JUDGMENT D.K. Seth, J.
1. In this case, a very short but interesting question emerges. We both at the Bar and the Bench have not been able to lay our hands on any authority answering the question raised herein.
2. Section 80HHC(1) of the Income-tax Act (hereinafter referred to as "the Act"), entitles an assessee resident in India, engaged in the business of export of specified goods or merchandise, to a deduction of the profits derived out of such export in computing the total income. Sub-section (2)(a) of the same section provides a condition to such entitlement in respect of goods or merchandise other than those specified in Clause (b) to the extent that the sale proceeds thereof are "received in, or brought into, India by the assessee . . . within a period of six months from the end of the previous year". But the said restriction is not absolute, i.e., where the Chief Commissioner or Commissioner is satisfied that the assessee was unable to do so within the said period of six months, for reasons beyond his control, he may allow further period.
3. In the present case, admittedly, the assessee, a company, resident in India, engaged in the business of export, having exported such specified merchandise, was unable to receive in or bring into India the sale proceeds thereof within the said period of six months.
4. Accordingly, the assessee claimed deduction in its return submitted on December 31, 1992, in respect of the assessment year 1991-92 ending on March 31, 1992, on account of export made by it on March 21, 1992. The assessee has sought to take the benefit of the discretion vested in the Chief Commissioner or Commissioner for allowing further period on the ground that the assessee was unable to receive in or bring into India the sale proceeds within the said period of six months and had made an application to the Commissioner of Income-tax on December 28, 1992. The said application was turned down by the Commissioner of Income-tax by an order dated September 13, 1993, which is annexure "I" to the writ petition on the ground that since the assessee did not apply before the expiry of six months, therefore, there was no scope for exercising the discretion in allowing a further period as contemplated in the said section.
5. Now, a simple and short question emerges ;
(a) Whether Section 80HHC(2)(a) contemplates the making of an application for claiming deduction ?
(b) If so, whether such application is to be made before the expiry of the said period of six months ?
Both learned counsel, Mr. S.P. Gupta, Advocate-General, appearing for the petitioner, and Mr. Misra, appearing for the Department, had made elaborate and erudite arguments. The facts are not disputed in the present case. In order to answer the question, we fall back on the expression used in Section 80HHC(2)(a) as quoted below :
" (2). (a) This section applies to all goods or merchandise, other than those specified in Clause (b), if the sale proceeds of such goods or merchandise exported out of India are received in, or brought into, India by the assessee (other than the supporting manufacturer) in convertible foreign exchange, within a period of six months from the end of the previous year or, where the Chief Commissioner or Commissioner is satisfied (for reasons to be recorded in writing) that the assessee is, for reasons beyond his control, unable to do so within the said period of six months, or within such further period as the Chief Commissioner or Commissioner may allow in this behalf."
Unlike various other sections including Section 11(2) and Section 12A, the present section does not specify the making of any application or any time limit for making such application nor any rules or forms therefor have been prescribed. The Income-tax Act is a complete code in itself and has laid down the method, manner and time for making applications wherever required for which appropriate rules have been framed and forms have been prescribed. Chapter VI-A entitles an assessee to claim various deductions as contemplated in Section 80C to Section 80U. Such deduction is to be claimed in the return to be filed in respect of the concerned assessment year. Nowhere in the Act, has any manner or method or procedure for claiming deduction other than the manner as indicated in Chapter VI-A been provided? The manner of claiming deduction is indicated in Form No. 2 appended to the Income-tax Rules, being a form for submitting return. The said Form, in item "G", requires the assessee to give the statement of the total income wherein a column in item No. 5 is provided for "less : Deductions under Chapter VI-A 'wherever admissible' with the instruction ..." a report under Section 80HHC,... certificate referred to in Section 80HHC, "wherever applicable", has been provided along with a space or column "specifying deductions to be claimed".
6. Therefore, looking into the provisions of various sections of the Act to which our attention was drawn by both learned counsel, it appears to us that Section 80HHC(2)(a) does not specify any manner or procedure for claiming deduction. For the purposes of claiming deductions under the provisions of Sections 80C to Section 80U other than Section 80HHC, no manner, procedure for making application or time limit for such application has been prescribed. Such deductions are to be claimed in the return itself. Therefore, Section 80HHC cannot claim special treatment other than the rest of the Sections 80C to 80U.
