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2018 (7) TMI 1461 - AT - Income TaxAssessment u/s 153A - Held that:- Referring to extracted provisions of section 153A that pending assessments on the date of search shall get abated. As mentioned elsewhere, since the period of limitation for issuing notice u/s 143(2) of the Act did not expire, the revised return filed on 31.03.2006 did not attain finality and has to be considered as pending assessment which got abated. This means that the return filed pursuant to notice u/s 153A of the Act has to be considered as a fresh return and the assessee is free to return income as per provisions of law and the same has nothing to do with any income returned previously u/s 139 of the Act. This means that the assessee is free to claim any new deduction which he is legally entitled for and compute its taxable income accordingly. To this extent, the action of the lower authorities is unlawful and is accordingly set aside. Deduction u/s 80IC - Exclusion of income received on account of licence fees from the deduction earlier claimed u/s 80IC along with the exclusion of the expenditure claimed on account of foreign exchange fluctuation loss, tours and travelling expenses, deprecation as intangible assets and administrative expenses - Held that:- AO did not allow claim of netting off of sub licence fees because the assessee in its return filed u/s 139 had shown the licence fees received from the two parties mentioned elsewhere on gross basis. AO did not allow the claim of royalty payment to Shri Ashok Chaturvedi since in the profit and loss account filed with the return of income u/s 139 of the Act the assessee had claimed ₹ 2,90,57,352/- which was debited to the profit and loss account. We find that the AO is simply carried away by treating the return filed u/ss 139 and 153A of the Act as separate returns for deciding the claim of the assessee. Since the return filed before the date of search did not attain finality, return filed u/s 153A of the Act has to be treated as having been filed for the first time and claim of deduction has to be considered only and only on the basis of income computed for filing return u/s 153A of the Act. The action of the AO/CIT(A) is not only erroneous but also against the relevant provisions of the law. - Decided in favour of assessee
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