2012 (7) TMI 485 - AT - Income Tax

Revised return order of the CIT (A) treating the revised return filed u/s 139(5) as that of sec. 139(4), rejecting the claim on the ground, as no such claim was made u/s 139(1) - reason behind disallowance of claim made by the assessee since the assessee has not claimed deduction u/s 10A in the return filed u/s 139(1), the proviso to section 10A debars him from making any such claim in revised return Held that - assessee has fulfilled all the requirements of provisions of section 10A. However, this claim of the assessee not examined by the lower authorities - keeping in view the orders of the ITAT for the earlier assessment years 2006-07 and 2007-08, directing the AO to consider assessee s claim for deduction u/s 10A - matter remanded back to the file of the AO directing him to consider assessee s claim of deduction u/s 10A - appeal filed by the assessee is treated as allowed for statistical purpose.

Issues Involved:
1. Interpretation of provisions under section 10A of the Income Tax Act regarding deduction claims.
2. Validity of revised return filed under section 139(5) for changing deduction claims from section 10B to section 10A.
3. Consideration of documentary evidence and relationship between the assessee and the exporter for claiming relief under section 10A.

Issue 1: Interpretation of Provisions under Section 10A:
The case involved a dispute regarding the interpretation of provisions under section 10A of the Income Tax Act related to deduction claims. The Assessing Officer (AO) disallowed the claim under section 10A on the basis that the proviso to section 10A requires the deduction to be claimed in the return filed under section 139(1). The Commissioner of Income Tax (Appeals) (CIT (A)) upheld this disallowance, citing relevant case laws and statutory provisions. However, the Appellate Tribunal disagreed with this interpretation, stating that the requirement for claiming deduction under section 10A is the filing of a return of income before the due date specified under section 139(1). The Tribunal highlighted that the assessee had filed a return under section 139(1) within the due date, albeit claiming deduction under section 10B instead of 10A. The Tribunal also noted past instances where the assessee was directed to consider the claim for deduction under section 10A for previous assessment years. Therefore, the Tribunal concluded that the assessee should be allowed to claim deduction under section 10A for the relevant assessment year.

Issue 2: Validity of Revised Return under Section 139(5):
The assessee had initially claimed deduction under section 10B but later realized the eligibility for claiming deduction under section 10A. A revised return was filed under section 139(5) within the due date to rectify this error. The AO disallowed this revised claim, emphasizing that the original return did not include a claim under section 10A as required by the proviso to section 10A. The CIT (A) also supported this disallowance. However, the Tribunal disagreed with this approach, noting that the assessee rectified the error promptly by filing a revised return within the prescribed time limit. The Tribunal highlighted that the past conduct of the assessee and directions from previous years' assessments supported the validity of the revised claim under section 10A. Therefore, the Tribunal directed the AO to consider the revised claim and allow the deduction if found legally justified.

Issue 3: Consideration of Documentary Evidence and Relationship for Relief under Section 10A:
Apart from the deduction claim issues, the case also involved the consideration of documentary evidence and the relationship between the assessee and the exporter for claiming relief under section 10A. The assessee provided substantial material documentary evidence to establish that no relationship existed between them and the exporter in the context of claiming relief under section 10A. The Tribunal, after analyzing the submissions and evidence presented, directed the AO to re-examine the matter, taking into account the documentary evidence and the lack of relationship between the parties. The Tribunal emphasized the importance of factual considerations and directed a thorough assessment based on the evidence provided by the assessee.

In conclusion, the Appellate Tribunal, in its judgment, allowed the appeal filed by the assessee for statistical purposes, directing the Assessing Officer to reconsider the deduction claim under section 10A in light of the provisions, past directions, and documentary evidence presented during the proceedings.

← Previous Next →