2018 (10) TMI 853 - AT - Income Tax

Allowability of deduction u/s 80P - denial of claim by CIT-A solely on the ground that the assessee had not made a claim in the original or in the revised return of income - Held that - The reasoning of the CIT(A) cannot be appreciated in the light of law laid down by several High Courts wherein it was held that there is no embargo on the powers of the CIT(A) to entertain the legal claim which the assessee is entitled to. As in the case of CIT vs. Mitesh Impex 2014 (4) TMI 484 - GUJARAT HIGH COURT after referring to the judgment of the Hon ble Supreme Court in the case of National Thermal Power Co.Ltd. vs. CIT 1996 (12) TMI 7 - SUPREME COURT if a claim though available in law is not made either inadvertently or on account of erroneous belief of complex legal position, such claim cannot be shut out for all times to come, merely because it is raised for the first time before the appellate authority without resorting to revising the return before the assessing officer. Therefore, any ground, legal contention or even a claim would be permissible to be raised for the first time before the appellate authority or the Tribunal when facts necessary to examine such ground, contention or claim are already on record. In such a case the situation would be akin to allowing a pure question of law to be raised at any stage of the proceedings. This is precisely what has happened in the present case. - Appeal filed by the assessee is treated as allowed for statistical purposes.

Summary

Issues:
Allowability of deduction u/s 80P of the Income-tax Act, 1961.

Analysis:

Issue: Allowability of deduction u/s 80P

The appeal was filed by the assessee-co-operative society challenging the order of the Commissioner of Income-tax (Appeals) concerning the allowability of deduction u/s 80P of the Income-tax Act, 1961. The Commissioner had denied the claim as the assessee did not make the claim in the original or revised return of income. However, the Tribunal referred to various High Court judgments emphasizing that there is no restriction on the power of the CIT(A) to entertain a legal claim to which the assessee is entitled. Citing the case of CIT vs. Mitesh Impex, the Tribunal highlighted that the Appellate Assistant Commissioner has plenary powers in disposing of appeals and can modify the assessment order on additional grounds even if not raised before the Income-tax Officer. The Tribunal also noted that the power of the Appellate Authority is co-terminus with that of the Income-tax Officer, allowing for the consideration of additional claims. Therefore, the Tribunal remitted the issue back to the CIT(A) for fresh adjudication on the claim of the assessee-co-operative society.

In conclusion, the appeal filed by the assessee was treated as allowed for statistical purposes, and the issue was remitted back to the CIT(A) for further consideration in light of the legal principles discussed.

Order pronounced on 10th October 2018 by the Appellate Tribunal ITAT Bangalore, comprising SHRI N.V.VASUDEVAN, JUDICIAL MEMBER, and SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER.