TMI Blog2014 (6) TMI 291X X X X Extracts X X X X X X X X Extracts X X X X ..... hin due date and the assessee clearly shows that the claim was duly made but the section was inadvertently wrongly mentioned and the fact came to the notice of the assessee at a later point of time when pointed out by the AO - the purpose of the assessment proceedings before the taxing authorities was to assess the income correctly and the tax liability of an assessee in accordance with law. The CIT(A) had plenary power in disposing of an appeal - The scope of his power was co-terminus with that of the ITO - In the absence of any statutory provision, the appellate authority was vested with all the plenary powers which the subordinate authority might have in the matter - as the assessee has filed a revised computation, it holds good as except the change of section from 80-IB to 10B, all other supporting material remained the same including the audit report claiming exemption – Relying upon CIT v. Prabhu Steel Industries P. Ltd. [1987 (1) TMI 17 - BOMBAY High Court] - where a claim for special deduction was made by the assessee not in his return but in the course of the assessment proceedings and the AO failed to consider the same, it was open to the appellate authority to enterta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been fulfilled of a claim under section 10B and even in the past years, the claim was being regularly allowed. 3. A detailed explanation appears to have been filed by the assessee before the Assessing Officer (for short, the AO ) mentioning about the facts and also requesting the Assessing Officer to consider the mistake and in the alternative the letter may be treated as a revised return and, accordingly, the claim, which is otherwise allowable under section 10B, may be allowed instead of wrong deduction under section 80-IB. 4. However, the Assessing Officer was not satisfied with the explanation and, according to him, strict compliance with the Income-tax Act is required to be made. According to the Assessing Officer, section 80A(5) is very clear that if the claim under section 10B has not been made in the return of income, then deduction cannot be allowed. However, he was of the opinion that if the assessee wanted to claim the deduction, he ought to have filed a regular revised return and the assessee having not done so, the claim was held to be disallowed and, accordingly, the Assessing Officer disallowed the claim to the extent of Rs. 46,17,406. The Assessing Officer a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r conditions will come only once the question of granting exemption under section 10B is settled. He further contended that if the assessee had been allowed deduction in the past, it will not make any difference as the exemption is to be allowed on the facts of the particular year and on year to year basis. He strongly relied upon the judgment rendered in the case of Goetze (India) Ltd. (supra) and submitted that substantial question of law emerges out of the order of the Income-tax Appellate Tribunal and needs consideration of this court. 8. We have heard learned counsel for the Revenue and gone through the orders passed by the authorities below. 9. It would be fruitful to quote section 80A(5) of the Income-tax Act, which provides as under : 80A. (1) '' '' '' '' '' '' '' (2) '' '' '' '' '' '' '' '' (3) '' '' '' '' '' '' '' '' (4) '' '' '' '' '' '' '' '' (5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... do not see any reason to restrict the power of the Tribunal under section 254 only to decide the grounds which arise from the order of the Commissioner of Income-tax (Appeals). Both the assessees as well as the Department have a right to file an appeal/cross-objections before the Tribunal. We fail to see why the Tribunal should be prevented from considering questions of law arising in assessment proceedings although not raised earlier'. 13. In the case of Jute Corporation of India Ltd. v. CIT [1991] 187 ITR 688 (SC), while dealing with the powers of the Appellate Assistant Commissioner, the Supreme Court observed that : An appellate authority has all the powers which the original authority may have in deciding the question before it subject to the restrictions or limitations, if any, prescribed by the statutory provisions. In the absence of any statutory provision, the appellate authority is vested with all the plenary powers which the subordinate authority may have in the matter. There is no good reason to justify curtailment of the power of the Appellate Assistant Commissioner in entertaining an additional ground raised by the assessee in seeking modificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion right from the assessment year 2004-05 under section 10B. It may be that the claim is to be allowed on year to year basis but when the facts and circumstances reveal that the assessee was eligible even this year for exemption under section 10B and it has been found to be in order except that instead of mentioning the exemption under section 10B, while e-filing the return of the income-tax, it was wrongly, on account of typographical error, mentioned as section 80-IB, in our view, it cannot be said to be such a mistake by which the exemption could be disallowed outrightly. It was already stated by the assessee during the course of hearing before the Assessing Officer himself that it complies with all the requirements for claim of exemption under section 10B. The assessee-company was under the bona fide belief that there was no mistake in the return, hence no revised return was filed but after knowing the clerical/computerized mistake that the claim was wrongly mentioned as under section 80-IB instead of section 10B, the assessee-company filed a revised computation of income claiming deduction under section 10B of the Income-tax Act, vide letter dated December 13, 2010, before th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s wrongly claimed and that one may claim the exemption under the concerned section. It is also an admitted position that substantial manufacturing activities were being carried out by the assessee within the bonded premises in terms of CBEC Circular No. 65 of 2002-Cus, dated October 7, 2002, and Notification No. 52 of 2003-Cus, dated March 31, 2003. In our view, the allegation of the Assessing Officer was totally unfounded as all the documents, which are issued by the Government authorities, could not have been predated or fabricated by the assessee and, in our view, the allegation of the Assessing Officer that the claim could be in the nature of an afterthought is not correct. 17. We may also observe that the Commissioner of Income-tax (Appeals) had plenary power in disposing of an appeal. The scope of his power was co-terminus with that of the Income-tax Officer. He could do what the Income-tax Officer could do and also direct him to do what he had failed to do. It has been held by the authorities of the hon'ble apex court (supra) that the above observations are squarely applicable and the interpretation of section 251(1)(a) of the Act. The declaration of law was clear tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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