CIT Vs. Shri Tikam Khandelwal (Rajasthan High Court)
On perusal of details and ledger account produced by the assessee it is noticed that the assessee has claimed depreciation @ 30% at Rs. 5,62,631. The assessee has claimed depreciation in the return filed in response to notice under section 153A on 2-7-2008. In his original return the assessee neither shown income from hiring of taxi nor claimed depreciation on taxi in his original return filed under section 139(1). During the course of assessment proceedings the assessee was asked as to why depreciation claimed on taxi be not disallowed as the assessee has claimed depreciation in the original return filed under section 139(1) of Income Tax Act but has claimed depreciation in the return filed in pursuance to notice under section 153A of Income Tax Act. The assessee filed reply dated nil stating that —
“It would be wrong and bad in law to disallow depreciation solely on the ground that income from taxi running business was declared while filing the return under section 139 and no depreciation was claimed in the said return of income. For sake of convenience clause (a) of sub-section (1) of section 153 is reproduced here in below —
Thus depreciation on taxi vehicles has been claimed by the assessee under the provisions of Income Tax Act. As applicable, as if the such return were a return required to be furnished under section 139. Further there is no bar on carry forward of absorbed depreciation for set off in subsequent years.”
The same is disallowable in view of judgment of ITAT in the case of Suncity Alloys Pvt. Ltd. v. ACIT in ITAs No. 586 to 588/Ju/2008 for assessment years 2001-02, 2002-03 & 2003-04 which reads as follows :–
“The assessing authority primarily declined to accept such a claim as the assessees has made no such claim in the returns of income filed originally under section 139 of the Act. He was of the view that returns of income filed in response to notice under section 153A of the Income Tax Act are as a consequence of action taken under section 132 of the Act on these assessees. These proceedings are analogous to proceedings under section 147 of the Act to the extent that these are proceedings for the benefit of revenue and not that of the assessee. The assessee cannot be permitted to convert these reassessment proceedings as his appeal or revision in disguise and seek relief in respect of items earlier not claimed in the original return of income. Reliance was placed to the judgment rendered b y the Hon’bloe Bombay High Court in K. Sudhakar S. Saubhag v. ITO (2000) 241 ITR 865 (Bom) which was rendered by taking notice of the principle laid by the Hon’ble Apex Court in Sun Engineering Works (P) Ltd. (1992) 198 ITR 297 (SC) to the effect that in reassessment proceedings, an assessee can neither claim nor be allowed a deduction that was not claimed in the original return. As such, it was held that the assessment proceedings initiated on the basis of an action under section 132 of the Act also cannot be utilised by the assessee to seek relief not claimed earlier. This all goes to show that the assessment or reassessment made pursuant to notice under section 153A of the Act are not de novo assessments. We, therefore, find no merit in the ground raised in appeal to make a new claim of deduction or allowance as such where admittedly the regular assessments are shown as completed assessment on the date of initiation of under section 132 of the Act. Such a ground in all these appeals stands rejected.”
Hence the claim of depreciation is not allowable in view of the judgment of ITAT, Jodhpur bench, Jodhpur delivered in the above case. Therefore, Rs. 5,62,631 is disallowed and added to the total income of the assessee.”
