Case Law Details
CIT Vs G. M. Knitting Industries (P) Ltd. (Supreme Court of India)
The Supreme Court considered appeals involving the allowability of additional depreciation where Form 3AA had not been filed along with the return of income but had been furnished during the course of assessment proceedings before the final assessment order was passed.
The Supreme Court reproduced paragraph 2 of the impugned order of the High Court, which had upheld the decision of the Income Tax Appellate Tribunal. The issue before the authorities was whether additional depreciation could be denied solely because the assessee had failed to submit Form 3AA together with the return of income.
The High Court had noted that additional depreciation had been disallowed on the ground that Form 3AA was not filed along with the return. However, it was an admitted position that Form 3AA had been submitted during the assessment proceedings. It was also undisputed that the assessee was otherwise entitled to claim additional depreciation.
In these circumstances, the High Court relied upon its earlier decision in Commissioner of Income Tax v. Shivanand Electronics, reported in (1994) 209 ITR 93 (Bom.), and found no merit in the Revenue’s appeal. Accordingly, the appeal before the High Court was dismissed without any order as to costs.
The Supreme Court concurred with the view expressed by the High Court. It held that even though Form 3AA had not been filed along with the return of income, the subsequent filing of the form during the assessment proceedings and before the final assessment order constituted sufficient compliance with the statutory requirement.
The Court thereby accepted the principle that where the prescribed form is furnished before the assessment proceedings attain finality, the claim cannot be rejected solely on the ground that the form did not accompany the original return of income.
The Supreme Court’s conclusion was based on the factual position that Form 3AA had been filed during the assessment proceedings and before the assessment order was made, and that there was no dispute regarding the assessee’s entitlement to additional depreciation. The Court affirmed the High Court’s reliance on the reasoning adopted in Shivanand Electronics, which had drawn a distinction between substantive compliance with statutory requirements and the timing of filing prescribed documents.
Accordingly, the Supreme Court dismissed the appeals and upheld the view that filing Form 3AA before completion of the assessment amounted to sufficient compliance. The appeals were dismissed in terms of the signed order.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
It would be suffice to reproduce para 2 of the impugned order whereby action of Income Tax Appellate Tribunal was held to be justified in allowing additional depreciation as claimed by the respondent-assessee herein: –
“Additional depreciation is denied to the assessee on the ground that the assessee has failed to furnish form 3AA along with the return of income. Admittedly, Form 3AA was submitted during the course of assessment proceedings and it is not in dispute that the assessee is entitled to the additional depreciation. In these circumstances, in the light of the judgment of this Court in the case of Commissioner of Income Tax v. Shivanand Electronics reported in (1994) 209 ITR 93 (Bom.), we see no merit in this appeal. The appeal is accordingly dismissed with no order as to costs.”
We concur with the aforesaid view of the High Court and hold that even if Form 3AA was not filed along with return of income but the same was filed during the assessment proceedings and before the final order of the assessment was made that would amount to sufficient compliance. These appeals are, accordingly, dismissed.
The appeals are dismissed in terms of the signed order.
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