1 IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR -------------------------------------------------------- INCOME TAX APPEAL No. 47 of 2006 C I T UDAIPUR V/S M/S JYOTIJAIN Mr. KK BISSA, for the appellant Mr. ARUN BHANSALI, for the respondent Date of Order : 20.8.2008 HON'BLE SHRI N P GUPTA,J. HON'BLE SHRI KISHAN SWAROOP CHAUDHARI,J. ORDER Heard learned counsel for the parties. This appeal has been filed by the Revenue against the judgment of Tribunal dt. 29.4.2005. Learned Tribunal had dismissed the appeal of the Revenue, and affirmed the order of Commissioner Appeals. Learned Commissioner allowed the appeal of the assessee, and held, that since the assessee has produced the certificate obtained from District Industries Centre, wherein a sum of Rs.4,83,449/- was certified to have been converted into loan, the disallowance made under section 43B was set aside, and the AO was directed to allow the claim, after verification of the certificate. Then disallowance under section 80IA was also set aside, while holding, that the appellant had filed 2 her return of income on 21.10.1998, along with the audit report as required by section 44AB, and during the course of assessment proceedings, claim for deduction was also made under section 80IA, vide letter dt. 13.11.2000, contending that all the necessary conditions for claiming deduction are fulfilled, and also filed the report in form No.10CCD, as prescribed under sub-section(7) of section 80IA. This was disallowed by the Assessing Officer, on the ground, the appellant was required to file the report in form No.10CCD “along with the return”. It was contended before the Commissioner, that the assessee did not claim any deduction under section 80IA in the return filed under section 139(1). However, after filing of the return, it came to her notice, that the return did not take into account claim of the deduction under section 80IA, in respect of unit M/s Avani Minerals Industries. Accordingly, the account was got audited, and a report, as required by sub-section (7) of section 80IA was obtained, and the claim for deduction was made, during the course of assessment proceedings. Learned Commissioner relying upon the judgment, reported in (1987) 23 ITD 364, Hem Sons Industries Ltd., found the requirement of filing the report along with the return was directory, and held, that the claim of deduction is allowable. The Tribunal held, that the requirement of filing report along with return of income is directory, and not 3 mandatory, and if the said report is made available to the Assessing Officer during the course of assessment proceedings, the lawful deduction to the assessee should not be rejected. The appeal was admitted on 18.4.2006, by framing the following substantial questions of law :- “1. Whether on the facts and in the circumstances of the case the Tribunal was justified in holding that for claiming deduction under section 80-IA the CIT was justified in holding claim of the assessee though claim was made after filing the account and audit report and claimed during the course of assessment? 2. Whether on the facts and in the circumstances of the case the Tribunal was justified in holding that the Assessee was entitled to deduction under Section 43-B of the Act in respect of Sales tax amount deferred under the State Government's Deferment Scheme and without actual payment of Tax under Section 43-E of the Act?” In our view, the question No.1 is covered by a decision of Division Bench of this Court dt. 15.2.2008, in Income Tax Appeal No.20/2005, CIT Udaipur vs. M/s Kothari Impex Udaipur, wherein considering the various judgments of different High Courts, and other provisions of the Act, it has been held, that the requirement cannot be said to be only directory. Of course, the learned counsel for the 4 assessee tried to distinguish the judgment by contending that in that case the report was filed after completion of assessment, while in the case in hand it had been filed during the assessment proceedings. In our view, this does not make any difference. Whether the report is filed during assessment proceedings or after assessment, if the requirement of filing “along with the return” is mandatory, the allowance of deduction cannot be made. On the other hand, if the requirement is directory, the permissibility of filing cannot be confined to the stage of “during the assessment proceedings”. Thus, the distinction sought to be drawn cannot be accepted. In that view of the matter, for the reasons as given in CIT Udaipur vs. M/s Kothari Impex Udaipur, the question No.1 is answered in favour of the Revenue, and against the assessee. So far as question No.2 is concerned, it is also covered, but against the Revenue, and in favour of the assessee, by judgment of this Court dt. 13.5.2008, in bunch of appeals, led by Income Tax Appeal No.30/2005, CIT Udaipur vs. M/s Ravindra Platimum Pvt. Ltd. For the reasons as given in the judgment in M/s Ravindra Platimum's case, the question No.2 is answered against the Revenue and in favour of the assessee. Result of the aforesaid discussion, the appeal is partly allowed, the order of the C.I.T., and Tribunal 5 allowing deduction under Section 80IA is set aside, and it is held, that the assessee was rightly disallowed the deduction under section 80-IA by the assessing officer, and has rightly been allowed deduction under section 43-B by the Tribunal. The Assessing Officer to do the remaining needful. The parties shall bear their own costs of this appeal. ( KISHAN SWAROOP CHAUDHARI ),J. ( N P GUPTA ),J. m.asif/-