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Q. Whether the demand of additional tax under the provisions of Section 143(1-A) in the facts of the presentcasewas justified or not t is true that while interpreting a Tax Legislature the consequences and hardship are not looked into but the purpose and object by which taxing statutes have been enacted cannot be lost sight. This Court while considering the very same provision i.e. Section 143(1-A), its object and purpose and while upholding the provision held that the burden of proving that the assessee has attempted to evade tax is on the Revenue which may be discharged by the Revenue by establishing facts and circumstances from which a reasonable inference can be drawn that the assessee has, in fact, attempted to evade tax lawfully payable by it. In the presentcase, not even whisper, that claim of 100% depreciation by the assessee, 25% of which was disallowed was with intend to evade tax. We cannot mechanically apply the provisions of Section 143(1-A) in the facts of the presentcaseand in view of the categorical pronouncement by this Court in Commissioner of Income Tax, Gauhati vs. Sati Oil Udyog Limited and another(supra), where it is held that Section 143(1-A) can only be invoked when the lesser amount stated in the return filed by the assessee is a result of an attempt to evade tax lawfully payable by the assessee. In view of the above, we hold that mechanical application of Section 143(1-A) in the facts of the presentcasewas uncalled for. In the result, we allow the appeal, set aside the judgment of the Division Bench of the High Court as well as demand of additional tax dated 12.02.1992 as amended on 28.02.

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Sections 143 of Income Tax Act, 1961—Assessment— The assessee is a Government Company as defined under Section 617 of the Companies Act, 1956. The assessee filed return on 30.12.1991 for the assessment year 1991-92 showing a loss. Due to a bonafide mistake the assessee claimed 100% depreciation on written down value of assets instead of 75% depreciation. Under the unamended Section 32(2) of the Income Tax Act, 1961 the assessee was entitled to claim 100% depreciation. However, after the amendment the depreciation could only be 75%. An intimation under Section 143(1)(a) of the Income Tax Act, 1961 dated 12.02.1992 was issued by the Assessing Officer disallowing 25% of the depreciation, restricting the depreciation to 75%. Additional tax under Section 143(1-A) of the Income Tax Act, 1961 was demanded. The assessee filed an application under Section 154 of the Income Tax Act, 1961 dated 18.02.1992 praying for rectification of the demand. The assessee also filed a petition under Section 264 of the Income Tax Act, 1961 against the demand of additional tax. In the petition it was stated that even after allowing only 75% of depreciation the income of the assessee remained to be in loss.The assessee prayed for quashing the demand of additional tax. The application filed under Section 154 of the Income Tax Act, 1961 was rejected by the Assessing Officer on 28.02.1992. The revision petition under Section 264 of the Income Tax Act, 1961 came to be dismissed by the Commissioner of Income Tax by order dated 31.03.1992 by giving the reasoning that the provision of section 143(1-A) shows that whenever adjustment is made, additional tax has to be charged @ 20% of tax payable on such excess amount. The assessee filed writ petition in the high court, the learned single judge allowed the writ petition quashing the levy of additional tax under section 143(1-A).The Revenue aggrieved by the judgment of the learned Single Judge filed a Special Appeal which has been allowed by the Division Bench of the High Court vide its judgment dated 13.11.2007 upholding the demand of additional tax. The assessee aggrieved by the judgment of division Bench and filed an appeal. In view of the facts, the Supreme court held that mechanical application of Section 143(1-A) in the facts of the present case was uncalled for. Court allowed the appeal and set aside the judgement of the division Bench of High Court as well as demand of additional tax dated 12.02.1992 as amended on 28. 02. 1992.--- RAJASTHAN STATE ELECTRICITY BOARD JAIPUR vs. Deputy CIT.[2020] 23 ITCD Online 21 (SC)