Section 153A – Assessee Entitled To Raise Fresh Claims – ITAT Mumbai

DCIT Vs. Eversmile Construction Co Pvt Ltd (ITAT Mumbai)- The Hon’ble Supreme Court in the case of National Thermal Power Company Ltd. Vs. CIT [(1998) 229 ITR 383 (SC)] has held that the Tribunal has the jurisdiction to examine a question of law which arises from the facts as found by the authorities below and having a bearing on tax liability of the assessee notwithstanding the fact that it was not raised before the learned CIT(A).

The purpose of assessment proceedings is to assess correctly the tax liability of an assessee in accordance with law. When we consider the judgement of the Hon’ble Supreme Court in Goetze (India) Ltd. (supra) in juxtaposition to National Thermal Power Company Ltd. (supra), it becomes patent that although the assessee cannot make a claim before the Assessing Officer otherwise than through the return of income, but there are no restrictions on the powers of the Tribunal to entertain such claim for examination provided the facts exists on record.

Coming back to the facts of the instant case we note that the assessee made a claim for deduction of Rs.58.86 lakh by way of Note to the return of income on account of interest expenditure, which the Assessing Officer in the remand proceedings found to be acceptable to the tune of Rs.48.05 lakh. Under such a situation the Department cannot take the shelter of the judgement of the Hon’ble Supreme Court in the case of Goetze (India) Ltd. (supra) before the Tribunal contending that the addition so held by the first appellate authority be restored.