IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE T.R.RAMACHANDRAN NAIR WEDNESDAY, THE 13TH FEBRUARY 2008 / 24TH MAGHA 1929 ITA.No. 23 of 2002() -------------------- (ITA 624 (COCH)/96 OF THE IT.APPELLATE TRIBUNAL COCHIN BENCH) APPELLANT -------------------------- THE COMMISSIONER OF INCOME-TAX, TRIVANDRUM. BY ADV. SRI.P.K.R.MENON,SR.COUNSEL,GOI(TAXES) RESPONDENTS: RESPONDENT ----------------------- THE KERALA STATE INDUSTRIAL DEVELOPMENT CORPORATION LTD., KOWDIAR P.O., TRIVANDRUM-695 003. BY ADV. SRI.M.PATHROSE MATTHAI (SR.) THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 13/02/2008, ALONG WITH ITA 46 OF 2002 THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C .N. RAMACHANDRAN NAIR & T.R. RAMACHANDRAN NAIR, JJ. -------------------------------------------- I.T.A. No. 23 & 46 OF 2002 -------------------------------------------- Dated this the 13th day of February, 2008 JUDGMENT C.N. Ramachandran Nair,J. Heard counsel appearing for the appellant and counsel appearing for the respondent. Appeals are against common order of the Tribunal dismissing the departmental appeals for the years 1986-87 and 1987- 88. The respondent-assessee, a Government of Kerala undertaking, was assessed granting relief under Section 80M of the I.T. Act. Assessments originally issued were later modified stating that relief granted under Section 80M is in excess of the eligible amount. The orders rectifying the assessments produced in Court show that rectification is carried out to limit the deduction under Section 80A(2) of the I.T.Act. However, in the statement of facts, the appellant has stated that the amount of unabsorbed deduction under Section 80 VVA carry forward from 1985-86 was modified leading to reduction of the amount for 1986-87 from Rs. 6,15,890/- to Rs. 2,36,072/-. While this is stated as a ground for rectification in the appeals, the impugned order of rectification produced in Court shows that rectification is carried out to limit the claim under Section 80A(2) of the Act. The very same 2 ground is raised in the appeal filed for 1987-88 also. In view of the conflicting grounds stated for rectification in the appeal and in the order issued under Section 154 of the Act, we are not in a position to decide the issue on merits. However, we make it clear that if the previous years' assessments were modifed leading to variation in figures of carried forward benefits, then subsequent assessments can be rectified under Section 154 of the Act. Similarly if over-all ceiling limit under Section 80A(2) was not followed while granting relief in the original assessment, then also the assessing officer is free to rectify the assessment under Section 154 of the act. However, since facts are not clear we set aside the impugned orders of the Tribunal and that of the first appellate authority and remand the matter back to the assessing officer for passing fresh orders after verifying the records and after issuing detailed reasons for rectification and after hearing the objections of the assessee. Appeals are allowed as above. (C.N.RAMACHANDRAN NAIR) Judge. (T.R.RAMACHANDRAN NAIR) Judge. kk 3