IN THE HIGH COURT OF JUDICATURE AT MADRAS Dated : 25.08.2008 Coram : THE HONOURABLE MR.JUSTICE K.RAVIRAJA PANDIAN and THE HONOURABLE MR.JUSTICE P.P.S.JANARTHANA RAJA Tax Case (Appeal) No.1380 of 2008 Commissioner of Income Tax Chennai ..Appellant/Appellant v. M/s Tamilnadu Electricity Board No.800, NPKRR Maligai Electricity Avenue Annasalai Chennai 2 ..Respondent/Respondent Tax Case Appeal filed under section 260A of the Income Tax Act, 1961 against the order of the Income Tax Appellate Tribunal, Madras 'C' Bench, Chennai, dated 28.02.2008 passed in ITA No.1639/Mds/2006, against the order dated 10.3.2006, made in ITA No.360/2005-06/A-III, on the file of the Commissioner of Income Tax (Appeals), III, Chennai-34, against the Assessment order dated 3.12.2002, for the Assessment year 2002-2003, passed by the Deputy Commissioner of Income Tax, Company Circle III(1), Chennai-34. For appellant : Mr.J.Narayanaswamy JUDGMENT (Judgment of the Court was delivered by K.RAVIRAJA PANDIAN, J.) This appeal is filed against the order of the Income Tax Appellate Tribunal, Madras 'C' Bench, Chennai, dated 28.02.2008 passed in ITA No.1639/Mds/2006. 2. The assessee is the Tamilnadu Electricity Board, which had come into existence through an enactment. For the assessment https://hcservices.ecourts.gov.in/hcservices/ year 2002-2003, the assessee filed loss returns without audit report under Section 44AB and the said return was considered invalid by order dated 30.10.2002. The assessee filed a 264 petition to the Commissioner of Income Tax Appeals and the same was dismissed on 08.12.2003. Subsequently, the assessee filed a revised return admitting additional loss along with 44AB report. Since the original return was treated as non est, the revised return was treated as a belated return and accordingly did not allow carry forward of losses and unabsorbed depreciation. 3. Aggrieved against the assessment order, the assessee filed appeal to the Commissioner of Income Tax (Appeals), who allowed the appeal holding that the revised return admitting additional loss along with 44AB report was a valid return and directed the carry forward of losses and unabsorbed depreciation. 4. Aggrieved against the order of the CIT(A), the revenue took the matter on appeal to the Tribunal. The Tribunal found that revised return was filed within the time limit given under Section 139(5) and the said revised return stands substituted by the revised return and the same is valid since it was filed along with the 44AB report and accordingly the carry forward of losses and unabsorbed depreciation were rightly directed to be allowed by CIT (A). 5. The correctness of the said order is now canvassed before this Court by filing this appeal by formulating the following substantial questions of law: " 1. Whether in the facts and circumstances of the case, the Tribunal was right in holding that the revised return filed within the time limit given under section 139(5) along with the 44AB report is valid and not belated return as per section 139(1) and accordingly the carry forward of losses and unabsorbed depreciation is allowable as per section 80 of the IT Act? 2. Whether the original return was considered invalid by assessing officer for want of 44AB report and assessee's petition under section 264 was dismissed by CIT and had become final, was the Tribunal right in not setting aside the order of the CIT(A), which admitted the appeal of the assessee on same issue?". 6. We heard the arguments of the learned counsel for the appellant and perused the materials available on record. https://hcservices.ecourts.gov.in/hcservices/ 7. The Revenue before filing an appeal against the assessee, the State owned Corporation, has to obtain clearance from the Committee of Disputes (CoD). The apex Court, in the case of ONGC v. City and Industrial Development Corporation, Maharashtra Ltd., (2007) 7 SCC 39, after referring to the earlier cases in ONGC (I) v. CCE, 1992 Supp (2) SCC 432; ONGC (II) v. CCE, 1995 Supp (4) SCC 541; ONGC (III) v. CCE, (2004) 6 SCC 437; in which directions have been issued to set up governmental committee to resolve the dispute between the intra-governmental or intergovernmental disputes involving Government Departments or Government owned companies of the Central and State Governments, rather than adjudicating the same before Courts of law, and having regard to the fact of the particular case, that the matter was pending since 1990 and considering the nature of the controversy, which is a recurring feature, directed that a Committee be formed to sort out the differences between the Central Government and the State Government entities. The composition of such committee is also stated to be as follows : 1. The Cabinet Secretary of the Union; 2. Chief Secretary of the State; 3. Secretaries of the departments concerned of the Union and the States; and 4. Chief Executive Officers of the undertakings concerned. 8. The Supreme Court in the case of Chief Conservator of Forests, Govt. Of A.P. vs. Collector and Others reported in (2003)3 Supreme Court Cases 472 has held as follows:- "Disputes between Government Departments cannot be contested in Court. States/Union of India must evolve a mechanism for resolving interdepartmental controversies. Constitution of Committees suggested which should consist of Chief Secretary, Secretaries of the departments concerned, Secretary of Law and Secretary of Finance (where financial commitments are involved) whose decision should be binding on all departments concerned". 9. The apex Court also held that it shall be the obligation of every Court and every Tribunal where such a dispute is raised hereafter to demand a clearance from the committee in case it has not been so pleaded and in the absence of the clearance, the proceedings would not be proceeded with. The same has been reiterated in the latest decision of the Supreme Court in the case of CIT, Delhi VI v. M/s. Oriental Insurance Co. Ltd., in Civil Appeals Nos.4529 of 2008 etc., decided on July 18, 2008 reported in 304 ITR. 10. In order to discharge that obligation, when we posed a question to the learned counsel as to whether such a clearance has https://hcservices.ecourts.gov.in/hcservices/ been obtained from the CoD, he admitted that such a certificate from COD has not been obtained. Hence, the appeal is dismissed as not entertainable in the absence of the clearance, however, by giving liberty to the appellant to move this Court after obtaining clearance from CoD. No costs. Sd/- Asst. Registrar /true copy/ Sub Asst. Registrar rg To 1. The Income Tax Appellate Tribunal, Chennai 'C' Bench, Chennai. 2. The Commissioner of Income Tax (Appeals)III, Chennai-34. 3. The Deputy Commissioner of Income Tax, Company Circle III(1), Chennai-34. 4. The Income Tax Officer, Chennai-34. 5. M/s. Tamil Nadu Electricity Board, No.800, NPKRR Maligai, Electricity Avenue, Anna Salai, Chennai-2. +1 cc to M/s.Pushyasitaraman, Advocate, SR.No.48097 T.C.(A)No.1380 of 2008 VM(CO) SMK/05.09.08 https://hcservices.ecourts.gov.in/hcservices/