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2020 (8) TMI 512 - AT - Income TaxCarry forward of MAT credit - Claim carried forward not been granted to the assessee on the plea that assessee has not claimed it in the return of income - HELD THAT - According to us the Ld. CIT(A) erred in dismissing the appeal of the assessee citing that the issue i.e. carry forward of MAT credit is debatable. In the light of the Hon ble Supreme court decision as well as the decision of the Tribunal cited we are of the opinion that carry forward of MAT credit ought to have been done automatically. Even though the Hon ble Supreme court in Goetz (India) Ltd. 2006 (3) TMI 75 - SUPREME COURT held that the AO is not competent to grant any claim without the assessee claiming it in its return of income u/s. 139(1) of the Act has specifically clarified that the embargo on the power of AO not to entertain claims which was not claimed by assessee while filing of return u/s 139(1) of the Act, is not there for the appellate authorities. Therefore, we admit the claim of the assessee regarding the claim of carry forward of MAT credit for AY 2015-16 and restore this issue back to the file of the AO so that the AO can verify the claim of the assessee and if found to be correct i.e. claim for carry forward MAT credit then the AO should allow the claim of the assessee in accordance to law. Needless to say the assessee should be given opportunity of being heard. Appeal of assessee is allowed for statistical purpose.
Issues:
Claim for MAT credit not granted due to failure to claim in return of income for AY 2015-16. Analysis: The appellant filed an appeal against the order of Ld. CIT(A)-2, Kolkata for AY 2015-16, regarding the non-granting of MAT credit carried forward from AY 2013-14. The appellant contended that the MAT credit of &8377; 8,70,241/- was not allowed as it was not claimed in the return of income. The AO denied rectification under section 154, citing the requirement of the claim in the return. The Ld. CIT(A) upheld the AO's decision, deeming the issue debatable. The appellant referred to a similar case where the Tribunal clarified that MAT credit is not debatable and should be granted automatically. The Tribunal analyzed the provisions of section 115JAA and relevant case laws, emphasizing that the entitlement to MAT credit is not dependent on the AO's determination but on the conditions specified in the Act. The Tribunal rejected the argument that MAT credit is optional, stating that it should be granted automatically against the tax liability. Referring to the Supreme Court decision in CIT Vs. Tulsyan NEC Ltd., the Tribunal highlighted that the right to claim set off arises from payment of tax under section 115JA(1), irrespective of the AO's actions. Considering the legal precedents and the specific provisions of the Act, the Tribunal concluded that the Ld. CIT(A) erred in dismissing the appeal based on the debatable nature of the issue. The Tribunal held that the carry forward of MAT credit should have been automatic, and the AO must verify and allow the claim if found correct. The Tribunal clarified that the power of appellate authorities to entertain claims not filed in the return under section 139(1) is not restricted as in the case of the AO. Therefore, the Tribunal admitted the appellant's claim for carry forward of MAT credit for AY 2015-16 and remanded the issue back to the AO for verification and appropriate action in accordance with the law. In conclusion, the Tribunal allowed the appeal of the assessee for statistical purposes, directing the AO to verify and grant the claim for carry forward of MAT credit. The appellant was to be given an opportunity to be heard in the process.
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