2017 (4) TMI 923 - HC - Income Tax

Claim of deduction u/s 80IA - Tribunal not allowing the appellant to raise additional ground in appeal - Held that - The claim for deduction under Section 80IA of the Act was not made before the Assessing Officer or the CIT(A) but was made for the first time only before the Tribunal nor was there any evidence in support of the claim for the subject assessment year on record. Thus it stands covered by the above decision in Gurjargravures Pvt. Ltd. (1977 (11) TMI 1 - SUPREME Court). The aforesaid decision of the Apex Court was subject matter of consideration in Jute Corporation of India Ltd.(1990 (9) TMI 6 - SUPREME Court ) wherein the Court while distinguishing Gurjargravures Pvt. Ltd. (supra) held that the additional ground could also be raised before the appellate Authority if such ground could not have been raised at the earlier stage i.e. when the return of income was filed. This is only when the assessee is able to satisfy the appellate Authority that the ground now raised was bona fide and the same could not have been raised earlier for good reasons. - In such cases, the raising of additional ground could be allowed. In this case, there is nothing on record to indicate as to what was the reason which prevented the appellant assessee from raising a claim for deduction under Section 80IA of the Act for subject assessment year during the proceedings before the Assessing Officer and the CIT(A). Therefore, in the above facts , the view taken by the Tribunal in not allowing the appellant to raise additional ground in appeal is correct. Where only a pure question of law arises from facts which are already on record, then there is no reason why the appellate authority should not consider the question of law so as to determine the correct tax liability of an assessee in accordance with law. However, where evidence is to be examined and that is not on record, then it will be considered only if the parties seeking to raise the additional ground satisfies the authority concerned that for good and sufficient reasons, the ground could not be raised before the lower authorities. In the present facts, no such ground has been made out by the assessee before the Tribunal. In the present facts, as pointed out above and being reiterated once more, the additional ground, which is raised, is not a pure question of law, but would depend upon the satisfaction of the authority as to the facts existing in the subject assessment year for allowing the benefit of Section 80IA of the Act. - Decided in favour of the respondent revenue and against the appellant assessee.

Summary

Issues Involved:
1. Refusal to admit additional ground for deduction under Section 80IA of the Income Tax Act.
2. Admissibility of evidence for subsequent assessment years for claims in earlier years.
3. Compliance with procedural requirements under Section 80IA(7) and Rule 18BBB(3).

Detailed Analysis:

1. Refusal to Admit Additional Ground for Deduction under Section 80IA:
The appellant assessee sought to introduce an additional ground for claiming deduction under Section 80IA for the operation and maintenance of a jetty/port, which was not raised before the Assessing Officer or the Commissioner of Income Tax (Appeals) [CIT(A)]. The Tribunal refused to admit this additional ground, citing that the relevant facts for the assessment year 2008-09 were not on record. The Tribunal relied on the Supreme Court's decision in National Thermal Power Co. Ltd. (NTPC Ltd.) Vs. Commissioner of Income Tax, 229 ITR 383, which held that additional grounds could only be admitted if the evidence is already on record.

2. Admissibility of Evidence for Subsequent Assessment Years:
The appellant argued that since the deduction under Section 80IA was allowed for the subsequent assessment year 2009-10, the same should apply retrospectively to the assessment year 2008-09. However, the Tribunal and the High Court held that each assessment year is separate, and the conditions for claiming deductions must be satisfied for each specific year. The evidence for the subsequent year cannot be used to infer eligibility for an earlier year. The court highlighted that the necessary Form 10CCB, which is required to claim the deduction, was not filed for the assessment year 2008-09.

3. Compliance with Procedural Requirements under Section 80IA(7) and Rule 18BBB(3):
The court emphasized that for a deduction under Section 80IA to be valid, the assessee must comply with procedural requirements, including the submission of an audit report in Form 10CCB along with the Return of Income. This form contains detailed information necessary for the claim, such as the initial assessment year and the nature of activities related to the infrastructure facility. The appellant did not submit Form 10CCB for the assessment year 2008-09, which was a critical omission. The court noted that the mere existence of a jetty/port does not automatically qualify for the deduction; compliance with statutory requirements is mandatory.

Conclusion:
The High Court upheld the Tribunal's decision, affirming that the additional ground for the deduction under Section 80IA could not be admitted due to the lack of evidence on record for the assessment year 2008-09. The court reiterated the principle that each assessment year is distinct and compliance with procedural requirements is crucial for claiming deductions. The appeal was disposed of in favor of the respondent-revenue, with the substantial question of law answered in the negative against the appellant-assessee.