2014 (5) TMI 582 - AT - Income Tax

Allowability of claim u/s 10A of the Act Claim not made in original return - Whether the claim of the assessee regarding deduction u/s 10A is allowable if the claim was made u/s 10B in the return of income Held that - CIT(A) was of the view that the assessee did make the claim though, because of a technical error, the claim was made u/s 10B instead of 10A - quoting of wrong section should not deprive the assessee from claiming deduction so long as the other conditions for making such claim are satisfied Relying upon circular issued by the CBDT dated 11.04.1955 wherein it was observed that it is the duty of the AO to guide the assessee with regard to eligibility to claim deduction - Revenue admitted that the assessee fulfilled all the other conditions necessary for the purpose of claiming deduction u/s 10A though he has not specifically mentioned the provisions before the AO - at least before the CIT(A) all the facts are on record and they have been taken into consideration the order of the CIT(A) is upheld Decided against Revenue.

Summary

Issues:
- Allowance of claim u/s. 10A without original return or revised return
- Consideration of amendment to Section 80A(5) and Supreme Court decision in M/s. Goetze (India) Ltd.
- Eligibility of deduction under section 10A when claimed under section 10B
- Denial of deduction due to technical error in claim mentioning

Analysis:
1. The appeal concerns the Revenue's challenge against the direction of the Ld. CIT(A) to allow the assessee's claim u/s. 10A for A.Y. 2007-08 despite not being in the original return or a revised return.
2. The Revenue contended that the CIT(A) erred in not considering the amendment to Section 80A(5) and the Supreme Court decision in M/s. Goetze (India) Ltd. regarding the claim.
3. The assessee, engaged in medical transcription, claimed a deduction under section 10B instead of section 10A, leading to the AO's rejection due to lack of necessary certificate and evidence.
4. The CIT(A) observed that the AO did not question the claim during assessment and failed to guide the assessee on eligibility, directing to allow the benefit under section 10A.
5. The CIT(A) emphasized that a technical error in claiming under section 10B should not deprive the assessee of deduction if all conditions are met, citing precedents and circulars.
6. The Revenue, acknowledging the fulfillment of conditions by the assessee, did not dispute the consideration of all facts by the CIT(A) and did not challenge the admission of additional evidence.
7. The ITAT upheld the CIT(A)'s order, finding no grounds for interference, leading to the dismissal of the Revenue's appeal against allowing the deduction under section 10A for the assessee for the relevant assessment year.