facilities such as FDRs, bank guarantees and credit facilities and advances to its contractors and credits to government departments. According to the AR, the assessee is also exposed on its own, towards various risks and responsibilities such as completion of contracts within stipulated time, maintenance, delayed payments and bad debts, litigation and geological risks.
11. The assessee was subjected to action under section 132 of the Income Tax Act, 1961, on 17.02.2005. In the course of search, the revenue seized certain documents relating to the projects undertaken by the assessee. As a consequence thereof, the assessee made an offer of Rs. 1.95 crores, under section 132(4) of the Income Tax Act, pertaining to assessment year 2005-06, wherein the assessee added back to its income, sundry creditors, which were more then three years, under section 41(1). Except for this, according to the AR, no incriminating material or evidence was found which could be used against the assessee for determining the "undisclosed income" of the assessee in any year.
12. As a consequence of search and seizure operations, as carried out under section 132 on the assessee, provisions of section 153A were triggered and the AO issued notices under section 153A on the assessee, calling upon the assessee to file its returns in response to these notices under section 153A for assessment years 2000-01 to 2005-06. The returns, in response to notices under section 153A were duly filed by the assessee. The AO, taking up the proceedings under section 153A for the years under consideration, made certain 5 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 disallowances and primarily disallowed the deduction claimed by the assessee under section 80IA(4).
13. At the time of hearing before us, the AR filed synopsis, giving brief of his submissions. According to the synopsis, the AR, submitted his reasons for non applicability of provisions of section 153A, its was submitted therein, that assessments for assessment years 2000-01 to 2003-04 were under section 143(1) already completed prior to action under section 132(1) and refunds had also been issued by the AO, which were duly credited in the bank account of the assessee. Assessment year 2004-05, the assessment was pending along with the time for the issue of notice under section 143(2). The point being agitated by the AR, here was, whether the AO was competent to issue 153A where there was no pendency, because according to the AR, as per the 2nd Proviso, provisions of section 153A can only be invoked in those years, where, any proceeding is pending and only such proceedings shall get abated and shall be taken over by the provisions of section 153A. To explain the issue, he referred to the subject head, "Assessment in case of search or requisition". The following sections were inserted by the Finance Act, 2003, w.e.f. 01.06.2003. Section 153A(1) brings about the following sections with the non-obstante expression, "Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, in the case of a person where a search is initiated under section 132 or books of account, other documents or any assets are requisitioned under section 132A after the 31st day of May 2003, the Assessing Officer shall :
(a) issue notice to such person requiring him to furnish within such period, as may be specified in the notice, the return of income in respect of each assessment year falling within six assessment years referred to in Clause (b), in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed and the provisions of this Act shall, so far as may be, apply accordingly as such return were a return required to be furnished under section 139;
(b) assess or reassess the total income of six assessment years immediately preceding the assessment year relevant to the previous year in which such search is conducted or requisition made:
6 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 Provided that the Assessing Officer shall assess or reassess the total income in respect of each assessment year falling within such six assessment years:
Provided further that assessment or reassessment, if any, relating to any assessment year falling within the period of six assessment years referred to in this sub section pending on the date of initiation of the search under section 132 or making or requisition under section 132A, as the case may be, shall abate.
14. The AR, in his arguments referred to the provisions, and demonstrated that the legislature has used the word "pending" on the date of initiation of the search under section 132. For the cases, which are either pending in assessment stage or reassessment stage, only those assessment or reassessment shall get abated and 153A shall be attracted. In short, the AR argues that those assessment which have seen the finality, they cannot be revived/reviewed all over again. This was also the intention of the legislature as well, as the 2nd Proviso is very specific, because otherwise, 2nd Proviso shall be otiose. He, therefore, submitted that so far as assessment years 2000-01 to 2003- 04 were concerned, these years have reached finality under section 143(1) and as pointed out, even the refunds for the years under consideration had been credited in the bank account of the assessee (bank statement at pages 199 & 200 - APB).
15. The AR submitted (in synopsis), that the purpose of conducting search is to unearth hidden or undisclosed income or property and bring it to assessment. He referred to C Venkata Reddy vs ITO, reported in 66 ITR 212 (Mys), wherein the basic objective to conduct the search has been explained, and it is observed, (extracted), as summed up at page 237, "The result of this discussion is - (1) that the impugned s. 132 does not to any extent do away with the applicability of the normal procedure prescribed under the statute for assessment or reassessment of income, nor does it, therefore, deprive the assessee concerned of his normal rights of appeal, second appeal and reference to the High Court; (2) that the provisions of the impugned s. 132 made with the object of preventing evasion of payment of tax are limited to getting hold of evidence sought to be withheld from the assessing authorities and getting at income believed to have been undisclosed with a view to bring it under assessment and ensure recovery of tax evaded or sought to be 7 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 evaded; and (3) that the application of the special provisions of the impugned section is possible only when the appropriate authority on the basis of information in his possession has reason to believe that the assessee is withholding or attempting to withhold evidence or is in possession of undisclosed income either in the shape of money or in the shape of bullion, jewellery or the like, which belief furnishes the criterion for making a separate classification having a reasonable relation with the object of the law".
16. More recently, Hon'ble Delhi High Court in the case of L R Gupta vs UOI reported in 194 ITR 32 explained the meaning of undisclosed income. The AR, through the synopsis submitted that CBDT being aware of the complexities for assessment of undisclosed income, issued Circular no. 7, dated 05.09.2003, reported in 263 ITR 106 (St) which clarified what is abatement and pointed out that the circular clarifies that abatement is only for pending assessment as on the date of search, which reads as under, "Para 65.5 The Assessing Officer shall assess or reassess the total income of each of these six assessment years. Assessment or reassessment, if any, relating to any assessment year falling within the period of six assessment years pending on the date of initiation of the search under section 132 or requisition under section 132A, as the case may be, shall abate. It is clarified that the appeal, revision or rectification proceedings pending on the date of initiation of search under section 132 or requisition shall not abate. Save as otherwise provided in the proposed section 153A, section 153B and section 153C, all other provisions of this Act shall apply to the assessment or reassessment made under section 153A. It is also clarified that assessment or reassessment made under section 153A shall be subject to interest, penalty and prosecution, if applicable. In the assessment or reassessment made in respect, of an assessment year under this section, the tax shall be chargeable at the rate or rates as applicable to such assessment year".
17. The AR further pleaded that the object and purpose of search under section 132 is to unearth undisclosed income/property, and as a consequence, thereof, assess that undisclosed income/property and to bring it to tax under provisions of section 153A. He points out and submits that, to not to lead to any absurd & unjust results or mischief, the Hon'ble Supreme Court in the case of K P Varghese vs ITO, reported in 131 ITR 597 (SC) lays down (head notes) ".....a statutory provision must be so construed, if possible, that absurdity and mischief may be avoided. Where the plain literal interpretation of a statutory provision produces a manifestly absurd and unjust result which could never have been intended by the 8 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 Legislature, the Court may modify the language used by the Legislature or even "do some violence" to it, so as to achieve the obvious intention of the Legislature and produce a rational construction. Luke V IRC [1963] AC 557; [1964} 54 ITR 692 (HL) followed.
18. The AR further submitted that in a recent decision by the Hon'ble Delhi High Court in the case of CIT vs Anil Kumar Bhatia (unreported), it has been specified that the provisions of section 153A refers to assessment/reassessment of total income, i.e. total income as per original return of income or income assessed under section 143(1) or 143(3) plus undisclosed income, if any, for the relevant assessment year (paras 20 and 21) 2O. A question may arise as to how this is to be sought to be achieved where an assessment order had already been passed in respect of all or any of those six assessment years, either under Section 143(1)(a) or Section 143(3) of the Act. If such an order is already in existence, having obviously been passed prior to the initiation of the search/requisition, the Assessing Officer is empowered to reopen those proceedings and reassess the total income taking note of the undisclosed income, if any, unearthed during the search. For this purpose, the fetters imposed upon the Assessing Officer by the strict procedure to assume jurisdiction to reopen the assessment under Section 147 and 148, have been removed by the non obstante clause with which sub section (1) of Section 153A opens. The time-limit within which the notice under Section 148 can be issued, as provided in Section 149 has also been made inapplicable by the non obstante clause. Section 151 which requires sanction to be obtained by the Assessing Officer by issue of notice to reopen the assessment under Section 148 has also been excluded in a case covered by Section 153A. The time-limit prescribed for completion of an assessment or reassessment by Section 153 has also been done away with in a case covered by Section 153A With all the stop having been pulled out, the Assessing Officer under Section 153A has been entrusted with the duty of bringing to tax the total income of an assessee whose case is covered by Section 153A, by even making reassessments without any fetters, if need be.
21. Now there can be cases where at the time when the search is initiated or requisition is made, the assessment or reassessment proceedings relating to any assessment year falling within the period of the six assessment years mentioned above, may be pending. In such a case, the second proviso to sub section (1) of Section 153A says that such proceedings "shall abate". The reason is not far to seek, Under Section 153A, there is no room for multiple assessment orders in respect of any of the six assessment years under consideration. That is because the Assessing Officer has to determine not merely the undisclosed income of the assessee, but also the total income' of the assessee in whose case a search or requisition has been initiated. Obviously there cannot be several orders for the sane assessment year determining the total income of the assessee in order to ensure this state of affairs namely, that in respect the six assessment years preceding the assessment year relevant to the year in which the search took place there is only one determination of the total income, it has 9 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 been provided in the second proviso of sub Sub-Section 153A that any proceedings for assessment or reassessment of the assessee which are pending on the date of initiation of the search or making requisition "shall abate". Once those proceedings abate;, the decks are cleared, for the Assessing Officer to pass assessment orders for each of those six years determining the total income of the assessee which would include both the income declared in the returns, if any, furnished by the assessee as well as the undisclosed income, if any, unearthed during the search or requisition. The position thus emerging is that where assessment or reassessment proceedings are pending completion when the search is initiated or requisition is made they will abate making way for the Assessing Officer to determine the total income of the assessee in which the undisclosed income would also be included but in cases where the assessment or reassessment proceedings have already been completed and assessment orders have been passed determining the assessee's total income and such orders are subsisting at the time when the search or the requisition is made, there is no question of any abatement since no proceedings are pending. In this latter situation, the Assessing Officer will reopen the assessments or reassessments already made (without having the need to fallow the strict provisions or complying with the strict conditions of Sections 147, 148 and 151) and determine the total income of the assessee. Such determination in the orders passed under Section 153A would be similar to the orders passed in any reassessment, where the total income determined in the original assessment order and the income that escaped assessment are clubbed together and assessed as the total income".
