2022 (11) TMI 313 - AT - Income Tax
Additional grounds in terms of additional claims not made in return filed - Set-off of brought forward business losses of previous year as against income of next assessment year - assessee does not claim the same in the return of income - HELD THAT:- In our considered view, even though the assessing officer may not be permitted to allow the assessee’s legitimate claim for set-off of brought forward business losses, in the event the assessee does not claim the same in the return of income, however, the appellate authorities are vested with the authority to allow such claim of the assessee, in case the same is tenable in law.
In the case of Pruthvi Brokers & Shareholders [2012 (7) TMI 158 - BOMBAY HIGH COURT]held that an assessee is entitled to raise before appellate authorities additional grounds in terms of additional claims not made in return filed by it.
The Karnataka High Court in the case of Karnataka State Co-operative Federation Ltd.[2021 (3) TMI 694 - KARNATAKA HIGH COURT] held that assessee's fresh claim before appellate authority is entertainable even when same is not claimed in original return of income nor assessee has filed revised return of income to make such claim. The Bombay High Court in the case of B. G. Shirke Construction Technology (P.) Ltd.[2017 (3) TMI 879 - BOMBAY HIGH COURT]has held that an assessee is entitled to make a claim before Tribunal which was not raised before Assessing Officer at time of filing return of income or by filing a revised return of income.
In view of the consistent position taken by the various Courts on this issue, in the interest of justice, we are restoring the file to the AO with the direction to verify the assessee’s claim of set-off of brought forward business losses of assessment year 2016-17 against income of assessment year 2017-18, and if the claim is legally tenable, to allow for such set-off. Appeal of the assessee is allowed.