Home Income tax Individual Income Tax ITR due date prolonged for tax audit case can’t be utilized to assessee accountable for audit below some other Act: ITAT

ITR due date prolonged for tax audit case can’t be utilized to assessee accountable for audit below some other Act: ITAT

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ITR due date prolonged for tax audit case can’t be utilized to assessee accountable for audit below some other Act: ITAT

ITR due date prolonged for tax audit case can’t be utilized to assessee accountable for audit below some other Act: ITAT

Within the matter of Gulu Hassanand Raney vs Asst. Director of I.T. Bangalore-CPC; the Revenue Tax Appellate Tribunal (ITAT) has held that for A.Y 2016-17 the CBDT had sought to increase the due date from 30/09/2016 to 17/10/2016 solely in respect of these instances the place accounts are required to be audited below the provisions of Revenue Tax Act whereas submitting the earnings tax returns. The stated prolonged due date profit can’t be prolonged to these assessee who had been liable to get their accounts audited below some other regulation in the interim in drive.

assessee is carrying on enterprise of Businesses of shipyards and marine electronics by the use of representing overseas shipyard and /or ship proprietor for ship repairing and/or day docking functions as a proprietor within the identify of Nautilus worldwide (India). Assessee is carrying on enterprise since 1975-76 within the above Proprietorship Identify. Thereafter, within the 12 months 1983-84 (AY 1984-85) he grew to become Non-Resident and continued the stated enterprise.

Since he grew to become Non-Resident, as required, below International Trade Regulation Act (FERA) provisions, he was required to take approval from Reserve Financial institution of India for persevering with his stated Proprietary enterprise. Permission was granted u/s 29(1)(a) of the FERA 1973 vide RBI’s Letter dated 05/08/1985. As per the clause (iii) of stated R.B.I permission, one of many situation was Accounts are to be audited by Chartered Accountant.

Accordingly, for the 12 months into account i.e. for A.Y.2016-17, the accounts of the assessee had been audited by a Chartered Accountant on 15/10/2016. The return of earnings for the A.Y.2016-17 was filed on 17/10/2016. The assessee claimed the enterprise lack of Rs.8,38,301/- within the return of earnings to be carried ahead to subsequent years. The ld. AO noticed that for the reason that return was not filed throughout the due date prescribed u/s.139(1) of the Act, by way of Part 139(3) r.w.s.80 of the Act, the loss claimed by the assessee shall not be allowed to be carried ahead to subsequent years. The ld. AR earlier than us positioned on document copy of press launch dated 09/09/2016 issued by CBDT extending the due date of submitting of returns to 17/10/2016 for A.Y.2016-17. For the sake of comfort, the stated press launch is reproduced hereunder:-

Authorities of India
Ministry of Finance
Division of Income
Central Board of Direct Taxes

New Delhi, ninth September, 2016

Press Launch

Sub:- CBDT Extends due date for submitting of Revenue Tax Returns – reg

The due date for submitting of Revenue tax returns by tax payers whose accounts are required to be audited below the Revenue Tax Act is the thirtieth September of the next 12 months. The tax payers whose enterprise receipts exceed Rupees One Crore or skilled receipts exceed Rupees twenty-five Lakh in the course of the earlier 12 months 2015-16 are required to file an Revenue Tax return accompanied by an audit report by the above talked about due date.

Nonetheless, taking into account that the final date for making declarations below the Revenue Declaration Scheme 2016 can be thirtieth September, 2016, the Central Board of Direct Taxes has determined to increase the final date for such returns which had been due on thirtieth September, 2016 to seventeenth October, 2016 with a purpose to take away inconvenience and to facilitate ease of compliance

(Meenakshi J Goswami)
Commissioner of Revenue Tax
(Media and Technical Coverage)
Official Spokesperson, CBDT.