7. The time limit mentioned in Section 80HHC(2)(a) is not a limitation for claiming deduction but it is the right to claim deduction which is available if the sale proceeds are received within a period of six months. But there might be cases where on account of no fault on the part of the assessee, he could not receive or be able to bring into India the sale proceeds within the said period. Contemplating such situation, the Legislature in its wisdom had provided for suspension which can also be termed as relaxation of the said period subject to the satisfaction of the Chief Commissioner or Commissioner on the condition that the assessee was unable to receive in or bring into India the sale proceeds within the period of six months as aforesaid for reasons beyond his control. The Chief Commissioner or Commissioner has been invested with the power to decide the period of such suspension or relaxation if he is satisfied that the assessee was unable to do so for reasons beyond his control. A plain reading of the said section gives an impression that the discretion is confined to the question of satisfaction by the Chief Commissioner or Commissioner but not with the power to allow the period of suspension or relaxation. The Commissioner, if satisfied, that the conditions are fulfilled, is bound to allow the period which remained suspended due to the inability of the assessee to receive in or bring into India the sale proceeds for reasons beyond his control. There is no discretion in the matter of allowing the period of suspension if the Chief Commissioner or Commissioner is satisfied that the condition for suspension of the period was fulfilled.
8. Since the deduction is claimed in the return, the question of deciding the period of such suspension or relaxation would arise in computing the total income in the process of assessment. Since the authority to relax is vested in the Chief Commissioner or Commissioner, the assessing authority having no jurisdiction to deal with the same, the same is to be decided by the Commissioner or Chief Commissioner for which a reference would be necessary by the assessing authority to the Chief Commissioner or Commissioner. Since no procedure has been provided, a procedure beneficial to the assessee is to be adopted. The purpose of engrafting the section for such deduction is to encourage the earning of convertible foreign exchange. The same would be apparent from Circular No. 572 (see [1990] 186 ITR (St.) 81), dated 5rd August, 1990, containing Explanatory Notes in respect of the Finance Act, 1990, paragraph 28 whereof reads as follows :
" 28. Under the existing provisions of Section 80HHC of the Income-tax Act, exporters are allowed 100 per cent. deduction in respect of the profits derived from export of goods or merchandise. One of the conditions for allowing the deduction is that the sale proceeds should be receivable in convertible foreign exchange. As a result, the deduction may be allowed even if the foreign exchange is not brought into India. In the absence of such a condition, one of the main purposes of allowing such concessions, namely, to augment the foreign exchange earnings of the country, is being defeated. Therefore, Section 80HHC has been amended to provide that for obtaining the deduction under this section, the taxpayer will be required to bring into India, the sale proceeds of goods or merchandise, in convertible foreign exchange, within a period of six months from the end of the previous year or within such extended period as the Chief Commissioner or Commissioner of Income-tax may allow on being satisfied that the taxpayer was prevented from complying with this requirement for reasons beyond his control."
Though much stress has been laid by Mr. Misra to the verb "is" used in present tense before the phrase "for the reasons beyond his control" for bringing home his submission that the jurisdiction for extension of time is to be exercised before the expiry of the said period of six months, but paragraph 28 used the verb "was" in the past tense before the phrase being the last but one line of the said paragraph 28 quoted above "prevented from complying with this requirement for reasons beyond his control". We, therefore, do not find any substance in the contention of Mr. Misra that the application is to be made before the expiry of the said period of six months. According to us, there is no scope for extension of time for making any application or for exercising the jurisdiction under Section 80HHC(2)(a). It is a question of relaxation in case the Commissioner is satisfied that there were conditions as contemplated therein.
9. It appears to us that if the contention of Mr. Misra is upheld, in that event, the assessee has to book a deducibility before filing the return within the said period of six months.
10. Relying on the decision in the case of CST v. Modi Sugar Mills Ltd., AIR 1961 SC 1047, referred to by Mr. Misra, we look squarely at the words of the statute in the light of what was expressly expressed. We cannot imply anything which is not expressed in it nor can we import provisions in the statute so as to supply any assumed deficiency. We also cannot interpret the said section on any presumption or assumption, neither are we interpreting the same on equitable considerations.
