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TMI Blog2013 (4) TMI 737X X X X Extracts X X X X X X X X Extracts X X X X ..... rder of CIT(A) allowing the claim sustained. Recurring Expenditure - replacement of certain machinery - Revenue Expenditure u/s 35(1)(i) - A.O. treated the cost of replacement of certain machinery in its spinning mill, as capital expenditure. Out of the said amount, the Commissioner of Income Tax (Appeals) allowed Rs. 4,23,588/- representing the cost of multi drum filter as revenue expenditure stating that these filters have to be constantly replaced on account of deterioration in filtering capacity. Revenue filed an appeal. HELD THAT: - A.O. is directed to allow the cost of replacement of multi drum filter as revenue expenditure. Revenue Appeal Dismissed. X X X X Extracts X X X X X X X X Extracts X X X X ..... Income Tax (Appeals) that the assessee filed a manual revised return again in the course of assessment proceedings on 20.12.2010 revising its claim made under section 80IA to ₹ 1,79,79,298/-. It was the submission of the assessee that since it had filed revised return on 31.3.2010 within the time allowed under section 139(5) its claim under section 80IA is to be allowed. The Commissioner of Income Tax (Appeals) considering the submissions of the assessee held that the assessee is entitled for deduction under section 80IA against which the Department is in appeal. 3. The Departmental Representative submitted that as seen from the assessment order, the assessee has filed revised return only on 15.12.2010 claiming deduction under section 80IA and this return is non-est, since it was filed beyond the time limit prescribed under section 139(1) or 139(5) of the Act. The Departmental Representative submits that the assessee should have filed revised return latest by 31.3.2010 as per the provisions of section 139(5) for claiming deduction under section 80IA when a valid return was filed ITA No.1214/Mds/2012 within due date i.e. prescribed under section 139(1). Here, the assessee th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erused the orders of lower authorities. Here the claim of the assessee under section 80IA was denied by the Assessing Officer on the ground that the assessee claimed deduction under section 80IA in the revised return filed manually in the course of assessment proceedings on 15.12.2010 which is beyond the due date specified under section 139(5). The contention of the Assessing Officer was that since the assessee could not file a revised return under section 139(5) claiming deduction under section 80IA within the due date specified i.e. 31.3.2010, the assessee is not entitled for deduction under section 80IA of the Act. The Assessing Officer treated the revised return filed on 15.12.2010 during the course of assessment proceedings as a non-est return. The Assessing Officer acted upon the revised return filed by the assessee on 16.09.2009 declaring income at ₹ 4,66,67,253/-. This is the only reason given by the Assessing Officer for not allowing the claim of the assessee for deduction under section 80IA. However, the Commissioner of Income Tax (Appeals) allowed the claim of the assessee on the ground that assessee had filed a revised return on 31.3.2010 as per the provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; no good reason to justify curtailment of the power of the Appellate ACIT in entertaining an additional ground raised by the assessee in seeking modification of the order of assessment passed by the Income Tax Officer. This court further observed that there may be several factors justifying the raising of a new plea in an appeal and each case has to be considered on its own facts. The Appellate ACIT must be satisfied that the ground raised was bono fide and that the same could not have been raised earlier for good reasons". 15. The appellant revised the claim of deduction u/s 80lA following the decision of the Jurisdictional High Court in the case of M/s. Velayuthaswamy Spinning Mills reported in 234 CTR 368. The Managing Director of the Company submitted that since the copy of the judgment was secured only in the month of May 2010 and since they were not clear about the method of calculation u/s 80lA, there was some confusion and so they filed the claim before the Assessing Officer on 20.12.2010 in the form of a manual revised return. Since the facts of the claim of the appellant are on record before the Assessing Officer at the time of completion of assessment, following t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Spinning Mills Ltd. (supra). It appears that the assessee has recomputed its claim under section 80IA at ₹ 1,79,79,298/- based on the said decision. But it is not a fresh claim made by the assessee in the course of assessment proceedings by filing a revised return. The revised return was already filed on 31.3.2010 under section 139(5) claiming deduction under section 80IA of the Act at ₹ 37,27,928/- which was not claimed in the original return filed by the assessee on 29.9.2008 within the due date specified under section 139(1) of the Act. In such circumstances, we find no good reason to interfere with the order of the Commissioner of Income Tax (Appeals) in allowing the claim of the assessee under section 80IA of the Act because the claim made by the assessee is in time and is in accordance with law. 7. With regard to the submission of the Departmental Representative that in view of the provisions of section 80AC, unless the assessee files return under section 139(1) claiming deduction under section 80IA, such claim is not allowable, we are not inclined to accept this view for the following reasons:- 8. We reproduce the provisions of section 80AC for better understa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of section 80AC of the Act by filing its original return on 29.9.2008 which is within the due date specified under section 139(1) of the Act. In view of our above observations, the submission of the Departmental Representative that since the assessee had not made any claim in its original return filed under section 139(1), no deduction is allowable under section 80IA of the Act, in view of the provisions of section 80AC, has no force. In the circumstances, we sustain the order of the Commissioner of Income Tax (Appeals) in allowing the claim of the assessee under section 80IA of the Act. 11. The last issue in the grounds of appeal of the Revenue is that the Commissioner of Income Tax (Appeals) erred in allowing the claim of the assessee for replacement of cost of multi drum filters of ₹ 4,23,588/- as revenue expenditure. As stated above, the Assessing Officer while completing the assessment disallowed ₹ 2,32,54,110 /- representing the cost of replacement of certain machinery in its spinning mill, treating it as capital expenditure. Out of the said amount, the Commissioner of Income Tax (Appeals) allowedRs. 4,23,588/- representing the cost of multi drum filter as reven ..... X X X X Extracts X X X X X X X X Extracts X X X X
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