9911796707
TMI Blog1988 (9) TMI 107X X X X Extracts X X X X X X X X Extracts X X X X ..... Later a reassessment was made u/s. 147(b) on 20-3-1980 adding a sum of Rs. 250 claimed as donation and a sum of Rs. 1,300 being expenses incurred for a guest house to determine the total income at Rs. 3,07,040. The assessee appealed on 24-4-1980 to contend that these two additions were untenable. The assessee also filed additional grounds of appeal on 24-9-1980 claiming that the assessee was entitled to deduction under sec. 35B in respect of an expenditure of Rs. 7,69,599. The CIT (Appeals) found that the disallowance of Rs. 250 was conceded and the disallowance of Rs. 1,300 was unjustified. He also found that the assessee was entitled to weighted deduction in respect of an expenditure of Rs. 1,85,702 and accordingly granted relief. 3. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8,451.06 T.A. to staff to procure the export items to port 12,546.23 Electricity charges 1,598.20 Godown Insurance-stored for export items only 4,578.75 Advertisement charges towards publicity for export 1,746.18 Stitching charges for garments 2,815.65 Madras Yarn Merchants Association 450.00 Federation of Indian Export Organization 300.00 Money order sent to Indian Export Director 60.00 Miscellaneous Export ECGC Premium 5,719.27 Subscriptions Texprocil 1,335.00 Indian Yarn Trade Federation 150.95 Bombay Silk Rayon Textiles Export Promotion Council 750.00 Hindustan Chamber of Commerce 300.00 Tamilnadu Handloom Industry Trade Association 100.00 Czechoslovakia Government Export Inspection Charges 514.52 Rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Dr. Ravishanker Tapa v. CIT [1987] 165 ITR 81 (MP) to the effect that the reassessment is concerned only with the escapement and the decision in the case of Chettinad Corpn. (P.) Ltd. v. CIT [1984] 147 ITR 57 (Mad.) to the effect that the claims rejected in the original assessment cannot be re-agitated in the reassessment proceedings. Reliance was also placed on the decisions in the cases of S. Inder Singh Gill v. CIT [1963] 47 ITR 284 (Bom.) and Sir Shadi Lal Sons v. CIT [1973] 92 ITR 453 (All.) to contend that the reassessment was made only for the benefit of the revenue and the income originally determined cannot be varied to the benefit of the assessee. On the other hand, it was contended on behalf of the assessee that once the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pinion that we have to uphold the objection of the Revenue. No doubt, the assessee is entitled to the decision u/s. 35B as we have found above and if that deduction is granted then the income of the assessee should be determined at a figure much less than that originally assessed. However, the assessee had not made that claim in the original assessment proceedings. Again it is unfortunate that even though the information that the assessee was engaged wholly in export business and its expenditure was eligible for deduction u/s. 35B was available on record, the assessee was not advised to make such a claim. In this connection, it may be re-called that there is a circular of the CBDT issued in June 1955 instructing the officers of the Departme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e allowed to be raised again in the course of the reassessment proceedings. But if no such question was raised in the original assessment proceeding, then there could be no prohibition against the assessee raising such a question relating to computation of the amount of tax payable by him at the time of reassessment. But the facts of that case show that the question which was raised in the reassessment proceedings related to the claim for deduction of the expenditure in respect of the escaped income. In the present case, however, we are concerned with the deduction which has nothing to do with the escaped income which was sought to be taxed in the reassessment proceedings. Moreover, the claim which has been abandoned cannot be a better clai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pinion, is sufficient to uphold the objection of the Revenue. The CIT (Appeals) has proceeded on the basis that the Income-tax Act is in pari materia with the Sales-tax Act and has, therefore, followed the decision of the Madras High Court in Indian Refrigeration Industries (P.) Ltd.'s case. But that Act does not contain any provision similar to sec. 152(2) which makes quite a difference to the situation. In the circumstances, we have to reverse the order of the CIT (Appeals) and reject the claim of the assessee for deduction u/s. 35B. Therefore, the order of the CIT (Appeals) in all other respects is confirmed. 8. In the result, the appeal of the assessee is dismissed and the appeal of the Revenue is allowed. - - TaxTMI - TMITax - In ..... X X X X Extracts X X X X X X X X Extracts X X X X
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