1982 (9) TMI 123 - AT - Income Tax

Summary

Issues:
- Assessment of deduction under section 80U of the Income-tax Act, 1961 for the assessment years 1979-80 and 1980-81.

Analysis:
The appeals before the Appellate Tribunal ITAT INDORE involved the assessment of deduction under section 80U of the Income-tax Act, 1961 for the assessment years 1979-80 and 1980-81. The assessee, an individual, had filed revised returns for both years showing reduced income and claimed deduction under section 80U. The primary issue was whether the assessee's case fell within the provisions of section 80U(ii) as he claimed to be suffering from a permanent physical disability affecting his capacity to engage in gainful employment.

The Income Tax Officer (ITO) disallowed the deduction, stating that the case did not fall under the CBDT Circular No. 246, dated 20-9-1978. The assessee contended that he was an IAS officer suffering from a permanent physical disability affecting his hearing, which substantially reduced his capacity to engage in employment. The assessee provided a certificate from a medical practitioner supporting this claim. The Assessing Officer (AO) and the Appellate Authority (AAC) were not convinced, arguing that the assessee was still employed and earning without a loss of remuneration, hence not eligible for the relief claimed.

The Tribunal analyzed the evidence, including the medical certificate, and observed that the assessee had been suffering from a permanent physical disability affecting his hearing since before 1976. The Tribunal noted that the CBDT Circular was not exhaustive and that the certificate from a registered medical practitioner fulfilled the requirements of section 80U(ii). The Tribunal emphasized that the CBDT circular could not impose additional burdens on the taxpayer beyond the statute's provisions. The Tribunal concluded that the assessee's case fell within section 80U(ii), entitling him to the claimed deduction in both assessment years.

The Tribunal highlighted the importance of the medical certificate and the statutory provisions of section 80U in determining the assessee's eligibility for the deduction. The Tribunal clarified that the CBDT Circular could not override the statutory provisions and that the assessee's genuine permanent physical disability supported his claim for the deduction. Ultimately, the Tribunal allowed both appeals, ruling in favor of the assessee and granting the deduction under section 80U for the assessment years 1979-80 and 1980-81.