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2011 (8) TMI 495 - ITAT MUMBAIAssessment of total income at a figure lower than the returned income under 153A,ignoring the fact that the assessee did not resort to the provisions of filing revised return within the prescribed time as it envisaged by the Supreme Court in the case of Goetz (India) Ltd. [2006 (3) TMI 75 -SUPREME Court] Original return on 31.10.2001 declaring loss-Search conducted on 22.03.2007-Return filed under 153A-Original return scrutnized under 143(3) AO disallowed interest expense- Assessee didnot appealed- Assessee voluntarily disallowed the disallowance of interest in return filed under153A -reserved the right to appeal. Can such interest be allowed under 153A. Held that:-A close look at the above provision manifests that the Assessing Officer is required to make assessment afresh and compute the `total income’ in respect of each of the relevant six assessment years. As there is no specific inhibition on the jurisdiction of the Assessing Officer in not including any new income to such fresh total income pursuant to search which was not added during the original assessment, in the like manner, there is no restriction on the assessee to claim any deduction which was not allowed in the original assessment.The requirement of section 153A is to compute the total income of each of such assessment years. Such determination of the total income has to be done afresh without any reference to what was done in the original assessment. Of course, the AO is entitled to make any addition in the fresh assessment, which he made in the original assessment, provided he is satisfied with the merits of the addition. But the mere fact that there was some addition in the original assessment, would not preclude the assessee from contesting the addition in the subsequent proceedings. As it is going to be a fresh exercise of framing assessment or reassessment of the total income at the end of the AO, the assessee cannot be stopped from not even arguing about the merits of his case qua the addition which was made in the original assessment. Debarring the assessee from making a claim about the deductibility of any item, which was earlier disallowed, counters the very concept of fresh assessment of total income. Conditions for taking action u/s 147 vis-à-vis under section 153A are altogether different.Therefore judgement of Sun Engineering works is not applicable in our case. The Hon’ble Supreme Court in the case of National Thermal Power Company Ltd. Vs. CIT [1996 (12) TMI 7 - SUPREME Court] - has held that the Tribunal has the jurisdiction to examine a question of law which arises from the facts as found by the authorities below and having a bearing on tax liability of the assessee notwithstanding the fact that it was not raised before the learned CIT(A). The purpose of assessment proceedings is to assess correctly the tax liability of an assessee in accordance with law. When we consider the judgement of the Hon’ble Supreme Court in Goetze (India) Ltd. in juxtaposition to National Thermal Power Company Ltd., it becomes patent that although the assessee cannot make a claim before the Assessing Officer otherwise than through the return of income, but there are no restrictions on the powers of the Tribunal to entertain such claim for examination provided the facts exists on record.The case was decided in favor of assessee.
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