19. In continuation, the AR referred to the decision of coordinate Bench at Mumbai in the case of Saf Yeast Co. Pvt. Ltd. vs ACIT in ITA no. 1074/Pu/2007 and ITA no. 5182/Mum/2007, dated 03.10.2010, wherein, the ITAT quashed the assessment for the reasons given in para 20 its order, after applying the ratio arrived at by the Special Bench, concluded (as extracted),
20. Applying the ratio of the above decisions to the facts of the present case, xxxxxxxxxxxxx. The position thus emerging is that where assessment proceedings are pending completion when the search is initiated, the pending assessment proceeding stood abated by virtue of the second proviso to section 153A of the Act. Instead of complying with the requirements of section 153A of the Act, the A.O. proceeded with the pending assessment proceeding for the A.Y. 2004-05 and passed the impugned assessment order during the pendency of the assessment under section 153A of the Act which is a nullity and a such the assessment order dtd. 27-12-2006 passed under section 143(3) of the Act is illegal, arbitrary, wholly without jurisdiction and, hence, the same is quashed."
20. Other cases have also been reproduced here. After referring to the submissions from both the sides, the coordinate Bench, quashed 10 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 the assessments framed by the AO under section 153A of the Income Tax Act.
21. On further submissions, the AR referred to the decision of coordinate Bench at Pune, in the context of section 153C of the Income Tax Act, in the case of Sinhgad Tech. Edu. Society vs ACIT, in ITA no. 114 to 117/Pn/2010 (where one of us was a party), wherein it was held that, "In this regard, we posed question to ourselves if it is fair to reopen the assessment which is already concluded without any reason or logic thereby encroach on the rights of the tax payers? Should the AO be given unfettered or arbitrary powers to issue notice for the six AYs specified in the first proviso to section 153A(1) of the Act when the impugned assessments for the said six AYs are otherwise reached finality after due process of law. In our opinion, the answer is negative and it is in favour of the assessee. In any case, DR has not brought anything on record to demonstrate that the decisions given by the Tribunal in the case of LMJ International (supra) and M/s Kumar Company (supra) are not to be followed in this case.
1) Anil Kumar Bhatia & Ors. (2010) 1 ITR (Trib) 484 (Del) Conclusion:-
"In respect of an assessment under s. 153A, where processing returns under s. 143(1)(a) stood completed iii respect of returns filed in due course before search and no material is found in search thereafter, no addition can be made".
2) Suncity Alloys (P) Ltd. (2009) 124 TTJ (Jd) 674 Conclusion:-
"Assessments or reassessments made pursuant to notice under s. 153A are not de novo assessment and therefore no new claim of deduction or allowance can be made by assessee where admittedly the regular assessments are shown as completed assessments on the date of initiation of action under s. 132".
22. This decision, has taken into consideration, certain other decisions as well, whose underlying ratio is that the existence of incriminating document is a must.
23. The AR submitted that, once an assessment, whether under section 143(1) or 143(3) has reached the stage of finality, the 2nd Proviso, prescribing the abatement of the assessment shall have no effect, because, only pending proceedings on the date of search, can get abated. The AR cited the case of Uttra S Shorewal, placed in the unreported portion in 48 SOT 6, wherein the additions made by the AO 11 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 were deleted by the CIT(A). Additions made in the 153A proceedings were held to be not valid. The relevant observation is, "The intention of section 153A is not to disturb matters that have reached finality between the parties. It is true that the provisions of section apply notwithstanding anything contained in section 147 and section 148. But that only conveys the limited idea that once a search takes place, it is open to the Assessing Officer to assess or reassess the total income of six assessment years immediately preceding the assessment year relevant to the previous year in which search was conducted and in exercising such power, the Assessing Officer was not bound to take recourse to section 147 or section 148. But this is only for the purpose of initiating proceedings for assessment under section 153A It does not mean that matters that have already been decided between the parties and had reached finality can be disturbed and brought back to assessment. If such a power is given to the Assessing Officer, he could even nullify decisions of the High Courts and Supreme Court, a power which would be wholly inconsistent with the law of the land. Section 153A cannot be construed in such a manner. In the assessments made under section 153A, therefore, the Assessing Officer had no jurisdiction to include the same additions, which were deleted by the Commissioner (Appeals) earlier and whose orders have become final".
24. The AR submitted that in so far as assessment years 2000-01 to 2003-04, were concerned, those years had reached the stage of finality and even the AO had issued refunds in these years. The AR, therefore, submitted that the disallowances made by the AO in these proceedings in so far as assessment years 2000-01 to 2003-04 were illegal, in view of the Circular issued by the Board (supra) and the decision of Uttra S Shorewal (supra). He referred to the case of recent SB decision in the case of All Cargo reported in 137 ITD 287, wherein, it has been held, in Para 19 "Similar issue came up before the Special Bench of this Tribunal (in, one of us was a party) and the Special Bench had an occasion to deal with the scope of interpretation of section 153A of the Act in the case of in All Cargo Global Logistics Ltd. (supra). The Special Bench of the Tribunal after considering the various decisions and CBDT circulars including the Circular No. 7 of 2003 dtd. 5-9-2003 and the decision of the [mentioned in the list of cases/circulars] has held as under:
"52. The provision comes into operation if a search or requisition is initiated after 31.5.2003. On satisfaction of this condition, the AO is under obligation to issue notice to the person requiring him to furnish the return of income of six years immediately preceding the year of search. The word used is "shall" and, thus, there is no option but to issue such a notice. Thereafter he has to assess or reassess total income of these six years. In this respect also, the word used is "shall"
and, therefore, the AO has no option but to asses or reassess the total income of these six years. The pending proceedings shall abate. This 12 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 means that out of six years, if any assessment or reassessment is pending on the date of initiation of the search, it shall abate. In other words pending proceedings will not be proceeded with thereafter. The assessment has now to be made under section 153A(1)(b) and the first proviso. It also means that only one assessment will be made under the aforesaid provisions as the two proceedings i.e. assessment or reassessment proceedings and proceedings under this provision merged into one. If assessment made under sub-section (1) is annulled in appeal or other legal proceedings, then the abated assessment or reassessment shall revive. This means that the assessment or reassessment, which had abated, shall be made, for which extension of time has been provided under section 153B.
53. The question now is, what is the scope of assessment or reassessment of total income under section 153A(1)(b) and the first proviso? We are of the view that for answering this question, guidance will have to be sought from section 132(1). If any books of account or other documents relevant to the assessment had not been produced in the course of original assessment and found in the course of search in our humble opinion such books of account or other documents have to be taken into account while making assessment or reassessment of total income under the aforesaid provision. Similar position will obtain in a case where undisclosed income or undisclosed property has been found as a consequence of search. In other words, harmonious interpretation will produce the following results :-
a) In so far as pending assessments are concerned, the jurisdiction to make original assessment and assessment under section 153A merge into one and only one assessment for each assessment year shall be made separately on the basis of the findings of the search and any other material existing or brought on the record of the A.O.
b) in respect of non-abated assessments, the assessment will be made on the basis of books of account or other documents not produced in the course of original assessment but found in the course of search, and undisclosed income or undisclosed property discovered in the course of search."
............... ............ .....................
58. Thus, question No. 1 before us is answered a) as under:
(a) In assessments that are abated, the A.O. retains the original jurisdiction as well as jurisdiction conferred on him under s. 153A for which assessments shall be made for each of the six assessment years separately;
(b) In other cases, in addition to the income that has already been assessed, the assessment under section 153A will be made on the basis of incriminating material, which in the context of relevant provisions means
(i) books of account, other documents, found in the course of search but not produced in the course of original assessment, and (i) undisclosed income or property discovered in the course of search.
59. Having come to this conclusion we need not go into various orders of the Tribunal cited by the rival parties. The decisions inconsistent with aforesaid view/conclusion stand disapproved an.. the decisions ;tent with this view/conclusion are approved"
20. Applying the ratio of the above decisions to the facts of the present case, xxxxxxxxxxxxx. The position thus emerging is that where assessment proceedings are pending completion when the search is initiated, the pending assessment proceeding stood abated by virtue of the second proviso to section 153A of the Act. Instead of complying with the requirements of section 153A of the Act, the A.O. proceeded with the pending assessment proceeding for the A.Y. 2004-05 and passed the 13 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 impugned assessment order during the pendency of the assessment under section 153A of the Act which is a nullity and a such the assessment order dt. 27-12-2006 passed under section 143(3) of the Act is illegal, arbitrary, wholly without jurisdiction and, hence, the same is quashed."
25. The AR, in continuation of his argument that when the proceedings had reached the stage of finality, those proceedings cannot be abated as per 2nd Proviso, pointed out that in so far as the proceedings for assessment year 2004-05 were concerned, even they could be taken to be finalized, as the AO had not issued any notice to regularize the assessment, either 142(1) or 143(2), to make the assessment proceedings pending on the date of search.
26. The AR, therefore concluded that so far as proceedings under section 153A was concerned, the proceedings could not be held to be legal, because (i) no incriminating material and/or document was found, which could indicate some income having been unearthed and
(ii) deny the deduction under section 80IA(4), holding that the assessee was only a contractor and not a developer of infrastructure. The AR submitted that this reason cannot be a good enough reason to invoke the provisions of section 153A, as this is only a legal argument, which by itself, cannot construe to be an incriminating material. The AR, therefore prayed that the proceedings under section 153A for assessment years 2000-01 to 2004-05 be held to be illegal and therefore must be quashed.
27. Replying to the detailed submissions, the DR submitted that in a case where there is a search operation under section 132 of the Income-tax Act or requisition of books, the AO is bound to issue notices under section 153A for the preceding six years from the financial year in which the search has taken place. The DR submitted that the legislature has neither given any option nor any discretion to the AO to make any decision for the issue or not to issue notices under 14 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 section 153A for the preceding six years. The DR, to strengthen his argument submitted that the Hon'ble Delhi High Court in the case of Anil Kumar Bhatia, (also referred to by the AR), has very categorically held that 153A empowers the AO to bring to tax the total income of the assessee. The relevant portions are extracted, "Under the provisions of Section 153A, as we have already noticed, the Assessing Officer is bound to issue notice to the assessee to furnish returns for each assessment year falling within the six assessment years immediately preceding the assessment year relevant to the previous year in which the search or requisition was made".
xxxx xxxx xxxx xxxx xxxx "With all stops having been pulled out, the Assessing Officer under section 153A has been entrusted with the duty of bringing to tax the total income of an assessee whose case is covered by section 153A, by even making reassessments without any fetters, if need be".
28. The DR emphasized that the assessee has not satisfied all the conditions, as laid down in the provisions, allowing the deduction. He put forth the submissions, as made by the AO, that merely being a developer is not enough, but in case, if the developer does not satisfy all the underlying conditions, as cast by the legislature, the deduction is not allowable. He submits in his conclusions, the relevant portions of the AO's observations, which are extracted as under :
"Thus it has been concluded that assessee by virtue of the manner in which it is carrying out its business neither fits in the definition of developer by general concepts nor it fits into the category of persons for whose benefit the provisions were introduced. Without prejudice to the above, it is also to be seen as to whether the assessee fulfills all the other conditions prescribed-hi the Section for availing the benefit. This issue has been dealt in subsequent paras.