11. A plain reading of the said section does not indicate the making of any application or fixing of any time limit for making such application. We cannot import different meanings for different parts of the same section, that the deduction can be claimed without any application if the sale proceeds are received or brought into India within six months and an application would be necessary if it is not and that too to be made before the expiry of the period of six months.
12. On the other hand, if a statute invests a public officer with authority to do an act in specified set of circumstances, it is imperative upon him to exercise his authority in a manner appropriate to the case when circumstances for exercise of authority are shown to exist. Even if the words used in the statute are prima facie enabling, the court will readily infer a duty to exercise power which is invested in aid of enforcement of a right -- public or private -- for a citizen. This has been so held in the case of L. Hirday Narain v. ITO [1970] 78 ITR 26 (SC).
13. According to us, the right to deduction under Section 80HHC is a right to the assessee which he can get straightaway if it is (sic) had within a period of a six months as contemplated therein. But the said right appears to remain suspended if the assessee is unable to have it for the reasons beyond his control, In such circumstances, authority is empowered to allow further period to cover the period of suspension as contemplated, if he is satisfied that the conditions contemplated are in existence. Therefore, it appears to us that the exercise to allow further time by the Commissioner is not dependent on the making of any application or that the said discretion is to be invoked before the expiry of the said period of six months, as has been sought to be argued by Mr. Misra.
14. In dealing with the question, we do not feel it necessary to refer to other submissions and citations made at the Bar. The more erudite the argument, the more the confusion. We, therefore, refrain from adverting to the same.
15. In fine, according to our view, a plain reading of Section 80HHC(2)(a) does not contemplate the making of any application by the assessee within a period of six months either for availing of the deducibility with respect to sale proceeds received in or brought into India as contemplated therein within a period of six months from the end of the previous year or for the purpose of invoking the power of the Chief Commissioner or Commissioner to allow further period in case the assessee is unable to receive in or bring into India the sale proceeds for reasons beyond his control. If such a position is accepted, then there is no scope for making any application for the purpose of having the benefit of further period before the expiry of six months. On the other hand, it is our considered view that the deductibility claimed in the return is to be decided in computing the total income in case the six month-period has expired before the assessee received or brought into India the sale proceeds, in that event, it is for the assessing authority to place the same before the Chief Commissioner or Commissioner if the assessee proposes to satisfy that he was unable to do so for reasons beyond his control. Inasmuch as the assessing authority having not been invested with the power granted under Sub-section (2)(a) for allowing further period, he can neither refuse nor deal with the same. Therefore, it is imperative on its part to place the same before the Chief Commissioner or Commissioner, as the case may be. The assessee may also bring the fact to the notice of the Chief Commissioner or Commissioner, but in that event, no time limit can be applied except that the claim is to be made in the return to be filed.
16. In the present case, by way of an application, the discretion was sought to be invoked immediately preceding the submission of the return. In our view, in such circumstances, the Commissioner or the Chief Commissioner was bound to exercise the power for allowing further period if he is satisfied that the assessee was unable to receive in or bring into India the sale proceeds within a period of six months for reasons beyond his control. Once he is satisfied about the existence of such condition, he has to exercise the discretion in favour of the assessee.
17. In view of the observations made hereinbefore, we are of the view that the Commissioner of Income-tax, while passing the impugned order contained in annexure "I" to the writ petition, has failed to exercise his jurisdiction though he was so invested with such power wholly on an erroneous misconception of the provisions contained in Sub-section (2)(a) aforesaid. In view aforesaid, the order of the Commissioner dated February 13, 1995, relating to the assessment year 1992-93 refusing to exercise his jurisdiction to allow further time is hereby set aside. The Commissioner is hereby directed to decide the matter afresh in the light of the observations made hereinbefore, as expeditiously as possible. The interim order of stay of assessment granted on March 9, 1995, and extended subsequently shall continue till the disposal of the application of the petitioner contained in annexure "2" to the writ petition and its communication to the petitioner by the assessing authority, whichever is later.
18. The writ petition is thus disposed of. There will, however, be no order as to costs.