TMI Blog2018 (2) TMI 1993X X X X Extracts X X X X X X X X Extracts X X X X ..... I 1 - SUPREME COURT ] hold that the assessee has to be permitted to agitate the ground which renders the escaped income as non-taxable. We held that it is open to the assessee to put forth claim for non taxability of the escaped income in view of Section 10A of the Act, while respectfully following the decision of Hon ble jurisdictional High Court in Regency Creations Ltd. [ 2012 (9) TMI 627 - DELHI HIGH COURT ] and Valiant Communications Ltd [ 2013 (1) TMI 1006 - DELHI HIGH COURT ] we deem it just and proper to direct the learned AO to examine the claim of the assessee for deduction u/s 10A of the Act by affording an opportunity to the assessee. Appeal of the assessee is allowed for statistical purpose - ITA No.5473/Del/2016, Stay Application No.109/Del of 2018 (In ITA No.5473/Del/2016) - - - Dated:- 27-2-2018 - SHRI G.D. AGRAWAL, HON BLE PRESIDENT AND SHRI K.NARASIMHA CHARY, JUDICIAL MEMBER For the Assessee : Shri Ajay Vohra, Senior Advocate, Ms Deepika Agarwal, Advocate For the Department : Shri S.S. Rana, CIT DR ORDER PER K.NARASIMHA CHARY, JUDICIAL MEMBER Challenging the order dated 22.8.2016 in Appeal No.480/14-15/69/15-16 passed by the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disposing the stay application, while keeping the appeal pending, because the discussion on the merits of these two proceedings would be same and overlapping. Learned counsel on either side agreed for the same and argued the matter on merits of the appeal. Hence the Stay application has become infructuous. We, therefore, proceed to dispose of these two matters by way of this common order. 5. It is the argument of the learned AR that the claim u/s 10B of the Act in the original return that was filed u/s 139(1) of the Act well within time was accepted by not choosing the case for scrutiny and allowing it to be processed u/s 143(1) of the Act. However, when the asesssment was sought to be reopened, the learned AO was under legal obligation to issue notice u/s 148 of the Act affording an opportunity to the assessee to file the return of income and for all practical purposes, the return so filed is the return u/s 139(1) of the Act and all other provisions of the Act would be applicable accordingly. He, therefore, submits that when once the claim u/s 10A of the Act was preferred in the return so filed in response to Section 148 of the Act, learned AO has to adjudicate the claim u/s 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iso to Section 10Aof the Act, as such they are not applicable to the case of the assessee. Further, issuance of notice u/s 148 of the Act was not involved in the decisions relied upon by the assessee and in such cases the alternative claim was made during the assessment proceedings. He, therefore, submitted that inasmuch as no claim was made u/s 10A of the Act in the original return and no revised return was filed before the due date specified under law, in view of Section 80A(5) and proviso to Section 10A of the Act, the claim of the assessee for direction u/s 10A of the Act could be countenanced. 9. We have carefully gone through the record in the light of the submissions made on either side. In this case, the claim u/s 10B of the Act made in the original return of income was accepted. However, subsequently, learned AO opined that for want of approval of the authority u/s 14 of the IDR Act and not that of the STPI authority, allowing deduction/exemption u/s 10B of the Act was bad and for such purpose he issued notice u/s 148 of the Act, in response to which the assessee filed a return of income on 1.5.2014 preferring claim u/s 10A of the Act. Both the learned AR and learned DR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of items not claimed in the original assessment proceedings, unless relatable to 'escaped income', and reagitate the concluded matters. Even in cases where the claims of the assessee during the course of reassessment proceedings relating to the escaped assessment are accepted, still the allowance of such claims has to be limited to the extent to which they reduce the income to that originally assessed. The income for purposes of 'reassessment' cannot be reduced beyond the income originally assessed. 11. From the above it is clear that in the reassessment proceeding for bringing to tax items which had escaped assessment, it would be open to an assessee to put forward claims for non taxability of the same. Since in this matter the amount sought to be brought under tax by reassessment proceedings is the same amount which the assessee claims non taxable u/s 10A of the Act, we hold that the assessee cannot be prevented from contending the amount which was originally allowed to be deductible u/s 10B is also deductible u/s 10A of the Act. There is no dispute that the agitation in this matter relates to the item sought to be taxed as escaped income. We, while respectfu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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