Judgment:
1. The only dispute in this appeal is that the lower authorities have not allowed the assessee the benefit of deductions under Section 80HHA because the Audit report was not filed alongwith the return of income.
The learned CIT (Appeals) has also mentioned that the assessee had not given any reason which prevented the appellant from complying with the clear provisions of the law. The learned counsel for the assessee was fair enough to concede before us that in assessee's own case for the preceding two years, namely, assessment years 1982-83 and 1983-84 also this benefit had been denied for similar reasons and the Tribunal had upheld the decision of lower authorities relying on the decision of the Hon'ble Punjab & Haryana High Court in the case of CIT v. Jaideep Industries [1989] 180 ITR 81. He, however, submitted that in the case of CIT v. Gujarat Oil & Allied Industries it had been held with reference to provisions of Section 80J(6A) that the first part of the provisions was mandatory but the second part which required the filing of Audit Report alongwith the return was only procedural and hence even if the audit report was filed during the course of assessment proceedings, the benefit of Section 80J should not be denied. The learned counsel also referred to the decision of this bench in the case of Shankar Tea Traders [IT Appeal Nos. 1066 to 1068 (JP) of 1992, dated 26-2-1993 where while dealing with 'similar provisions of Section 43B this bench had held that even if the proof of payment of sales-tax was filed after filing of income-tax return, disallowance under Section 43B need not be made. The learned counsel also referred to the decision of the Hon'ble Supreme Court in [1989] 179 ITR (St.) 61 in which the Hon'ble Supreme Court had rejected the SLP in a case where the High Court had held that when audit report was not filed with the return, the benefit under Section 12A could not be denied. He also referred to the decisions in CIT v. Rai Bahadur Bissesswarlal Motilal Malwasie Trust [1992] 195 ITR 825 (Cal.) and CIT v. Hardeodas Agarwalla Trust [1992] 198 ITR 511 (Cal.) to support his contentions. He submitted that in the case of Goodyear India Ltd. v. State of Haryana [1991] 188 ITR 402 (SC) at page 404 the Hon'ble Court had held that in a Taxing Statute literal interpretation had to be avoided if that interpretation defeats the purpose of the Statute. He referred to the decision in the case of Billimora Eng. Martv. CIT [1985] 156 ITR 153 (Guj.) and submitted that in that case although registration application did not accompany the return of income yet it was held that registration could not be refused to the firm. Finally the learned counsel drew our attention to the decision of the Hon'ble Supreme Court in the cases of CIT v. Vegetable Products Ltd. [1973] 88 ITR 192 and CIT v. J.K.Hosiery Factory [1986] 159 ITR 85 in which the Apex Court had held that if two interpretations of a provision of Taxing Statute were possible, the interpretation which is favourable to the assessee should be preferred.
2. The learned Departmental Representative on the other hand referred to the specific provisions of Sub-section (4) of Section 80HHA which made it mandatory to file the Audit Report alongwith the return. He submitted that the conduct of the assessee was not bonafide because in the past also it had not been filing the audit report with the returns.
He repeated that no reasonable cause had been given by the assessee for not complying with the statutory requirements. He pointed out that in the decision of Shankar Tea Traders's case (supra) this bench had decided the issue with respect to provisions of Section 43B and not 80HHA and hence that ratio was not applicable to the facts of assessee's case. With regard to the reference to the cases of Vegetable Products Ltd. (supra) and J.K. Hosiery Factory (supra), the learned Departmental Representative submitted that this bench had already given its decision in assessee's own case and no two reasonable interpretations of the provisions of Sub-section (4) of Section 80HHA were possible.
3. We have carefully considered the rival submissions. We may first quote from the provisions of Sub-section (4) of Section on 80HHA which reads as under:- Where the assessee is a person, other than a company or a co-operative society, the deduction under Sub-section (1) shall not be admissible unless the accounts of the small-scale industrial undertaking for the previous year relevant to the assessment year for which the deduction is claimed have been audited by an accountant as defined in the Explanation below Sub-section (2) of Section 288 and the assessee furnishes, alongwith his return of income, the report of such audit in the prescribed form duly signed and verified by such accountant.
