2009 (7) TMI 878 - AT - Income Tax

Deduction under 80IB- Original return on time-Revised return invalid-Held that -original return should be filed in time, but the claim need not necessarily be made in the original return, it can be made subsequent thereto - Goetze India Ltd.(2006 -TMI - 5171 - SUPREME Court) was limited to the power of the assessing authority to entertain claim for deduction otherwise than by a revised return, and did not impinge on the power of the Tribunal. The claim of deduction under section 80-IB can be made by the assessee before the appellate authorities. Since grounds relating to the deduction under section 80-IB were made before the appellate authorities, irrespective of whether it was claimed by the assessee before the Assessing Officer or not, or whether it was claimed through original return or revised return, the allowability of claim has to be adjudicated on the merits. - Since the learned Commissioner of Income-tax (Appeals) has not decided the issue on the merits, we restore the issue claim of deduction under section 80-IB before him to decide the same on the merits.

Summary

Issues:
Claim of deduction under section 80-IB of the Income-tax Act, 1961.

Analysis:
The appeal involved the assessee challenging the order of the Commissioner of Income-tax (Appeals) regarding the denial of deduction under section 80-IB. The key contention was the timing of filing the revised return and the validity of the claim for deduction. The Assessing Officer rejected the claim citing late filing and operational dates not meeting statutory requirements. The Commissioner of Income-tax (Appeals) upheld the disallowance due to the absence of a valid revised return and lack of additional facts. The authorized representative argued that the original return was timely filed as per CBDT Circular, and referred to various precedents supporting the claim before appellate authorities. The Departmental representative contended that deductions under Chapter VI-A must be claimed through the original return filed within the prescribed time.

The Tribunal analyzed the provisions of section 80AC and relevant case laws to determine the validity of the deduction claim under section 80-IB. It clarified that while the original return must be filed on time, the claim itself need not be made in the original return. The Tribunal relied on the interpretation of the Supreme Court's decision in Goetze (India) Ltd.'s case and subsequent judgments to establish that the claim for deduction under section 80-IB can be raised before appellate authorities. The Tribunal emphasized that the decision in Goetze (India) Ltd.'s case pertained to the assessing authority and did not restrict the power of appellate authorities to consider deduction claims. Therefore, the Tribunal held that the claim under section 80-IB could be adjudicated on its merits before the Commissioner of Income-tax (Appeals).

In conclusion, the Tribunal partially allowed the appeal, directing the Commissioner of Income-tax (Appeals) to reconsider and decide the claim of deduction under section 80-IB on its merits. The judgment clarified the procedural aspects of claiming deductions under section 80-IB and established the authority of appellate bodies to adjudicate such claims based on the available facts and legal provisions.