(b) Sub-section 801A(4) specifies the entities which are entitled for deduction under section. 801A. In clause (i) while stating that any enterprise carrying business of (i) developing or (ii) operating and maintaining or (iii) developing operating and maintaining infrastructure facility, it has been clearly laid down that such enterprise shall fulfill all the conditions laid down in sub clause (a) (b) and (c). Sub clause (c) puts a condition that the enterprise has started or starts operating and maintaining the infrastructure facility on or after first day of April 1995.
Thus, the plain language of provisions of sec. 80IA(2) and 4(i)(c) makes it very dear that the deduction to an enterprise is available under this section only when enterprise developers and begins to operate or maintain the infrastructure facility".
29. The DR submitted that no doubt that there were no incriminating documents per se, but a wrong claim of a deduction 15 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 would definitely construe to be an incriminating information/document, he observes, "Whereas assessee satisfies the conditions referred by it in its reply reproduced in para 3.1(B) (c) and (f) without any doubt. There are several doubts over the satisfaction of the other conditions". He submitted that since the assessee, who has been held to be contractor and not a developer, the assessee was not entitled to the claim of section 80IA(4), which is available only to the developer. The DR made a reference to pages 18 & 19 of DPB, whereby he submitted that the assessee was in fact a co-contractor with the Mukut Group and to this extent, the said pages construe to be incriminating. AS per the DR, the assessee has not fulfilled any of the these underlying conditions, as per clause (ii) to section 80IA(4), which by themselves, are essential for the allowance of deduction.
30. The DR, therefore, concluded that in view of the decision of Hon'ble Delhi High Court and taking into account pages 18 & 19 of the seized documents, the action of the AO with regard to invoking section 153A was legal and as per the provisions of the Act. According to him, the arguments advanced by the AR were devoid of all legal sanctions.
31. In the rejoinder, the AR straight away submitted that in so far as section 80IA(4) is concerned, it does not talk either about developer or about contractor, therefore according to the AR, when the relevant section does not make any distinction between either the developer or contractor, then how can the AO create the distinction. He further submitted that in cases where the infrastructure development is undertaken by the government, the government passes over the entire project along with all its liabilities with respect to delay, legal formalities, legal cases, maintenance and interaction with govt. departments for sanctions and all financial commitments to the so called contractor, who basically is the developer in all sense of the matters. The AR further pointed out that there are plethora of 16 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 judgments wherein the contractors is held as the developer and the relevant deduction has been allowed.
32. The AR once again reiterated his arguments on the issue of validity of proceedings under section 153A, and once again, he submitted that accept for the change in view with regard to allowance of deduction under section 80IA(4), there is no material, either found in the course of search under section 132 or any other material was brought to the notice, which indicated any concealed income. He submitted that the purpose of section 132 is unearthing undisclosed/concealed income or item of income and where there is no material whatsoever, the case fell within the ratio of All Cargo (SB) (supra), wherein it was held that in case there is a proceeding pending, that shall be abated and provisions of section 153A shall prevail and assessment, in the normal course shall be taken, but where the proceedings had culminated and they have reached the stage of finality, the provisions of section 153A shall only become applicable if there is any evidence/material found, indicating concealment/items of income.
33. The AR further referred to the decision of CIT vs Smt. Shaila Agarwal, reported in 346 ITR 130 (All), wherein, it is held, "Section 153A of the Income-tax Act, 1961, provides that where notice under this section is issued as a result of any search under section 132, assessment or reassessment, if any, relating to any assessment year falling within the period of six assessment years referred to under section 153, pending on the date of initiation of search under section 132 or requisition under section 132A shall abate. The words "pending on the date of initiation of search under section 132 or making of requisition under section 132A, as the case may be", have to be assigned their simple and plain meaning. Where the assessment or reassessment is finalised, there are no pending proceedings to abate and be restored to the file of the Assessing Officer. The word "abatement" is referable to something which is pending, alive, or is subject to deduction. Abatement refers to suspension or termination of proceedings either of the main action, or proceedings ancillary or collateral to it. Proceedings which have already terminated are not liable for abatement unless the statute expressly provides for it. The word "pending" occurring in the second proviso to section 153A of the Act is qualified by the words "on the date of initiation of the search", 17 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 and makes it abundantly clear that only such assessment or reassessment proceedings are liable to abate. The pendency of an appeal in the Tribunal against the order of assessment against which an appeal has been decided by the Commissioner (Appeals) is not a continuation of the proceedings of assessment. An appeal under the Income-tax Act lies to the Appellate Tribunal on a question of law. Even if it is pending on the date of search the reassessment proceedings will not abate. The abatement of any proceedings has serious effect inasmuch as it takes away all the consequences that arise thereafter. The material found in the search may be a ground for notice and assessment under section 153A of the Act but that would not efface or terminate all the consequences, which arise out of the regular assessment or reassessment resulting in a demand or proceedings for penalty".
34. He also referred to the decision of Hon'ble Delhi High Court in the case of SSP Aviation Ltd. vs DCIT, reported in 346 ITR 177, This decision was also referred to in the case of All Cargo (SB), wherein, at page 187 answers the fate of proceedings which is/are pending.
35. The AR, therefore, pressed his grounds taken in each of the CO, with the arguments that the proceedings for assessment years 2000- 01 to 2004-05 were legally not correct.
36. We have heard the rival contentions at length, in the instant COs, the issue being agitated is, when there was no evidence or incriminating material found in the course of search operations, the assessment orders passed, invoking the provisions under section 153A were bad in law and liable to be quashed, as the underlying purpose of making assessment of total income, under section 153A, i.e. to assess income which was not disclosed or would not have been disclosed, failed, and thus the assessment made as if it were regular scrutiny assessment was beyond jurisdiction.
37. The search operations were carried out on the assessee's business premises & the residential premises of its Directors on 17.02.2005. As a consequence of which, the AO initiated proceeding under section 153A for assessment year 2000-01 to assessment year 2004-05. From the arguments advanced by the AR and which were not 18 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 controverted by the DR before us and by the department in the proceedings before the revenue authorities are :
a) during search operations no incriminating document was found and seized, which could indicate any undisclosed income
b) the only addition made by the AO was on account of withdrawal of deduction under section 80IA(4).
38. Based on these two issues, we have to first ascertain the validity of the jurisdiction cast by the legislature on the AO for the issue of notice under section 153A and then revert our attention to the validity of the additions made therein.
39. Section 153A was introduced in the statute w.e.f. 01.06.2005, wherein the section starts with the non obstante phrase "Notwithstanding...", therefore, as soon as the search is concluded, the AO having jurisdiction over the assessee, a jurisdiction is cast upon the AO to issue notices under section 153A(1), for the preceding six years, calling upon that person to file its returns. As soon as the notices are issued, due process of law shall begin and AO and the assessee are required to follow the same, which shall culminate with the AO to assess or reassess the total income of the searched person in all the six years in question. While casting this jurisdiction over the AO, the legislature, to remove all the difficulties with regard to the multiplicity of proceedings pending on the date of initiation of search, through 2nd Proviso, expunged all those proceedings, so that the assessee and the AO shall deal with only one type of proceedings, wherein the AO shall, as per clause (ii), assess or reassess the total income of the searched person. This barrier has been set up by the legislature only with regard to proceedings that were found pending before the AO on the date of search. Therefore, a proceeding which is pending, only those proceedings shall get abated. In other words, any proceeding that has reached its finality shall not be disturbed, as per the clarification issued by the CBDT, through Circular no. 7, dated 19 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 05.09.2003 (supra), unless there are materials found, indicating existence of income embedded in those incriminating document(s).
40. This has been explained by the Special Bench in the case of All Cargo Global Logistics Ltd. vs DCIT reported in 137 ITD 287 (Mum- SB), which states, "58. Thus, question No. 1 before us is answered a) as under:
(a) In assessments that are abated, the A.O. retains the original jurisdiction as well as jurisdiction conferred on him under s. 153A for which assessments shall be made for each of the six assessment years separately;
(b) In other cases, in addition to the income that has already been assessed, the assessment under section 153A will be made on the basis of incriminating material, which in the context of relevant provisions means
(i) books of account, other documents, found in the course of search but not produced in the course of original assessment, and (i) undisclosed income or property discovered in the course of search.
Therefore what emerges is that no doubt 153A shall be initiated, and all the six years shall become subject matter of assessment under section 153A. The AO shall get the free hand, through abatement, only on the proceedings that are/is pending. It is, in these abated proceedings, AO can frame the assessment(s) afresh. But in a case or in a circumstances where the proceedings have reached finality, assessment under section 153A read with 143(3) has to be made as was originally made/assessed and in case where certain incriminating documents have been found indicating undisclosed income, then the addition shall only be restricted to those documents/incriminating material, and clubbed only to the assessment framed originally, as the law does not permit the AO to disturb already concluded issues, whether it pertained to any income or expenditure or deduction, as also observed by the Hon'ble Delhi High Court in the case of Anil Kumar Bhatia, "18. A perusal of Section 153A shows that it starts with a non obstante clause relating to normal assessment, procedure which is covered by Sections 139, 147, 148, 149, 151 and 153 in respect of searches made after 31.5.2003. These Sections, the applicability of which has been excluded, relate to returns, assessment and reassessment provisions. Prior to, the introduction of these three Sections, there was Chapter XIV-
20 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 B of the Act, which took care of the assessment to be made in cases of search & seizure. Such an assessment was popularly known as 'block assessment' because the Chapter provided for a single assessment be made in respect of a period of a block of ten assessment years prior to the assessment year in which the search was made. In addition to these ten assessment years, the broken period up to the date on which the search was conducted was also included in what was known as 'block period'. Though a single assessment order was to be passed, the undisclosed income was to be assessed in the different assessment yeas to which it related. But all this had to be made in a single assessment order. The block assessment so made was independent of and in, addition to the normal assessment proceedings as clarified by the Explanation below Section 158BA(2). After the introduction of the group of Sections namely, 153A to 153C, the single block assessment concept was given a go-by. Under the new Section 153A, in a case where search is initiated under section 132 or requisition of books of account, documents or assets is made under Section 132A after 31.5.2008, the Assessing Officer is obliged to issue notices calling upon the searched person to furnish returns for the six assessment years immediately preceding the assessment year relevant to the previous year in which the search was conducted or requisition was made. The other difference is that there is no broken period from the first day of April of the financial year in which the search took place or the requisition was made and ending with the date of search/requisition. Under Section 153A and the new scheme provided for, the AO is required to exercise the normal assessment powers in respect of the previous year in which the search took place.