In response to the ld. DR, solely these instances the place accounts of tax payers are required to be audited below the Revenue Tax Act alone would get prolonged time restrict as much as 17/10/2016 for submitting the returns. The assessee within the immediate case admittedly isn’t liable to get his accounts audited below the provisions of Revenue Tax Act. Per contra, the ld. AR said that assessee is liable to get the accounts audited solely as per RBI permission letter dated 05/08/1985 vide clause (iii) of the stated letter. The assessee being a non-resident, this approval was crucial for the assessee to proceed his enterprise in India. We discover that the expression “due date” is outlined in Rationalization-2 to Part 139(1) of the Act which reads as below:-

Rationalization 2.—On this sub-section, “due date” means,—
(a) the place the assessee [other than an assessee referred to in clause (aa]) is—
(i) an organization;[***] or
(ii) an individual (apart from an organization) whose accounts are required to be audited below this Act or below some other regulation in the interim in drive; or
(iii) a working associate of a agency whose accounts are required to be audited below this Act or below some other regulation in the interim in drive,
The [30th day of September] of the evaluation 12 months;
(aa) within the case of an assessee [who] is required to furnish a report referred to in part 92E, the thirtieth day of November of the evaluation 12 months;
(b) within the case of an individual apart from an organization, referred to within the first proviso to this sub-section, the thirty first day of October of the evaluation 12 months;
(c) within the case of some other assessee, the thirty first day of July of the evaluation 12 months.

ITAT Order:

3.3. We discover that assessee’s case herein falls below the ambit of Rationalization 2(a)(ii) to Part 139(1) of the Act, because the assessee is accountable for audit below some other regulation in the interim in drive. This expression “due date” can be talked about in press launch dated 09/09/2016. However on naked studying of the press launch dated 09/09/2016, we’re of the thought of view that “due date” of submitting of earnings tax return is prolonged from 30/09/2016 to 17/10/2016 solely in respect of assessees whose accounts are required to be audited below the Revenue tax Act. This reality is additional strengthened by the final line of the primary paragraph of the press launch extending the due date for professionals whose accounts are to be audited below the Revenue Tax Act by stating the expression “above talked about due date”. Additional, within the second para of the press launch dated 09/09/2016, the CBDT in categorical phrases states that it has determined to increase the final date for “such returns” which was due on 30/09/2016 to 17/10/2016. These phrases categorically go to show that the CBDT had sought to increase due date from 30/09/2016 to 17/10/2016 solely in respect of these instances the place accounts are required to be audited below the provisions of Revenue Tax Act whereas submitting the earnings tax returns. The stated prolonged due date profit can’t be prolonged to these assessee’s who had been liable to get their accounts audited below some other regulation in the interim in drive which is the case as that of the assessee earlier than us. Therefore, we maintain that due date of submitting of earnings tax return for the assessee for A.Yrs. 2016-17 is 30/09/2016 and never 17/10/2016 as contended by the ld. AR.

3.4. With regard to remark made by the ld. CIT(A) in web page 6 of the order, that assessee has not carried out enterprise within the identify of any restricted firm thereby warranting the accounts to be audited by an individual who’s succesful to audit the restricted firm, are of completely no relevance to the info and we maintain that the identical are fully fallacious. From the perusal of the RBI permission letter dated 05/08/1985 mandating the assessee to get his accounts audited, we’re of the thought of opinion that what RBI mandate was just for the competence of the Chartered Accountant i.e. to say {that a} Chartered Accountant who’s able to auditing the company assessees ought to conduct the audit of the assessee herein. This was the only real mandate of RBI permission letter dated 05/08/1985. In our thought of opinion, as said supra, this has been fully misunderstood by the ld. CIT(A) whereas rendering his choice in web page 6 of his order. Both means, this misunderstanding wouldn’t in any means advance the case of the assessee in view of our findings that the due date for the assessee herein is just 30/09/2016 and never 17/10/2016. Therefore, we maintain that assessee isn’t entitled to hold ahead enterprise loss incurred in the course of the 12 months to subsequent years. Accordingly, the grounds raised by the assessee are dismissed.

For Official Judgment Obtain PDF Given Under:

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