TMI Blog2015 (11) TMI 1819X X X X Extracts X X X X X X X X Extracts X X X X ..... ct to the order of the CIT(A). It is significant to note that in the Circular issued by the Central Board of Direct Taxes No. 14 (XL35) of 1955, dated April 11, 1955 it has categorically held that the Officers of the Department must not take advantage of the ignorance of an assessee as to his rights. It is one of their duties to assist a taxpayer (assessee) in every reasonable way, particularly in the matter of claiming and securing reliefs and in this regard the officers should take the initiative in guiding a taxpayer where proceedings or other particulars before them indicate whether some refund or relief is due to the assessee, which would benefit the Department and it would inspire confidence in the assessee. In such view of the mater the Tribunal ought to have taken a wider look in allowing the claim of the assessee even if the return for the assessment year 1986-87 is belatedly filed, which would not restrict the rights of the assessee to claim the benefit of unabsorbed depreciation, investment allowance and 80J exemption. - Decided in favour of assessee. - ITA NO.801/2009 & ITAs.840-841/2009 - - - Dated:- 17-11-2015 - Mr. Vineet Saran And Mrs. S.Sujatha, JJ. Sri A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. Being aggrieved by the order dated 02.02.2005, the appellant filed a rectification application under Section 154 of the Act. After considering the said application, the Assessing Officer held that the appellant-assessee cannot claim the issue which was not in the order of CIT(A), that the Assessing Officer ought to have considered while giving effect to the appellate order. Being aggrieved by the said order, the assessee had filed an appeal before the CIT(A), Hubli. The CIT(A), Hubli, after hearing the appellant on 28.03.2007, has held that the appellant cannot seek for carrying forward the unabsorbed depreciation upto assessment year 1986-87 to the next year because it is mandatory on his part to file the loss return before the due date stipulated under Section 139(1) of the Act and it was also held that the claim of the assessee was contrary to the provisions of Section 139(4) of the Act. 3. Being aggrieved by the said order dated 28.03.2007, the assessee filed appeals before the Income Tax Appellate Tribunal (for short the ITAT), Bangalore Bench A for the Assessment Years-1987-88, 1988-89 and 1989-90. The ITAT dismissed the appeals of the appellant. Being aggrieved by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i) to contend that the effect of Section 32(2) of the Act is that unabsorbed depreciation of a year becomes part of depreciation of the subsequent year and in the case of unabsorbed depreciation there is no time limit for filing of the returns and further that under the statute there is a separate identity with respect to unabsorbed depreciation though at the time of computation, it becomes a part of loss. 6. Learned counsel also relied on the judgment of the Punjab and Haryana High Court in the case of Commissioner of Income-Tax vs- Haryana Hotels Ltd., reported in (2005) 276 ITR 521 wherein it has held thus: Similarly, there is no provision under the Act which makes it mandatory for the assessee to file return for carry forward and set off of unabsorbed depreciation which is to be notified by the Assessing Officer as in the case of unabsorbed business loss. Thus, from a reading of the provisions of the Act, the distinction between unabsorbed deprecition and unabsorbed business loss for the purposes of set off and carry forward is clear. 7. Further, learned counsel placed reliance on the judgment of Kerala High Court in the case of Parekh Brothers vs-Commissioner of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o rectify the order of the CIT(A). If the assessee was aggrieved by any order passed by the CIT in the appeal, it was appropriate for the assessee to file rectification application before the CIT(A) or otherwise to carry the matter in appeal, without having done so filing an application before the Assessing Officer to rectify the orders passed by the ITAT is unknown to law and such an action of the assessee in claiming unabsorbed depreciation would not be entertained at the belated stage more particularly, when the returns are filed for the assessment year 1986-87 belatedly. It is also contended that unless unabsorbed depreciation, investment allowance and 80J exemption claimed by the assessee is not carried forward in the subsequent years and more particularly, when the provision only provides to carry forward of the unabsorbed depreciation from the previous year. If no such depreciation is carried forward from the previous year and if there is any break in the carry forward of the depreciation, the assessee is not entitled to carry forward the depreciation for the subsequent years. Accordingly, learned counsel justifies the order passed by the Tribunal and seeks for dismissal of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion, investment allowance and 80J exemption under the Act. We are of the considered opinion that the Tribunal has proceeded hypertechnially in rejecting the claim of the assessee on the ground that rectification application was filed by the assessee before the Assessing Officer after giving effect to the order of the CIT(A). It is significant to note that in the Circular issued by the Central Board of Direct Taxes No. 14 (XL35) of 1955, dated April 11, 1955 (referred to as item 491 in Taxman's Direct Taxes Circulars, Volume I, 1977, 4th Edition), it has dealt with Administrative instructions in regard to the attitude of the Department in matters affecting the assessee's interest. It has categorically held that the Officers of the Department must not take advantage of the ignorance of an assessee as to his rights. It is one of their duties to assist a taxpayer (assessee) in every reasonable way, particularly in the matter of claiming and securing reliefs and in this regard the officers should take the initiative in guiding a taxpayer where proceedings or other particulars before them indicate whether some refund or relief is due to the assessee, which would benefit the Dep ..... X X X X Extracts X X X X X X X X Extracts X X X X
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