TMI Blog2017 (6) TMI 604X X X X Extracts X X X X X X X X Extracts X X X X ..... it any interference. - Rajiv Shakdher And R. Suresh Kumar, JJ. For Appellant : Mr.T.Ravikumar For Respondent : Mr.R.Sivaraman JUDGMENT ( Judgment of the Court was delivered by Rajiv Shakdher, J.) Background facts: 1. This is an appeal preferred under Section 260A of the Income Tax Act, 1961 (in short the Act ) by the Revenue against the judgment and order dated 29.04.2016 passed by the Income Tax Appellate Tribunal (in short the Tribunal ) in I.T.A.No.281/Mds/2016. 2. In the appeal, the Revenue seeks to raise the following questions of law for our consideration: i. Whether on the facts and in the circumstances of the case, the Tribunal was right in directing the AO to consider the claim made under Section 80IB(10) even though the assessee did not make any such claim in the return of income filed ? ii. Is not the finding of the Tribunal bad by directing the AO to consider the claim afresh in respect of deduction u/s.80IB (10) especially when no such claim was made in the original return filed nor any revised return filed claiming the same nor any Petition under Section 264 filed which is against the law laid down by the Apex Court in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal. The Tribunal reversed the order of the CIT (A), after discussing the facts and case law on the subject in great detail. In sum, the Tribunal, having regard to the law cited on the subject, ruled that both the CIT (A) and itself (being the appellate authorities) had the power to consider the revised claim by the assessee company, if, it was otherwise entitled to, even though no claim qua the same had been lodged by it in the return as originally filed. Having, thus, come to the said conclusion, in the given facts and circumstances, the Tribunal remitted the matter to the Assessing Officer for fresh consideration, based on the documents already filed by the assessee company at the time of assessment. Consequently, the assessee company s appeal was partly allowed, albeit, for statistical purpose. 3.5. As is indicated above, the Revenue, being aggrieved, have preferred the present appeal before us qua the judgment and order passed by the Tribunal. Submissions of counsels: 4. In support of the appeal, arguments have been advanced by Mr.T.Ravikumar, Advocate, while the assessee company s case was argued by Mr.R.Sivaraman, Advocate. 5. Mr.Ravi, learned counsel for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal has said is that the Assessing Officer should reconsider the claim made by the assessee company for deduction under Section 80IB (10) of the Act, based on the material already placed on record at the stage, when, the assessment proceedings were on. 6.3. In support of his submissions, the learned counsel for the assessee company relied upon the following judgments: a)National Thermal Power Co. Ltd. vs. CIT, (1998) 229 ITR 383 (SC) b)A judgment of the Division Bench of this Court dated 18.11.2014, rendered in T.C. (A) No.878 of 2014, titled CIT vs. Malind Laboratories P. Ltd. c)CIT vs. Sam Global Securities Ltd., (2013) 38 taxmann.com 129 (Delhi) d)Ramco Cements Ltd. vs. DCIT, (2015) 55 taxmann.com 79 (Madras). 7. In the rejoinder, Mr.Ravikumar reiterated his submissions and further added that while it may be possible for the assessee company to raise an additional ground based on material already on record, it cannot be allowed to make a claim which does not form part of the original return or a revised return. Reasons: 8. We have heard the learned counsel for the parties and perused the record. 9. According to us, what clearly emerges upon per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cision in question is that the power of the Tribunal under S.254 of the IT Act, 1961, is to entertain for the first time a point of law provided the fact on the basis of which the issue of law can be raised before the Tribunal. The decision does not in any way relate to the power of the AO to entertain a claim for deduction otherwise than by filing a revised return. In the circumstances of the case, we dismiss the civil appeal. However, we make it clear that the issue in this case is limited to the power of the assessing authority and does not impinge on the power of the Tribunal under s.254 of the IT Act, 1961. There shall be no order as to costs.'' (Emphasis is ours) 12. To be noted, the Supreme Court, while rendering its judgment in the case of Goetze, had noticed its own judgment in National Thermal Co. Ltd. vs. CIT, (1998) 229 ITR 383 (SC). In the said case, the Supreme Court was called upon to adjudicate as to whether a claim made by way of a letter before the Tribunal for the first time could have been entertained by the Tribunal. Briefly, the facts which obtained in the said case are as follows: 12.1. The assessee, in that case, had available with it sur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tribunal. We fail to see why the Tribunal should be prevented from considering questions of law arising in assessment proceedings although