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2018 (12) TMI 406 - AT - Income TaxAdditional grounds/claims - Entitlement to make claim in the assessment proceedings u/s. 153A, though the same were not made in the earlier assessment proceedings u/s.143 - Held that - When the issue has been decided in favour of the assessee by placing reliance upon decisions including that of the honourable apex court in SHELLY PRODUCTS AND ANOTHER 2003 (5) TMI 4 - SUPREME COURT we find that the same will prevail over other case laws referred by the learned departmental representative in absence of any direct Hon ble jurisdictional High Court decision on this issue. As reiterated in the case of Asst. CIT vs. Shri Dilip Chimanlal Gandhi 2018 (8) TMI 271 - ITAT MUMBAI wherein it was held that insofar as charging provisions are concerned, if two views on possible one in favour of the assessee should be adopted, in contradiction to the exemption provisions, where if two views are possible one in favour of the Revenue should be adopted. Accordingly, in view of the aforesaid precedent s including that from the Hon ble Apex Court we hold that assessee was entitled to make claim in the assessment proceedings u/s. 153A, though the same were not made in the earlier assessment proceedings u/s.143 of the act. Disallowance u/s. 14A - MAT computation - Held that - As regards the ground with regard to disallowance u/s. 14A is concerned the same has been done in accordance with ITAT direction. Hence, we find no reason to interfere in the same. As regards disallowance u/s. 115 JB is concern, we find that the same is not as per rule 8D of section 14A, it is on reasonable basis, which in our view is in accordance with the mandate of the Special Bench of the Tribunal in the case of Vireet Investment Pvt. Ltd. and ANR. 2017 (6) TMI 1124 - ITAT DELHI . Accordingly we do not find any infirmity in the ld CIT-A s direction in this regard.
Issues Involved:
1. Whether the assessee can claim or raise additional grounds in assessment done under Section 153A of the Income Tax Act, 1961, when such grounds were not raised in the original assessment under Section 143. 2. Admissibility of claims for exempt dividend income under the Double Taxation Avoidance Agreement (DTAA). 3. Various specific claims and disallowances related to different assessment years, including Section 14A disallowance, computation of book profit under Section 115JB, and set-off of short-term capital loss. Detailed Analysis: 1. Claiming Additional Grounds under Section 153A: The primary issue was whether the assessee could raise additional grounds during the assessment under Section 153A, which were not raised during the original assessment under Section 143. The tribunal referred to multiple case laws, including Dorf Ketal Chemicals (I) P. Ltd. vs. DCIT and others, supporting the assessee's right to make such claims. The tribunal emphasized that Section 153A allows for a fresh assessment of total income for the relevant years, and there is no restriction on the assessee to claim deductions not previously claimed. The tribunal concluded that the assessee could raise new claims during the assessment under Section 153A, aligning with the principle that the assessment should be comprehensive and just. 2. Exempt Dividend Income under DTAA: The tribunal noted that the Commissioner of Income Tax (Appeals) had not adjudicated the merits of the claim regarding the dividend income received from the Brazilian subsidiary being exempt in India under the DTAA. The tribunal remitted the matter back to the Commissioner to consider this claim on its merits, ensuring that the assessee is given a proper opportunity to be heard. 3. Specific Claims and Disallowances: - Assessment Year 2006-07: The tribunal addressed multiple grounds related to additional claims and disallowances, including a ?5,00,00,000 deduction and a Section 14A disallowance of ?32,08,595. These issues were remitted back to the assessing officer for reconsideration in light of the tribunal's directions. - Assessment Year 2007-08: The tribunal dismissed grounds 1 to 6 as not pressed by the assessee. For the Section 14A disallowance and related book profit computation under Section 115JB, the tribunal found no reason to interfere with the disallowance made according to ITAT directions. - Assessment Year 2008-09: The tribunal remitted the issues related to Section 14A disallowance and book profit computation under Section 115JB back to the assessing officer. A specific claim regarding employees' contribution paid before the due date was also remitted for reconsideration. - Assessment Year 2009-10: Similar to previous years, the tribunal remitted issues related to Section 14A disallowance and book profit computation under Section 115JB back to the assessing officer. - Assessment Year 2010-11: The tribunal remitted issues related to Section 14A disallowance, book profit computation under Section 115JB, and specific claims regarding the diminution in the value of investments and unpaid incentives to employees back to the assessing officer. Conclusion: The tribunal allowed the assessee to raise additional grounds during the assessment under Section 153A and remitted several issues back to the assessing officer for reconsideration. The tribunal emphasized the need for a comprehensive and just assessment, allowing the assessee to make claims that were not previously raised. The decision was aligned with the principle that the assessment under Section 153A should be a fresh and complete evaluation of the total income. The tribunal's order was pronounced on 05.12.2018, with ITA No. 2968/Mum/2016 for A.Y. 2007-08 dismissed and other appeals partly allowed for statistical purposes.
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