19. Under the provisions of Section 153A, as we have already noticed, the Assessing Officer is bound to issue notice to the assessee to furnish returns for each assessment year falling within the six assessment years immediately preceding the assessment year relevant to the previous year in which the search or requisition was made. Another significant feature of this Section is that the Assessing Officer is empowered assess or reassess the "total income" of the aforesaid years. This is significant departure from the earlier block assessment scheme in which the block assessment roped in only the undisclosed income and the regular assessment proceedings were preserved, resulting in multiple assessments. Under section 153A, however, the Assessing Officer has been given the power to assessee or reassess the 'total income' of the six assessment years in question in separate assessment orders. This means that there can be only one assessment order in respect of each of the six assessment .years, in which both the disclosed and the undisclosed income would be brought to tax. 2O. A question may arise as to how this is to be sought to be achieved where an assessment order had already been passed in respect of all or any of those six assessment years, either under Section 143(1)(a) or Section 143(3) of the Act. If such an order is already in existence, having obviously been passed prior to the initiation of the search/requisition, the Assessing Officer is empowered to reopen those proceedings and reassess the total income taking note of the undisclosed income, if any, unearthed during the search. For this purpose, the fetters imposed upon the Assessing Officer by the strict procedure to assume jurisdiction to reopen the assessment under Section 147 and 148, have been removed by the non obstante clause with which sub section (1) of Section 153A opens. The time-limit within which the notice under Section 148 can be issued, as provided in Section 149 has also been made inapplicable by the non obstante clause. Section 151 which 21 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 requires sanction to be obtained by the Assessing Officer by issue of notice to reopen the assessment under Section 148 has also been excluded in a case covered by Section 153A. The time-limit prescribed for completion of an assessment or reassessment by Section 153 has also been done away with in a case covered by Section 153A With all the stop having been pulled out, the Assessing Officer under Section 153A has been entrusted with the duty of bringing to tax the total income of an assessee whose case is covered by Section 153A, by even making reassessments without any fetters, if need be.
21. Now there can be cases where at the time when the search is initiated or requisition is made, the assessment or reassessment proceedings relating to any assessment year falling within the period of the six assessment years mentioned above, may be pending. In such a case, the second proviso to sub section (1) of Section 153A says that such proceedings "shall abate". The reason is not far to seek; Under Section 153A, there is no room for multiple assessment orders in respect of any of the six assessment years under consideration. That is because the Assessing Officer has to determine not merely the undisclosed income of the assessee, but also the total income' of the assessee in whose case a search or requisition has been initiated. Obviously there cannot be several orders for the sane assessment year determining the total income of the assessee in order to ensure this state of affairs namely, that in respect the six assessment years preceding the assessment year relevant to the year in which the search took place there is only one determination of the total income, it has been provided in the second proviso of sub Sub-Section 153A that any proceedings for assessment or reassessment of the assessee which are pending on the date of initiation of the search or making requisition "shall abate". Once those proceedings abate, the decks are cleared, for the Assessing Officer to pass assessment orders for each of those six years determining the total income of the assessee which would include both the income declared in the returns, if any, furnished by the assessee as well as the undisclosed income, if any, unearthed during the search or requisition. The position thus emerging is that where assessment or reassessment proceedings are pending completion when the search is initiated or requisition is made they will abate making way for the Assessing Officer to determine the total income of the assessee in which the undisclosed income would also be included but in cases where the assessment or reassessment proceedings have already been completed and assessment orders have been passed determining the assessee's total income and such orders are subsisting at the time when the search or the requisition is made, there is no question of any abatement since no proceedings are pending. In this latter situation, the Assessing Officer will reopen the assessments or reassessments already made (without having the need to fallow the strict provisions or complying with the strict conditions of Sections 147, 148 and 151) and determine the total income of the assessee. Such determination in the orders passed under Section 153A would be similar to the orders passed in any reassessment, where the total income determined in the original assessment order and the income that escaped assessment are clubbed together and assessed as the total income".
41. On going through the provisions of section 153A, clause (b) of section 153A, 2nd Proviso and the various decisions cited before us, three possible circumstances emerge on the date of initiation of search 22 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 under section 132(1) of the Income Tax Act, (a) proceedings are pending; (b) proceedings are not pending but some incriminating material found in the course of search, indicating some income and/or assets not disclosed in the return and (c) proceedings are not pending and no incriminating material has been found.
42. When we tread to trace the correct and logical answers to the above circumstances, circumstance (a) is answered by the Act itself, that is, since the proceedings are still pending, all those pending proceedings are abated and the AO gets a free hand to make the assessment. Circumstance (b) has been answered by the Courts, interpreting 2nd Proviso along with clause (b) to section 153A, wherein the Hon'ble Delhi Court observes and hold, "where the assessment or reassessment proceedings have already been completed and assessment orders have been passed determining the assessee's total income and such orders are subsisting at the time when the search or the requisition is made, there is no question of any abatement since no proceedings are pending. In this latter situation, the Assessing Officer will reopen the assessments or reassessments already made (without having the need to fallow the strict provisions or complying with the strict conditions of Sections 147, 148 and 151) and determine the total income of the assessee. Such determination in the orders passed under Section 153A would be similar to the orders passed in any reassessment, where the total income determined in the original assessment order and the income that escaped assessment are clubbed together and assessed as the total income". But when we come to third circumstance i.e. circumstance (c), we find that this has been left unanswered. Para 23 of the judgment, the Hon'ble Delhi High Court mentions that the issue is left open.
43. This, has been explained in the graphic made below and the relevant portion is in italics therein.
This can be explained through this graphic :
23 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 Search | 153A for six years | _______________ |___________________ | | Assessment Pending Assessment not pending |- (1) |- (2) 153A read with 143(3) | to be framed, as per the | provisions | ___________ _________ | | Material found Material not found |- (2A) | - (2B) Assessment to be Assessment under framed : assessing section 153A to be framed income unearthed in only as per original asst.
search + originally whether under section
assessed income. 143(1) or 143(3)
Assessment : under
Section 153A/143(3)
44. To answer the question, as to what shall be the assessment of total income, where there is/are no pending proceedings and no incriminating material, we have to trace out the logical conclusion, by harmonising the legislative intendments and the judicial decisions, as held by the Hon'ble Supreme Court of India in the case of K P Varghese (supra), wherein it was observed, so as to achieve the obvious intention of the Legislature and produce a rational construction. When we look into the decision of the Hon'ble Delhi High Court in Anil Kumar Bhatia (supra), we find that the Hon'ble Court has pointed out that in case where there is no abatement, total income has to be determined by clubbing together the income already determined in the original assessment order and the income that escaped assessment (situation 2A in the graphic). In the circumstance, what we are dealing in instantly, there are finalized assessment proceedings and no incriminating material indicating any escaped income (situation 2B in the graphic). Taking a cue from the decision of Hon'ble Delhi High Court in the case of Anil Kumar Bhatia (supra) we can tread on the same premise and hold that on clubbing, what remains is the income 24 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 originally determined or assessed (i.e. income originally determined + Zero = income originally determined - as there was no incriminating material).
45. In the instant case(s), what we find as a matter of fact :
(a) Assessment years 2000-01 to 2003-04 have already been completed and finalized and even the refunds had been issued, therefore, even the department had accepted the relevant assessment years to be final. For assessment year 2004-05, the time for issue of notice under section 143(2) was upto 31.10.2005, which was accepted to have not been issued till the date of search, i.e. 17.02.2005. Therefore, even assessment year 2004-05, could be accepted to be completed and finalized on the date of search.
(b) the AO revived/reviewed the assessment proceedings for all five assessment years and proceeded to make only normal disallowances, and withdrew the deduction under section 80IA(4), which had been allowed to the assessee.
46. The arguments of the AR, that when there was no incriminating material or assets, then there is no jurisdiction of section 153A, cannot be accepted. It is triate, that whenever a provision begins with a non obstante provision, it shall supersede all other provisions. Since section 153A begins with the word, Notwithstanding, section becomes non porous and it has to be applied first. Therefore, whenever a search is undertaken under section 132 on any person, 153A is triggered automatically. This is a settled provision of law and now well supported by the decision of Hon'ble Delhi High Court in the case of Anil Kumar Bhatia, wherein in para 19. The Hon'ble Delhi High Court observes, Under the provisions of Section 153A, as we have already noticed, the Assessing Officer is bound to issue notice to the assessee to furnish returns for each assessment years, falling within the six assessment years immediately preceding the assessment year relevant to the previous year in which the search or requisition was made".
47. When we look into clause (b) of sub section (1) of section 153A, the legislature has granted an authority on the AO to assess or 25 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 reassess the total income. This clause has to be read along with 2nd Proviso, where the law has laid restriction over the AO as to which assessment would become eligible for being assessed or reassessed. 2nd Proviso specifies that the AO can only assess or reassess the assessment years which are still pending before him, as the legislature has only mentioned the words assessee or reassess, which power is only vested with the AO, therefore, no other proceeding can get abated, which includes appeal, revision or rectification (as per Circular no. 7 (supra)).
48. Now we have to tread into a situation where on the date of initiation of search under section 132 or requisition of books, no proceeding(s) is pending, but in the search, material is found indicating incriminating material. In this situation, the AO embarks on a jurisdiction, wherein he has to club the two sets of incomes, i.e. returned income and the unearthed income and arrive at the total income.
49. There is another circumstance, wherein, in the search operation, no incriminating material is found and there are no proceedings pending before the AO. In this scenario, as per the provisions of section 153A(1), the AO has to issue notices under section 153A, asking the searched person to file its returns. Since there are no proceedings which are pending before him, 2nd Proviso stops the AO to proceed further, because proceedings cannot be abated and since there is no material, no further jurisdiction is embarked on him. This is where, Hon'ble Delhi High Court stops and leaves the question open.
50. We find there is complete disharmony in the circumstance, because, the Act allows six assessments years to be open vide section 153A for being assessed or reassessed to ascertain total income, therefore, the AO is bound to pass an order under section 153A read 26 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 with 143(3), which, according the Anil Kumar Bhatia (supra), "Such determination in the orders passed under section 153A would be similar to the orders passed in any reassessment, where the total income determined in the original assessment order and the income that escaped assessment are clubbed together and assessed as the total income". Therefore, the AO, accordingly has to stop short in these proceedings and restrict himself to the income already determined/assessed in the already concluded proceedings for the year(s), whether under section 143(1) or 143(3). Thus it is a case of valid notice under section 153A, with no undisclosed income to be clubbed with income originally assessed and finalized. However, it has to be added here that proceedings under section 153A are linked to the search having been initiated on the person, not with the documents found and seized. The documents so found and seized, may become useful to the AO for making an assessment of total income under section 153A read with 143(3).
51. We refer here, to the arguments of the DR, wherein he pointed out that seized documents no. 18 and 19, which showed that the assessee was co-contractor. As per his arguments, those documents may be considered as incriminating documents for all the years under consideration, particularly from the point of view that the terms of the agreement, on which the assessee was conducting its business on the particular infrastructure facility, was still under continuation.
52. In our opinion, the referred documents may be considered relevant initially, for the purposes of 2nd Proviso to section 153A, but in any case, these documents cannot be read as stand-alone and in isolation, but have to be read along with other connected documents.
