Appellate Authorities can allow Additional Claims made by Assessee during Proceedings

J U D G M E N T

(Judgment of the Court was delivered by Rajiv Shakdher, J.)

Background facts:

1.This is an appeal preferred under Section 260A of the Income Tax Act, 1961 (in short ‘the Act’) by the Revenue against the judgment and order dated 29.04.2016 passed by the Income Tax Appellate Tribunal (in short ‘the Tribunal’) in I.T.A.No.281/Mds/2016.

2.In the appeal, the Revenue seeks to raise the following questions of law for our consideration:

i. Whether on the facts and in the circumstances of the case, the Tribunal was right in directing the AO to consider the claim made under Section 80IB(10) even though the assessee did not make any such claim in the return of income filed ?

ii. Is not the finding of the Tribunal bad by directing the AO to consider the claim afresh in respect of deduction u/s.80IB (10) especially when no such claim was made in the original return filed nor any revised return filed claiming the same nor any Petition under Section 264 filed which is against the law laid down by the Apex Court in the case of Goetze India , reported in 284 ITR page 323 ?

3.In order to adjudicate upon the present appeal, the following broad facts need to be noticed:

3.1.The respondent, i.e. the assessee company, had filed its return of income for the Assessment Year (AY) 2011-12 on 30.09.2011. By virtue of the said return, the assessee company had disclosed a total income of Rs.3,63,39,110/-, after claiming deduction under Chapter VI-A, equivalent to a sum of Rs.6,19,525/-. The return filed by the assessee company was processed under section 143(1) of the Act on 16.02.2012. Thereafter, as it appears, the assessee company’s return was picked up for scrutiny and a notice under section 143(2) of the Act was issued to it. Finally, after due opportunity was given to the assessee company, an assessment order was passed under section 143(3) of the Act, whereby, the income, as returned by the assessee company, was accepted.

3.2.It appears, that the assessee company had not made a claim in the return as originally filed on 30.09.2011 for deduction under Section 80IB (10) of the Act. However, during the course of the assessment, the assessee company filed the details of the project executed by it, based on which, it claimed deduction under Section 80IB (10) of the Act. The assessee company, while making the said claim, as required, also filed the details in the prescribed format, i.e. Form No.10CCB. It is pertinent to note that the Assessing Officer, however, bypassed the claim made by the assessee company qua deduction under Section 80IB (10) of the Act, while passing the assessment order.

3.3. The assessee company, being aggrieved, preferred an appeal with the Commissioner of Income Tax ( Appeals) [in short “CIT(A)”]. The CIT(A), while noting the fact that the assessee company’s claim for deduction under Section 80IB (10) of the Act had been accepted by the Department both in the preceding and succeeding years, dismissed the appeal on the ground that the claim with respect to deduction under Section 80IB (10) of the Act did not form part of the original return filed by the assessee company. In other words, the view taken was that once a return is filed, which does not advert to a claim, the assessee company cannot press for, it being allowed.

3.4.The assessee company, being dissatisfied with the view taken by the CIT (A), preferred an appeal to the Tribunal. The Tribunal reversed the order of the CIT (A), after discussing the facts and case law on the subject in great detail. In sum, the Tribunal, having regard to the law cited on the subject, ruled that both the CIT (A) and itself (being the appellate authorities) had the power to consider the revised claim by the assessee company, if, it was otherwise entitled to, even though no claim qua the same had been lodged by it in the return as originally filed. Having, thus, come to the said conclusion, in the given facts and circumstances, the Tribunal remitted the matter to the Assessing Officer for fresh consideration, based on the documents already filed by the assessee company at the time of assessment. Consequently, the assessee company’s appeal was partly allowed, albeit, for statistical purpose.3.5.As is indicated above, the Revenue, being aggrieved, have preferred the present appeal before us qua the judgment and order passed by the Tribunal.