We would as well quote from the provisions of Section 12A(b), fist proviso to Section 43B and would also refer to the provisions of Section 184 because the learned counsel for the assessee has supported his arguments with case law relating to those sections. Section 12A(b) reads as under :- Where the total income of the trust or institution as computed under this Act without giving effect to the provisions of Section 11 and Section 12 exceeds twenty-five thousand rupees in any previous year, the accounts of the trust or institution for that year have been audited by an accountant as defined in the Explanation below Sub-section (2) of Section 288 and the person in receipt of the income furnishes along with the return of income for the relevant assessment year the report of such audit in the prescribed form duly signed and verified by such accountant and setting forth such particulars as may be prescribed.
Provided that nothing contained in this section shall apply in relation to any sum referred to in Clause (a) or Clause (c) or Clause (d) which is actually paid by the assessee on or before the due date applicable in his case for furnishing the return of income under Sub-section (1) of Section 139 in respect of the previous year in which the liability to pay such sum was incurred as aforesaid and the evidence of such payment is furnished by the assessee along with such return.
4. It may be seen that in both these provisions procedures are prescribed by following which the assessee is entitled to certain benefits. It is prescribed under Section 12A(b) that the concerned person "furnishes" the audit report alongwith the return and also leaves scope for furnishing such other particulars as may be prescribed. The proviso to Section 43B allows that even if the payment of taxes, etc. aie not made within the previous year, the assessee shall be allowed the benefit of deductions if he follows the procedure, viz. pays the taxes before the date due for filing his income-tax return and files evidence of payment alongwith the return. Similarly various Sub-sections of Section 184 lay down the procedure for registration of a firm. In fact, under Section 184 the Assessing Officer has also been empowered to entertain a belated application. On the other hand, as may be seen from the emphasis supplied by us by underlining the words "shall not be admissible unless" in Sub-section (4) of Section 80HHA that this Sub-section clearly shows the intention of the Legislature to the effect that the assessee is prohibited from getting the benefit of the deductions under Section 80HHA unless the accounts of the small-scale undertaking for the previous year relevant to the assessment year for which the deduction is claimed have been audited by an accountant as defined in the Explanation below Sub-section (2) of Section 288 and the assessee furnishes, along with his return of income, the report of such audit in the prescribed form duly signed and verified by such accountant. We feel that if the Legislature had intended to be only casual about filing of the audit report along with the return then, instead of spelling out the conditions, without fulfilling which the assessee would not be entitled to the deduction under Section 80HHA, it could have merely mentioned that the assessee may file the audit report alongwith the return of income and if he does not do so, the Assessing Officer may waive this condition and the assessee may file the audit report at any stage at his discretion. We find that that has not been done. In these circumstances it is not for us to sit in judgment over the reasonableness of the provisions of the Statute when the language of the Statute is clear, or to guess and lay down that the intention of Legislature was to allow the assessee this benefit even if he filed the audit report at his sweet will or did not file it at all because that would not effect the basic requirements of Section 80HHA. In our view, there can be no two opinions after reading the language of Sub-section (4) of Section 80HHA as to whether it was at the sweet will of the assessee to file the audit report alongwith the return or at any stage when it suited the convenience of the assessee or it was obligatory on him to file it along with the return. If we accept such an interpretation then the clear prohibition imposed by the Legislature in Sub-section (4) would be rendered useless and by a liberal interpretation the assessee may file the audit report, if he choses, even when the appeal is being heard after several years before the Tribunal because the hearing of appeal before the Tribunal may also be interpreted as continuation of assessment proceedings. In our opinion, this interpretation cannot be accepted. At this stage we may also refer to the decision of the Hon'ble Punjab & Haryana High Court in the case of Jaideep Industries (supra) where their Lordships have dis-approved of the decision of the Tribunal and have laid dcwn that the audit report must be filed with the return and that the Tribunal was not correct in holding that it could be filed at any time during the assessment proceedings before completion of assessment. We may also point out that in this very assessment year the Assessing Officer has refused to grant benefit under Section 80J (alongwith 80HHA), the language of which is also similar so far as the provisions of submission of audit report is concerned, yet the assessee did not agitate this issue either before the CIT (Appeals) or in the appeal before us. We have also taken note of the conduct of the assessee to the effect that he is habitually not complying with the provisions of Sub-section (4) of Section 80HHA nor has he given any justification for this repeated non-compliance with the statutory provisions. There is nothing on record to show if the audit report was even filed by the assessee. In these circumstances, in our opinion, the case law referred to by the learned counsel for the assessee is not applicable to the facts and circumstances of this case nor is it a case where two reasonable interpretations of the provisions of Sub-section (4) of Section 80HHA are possible. Hence, following our own decision in the case of the assessee for earlier years, we uphold the decisions of the authorities below.