53. When we peruse the assessment orders, as well as the denial of deduction under section 80IA(4), at no point of time, the AO has been 27 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 able to bring on record or refer to any material, which could be said to be either incriminating, or found in the course of search, indicating undisclosed income. On the contrary, we find that even the withdrawal of impugned deduction is only based on the changed interpretation of the AO, i.e. whether the assessee was really a contractor or was the assessee really the developer of infrastructure, and working for and on behalf of the government. Still looking from the point of view of the AO, as to how the deduction could be denied, we, do not find either any change in the relevant provision allowing deduction, nor was there any change in the factual circumstance, which could have lead to a distinguishable circumstance, or anything else, which the assessee did not bring on record in the computation of income, filed for the various years under consideration or that the claim made by the assessee was illegal or the claim was wrong.
54. When we read section 153A along with the observations made in Anil Kumar Bhatia (supra) and in All Cargo (supra), we are of the opinion that the AO was correct in law to issue the notices under section 153A for the years under consideration, as he was bound to in respect of all the concerned assessment years. We cannot agree with the arguments of the AR that the proceedings under section 153A have to be quashed, because there was no material found in the search, indicating, that the assessee had concealed any part of its income.
55. Proceeding with our decision further, we are of the opinion that, once search is conducted, the AO is bound to issue the notices under section 153A and then has to pass orders thereon. Therefore, the AO was legally correct to initiate proceedings under section 153A and passing appropriate orders in accordance with law. It may, however, be a separate issue to be dealt with separately, what should be the contents of the order(s) passed under section 153A read with 143(3).
28 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008
56. In the result, so far as the grounds raised by the assessee in Cross Objections, for assessment years 2000-01 to 2004-05, against the CIT(A)'s decision to sustain the assessments framed under section 153A are incorrect, cannot be accepted. We, therefore, sustain the decision of the CIT(A). The COs, filed by the assessee, fail, therefore, the grounds raised therein are dismissed.
57. Apropos, departments appeals directed against the deletion of disallowance of deduction under section 80IA(4), wherein, the AO held in the proceedings under section 153A, that the assessee was not eligible for the deduction, as the assessee was a contractor and not a developer of infrastructure projects.
58. The facts have been discussed earlier in this combined order, that the assessee entered into an agreement with the Governmental bodies to carry out infrastructures development projects. In the years under consideration, the assessee was carrying on the project concerning water supply. In years covering assessment years 2000-01 to 2004-05, the returns, claiming the deduction under section 80IA(4) was accepted by the AO under section 143(1) and the AO issued refunds, wherever it was required to. In these years, the AO did not regularize the assessment proceedings by the issue of notice either under section 142 or 143(2).
59. Search and seizure operations were carried out on 17.02.2005, i.e. financial year 2004-05, falling in assessment year 2005-06. For the financial year in which the search took place, the assessee offered under section 132(4), an amount of Rs 1.95 crores under section 41(1), covering creditors which were more then three years old.
60. As per the provisions of section 153A(1), the AO issued notices calling upon the assessee to file its returns of income for the relevant 29 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 assessment years, i.e. assessment years 2000-01 to 2005-06, which the assessee filed, and the assessment proceedings were undertaken.
61. In the assessment proceedings, undertaken by the AO, the AO asked the assessee, as to how the assessee fulfilled the basic condition of being a developer of infrastructure facilities, and if it is unable to fulfill the basic conditions, why the deduction under section 80IA(4) should not be denied/disallowed, which the assessee had been claiming year to year.
62. In reply to the show cause, the assessee replied, "3.1 The assessee furnished a note for justification of his claim in which, after reproducing provisions of sec.801A(1) and (4) of the I.T. Act, he has submitted the following arguments in support of its claim --
(A) On the basis of section, the assessee has concluded that following are the conditions which need to be satisfied -
(a) Profits and Gains must be derived by the undertaking or enterprise from the business of developing or operating and maintaining or developing, operating and maintaining any infrastructure facility.
(b) The enterprise carrying on the above business must be owned by a company registered in India or by a consortium of such companies.
(c) Such enterprise must enter into agreement with Central or State Government or local authority or any other statutory body for carrying out the said activity.
(d) The enterprise has started or starts operating and maintaining the infrastructure facility on or after 1/4/1995.
(e) Infrastructure facility would mean the development/ operating/maintaining of items as given under the Explanation to the Section.
(B) Then, it is argued that --
(a) The Assessee is engaged in the business of developing the infrastructure facility like development of road, water supply project, irrigation project, sewerage system etc. Hence, the Assessee has satisfied the requirements of the applicability of sub-section (4) to Section 80IA of the Income-tax Act.
(b) As per the facts given, the Assessee is a company registered in India and the projects are undertaken and owned by the enterprise of the Assessee and hence, the condition laid down in sub-clause (a) of clause (i) of Section 80IA(4) of the I.T. Act is fulfilled.
(c) The Assessee has entered into agreements with State Government and / or local authority or statutory body for developing and/or operating and maintaining of infrastructure facility and hence, the condition stipulated in sub-clause (b) of clause (1) of Section 80IA(4) of the I.T. Act is satisfied. 30 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008
(d) The amendment to section 801A in 2000 has made Deduction under section 801A allowable also to the developer of Infrastructure facility. The decision of the Mumbai Tribunal in Patel Engineering Ltd. v. Dy. CIT (2004) 84 TTJ 646 (Mum). relates to the period prior to the amendment where in it was debatable whether deduction was available to the developer of infrastructure facility. Even in the decision the honorable ITAT Mumbai has decided in favour of the Assessee and allowed deduction under section 801A. Post amendment w.e.f. Assessment year 2000 - 2001 it has been very clear that deduction under section 801A is also allowable to the developer. The amendment has specifically included developer of infrastructure facility under sub clause 4 of section 801A. Post amendment the situation is more favourable to the Assessee.
(e) Thus deduction under s 80IA(4) of the Income-tax Act could be availed even in cases where the enterprise merely develops the infrastructure facility and does not operate and maintain the same.
(f) The last and the final condition is the meaning assigned to the term infrastructure facility in the Explanation under clause
(c) of sub-s. (4)(i) of section 80IA of the Act. As per the facts stated, the Assessee has entered into agreements for development of roads, bridges, water transmission system, railway-stations, etc. and thus, the projects developed or undertaken for development falls within the scope of the meaning assigned to infrastructure facility. Hence, in the case of the Assessee, this test also gets satisfied.
Accordingly, it has claimed that it is entitled for benefit of deduction. The assessee has also submitted a note on the business process.
Xxxx xxxxx xxxxx xxxxx The scope and effect of the introduction of the said section has been explained by the Department Circular No.717 dated 14/8/1995 reported in 215 JTR (St.) 70 i.e. Explanatory notes on provisions relating to direct taxes. The explanatory note is given in para 34.2 of the said circular wherein it is stated as under-
"34.2 Industrial modernization requires a massive expansion of; and qualitative improvement in, infrastructure. Our country is very deficient in infrastructure such as expressways, high ways, airports, ports and rapid urban rail transport systems. Additional resources are needed to fulfil the requirements of the country within a reasonable time frame. In may countries, the BOT (build-operate-transfer) or the BOOT (build-own-operate-transfer) concept have been utilized for developing new infrastructure."
Further, the notes on clauses of Finance Bill, 1999 as reported in 236 1TR (St.) 135 states as under-
"It further seeks to provide that when an enterprise develops infrastructure facility and subject to the agreement with the Central or State Government, local authority or statutory body, as the case may be, the operation and maintenance of such facility is carried on its behalf by some other undertaking, the provisions of this section shall continue to apply to such other enterprise for the unexpired period of the prescribed time".
31 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008
63. The AR further referred to the decision of coordinate Bench in Mumbai in the case of Patel Engineering Ltd. vs DCIT reported in 94 ITD 411 (Mum), wherein the Bench of the ITAT was seized with the similar issue, as in the instant appeals/COs, that we are dealing with. The coordinate Bench held, (extracted) :
"The amendment in s. 80IA was brought about by Finance Act, 1995 w.e.f 1st April, 1996. By virtue of this amendment, exemption under s. 80-IA(4A) was provided to any enterprise carrying on the business of developing, maintaining and operating any infrastructure facility. Thus, to be eligible for this deduction an assessee was required to carry out all the three activities i.e. (i) to develop, (ii) to maintain and (iii) to operate. After the modification effected by the finance Act, 1999 w. e.f 1st April, 2000, deduction under s. 80-IA (4) has been made available to any enterprise carrying on the business of (i) developing or (ii) maintaining and operating, or (iii) developing, maintaining and operating the infrastructure faculty. Therefore, from asst. yr. 2000-01, deduction is available to the assessee carries on the business of any one of the abovementioned types of activities, and accordingly also when the assessee is carrying activity of only developing. When an assessee is only developing the infrastructure faculty/project and is not maintaining nor operating it, obviously such an assessee will be paid for the cost incurred by it, otherwise, how such person, who develops the infrastructure facility project, realize its cost where infrastructure facility is, after its development, transferred to the Government, naturally the cost would be paid by the Government. Therefore merely because the Maharashtra Government or APSEB has paid for the development of infrastructure' facility carried out by the assessee, it cannot be said that the assessee did not develop the infrastructure facility. If the interpretation canvassed by the Revenue authorities is accepted, no enterprise carrying on the business of only developing the infrastructure facility, would be entitled to deduction under s. 80-IA(4). If a person who only developed the infrastructure facility is not paid by the Government, the entire cost of development would be a loss in the hands of the developer as he is not operating the infrastructure facility. When the legislature has provided that the income of the developer of the infrastructure project would be eligible for deduction, it presupposes that there can be income to developer, i.e. to the person who is carrying on the activity of only developing infrastructure facility."
"clause (c), which reads, "It has started or starts operating and maintaining the Infrastructure facility on or after 1st day of April, 1995"
is obviously applicable to an enterprise which is 'maintaining and operating' the Infrastructure facility; it cannot apply to the case of an enterprise, which has undertaken merely 'development' of infrastructure facility, and not its 'maintenance and operation' and so the question of 'operating and maintaining' of infrastructure facility by such enterprise before or after any cut off date cannot arise. However, if the contention of the Departmental Representative is accepted, it would obviously/understandably lead to manifestly absurd results. When the Act provided deduction for a person who is only 'developing' the infrastructure facility, unaccompanied by 'operating' thereof by such person, there can be no question of providing a condition for such an enterprise to start operating and maintaining the infrastructure facility on or after 1st April, 1995. Since the assessee is only a developer of the Infrastructure project and it is not maintaining and operating the 32 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 infrastructure facility, cl. (c) of sub-sec (4) is not applicable to the present assessee".
Thus going by any of the interpretation as discussed above, deduction under Section 80IA(4) of the Income-tax Act could not be denied even in cases where the enterprise merely develops the infrastructure facility and does not operate and maintain the same".