not raised earlier. In the case of Jute Corporation of India Ltd. v. CIT (1991) 187 ITR 688, this court, while dealing with the powers of the Appellate Assistant Commissioner 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 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 Assistant Commissioner must be satisfied that the ground raised was bona ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the Revenue, that though, an amendment to the original return could not be made by filing a letter - it would be open to the appellate authorities to consider the claim and adjudicate upon the same. In this behalf, the Bombay High Court made the following observations: ''14. A long line of authorities establish clearly that an assessee is entitled to raise additional grounds not merely in terms of legal submissions, but also additional claims to wit claims not made in the return filed by it. It is necessary for us to refer to some of these decisions only to deal with two submissions on behalf of the department. The first is with respect to an observation of the Supreme Court in Jute Corporation of India Limited v. Commissioner of Income Tax, 1991 Supp (2) SCC 744 = (1991) 187 ITR 688. The second submission is based on a judgment of the Supreme Court in Goetze (India) Limited v. Commissioner of Income Tax, (2006) 157 Taxman 1. (A). In Jute Corporation of India Limited v. CIT, for the assessment year 1974-75 the appellant did not claim any deduction of its liability towards purchase tax under the provisions of the Bengal Raw Jute Taxation Act, 1941, as it entert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment order on an additional ground even if not raised before the Income Tax Officer. No exception could be taken to this view as the Act does not place any restriction or limitation on the exercise of appellate power. Even otherwise an Appellate Authority while hearing appeal against the order of a subordinate 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 appears to be no good reason and none was placed before us to justify curtailment of the power of the Appellate Assistant Commissioner in entertaining an additional ground raised by the assessee in seeking modification of the order of assessment passed by the Income Tax Officer. [emphasis supplied]'' (B) It is clear, therefore, that an assessee is entitled to raise not merely additional legal submissions before the appellate authorities, but is also entitled to raise additional claims before them. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er was made.... or if the ground became available on account of change of circumstances or law 18.The appellate authorities, therefore, have jurisdiction to deal not merely with additional grounds, which became available on account of change of circumstances or law, but with additional grounds which were available when the return was filed. The first part viz. if the ground so raised could not have been raised at that particular stage when the return was filed or when the assessment order was made... clearly relate to cases where the ground was available when the return was filed and the assessment order was made but could not have been raised at that stage. The words are could not have been raised and not were not in existence . Grounds which were not in existence when the return was filed or when the assessment order was made fall within the second category viz. where the ground became available on account of change of circumstances or law. (Emphasis is ours) 12.5. A reading of the aforesaid observations would clearly establish that the arguments advanced by Mr.Ravi that the assessee company could only raise an additional ground and not make a new claim or additi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad neither made a claim before the ITO nor was any material placed on record in support of the claim. The High Court, in this context, held that the Tribunal was not justified in entertaining the claim made under Section 80G of the Act and thereupon, issuing a consequent direction to the ITO to examine the same on merits. 16. 1.As would be evident from the narration of facts set out above, in the present case, the Tribunal has noted that relevant material was placed by the assessee company before the Assessing Officer during the course of the assessment proceedings. Therefore, in our view, the said judgment is also distinguishable. 17. A similar situation arose in the case of ACIT vs. Gurjargravures P. Ltd. In this case as well, it was noticed that neither was any claim made before the ITO nor was any supporting material placed on record. It is in this background that no relief was granted. The Supreme Court, in this case, disagreed with the High Court, inasmuch as it sustained the direction of the Tribunal issued to the ITO to grant appropriate relief qua claim made under Section 84 of the Act. 18. In sum, what emerges from a perusal of the ratio of the judgments cited ab ..... X X X X Extracts X X X X X X X X Extracts X X X X
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