MURALI EXPORT HOUSE Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) The Court: This writ application is directed against a revisional order passed by the Commissioner of Income Tax (IX) West Bengal under section 264 of the Income Tax Act 1961 (for short 'Act') affirming the order passed by the Income Tax Officer refusing to cancel the disallowance made in the intimation under section 143(1)(a) of the Act.

(2.) The facts leading to moving of this writ application are stated below :- The writ petitioners No. 1 is a registered firm (hereinafter referred to as 'the firm") and the writ petitioner No. 2 is one of its partners. The firm filed its return of Income for the assessment year 1991-92 showing therein profits on export business of Rs. 3,74,960 and claiming exemption from tax of 100% of such income under section 80HHC of the Act. If is not in dispute that the return of income was accompanied by audited profit and loss account as also the auditor's report in respect of general audit of the accounts of the firm.

(3.) It is also not in dispute that a special audit report known as tax audit, was also furnished as required under section 44AB. It is also not in dispute that in the return a separate computation statement was attached showing the claim of 100% deduction under section 80HHC of the Act being the profit of business being exclusively from export business. However, the additional separate audit certificate as indicated in form 10CCAC was omitted to be enclosed with the return although the audit was carried out and certificate in form 10CCA was also made out handed over by the auditor to the firm. The deduction asked for by the firm was disallowed by the assessing officer on the ground that the audit Certificates as required to be filled with the return under section 80HHC of the Act were not filed with the return of income. It appears from intimation issued under section 143(1) of the Act that although, the total income as shown in the return after adjustments of the deduction claimed under section 80HHC of the Act was nil, the assessing officer refused to give benefit to the firm under section 80HHC of the Act. The firm immediately thereafter filed an application for rectification before the assessing officer showing in the said application that the firm was entitled to the deduction under section 80HHC of the Act in respect of the profit derived from its export business and pointed out therein that the requisite audit certificates in form 10CCAC were in fact ready for being furnished with the return but the same was not attached to the return, in advertance of the clerk to whom such details of work had been assigned before filing the return with the department. The assessing officer however, declined to rectify the adjustment made by him in the adjustment under section 143(1)(a) stating that the special audit certificate requirement under section 80HHC of the Act in the prescribed form must be furnished with the return and not afterwards, as this was not a rectifiable mistake. Feeling aggrieved by this order passed by the assessing officer the petitioners carried the dispute before the Commissioner of Income Tax. West Bengal (IX) by moving a revisional application under section 264 of the Act for his intervention. The Commissioner of Income Tax (IX) West Bengal however, affirmed the decision of the assessing officer and refused to give deduction to the writ petitioner under section 80HHC of Act also on the ground that it was mandatory on the part of the firm to submit the special audit certificate with the return of income. The writ petitioner against the aforesaid orders have come up to this court under Article 226 of the Constitution.