64. The AO, unable to agree with the explanation as given by the assessee, observed, "3.2 Whereas assessee satisfies the conditions referred by it in its reply reproduced in para 3.1(B) (c) and (f) without any doubt. There are several doubts over the satisfaction of the other conditions. For example whether the assessee is a developer or merely a contractor. By way of arguments reproduced in para 3.1 (B)(b) and (c) assessee has claimed that it fulfills the conditions laid down in sec 801A(4)(i)(a) and (b). But conditions laid down in sub clauses (a) to (c) of clause (i) of sub sec. (4) need to be satisfied simultaneously, whereas assessee ignored to comment upon conditions laid down in sub clause (c). Accordingly, assessee was issued show cause notice dated 21.12.2006 in which it was mentioned that apparently the assessee was not entitled for deduction under section 801A for the following reasons --
(a) The deduction is available only for developers while from the business process discussed, it appears to be a mere contractor. With regard to business process assessee was also asked to clarify its role in conceptualization and designing, of the facilities. It was also brought to the notice of the assessee that TDS is being made on payments corresponding to the contracts executed by it.
(b) It is merely constructing the facility not subsequently maintaining or operating the facility. In view of the provisions of section 801A(2) and subsection 4(i)(c), it appears that the deduction is available only when the assessee is operating and maintaining the infrastructure which it has not done.
(c) In respect of A.Yrs. 2000-01 and 2001-02, another condition for entitlement of the above deduction is that transfer of such facility to Central Government, State Government, Local Authority etc within a stipulated period. Since it has not owned any right in the property, that is why it cannot be said it has transferred it back to Government".
65. The AO further observes that the assessee cannot be allowed the deduction because being a developer is not enough, the other requirements such as operating and maintaining and handing it back to the government are also embedded in the section, which the assessee had not done. Besides the fact that the assessee is remunerated by the government and on which the government deducts TAS. This shows that the assessee only receives payment against the construction work of the infrastructure facility and not out its 33 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 operation. This, according to the AO was completely against the provisions, allowing the deduction under section 80IA.
66. The AO, therefore, after taking into account the detailed arguments of the assessee, held, "Thus, it has been concluded that assessee by virtue of the manner in which it is carrying out its business neither fits in the definition of developer by general concepts nor it fits into the category of persons for whose benefit the provisions were introduced. Without prejudice to the above, it is also to be seen as to whether the assessee fulfills all the other conditions prescribed in the Section for availing the benefit. This issue has been dealt in subsequent paras.
Sub section 801A(4) specifies the entities which are entitled for deduction under section. 801A. In clause (i) while stating that any enterprise carrying business of (i) developing or (ii) operating and maintaining or (iii) developing operating and maintaining infrastructure facility, it has been clearly laid down that such enterprise shall fulfill all the conditions laid down in sub clause (a) (b) and (c). Sub clause
(c) puts a condition that the enterprise has started or starts operating and maintaining the infrastructure facility on or after first day of April 1995.
Thus, the plain language of provisions of sec. 801A(2) and 4(i)(c) makes it very dear that the deduction to an enterprise is available under this section only when enterprise develops and begins to operate or maintain the infrastructure facility".
67. The AO, on these observations, disallowed the deduction under section 80IA to the assessee.
68. The assessee, on denial of deduction under section 153A read with 143(3), approached the CIT(A), wherein, the assessee agitated that provisions of section 153A cannot be construed as regular assessment or reassessment and hence the AO would be barred to undertake enquiries with regard to disallowances/deductions, which have already been finalized.
69. The CIT(A), rejected the assessee's appeals, on the legality of the assessments framed under section 153A (which has been dealt with by us in the COs) and on merits, the CIT(A) perused the submissions and records produced by the assessee. The CIT(A) observed that it was the assessee who deployed its technical personnel who undertook studies 34 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 on site and took all the responsibilities from the start of the project till its completion. He also observed only the conception of the idea and selection and ownership of site, where the particular project had to be developed, did not make the government, the developer. The CIT(A) agreed with the argument of the assessee that the impugned section did not use the expression developer or contractor and so far as the section was concerned, which reads as, "80IA(1) Where the gross total income of an assessee includes any profits and gains derived by an undertaking or an enterprise from any business referred to in sub-section (4) (such business being hereinafter referred to as the eligible business), there shall, in accordance with and subject to the provisions of this section, be allowed, in computing the total income of the assessee, a deduction of an amount equal to hundred per cent of the profits and gains derived from such business for ten consecutive assessment years."
The term used in the section is therefore 'undertaking' or 'enterprise' which refers to the assessee. Section 80-IA(4)(i) which qualifies the types of eligible businesses reads as under "801-A (1) (2) (3) (4) This section applies to -
(i) any enterprise carrying on the business of (i) developing or (ii) operating and maintaining or (iii) developing, operating and maintaining any infrastructure facility which fulfils all the following conditions .."
70. The CIT(A), therefore, went on to trace the difference between developer and the contractor, which had been interpreted by the coordinate Bench at Mumbai, in Patel Engineering (supra), relevant portion which has been extracted by the CIT(A) which is, "There has also been the contention of the Revenue that the assessee is a contractor, executing civil contract and so it cannot be the developer as such. However, we are unable to agree with this contention of the Revenue. A person, who enters into a contract with another person will be a contractor no doubt; and this assessee having entered into an agreement with the Government of Maharashtra and also with APSEB for development of the infrastructure projects, is obviously a contractor but that does not derogate the assessee from being a developer as well. The term 'contractor" is not essentially contradictory to the term "developer" On the other hand, rather section 80-IA(4) itself provides that assessee should develop the infrastructure facility as per agreement with the Central Government, State Government or a local authority. So, entering into a lawful agreement and thereby becoming a contractor should, in no way, be a bar to the one being developer. The assessee, presently under consideration before us, has developed infrastructure facility as per agreement with Maharashtra State Government/APSEB. Therefore, merely because, in the agreement for development of infrastructure facility, assessee is referred to as contractor or because some basic specifications are laid down, it does 35 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 not detract the assessee from the constructing the above mentioned two project, namely Srisailam Project and Koyana Project, as detailed above, is appropriately a developer of the said two infrastructure facilities, and in turn is entitled, and entitled justifiably, to claim deduction under section 80-IA(4)." (Emphasis supplied). Thus from the above, it clearly follows that there is no difference between a contractor and a developer and that mere development of an infrastructure facility also entitles the appellant to claim deduction under section 80-IA".
71. The CIT(A), after examining the legal aspect, examined the facts of the assessee claim, wherein, the assessee produced before the CIT(A), "Year-wise split up of investment was given relating to the entire block period, which was examined. It is seen that the investments are in (a) fixed assets including sophisticated earth excavation machineries and tower cranes, etc. (b) investment by way of fixed deposits and advances to contractors and credits to the government department, (c) stock of cement/steel etc. Corresponding project receipts were also submitted and an analysis shows that the ratio of project receipts to total investments varied between 52% to 118%. Further, an analysis of the contract entered into by the appellant it was revealed that the appellant was exposed to various kinds of risks namely - (a) completion of contract within stipulated period, (b) risk of maintenance, (c) risk of delayed payments or bad debts, (d) arbitration & litigation risk arid (e) geological risks.
Hence, the factual position, which emerges, is that not only was the appellant also making its own investments in the development of infrastructure projects, but the process of creating the infrastructure facilities in itself was fraught with inherent risks and it was not that the appellant was engaged in blindly executing civil work contracts. It needs to be pointed out here that if the interpretation of the AO of a developer as only a persons who conceives the idea is correct, in that case, the deduction under section.80-IA could be claimed in almost each and every case, only by Government/local bodies/statutory authorities, as the infrastructure projects would always be conceived by them. This surely was not the legislative intention behind the introduction of the provisions of section 80-IA. The fact that the appellant executed infrastructural projects is not disputed by the AO. What is disputed is that the appellant was not a developer, but merely a contractor. As is clear from the discussion above, the AO's reasoning is faulty. It is further an undisputed fact that the appellant is not a subcontractor. That being so, the appellant is entitled to claim the deduction under section.80-IA(4). For all these reasons and placing reliance on the decision of the Mumbai ITAT in the case of Patel Engg. Ltd. (supra), it is thus held that even as a developer the appellant, as it is not a sub- contractor, is entitled to claim the deduction under section.80-IA".
The CIT(A), therefore, rejected the observation of the AO with regard to the distinction between developer and contractor as well as the concept of BOT/BOOT and that the assessee has not fulfilled the conditions under section 80IA(2) and 80IA(4) completely. The CIT(A) 36 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 also rejected the observation of the AO that the case of Patel Engineering (supra) was distinguishable on facts. He, therefore, overruled the disallowance made by the AO, and allowed the same for assessment years 2000-01 to 2005-06.
72. Against this decision of the department is in appeal before the ITAT.
73. Before us, the DR supported order of the AO and submitted that conclusion of the AO that the assessee was only a contractor and not the developer was correct in law, because as per the papers seized from the premises of PIL it was found that the assessee was working for/in unison with Mukut Group of Industries, therefore, the DR submitted that the assessee was at best a contractor and in no way it can be called the developer. The DR also submitted that since these papers were found from the searched premises, which had the direct bearing on the allowability of the deduction under section 80IA, the AO was fully justified in invoking the provisions under section 153A, which was in line with the SB decision of All Cargo (supra), as also as per the decision of Hon'ble Delhi High Court in the case of Anil Kumar Bhatia (supra).
74. The DR, therefore, concluded that the CIT(A) erred in allowing the deduction under section 80IA/80IA(4).
75. The AR, appearing for the assessee submitted that the issue was squarely covered by the decisions of Patel Engineering (supra) and Anil Kumar Bhatia (supra). The AR further pointed out that similar circumstance arose in the case before coordinate Bench at Pune in Mahalaxmi Construction Corp Ltd. vs ACIT in ITA no. 433/Pn/2007, wherein, in para 9, it is observed, "We find from the decision of Hon'ble Bombay High Court in aforesaid case of CIT vs. ABG Heavy Industries Ltd & Ors (supra) that even in the 37 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 case before the Hon'ble High Court, the assessee acted as a contractor for Government agency, was held eligible for the purposes of claim of deduction under section 80-IA(4) of the Income Tax Act. As per the said decision of the Hon'ble High Court assessee who only develops infrastructural facility (even as a contractor) but does not have an occasion to operate and maintain is also eligible for claim of deduction under section 80-IA(4) of the Act. The Hon'ble High Court has been pleased to observe that qua such a person the condition stated in sub- section (c) of sec.80-IA(4)(i) has to be read harmoniously with the main provision under which deduction is available to an assessee, who develops; or operates and maintain; or develops, maintains and operates an infrastructural facility. In other words a developer who only develops (i.e., constructs) an infrastructural facility is not envisaged to operate and maintain such facility, cannot be accepted to fulfil the condition in clause (c) of sec. 80-IA(4) since it would be an impossibility. Therefore, in view of the construction placed by the Hon'ble Bombay High Court on the requirements of clause (c) of sec. 80-IA(4)(i) requiring it to be harmoniously read with the main sec. 80-IA(4), we do not find substance in the objection raised by the Revenue. We thus respectfully following the decision of the Hon'ble Bombay High Court on the issue in the case of CIT vs ABG Heavy Industries Ltd & Ors (supra) decide the matter in favour of the assessee with this finding that assessee is eligible to claim the deduction in question under section 80-IA(4). The issue is thus decided in favour of the assessee.The related grounds are thus allowed with this direction to the AO to allow the claimed deduction to the assessee".
