2012 (8) TMI 1223 - AT - Income Tax

Summary

Issues involved: Denial of claim for exemption u/s 11 and 12 of Income-tax Act, 1961.

Summary:
The appellant, an assessee governed by the Major Port Trusts Act, 1963, filed returns for the assessment year admitting income but did not claim exemption u/s 11 initially. Subsequently, after receiving registration u/s 12AA with retrospective effect, the appellant filed a revised return claiming exemption. The Assessing Officer (A.O.) denied the claim citing the late filing of the revised return beyond the allowed time u/s 139(5) and relied on a court decision. The CIT(Appeals) upheld the A.O.'s decision, stating that the appellant could not claim exemption without a valid revised return. The appellant argued that similar exemptions were allowed in previous years and challenged the decision.

The Tribunal noted that the appellant received registration u/s 12AA after filing the original return, making it ineligible to claim exemption initially. However, upon receiving registration with retrospective effect, the appellant filed a revised return claiming exemption. The A.O. was aware of the registration during assessment but denied the exemption solely based on the late filing of the revised return. The Tribunal differentiated between deduction and exemption, emphasizing that exemption excludes income from taxation. The Tribunal also referenced a previous order where similar exemption claims were allowed for the appellant. Therefore, the Tribunal directed the A.O. to grant the exemption claimed by the appellant u/s 11 and 12 of the Act.

The appeal was allowed, and the order was pronounced on August 23, 2012, in Chennai.