Commissioner of Income Tax vs Padmey Impex

Akil Kureshi, J.—Though served no one appeared for the respondent. The applicant department seeks correction in our judgment dated 17.1.2012. It is the case of the applicant that in paragraph-30 thereof while giving the final directions, we had dismissed the tax appeal no. 1116/2010 of the Revenue though as per the facts arising in the said appeal and our conclusion of the judgment in question, same was required to be allowed. We notice that in paragraph 26 and 27 of the said judgment we had summed up our opinion on the legal issues presented before us in the following manner:

In the present group of cases, however, we need not dwell on this issue at any length. Primarily we are of the opinion that while holding that assessees are not entitled to deduction u/s 80IB(4) of the Act, we are not reading into it any other requirements contained in any other Act but are reading the requirements contained in the proviso to Subsection (4) of Section 80IB of the Act so as to require that commencement of the industrial activity must be lawful and any manufacturing activity which is fundamentally unlawful or prohibited by law and against public policy, would not be covered by said provision.

However, in cases where the application for license was already made before 31.3.2004, but obtained shortly thereafter, we are of the opinion that such lapse must be viewed as one which is purely technical even without accepting the contention of the counsel for the assessee that grant of license subsequently would relate back to the original date of application. We are inclined to uphold the Tribunal''s view to this extent.

Counsel for the petitioner rightly points out that the respondent of Tax Appeal No. 1116/2010 had not applied for factory license before the cut off date of 31.3.2004 nor had it obtained such as license shortly thereafter. Case of respondent assessee thus would fall within the observations and conclusions of para. 26 of the judgment and resultantly Tax Appeal had to be allowed. In paragraph 30, we had wrongly included the said number for dismissing the appeal. Paragraph 30 of the said judgment reads as under:

In Tax Appeals No. 1387/2010, 1388/2010, 1116/2010, 1125/2010 and 1117/2010, assessee had already applied before 31.3.2004 and such licenses were granted shortly thereafter. In view of our answer to question(B), these Tax Appeals are dismissed.

In the result, para. 29 and 30 of the said judgment insofar as the same dismissed the Tax Appeal No. 1116/2010 is concerned, the same shall stand corrected. The reference of Tax Appeal No. 1116/2010 shall be deleted from paragraph 30 and shall be included in paragraph 29 of the judgment. Disposed of accordingly. Rule made absolute to above extent.