76. It was submitted that the decision of Hon'ble Bombay High Court in the case of ABG Heavy Industries has been followed in a number of decisions, which have been made part of the APB, along with a no. of other decisions, which are as follows No. Contents Page No. 1 Mahalakshmi Infraproject Limited vs. ACIT (Bom.HC) 247 - 248 2 Mahalaxmi Construction Corp. Ltd. vs. ACIT (Pune ITAT) 249 - 254 3 Laxmi Civil Engg. Pvt. Ltd. vs. Addl. CIT (Pune ITAT) 255 - 257 4 Pratibha Construction & Engineers (I) Pvt.Ltd.(Pune ITAT) 258 - 263 5 Tarmet Bel (JV) vs. ITO (Rajkot ITAT) 264 - 273 6 GVPR Engineers Ltd. vs. ACIT (Hyd . ITAT) 274 - 313
77. The AR pointed out that similar question came up before the Coordinate Bench at Hyderabad in the case of GVPR Engineers Ltd. vs ACIT in ITAs no. 347, 1323/Hyd/2008, wherein, vide order dated 29.02,2012, it was held (head notes), "The assessee-company entered into contracts with the Government to develop infrastructure facility. The Government handed over the possession of the projects site to the assessee and it was the assessee's responsibility to do all the acts till the developed infrastructure facility was handed over to the Government. Thereafter, the assessee had to undertake maintenance of said infrastructure for a period of 12 to 24 months. The assessee claimed deduction under 38 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 section 80-IA. The Assessing Officer disallowed the same on the ground that the assessee had not developed any new infrastructure facility as required under section 80-IA(4)(i)(b) but had only taken up works contract for renovation and modernization of existing Network/infrastructure facility. The Assessing Officer also observed that the assessee entered into contract for building or constructing the whole part of the project for which the entire investments were made by the Government and the assessee was paid 'on running bill to bill basis' and there was no stipulation in any of the contract that the facility built would be transferred or handed over back to the owner/employer. Being so, such contracts were held not eligible for deduction under section 80-IA. On appeal:
HELD-I The provisions of section 80-IA(4), when introduced afresh by the Finance Act, 1999, the provisions under section 80-IA(4A) were deleted from the Act. The deduction available for any enterprise earlier under section 80-IA(4A) is also made available under section 80-IA(4) itself Further, the very fact that the legislature mentioned the words (1) 'developing' or (ii) 'operating and maintaining' or (iii) 'developing, operating and maintaining' clearly indicates that any enterprise which carried on any of these three activities would become eligible for deduction. Therefore, there is no ambiguity in the Act. Where an assessee incur expenditure for purchase of materials himself and executes the development work, i.e., carries out the civil construction work, he will be eligible for tax benefit under section 80-IA. In contrast to this, an assessee, who enters into a contract with another person including Government or an undertaking or enterprise referred to in section 80-IA, for executing works contract, will not be eligible for the tax benefit under section 80-IA. The word 'owned' in sub-clause (a) of clause (1) of sub-section (4) of section 80-IA refers to the enterprise. By reading of the section, it is clear that the /enterprises carrying on development of infrastructure development should be owned by the company land not that the infrastructure facility should be owned by a company. The provisions are made applicable to the person to whom such enterprise belongs to is explained in sub-clause (a). Therefore, the word 'ownership' is attributable only to the enterprise carrying on the business which would mean that only companies are eligible for deduction under section 80-IA(4) and not any other person like individual, HUF, firm etc. According to sub-clause (a), clause (i) of sub-section (4) of section 80-IA, the word 'it' denotes the enterprise carrying on the business. The word 'it' cannot be related to the infrastructure facility, particularly in view of the fact that infrastructure facility includes Rail system, Highway project, Water treatment system, Irrigation project, a Port, an Airport or an Inland port which cannot be owned by any one. Even otherwise, the word 'it' is used to denote an enterprise. Therefore, there is no requirement that the assessee should have been the owner of the infrastructure facility.
The next question to be answered is whether the assessee is a developer or mere works contractor. The revenue relied on the amendments brought in by the Finance Act 2007 and 2009 to mention that the activity undertaken by the assessee is akin to works contract and it is not eligible for deduction under section 80-IA(4). Whether the assessee is a developer or works contractor purely depends on the nature of the work undertaken by the assessee. Each of the work undertaken has to be analyzed and a conclusion has to be drawn about the nature of the work undertaken by the assessee. The agreement
39 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 entered into with the Government or the Government body may be a mere works contract or for development of infrastructure. It is to be seen from the agreements entered into by the assessee with the Government. The Government handed over the possession of the premises of projects to the assessee for the development of infrastructure facility. It is the assessee 's responsibility to do all acts till the possession of property is handed over to the Government. The first phase is to take over the existing premises of the projects and thereafter developing the same into infrastructure facility. Secondly, the assessee shall facilitate the people to use the available existing facility even while the process of development is in progress. Any loss to the public caused in the process would be the responsibility of the assessee. The assessee has to develop the infrastructure facility. In the process, all the works are to be executed by the assessee. It may be laying of a drainage system; may be construction of a project; provision of way for cattle and bullock carts in the village; provision for traffic without any hindrance, the assessee 's duty is to develop infrastructure whether it involves construction of a particular item as agreed to in the agreement or not. The agreement is not for a specific work, it is for development of facility as a whole. The assessee is not entrusted with any specific work to be done by the assessee. The material required is to be brought in by the assessee by sticking to the quality and quantity irrespective of the cost of such material. The Government does not provide any material to the assessee. It provides the works in packages and not as a works contract. The assessee utilizes its funds, its expertise, its employees and takes the responsibility of developing the infrastructure facility. The losses suffered either by the Government or the people in the process of such development would be that of the assessee. The assessee hands over the developed infrastructure facility to the Government on completion of the development. Thereafter, the assessee has to undertake maintenance of the said infrastructure for a period of 12 to 24 months. During this period, if any damages are occurred, it shall be the responsibility of the assessee. Further, during this period, the entire infrastructure shall have to be maintained by the assessee alone without hindrance to the regular traffic. Therefore, it is clear that from an undeveloped area, infrastructure is developed and handed over to the Government and as explained by the CBDT vide its Circular, dated 18-5-2010, such activity is eligible for deduction under section 80-IA(4). This cannot be considered as a mere works contract but has to be considered as a development of infrastructure facility. Therefore, the assessee is a developer and not a works contractor as presumed by the revenue. The circular issued by the Board clearly indicate that the assessee is eligible for deduction under section 80-IA(4). The department is not correct in holding that the assessee is a mere contractor of the work and not a developer.
As per the provisions of section 80-IA, a person being a company has to enter into an agreement with the Government or Government undertakings. Such an agreement is a contract and for the purpose of the agreement a person may be called as a contractor as he entered into a contract. But the word 'contractor' is used to denote a person entering into an agreement for undertaking the development of infrastructure facility. Every agreement entered into is a contract. The word 'contractor' is used to denote the person who enters into such contract. Even a person who enters into a contract for development of infrastructure facility is a contractor. Therefore, the contractor and the developer cannot be viewed differently. Every contractor may not be a developer but every developer developing infrastructure facility on behalf of the Government is a contractor.
40 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 Section 80-IA intends to cover the entities carrying out developing, operating and maintaining the infrastructure facility keeping in mind the present business models and intend to grant the incentives to such entities. The CBDT, on several occasions, clarified that pure developer should also be eligible to claim deduction under section 80-IA which ultimately culminated into amendment under section 80-IA in the Finance Act, 2001, to give effect to the aforesaid circulars issued by the CBDT To avoid misuse of the aforesaid amendment, an Explanation was inserted in section 80-IA, in the Finance Act, 2007 to 2009, to clarify that mere works contract would not be eligible for deductions under section 80-IA. But, certainly, the Explanation cannot be read to do away with the eligibility of the developer; otherwise, the Parliament would have simply reversed the amendment made in the Finance Act, 2001. Thus, the aforesaid Explanation was inserted, certainly, to deny the tax holiday to the entities who do mere works contract or sub- contract as distinct from the developer. This is clear from the express intention of the Parliament while introducing the Explanation. The explanatory memorandum to Finance Act, 2007 states that the purpose of the tax benefit has all along been to encourage investment in development of infrastructure sector and not for the persons who merely execute the civil construction work It categorically states that the deduction under section 80-IA is available to developers who undertakes entrepreneurial and investment risk and not to the contractors, who undertake only business risk Without any doubt, the assessee clearly demonstrated that it has undertaken huge risks in terms of deployment of technical personnel, plant and machinery, technical know-how, expertise and financial resources. After the amendment section 80-IA(4) is read as (1) developing or (ii) operating and maintaining or (iii) developing, operating and maintaining any infrastructure facility. While prior to amendment the 'or' between three activities was not there, after the amendment 'or' has been inserted with effect from 1-4-2002 by Finance Act, 2001. Therefore, if the contracts involve design, development, operating and maintenance, financial involvement, and defect correction and liability period, then such contracts cannot be called as simple works contract to deny the deduction under section 80-IA. The contracts which contain above features to be segregated, this deduction under section 80-IA have to be granted and the other agreements which are pure works contracts hit by the Explanation to section 80-IA (13), those work are not entitled for deduction under section 80-IA. The profit from the contracts which involve design, development, operating and maintenance, financial involvement, and defect correction and liability period is to be computed by the Assessing Officer on pro rata basis of turnover. The Assessing Officer is directed to examine the records accordingly and grant deduction on eligible turnover as directed above".
78. He further pointed out that so far as the allowance of deduction to the infrastructure development is concerned, the legislature has itself made the distinction, for the purposes of section 80IA(4), the words used are "any enterprise", whereas in section 80IAB, the words used are " ......an assessee, being a developer.......". The AR, therefore, submitted that the AO here erred in disallowing the deduction.
41 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008
79. In the rejoinder, the DR pointed out that the assessee had voluntarily accepted the provisions of section 194C to be applied on it, therefore, the assessee has itself accepted itself to be a contractor and in any case, since the decision of ABG Heavy Industries Ltd. has not gone into the distinction of developer and contractor, therefore, according to the DR, the decision of ABG (supra) cannot be applied /relied upon and finally submitted that the decision of the AO to deny the deduction under section 80IA was correct in law and prayed that the order of the CIT(A) be set aside.
