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TMI Blog2017 (6) TMI 604X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 of Goetze India Ltd., reported in 284 ITR page 323 ? 3. In order to adjudicate upon the present appeal, the following broad facts need to be noticed: 3.1. The respondent, i.e. the assessee company, had filed its return of income for the Assessment Year (AY) 2011-12 on 30.09.2011. By virtue of the said return, the assessee company had disclosed a total income of Rs. 3,63,39,110/-, after claiming deduction under Chapter VI-A, equivalent to a sum of Rs. 6,19,525/-. The return filed by the assessee company was processed under section 143(1) of the Act on 16.02.2012. Thereafter, as it appears, the assessee company s return was picked up for scrutiny and a notice under section 143(2) of the Act was issued to it. Finally, after due opportunity was given to the assessee company, an assessment order was passed under section 143(3) of the Act, whereby, the income, as returned by the assessee company, was accepted. 3.2. It appears, that the assessee company had not made a claim in the return ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal, 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 Revenue, broadly made the following submissions: i.Since, the assessee company had not made a claim for deduction under Section 80IB (10) of the Act either in the return as originally filed or, by filing a revised return, it could not be permitted in law to claim the said deduction; ii.The Tribunal had erred in law in directing the Assessing Officer to consider the claim afresh preferred by the assessee company under Section 80IB (10) of the Act, given the circumstance that no such claim had been made by the assessee company either in the return as originally filed or, via a revised return or, even by preferring a petition under Section 264 of the Act; 5. 1. In support of the aforesaid submissions, Mr.Ravi relied upon the following judgments: a)GOETZE (India) Ltd. vs. CIT, (2006) 284 ITR 323 b)A Division Bench judgment of this Court, dated 16.06.2011, passed in T.C.(A) No.344 of 2005, titled CIT vs. M/s.Shriram Investments c)CIT vs. Stepwell Industries Ltd., (1997) 228 ITR 171 d)ACIT vs. Gurjargrav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e have heard the learned counsel for the parties and perused the record. 9. According to us, what clearly emerges upon perusal of the record and, in particular, the impugned judgment and order of the Tribunal, is as follows: i.That, in the original return as filed by the assessee company, no claim for deduction under Section 80 IB (10) of the Act had been made. ii.That the assessee company, as observed in paragraph 3 of the impugned judgment and order of the Tribunal, had made a claim for deduction under Section 80 IB (10) of the Act at the stage, when, the assessment proceedings were on. At that point in time, details with regard to the project, qua which, claim was made, were filed along with requisite information, in the prescribed format, i.e., Form 10CCB. iii.The CIT (A), even while recognizing the fact that the claim made by the assessee company for deduction under Section 80 IB (10) of the Act had been allowed both in the preceding and succeeding years, rejected the same, solely, on the ground that it did not form part of the original return. 10. Having regard to the aforesaid facts, what is required to be considered is : whether the conclusion reached by the Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h obtained in the said case are as follows: 12.1. The assessee, in that case, had available with it surplus funds, which it chose to deposit with banks on a short term basis. Qua the said short term deposits, the assessee earned interest during the relevant previous year amounting to Rs. 22,84,994/-. The said interest was offered for levy tax by the assessee, based on which, assessment proceedings were completed. The assessee, however, challenged the assessment order before the CIT (A) qua grounds other than the inclusion of the interest earned on short term deposits in the total income. Consequently, this aspect of the matter was not considered by the CIT (A). The assessee, however, carried the matter in appeal to the Tribunal. The appeal, as originally filed with the Tribunal, did not object to the inclusion of interest in the sum of Rs. 22,84,994/-. The assessee, however, as indicated above, for the first time, by way of a letter dated 16.07.1983, raised additional grounds, whereby, a challenge was laid to the inclusion of interest in the total income. The basis of the challenge was that, since, the sum of Rs. 22,84,994/- had been deducted from the expenditure incurred during c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Appellate Assistant Commissioner must be satisfied that the ground raised was bona fide and that the same could not have been raised earlier for good reasons. The Appellate Assistant Commissioner should exercise his discretion in permitting or not permitting the assessee to raise an additional ground in accordance with law and reason. The same observations would apply to appeals before the Tribunal also. The view that the Tribunal is confined only to issues arising out of the appeal before the Commissioner of Income-tax (Appeals) takes too narrow a view of the powers of the Appellate Tribunal (vide, e.g., CIT v. Anand Prasad (1981) 128 ITR 388 (Delhi), CIT v. Karamchand Premchand