TMI Blog2018 (8) TMI 198X X X X Extracts X X X X X X X X Extracts X X X X ..... fficer, setting aside those of the first appellate authority and the Tribunal to that extent. We answer the alternate question raised by us in favour of the revenue and against the assessee. - I.T Appeal No. 96 of 2010 - - - Dated:- 30-5-2018 - MR. K. VINOD CHANDRAN AND MR ASHOK MENON, JJ. For The Appellant : Sri Jose Joseph, SC, For Income Tax For The Respondent : Sri.P. Benny Thomas, Sri.P. Gopinath, Sri.K.John Mathai And Sri.E.K.Nandakumar JUDGMENT Vinod Chandran, J We are faced with an interesting situation wherein the assessee claims a deduction as allowable, under a different provision from that claimed in the return; denied however, for reason of the proper procedure of revision of return having not been resorted to. The question of law framed by the revenue who is in appeal is re-framed as follows: When at the time of assessment, the claim for deduction made in the return is disallowed, whether the assessee is entitled to make an alternate plea by way of mere submission before the Assessing Officer, especially when the statute interdicts even a revision, as per Sub-section(5) of Section 139, after one year from the relevant assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x [1998] 229 ITR 383 was relied on to allow an identical claim. The decision of High Court of Bombay is reported in 2012 (349) ITR 336 (Commissioner of Income-Tax v. Pruthvi Brokers and Shareholders Pvt.Ltd. wherein Goetze (India) Ltd. was noticed but distinguished. The learned Counsel appearing for the assessee also contended that when the claim is allowable under Section 80G and not includable in the taxable income as per the Income- Tax Act, there can be no deduction merely for the reason of the claim having not been made before the Assessing Officer. That would lead to the assessee being pinned down to the claim of deduction made under the return; applying the principles of estoppel; which has been deprecated by the Hon'ble Supreme Court in (1965) 56 ITR 67 (Commissioner of Income-Tax v. V.MR P. Firm Muar. AIR 1986 (SC) 2111 Commissioner of Income-Tax v. Mahalekshmi Sugur Mills Ltd. , was also placed before us to urge that a claim of benefit of set off has to be applied in appropriate cases in computation of total income; even if it is not claimed by the assessee. 5. We have to first notice that the issue of Section 80G was examined by the Assessing Officer and disallowe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relevant to the subject assessment year. The Division Bench also found that even if the Assessing Officer was not entitled to grant a deduction on the basis of a mere submission made or letter communicated, the appellate authorities would be entitled to consider the claim and adjudicate it. An extract from para7 is relevant: We find well founded, Mr. Mistri's submission that even assuming that the Assessing Officer is not entitled to grant a deduction on the basis of a letter requesting an amendment to the return filed, the appellate authorities are entitled to consider the claim and to adjudicate the same 7. In Pruthvi Brokers the deduction was one claimed in the return but the quantum claimed was a mistake and it was relevant to another year. The claim raised on assessment was only to correct the quantum claimed. Likewise herein too, the claim of deduction was raised but however the provision under which the claim was allowable, as claimed in the return was not proper. Therefore a claim for deduction under a different provision under the Income-tax Act itself. The assessee also had raised the claim independently before the first appellate authority which was allo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed as an additional ground and a deduction not claimed by the assessee cannot be raised before any of the authorities unless a claim is made in the return of income or a revised return filed. The learned Counsel appearing for the assessee specifically refers to sub-section (5) of Section 139, which mandates a revised return to be filed within the expiry of one year or before the completion of the assessment which ever is earlier as the provision stood at the time of assessment. Hence there could have been no revised return filed at the time of assessment since it was after a period of one year from the date of expiry of the end of relevant assessment year. The learned Standing Counsel appearing for the Revenue per contra would alertly point out that in the assessee's own case, by [2006] 284 ITR 69 (Ker) this Court had held that an identical claim raised under Section 37 was not permissible. The judgment was delivered on 13.12.2005. The relevant assessment year in the instant case is 2004-05. The time within which a revised return had to be filed was 31.03.2006. There was no appeal filed from the decision in [2006] 284 ITR 69 (Ker). The assessee having accepted the decision d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal found that the assessee having had the benefit of the scheme, for setting off losses, the debts are deemed to be written off and the further recovery is assessable as income. The High Court held in the case of recoveries; whatever received as principal will be allowable and the interest component alone will be treated as income. As to the subsequent payments on revival of debts it was held that the interest component alone will be treated as business expenditure and the principal cannot be allowed as deduction. Agreeing with the High Court, the Hon'ble Supreme Court held so: The contention is that the assessees having opted to accept the scheme, derived benefit there under, and agreed to have their discharged debts excluded from the asset side in the balance sheet subject to the condition that subsequent recoveries by them would be taxable income, they are now precluded, on the principle of approbate and reprobate from pleading that the income they derived subsequently by realization of the revived debts is not taxable income. The doctrine of approbate and reprobate is only a species of estoppel; it applies only to the conduct of parties. As in the case of estopp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xisting in each of the countries. Hence, set-off as provided in the income-tax laws of India has to be applied even if the assessee fails to claim the same. It is to be noticed that the set-off applied went against the assessee and not in its favour insofar as the losses of the Indian Company to the said extent was set of by the dividend income which was received from the Pakistani company. The aforesaid decision has absolutely no application on facts or law to the present case. 14. On the questions of law, we are of the opinion that the Assessing Officer cannot allow a claim for deduction, afresh raised; unless there is a revised return made in accordance with the act as has been held in Goetze(India) Limited. Merely for reason that the Assessing Officer had disallowed the claim for the technical reason of the assessee having not filed a revised return, the assessee cannot be disabled from raising the very same claim before the appellate authorities as has been held in NTPC. Following NTPC it has also to be found that the necessary facts for claiming a deduction if available in the return filed; an erroneous claim on figures or even a wrong claim under a provision could be ente ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n and certificate issued to the Trust under Section 80G. The Tribunal also upheld the same. The alternate question framed by us hence assumes relevance. The Assessing Officer having declined the claim under Section 37 also considered the claim raised as a donation under Section 80G. The Assessing Officer found that it was the initial claim of the assesssee that the amount incurred by the Company was for a specific purpose; of air-conditioning of Mamman Mappilai hall. The assessee had been regularly debiting and claiming such expenses in the preceding years as business expenditure which stood disallowed by a decision of this Court. There was found to be no evidence filed to prove the expenses incurred by the Company for air-conditioning the Mamman Mappilai hall; to be a donation to the charitable trust. It is before the appellate authority copies of the receipts were produced. 18. Even if there is a payment made to a Trust, certified under Section 80G and the Trust has issued a receipt, in the totality of the facts pleaded by the assessee, we are of the opinion that it is not a donation to a charitable trust. The nominal heading of Section 80G reads as Capital deduction in respe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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