80. We have heard the arguments from both the sides. The basic issue before us is, whether at all, deduction under section 80IA(4) could be allowed to the assessee, on the premise that the assessee was a contractor and not the developer, as agitated by the DR/AO. To address the impugned issue, we must first refer to the section which has been debated, i.e. section 80IA(4). The section reads as under:
"(4) This section applies to--
(i) any enterprise carrying on the business of (i) developing or (ii) operating and maintaining or (iii) developing, operating and maintaining] any infrastructure facility which fulfils all the following conditions, namely :--
(a) it is owned by a company registered in India or by a consortium of such companies or by an authority or a board or a corporation or any other body established or constituted under any Central or State Act;
(b) it has entered into an agreement with the Central Government or a State Government or a local authority or any other statutory body for (i) developing or (ii) operating and maintaining or (iii) developing, operating and maintaining a new infrastructure facility;]
(c) it has started or starts operating and maintaining the infrastructure facility on or after the 1st day of April, 1995:
Provided that where an infrastructure facility is transferred on or after the 1st day of April, 1999 by an enterprise which developed such infrastructure facility (hereafter referred to in this section as the transferor enterprise) to another enterprise (hereafter in this section referred to as the transferee enterprise) for the purpose of operating and maintaining the infrastructure facility on its behalf in accordance 42 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 with the agreement with the Central Government, State Government, local authority or statutory body, the provisions of this section shall apply to the transferee enterprise as if it were the enterprise to which this clause applies and the deduction from profits and gains would be available to such transferee enterprise for the unexpired period during which the transferor enterprise would have been entitled to the deduction, if the transfer had not taken place.
Explanation.--For the purposes of this clause, "infrastructure facility"
means--
(a) a road including toll road, a bridge or a rail system;
(b) a highway project including housing or other activities being an integral part of the highway project;
(c) a water supply project, water treatment system, irrigation project, sanitation and sewerage system or solid waste management system;
(d) a port, airport, inland waterway, inland port or navigational channel in the sea;
............... ................... ..............
81. As seen, sub section (4) talks about any enterprise. When we trace the heading of the section, it reads, "Deductions in respect of profits and gains from industrial undertakings or enterprises engaged in infrastructure development, etc.". This heading itself clarifies that if an industrial undertaking is in the business of infrastructure development, that industrial undertaking qualifies to claim the deduction under section 80IA. Sub sections (1) to (3) to section 80IA, through operation of law is available to industrial undertaking, but there is a slight departure in sub section (4) of section 80IA, which is the impugned section before us. It has to be noticed that it is available to any enterprise, which means, it can be made available to an assessee, which itself may not even be an industrial undertaking, which in literal meaning, envisages, that even an enterprise, who secures an infrastructure development and gets it developed through its vendors, even then, the deduction shall be available to it (though Proviso to clause (iii), may allow the deduction to be transferred to another undertaking). Looking from the legislative point only, we find that the assessee is in a much better foundation, because, not only it 43 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 secured the development project from the Government agency, but it itself was developing the same. The case of the assessee is similar to the case of GVPR Engineers Ltd. (supra), wherein who can be called as a contractor in development projects, has been explained, as reproduced in earlier paras. We also found the distinction has been drawn by the legislature itself, because in the impugned section, the words have been used "any enterprise", but when we see section 80IAB, the legislature uses the words, ".....an assessee, being a developer, ....". Therefore, tracing the difference, within the legislation itself, proves the fact, that the legislature is inclined to allow the deduction to an enterprise, who is in the business of infrastructure development, irrespective of itself being a developer.
82. We find that, the AO accepts that the assessee is an infrastructure developer. But we look into the main objection of the AO that being a developer by itself is not enough to avail the deduction, but the assessee should have maintained, operated and handed it back to the government. We must observe here that the AO erred in interpreting the relevant clause (i), because after each qualification, the legislature has used the word "or", which does not join the qualifications but separates one qualification from the other. Besides this, the AO erred once again to not to read sub clause (b), which reads as, "it has entered into an agreement ....". Here, "it" would mean, "any enterprise", as per clause (i) to section 80IA(4).
83. We have already perused the various decisions relied upon by the AR during the course of hearing. We have also not come across anything either on facts or in law, which distinguishes, the already existing position as on the date of search and in the proceedings under section 153A read with 143(3), which substantiates the denial. Accept for the interpretation, as made out by the AO, there is nothing, which could substantiate the disallowance. In the entire proceedings upto the 44 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 hearing before us, the department has not even said that there was either no agreement between the assessee and the state government or there is any change in the agreement entered into by the assessee and the government department. In fact the DPB filed by the department, at pages 48 to 72, we find there are letters exchanged, written by the assessee and various government departments, which indicate that the assessee was awarded the job, wherein the assessee had placed the bank guarantee for Rs. 2,61,62,400, against the tendered cost. This proves beyond doubt that the assessee, itself was doing the development of infrastructure facility, on behalf of the government, besides placing its own funds at risk and peril. These seized documents and placed in the DPB, also negate the arguments of the DR, with regard to documents no. 18 & 19, referred to earlier, wherein the DR had strenuously argued that the assessee was a co-contractor.
84. The other argument by the AO and the DR had been that the assessee accepted itself to be contractor, by accepting the tax to be deducted under section 194C, which is relevant, only in case of a contractor, also cannot be accepted. Because, first, we have to ascertain whether the assessee falls under section 80IA/80IA(4), because Chapter XVII, wherein section 194C is embedded, is only a machinery chapter for collection and recovery of taxes.
85. Under these circumstances, we are unable to convince ourselves to sustain the disallowance under section 80IA(4), made by the AO. We, therefore, sustain the order(s) of the CIT(A), allowing the deduction under section 80IA(4), as claimed by the assessee.
86. The appeals filed by the department, covering assessment years 2000-01, 2001-02, 2002-03, 2003-04, 2004-05 are dismissed.
45 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008
87. In the result, the appeals filed by the department, as well as the Cross Objections filed by the assessee for assessment years 2000-01, 2001-02, 2002-03, 2003-04, 2004-05 are dismissed.
ITA No. 2202/Mum/2008 : Appeal by the department : Asst. year2005-06
88. The appeal filed by the department raises the following grounds of appeal :
(i) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance of deduction under section 80IA of the I.T. Act without appreciating the fact that the assessee is not eligible for deduction under section 80IA in most of the infrastructure projects where the assessee is merely a work contractor and not a developer.
(ii) On the facts and in the circumstances of the case and in law without prejudice to above, the Ld. CIT(A) erred in allowing deduction under section 80IA on amount of liabilities written back without appreciating the fact that the assessee failed to prove that such liabilities pertained to projects entitled to deduction under section. 80IA of the I.T. Act.
89. So far as ground no. 1 is concerned, we have already held in assessment years 2000-01 to 2004-05, that deduction shall be available to the assessee.
90. We, therefore, are not going into detailed discussion in the instant year.
91. Therefore, placing reliance on the decision taken by us in the preceding years, where we have dismissed the ground taken by the department, we reject the ground in the current years as well.
92. Ground no. 1 is rejected.
46 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008
93. Ground no. 2 is on account of allowance of deduction under section 80IA on the amounts written back under section 41(1) of the Income Tax Act.
94. Before the AO, the assessee submitted that it had offered Rs 1.95 crores on account of cessation of liabilities under section 41(1). Since the liabilities pertained to both types of projects, i.e. 80IA and non 80IA and there being a possibility that same creditors may have supplied the materials which was utilized both for 80IA and non 80IA, arrive at accurate figures particularly to the supplier for both the types of projects was a virtual impossibility. Therefore, the assessee has bifurcated the cessation of liabilities on the basis of proportion of the turnover.
95. The AO rejected the claim of the assessee to include proportionate portion of cessation of liabilities to the income for determination of deduction under section 80IA(4).
96. Aggrieved, the assessee approached the CIT(A), who just accepted that the assessee was eligible to deduction under section 80IA(4) and then accepted the rational bifurcation of the liabilities written back on the proportion of turnovers of 80IA projects & non- 80IA projects and he directed the AO to allow the liabilities written back to be added for the computation of deduction under section 80IA(4).
97. Aggrieved, the department is in appeal before the ITAT on this ground.
98. The DR reiterated the observations of the AO in his submissions and pleaded that written back liabilities cannot be included for the allowance of deduction under section 80IA.
47 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008
99. On the other hand, the AR also reiterated the submissions made by him before the revenue authorities and pleaded that only this bifurcation is the most appropriate method to distinguish the liabilities written back between 80IA Projects and non 80IA projects. He, therefore, pleaded that the CIT(A) was very fair to give a reasonable direction to the AO.
100. We have heard the arguments. It is not the case of the department that these liabilities were non business. When the liabilities which have been written back/offered to tax by the assessee pertains to the business, then it has to be added back as a business income.
101. In the instant case, the CIT(A) has also taken note of the fact that the assessee was having two types of projects, i.e., which qualify for deduction under section 80IA and which do not qualify. But while the assessee is undertaking both types of the projects, it is procuring materials such as cement, steel and all other materials, which are need used for both types of projects. In such circumstance, it is difficult to make precise allocation. As held by the coordinate Bench at Mumbai in Extrusion Process (P) Ltd. vs ITO, ITA no. 630/Mum/2003, reported in 107 TTJ 1001 (Mum) that even for computing deduction under section 80HHC, it would be added as business income.
102. Here, in the instant case, we are concerned with domestic projects, and the ceased liabilities are emanating from the normal course of business of the assessee. Hence, we are of the opinion that the liabilities written back would be added to the claim of deduction under section 80IA. Since the assessee also has non-80IA projects and it has been accepted by the assessee that these written back liabilities would also pertain to non 80IA projects, in these circumstances, we are of the opinion that the assessee and the CIT(A) were very reasonable in allocating the income offered under section 132(4) on 48 M/s. Pratibha Industries Ltd ITA 2197 to 2201/Mum/2008 ITA no. 2202/Mum/2008 C.Os. 117 to 121/Mum/2008 account of cessation of liabilities under section 41(1) in proportion of the turnover of 80IA project and non 80IA projects.
103. We, do not find any reason to deviate from the finding reached by the CIT(A) to direct the AO to add the proportion of offered amount of Rs 1.95 crores to the income eligible for deduction under section 80IA for assessment year 2005-06.
104. The ground raised by the department, is therefore, rejected.
105. In the result, the appeal filed by the department is dismissed.
We may clarify that in the course of hearing before us, both the parties cited a number of decision and judgment, which have all been perused by us. We, in any case, have referred to and cited only those cases, which according to us were relevant for taking the above decisions in all the appeals filed by the department and cross objections filed by the assessee.
To sum-up:
The appeals filed by the department, as well as the Cross Objections filed by the assessee for assessment years 2000-01 to 2004-05 are dismissed and departmental appeal for assessment year 2005-06 is also dismissed.
Order pronounced in the open Court on this day of 19/12/2012.
Sd/- Sd/-
(D. KARUNAKARA RAO) (VIVEK VARMA)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Mumbai, Date: 19/12/2012
Copy to:-
1) The Appellant.
2) The Respondent.
3) The CIT (A)- Central-III, Mumbai.
4) The CIT -Central-IV, Mumbai,
49 M/s. Pratibha Industries Ltd
ITA 2197 to 2201/Mum/2008
ITA no. 2202/Mum/2008
C.Os. 117 to 121/Mum/2008
5) The D.R. "C" Bench, Mumbai.
6) Copy to Guard File.
By Order
/ / True Copy / /
Asstt. Registrar
I.T.A.T., Mumbai
*Chavan