P. Ltd. (1969) 74 ITR 254 (Guj) and CIT v. Cellulose Products of India Ltd. (1985) 151 ITR 499 (Guj) (FB). Undoubtedly, the Tribunal will have the discretion to allow or not allow a new ground to be raised. But where the Tribunal is only required to consider a question of law arising from the facts which are on record in the assessment proceedings we fail to see why such a question should not be allowed to be raised when it is necessary to consider that question in order to correctly assess the tax lia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der the provisions of the Bengal Raw Jute Taxation Act, 1941, as it entertained a belief that it was not liable to pay purchase tax under that Act. Subsequently, the appellant was assessed to purchase tax and the order of assessment was received by it on 23rd November, 1973. The appellant challenged the same and obtained a stay order. The appellant also filed an appeal from the assessment order under the Income Tax Act. It was only during the hearing of the appeal that the assessee claimed an additional deduction in respect of its liability to purchase tax. The Appellate Assistant Commissioner (AAC) permitted it to raise the claim and allowed the deduction. The Tribunal held that the AAC had no jurisdiction to entertain the additional ground or to grant relief on a ground which had not been raised before the Income Tax Officer. The Tribunal also refused the appellant's application for making a reference to the High Court. The High Court upheld the decision of the Tribunal and refused to call for a statement of case. It is in these circumstances that the appellant filed the appeal before the Supreme Court. 15.The Supreme Court held as under (page 693) :- ''In CIT v. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is also entitled to raise additional claims before them. The appellate authorities have the discretion whether or not to permit such additional claims to be raised. It cannot, however, be said that they have no jurisdiction to consider the same. They have the jurisdiction to entertain the new claim. That they may choose not to exercise their jurisdiction in a given case is another matter. The exercise of discretion is entirely different from the existence of jurisdiction. 16. At page 694, after referring to certain observations of the Supreme Court in Additional Commissioner of Income-tax v. Gurjargravures P. Ltd., (1978) 111 ITR 1, the Supreme Court observed at Page 694 as under :- "The above observations do not rule out a case for raising an additional ground before the Appellate Assistant Commissioner 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, or that the ground became available on account of change of circumstances or law. There may be several factors justifying raising of such new plea in appeal, and each case has to be considered on its own facts. If the Appellate Assistant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l ground and not make a new claim or additional claim is not sustainable. As indicated by us hereinabove, this power of entertaining the claim vests with the appellate authorities based on the facts and circumstances of the case. The power of the appellate authorities to consider claims made based on material already on record is co-terminus with the power of the Assessing Officer. The failure to advert to the claim in the original return or the revised return cannot denude the appellate authorities of their power to consider the claim, if, the relevant material is available on record and is otherwise tenable in law. Any other view, in our opinion, will set at naught the plenary powers of appellate authorities. 13. The judgment of the Division Bench of this Court rendered in T.C. (A) No.344 of 2005, dated 16.06.2011, titled CIT vs. M/s.Shriram Investments, which is relied upon by the learned counsel for the Revenue, is clearly distinguishable, as in that case, the assessee had sought assessment of tax by disclosing a lower taxable income, albeit, by filing a second revised return. It is in that context that the Division Bench came to the conclusion that the second revised return, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tio of the judgments cited above, in particular, the judgments rendered by the Supreme Court in GOETZE's case and National Thermal Power Co. Ltd.'s case, and those, rendered by the Division Bench of this Court in Ramco Cements Ltd. and CIT vs Malind Laboratories P. Ltd., as also the judgments of the Delhi High Court in Sam Global Securities Ltd.'s case and Jai Parabolic Springs Ltd.'s case, that, even if, the claim made by the assessee company does not form part of the original return or even the revised return, it could still be considered, if, the relevant material was available on record, either by the appellate authorities, (which includes both the CIT (A) and the Tribunal) by themselves, or on remand, by the Assessing Officer. In the instant case, the Tribunal, on perusal of the record, found that the relevant material qua the claim made by the assessee company under Section 80 IB (10) of the Act was placed on record by the assessee company during the assessment proceedings and therefore, it deemed it fit to direct its reexamination by the Assessing Officer. 18.1. In our opinion, the view taken by the Tribunal is unexceptionable and therefore, does not merit a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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