PRINCIPAL COMMISSIONER OF INCOME TAX-III, BANGALORE AND ANOTHER versus M/S WIPRO LIMITED

Citation: [2022] 17 S.C.R. 36 · Decided: 11-07-2022 · Supreme Court of India · Bench: M.R. SHAH · Disposal: Appeal(s) allowed

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Judgment (excerpt)

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SUPREME COURT REPORTS
[2022] 17 S.C.R.
   [2022] 17 S.C.R. 36
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PRINCIPAL COMMISSIONER OF INCOME TAX-III,
BANGALORE AND ANOTHER
v.
M/S WIPRO LIMITED
(Civil Appeal No. 1449 of 2022)
(Arising out of SLP (Civil) No. 7620/2021)
JULY 11, 2022
[M. R. SHAH AND B. V. NAGARATHNA, JJ.]
Income Tax Act, 1961 – Ss. 10B, 10B (5), 10B (8), 72, 32 (1)
(ii-a), 80, 139 (1), 139 (5) – Return of income u/S 139 (1) – Revised
return –Denial of claim of carrying forward of losses –Respondent
assessee filed return of income, declaring loss and claiming
exemption u/S. 10 B of IT Act along with a note that no loss is being
carried forward – Subsequently, assessee filed a declaration before
Assessing Officer (AO) stating that it does not want to avail the
benefit u/10 B as per S. 10 B (8) and thereafter filed a revised
return of income wherein exemption u/10 B was not claimed and
claim for carry forward of losses was made – AO rejected the
withdrawal of exemption u/S. 10 B – Respondent Assessee filed
appeal before Commissioner of Income Tax (Appeals), which upheld
the order passed by AO – Assessee filed appeal before ITAT, which
ruled in favour of assessee, allowing the assessee’s claim for
carrying forward of losses under Section 72 of the IT Act – Appellant
revenue went in appeal before High Court, which dismissed the
appeal –Whether, for claiming exemption under Section 10B (8) of
the IT Act, the assessee is required to fulfil the twin conditions,
namely, (i) furnishing a declaration to the assessing officer in writing
that the provisions of Section 10B (8) may not be made applicable
to him; and (ii) the said declaration to be furnished before the due
date of filing the return of income under sub-section (1) of Section
139 of the IT Act – Held:For claiming the benefit under Section
10B (8), the twin conditions of furnishing the declaration to the
assessing officer in writing and that the same must be furnished
before the due date of filing the return of income under sub-section
(1) of section 139 of the IT Act are mandatory –A revised return of
income, under Section 139(5) cannot be filed to withdraw the claim
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and subsequently claiming the carried forward or set-off of any
loss –By filing the revised return of income, the assessee cannot be
permitted to substitute the original return of income filed under
section 139(1) of the IT Act – Also, if the claim is withdrawn post
the date of filing of return, the accountant’s report under section
10B (5) would become falsified and would stand to be nullified.
Interpretation of Statutes – Taxing Statutes/Provisions – In a
taxing statute the provisions are to be read as they are and they are
to be literally construed, more particularly in a case of exemption
sought by an assessee - Literal construction of interpretation to be
used in taxing statutes/provisions
Allowing the appeal, the Court
HELD: 1.1 The wording of the Section 10B (8) is very clear
and unambiguous. For claiming the benefit under Section 10B
(8), the twin conditions of furnishing the declaration to the
assessing officer in writing and that the same must be furnished
before the due date of filing the return of income under sub-section
(1) of section 139 of the IT Act are required to be fulfilled and/or
satisfied. Both the conditions to be satisfied are mandatory. It
cannot be said that one of the conditions would be mandatory and
the other would be directory, where the words used for furnishing
the declaration to the assessing officer and to be furnished before
the due date of filing the original return of income under sub-
section (1) of section 139 are same/similar. It cannot be disputed
that in a taxing statute the provisions are to be read as they are
and they are to be literally construed, more particularly in a case
of exemption sought by an assessee. [Para 8][50-G-H; 51-A-B]
1.2 Filing a revised return under section 139(5) of the IT
Act claiming carrying forward of losses subsequently would not
help the assessee. The revised return filed by the assessee under
section 139(5) can only substitute its original return under Section
139(1) and cannot transform it into a return under Section 139(3),
in order to avail the benefit of carrying forward or set-off of any
loss under Section 80 of the IT Act. The assessee can file a revised
return in a case where there is an omission or a wrong statement.
But a revised return of income, under Section 139(5) cannot be
PRINCIPAL COMMISSIONER OF INCOME TAX-

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