TMI Blog2022 (10) TMI 226X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to be part of the returns of an assessee and the assessee has replied in detail to the query putting forth all the information about the transaction along with documents as to how no capital gain had arisen then it can not be a case that assessee had made claim beyond his return. Assessment is not only of the income but also involves considering claim of the exemption or deduction which flow with the assessee s income. CIT(A) was very much in powers to consider the claim of the assessee which was left half way by the Ld. AO. Then, upon going through order of ld. CIT(A) it can be observed that Ld. CIT(A) has meticulously examined the claim of deduction u/s 54 of the Act in terms of eligibility and quantum. He specifically dealt with question if the sale proceeds can be used for purchasing property in Dubai and has rightly relied the judgment quoted by Ld. Sr. Counsel before this Bench wherein it was held that prior to amendment brought by Finance Act No. 2, 2014 the benefit of exemption is available even if the house is purchased / constructed outside India. As examined the evidence on record which established that assessee purchased the residential plot in the name of him ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ide note sheet entry dated 05.12.2016 asked the assessee to reply as to why sale consideration of Rs. 25,75,00,000/- as shown in 26AS was not shown in ITR and why no income was offered as capital gains. Assessee replied to the same submitting that the transaction of sale of property was inadvertently overlooked by the Accountant of the Assessee while filing the Income Tax Return and similarly the details of exemptions were also not disclosed inadvertently. However, since the Assessee has fulfilled all the conditions of exemption and the defect being only procedural in nature, it was submitted that the claim of exemption may kindly be granted. Similarly the Assessee claimed to be allowed credit of TDS of Rs 25,75,000/- as it was missed erroneously although it was deposited to government treasury under PAN of the Assessee and disclosed /reported in his Form 26 AS. 2.2 Thereafter vide note sheet entry dated 23.12.2016 assessee was asked to show cause as to why deduction u/s 54 not be disallowed as not only he has failed to show the relevant sale of immovable property i.e E-6/2 Vasant Vihar, Delhi in his Return of Income and but also he has not claimed deduction u/s 54 of the IT Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Company Limited Vs CIT 229 ITR 383, held that before the AO the assessee could not make a claim for deduction otherwise than by filing a revised return. Considering the above facts and discussion, Assessee s claim of deduction u/s 54 is hereby rejected. Hence, Long Term Capital Gain on sale of the property, as calculated below. 3. The Ld. CIT(A) dealt with the controversy by following observations : 5.7 The appellant averred that the learned AO has incorrectly applied the principle laid down by the Apex Court in the case of Goetze (India) Ltd. vs. CIT reported in 284 ITR 323. I find that the issue of allowability of deduction even without its claim in the return has now settled based on various judicial pronouncements. Hon'ble Madras High Court summed up this issue in the case of M/s. Abhinitha Foundation Pvt Ltd. 249 Taxman p 37 at para 18 which read as under: In sum, what emerges from a perusal of the ratio 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 Mali ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. CIT(A) was taking into consideration fresh evidence then opportunity should have been given to the Ld. AO to rebut the same. It was submitted that the cases relied by Ld. CIT(A) in M/s. Abhinitha Foundation Pvt. Ltd. 2014 taxman is mis-construed as the facts were different. It was submitted that in the cases relied on behalf of the assessee, Ld. AO was made aware of the essential facts. It was submitted that in the case in hand facts like date of completion of house required examination and the also documentary evidences was not available with Ld. AO and he could not examine the same. 6.1 On the other hand, Ld. Sr. counsel representing the assessee took the bench through various portions of the assessment order to submit that Ld. AO was apprised of all the relevant facts. He submitted that Ld. AO summarily dismissed the claim of assessee by relying the judgment of Hon ble Supreme Court of India in Goetze (India) Ltd. vs. CIT case (supra). Ld. Sr. Counsel relied judgment of Hon ble Supreme Court of India in Wipro Finance Ltd. Vs. CIT [2022] 443 ITR 250 (SC) and the judgment of Hon ble Delhi High Court in CIT vs. Jai Parabolic Springs Ltd. [2008] 306 ITR 42 (Del.) and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act includes reassessment. The word assessment has a comprehensive meaning in the Act and includes all steps and proceedings taken for determination of the tax payable and for imposing liability on the taxpayer. 15. Assessment under the Act is done under s. 143/144 and the total income is assessed and the tax payable is determined. Assessment may be made on the basis of the return subject to adjustment provided under the Act. The assessment is completed after due enquiry under sub-s.(3). 8.1 Similarly Hon ble Bombay High Court in The Commissioner Of Income-Tax vs Khemchand Ramdas (1938) 40 BOMLR 854 has held; 20. In order to answer them, it is essential to bear in mind the method prescribed by the Act for making an assessment to tax, using the word assessment in its comprehensive sense as including the whole procedure for imposing liability upon the tax-payer. The method consists of the following steps. In the first place the taxable income of the tax-payer has to be computed. In the next place the sum payable by him on the basis of such computation has to be determined. Finally, a notice of demand in the prescribed form specifying the sum so payable has t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce with law. 10. Accordingly the facts before the Ld. AO were different from those in Goetze (India) Ltd. vs. CIT [(supra) as in that case the return of income was filed on 30.11.1995 by the assessee for the assessment year 1995-96 and on 12.01.1998 a claim of deduction was made by way of letter which was disallowed by Ld. AO observing that there was no provision under the Act to make amendment in the return of income by modifying an application at the assessment stage without revising the return also. There was no case of a scrutiny assessment of the issue for which the assessee had furnished partial information and was seeking a deduction. Similarly in National Thermal Power Company Ltd. vs. CIT 229 ITR 383 infact the claim was made for the first time in appeal. 11. Even otherwise there is no error in the findings of ld. CIT(A) as he did not as such distinguish the case of assessee or the law laid down in Goetze India Ltd.(supra) but he only went ahead with further in accordance with law that even if the claim is not part of original return or the revised return, the same can be considered by appellate authorities while exercising appellate powers. In this regard even ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red on its own facts. The 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. (p. 386) 12.1 Then explanation attached to Section 251 describing powers of Commissioner (Appeals) specifically provided that : Explanation In disposing of an appeal, the [***] [Commissioner (Appeals)] may consider and decide any matter arising out of the proceedings in which the order appealed against was passed, notwithstanding that such matter was not raised before the [***] [Commissioner(appeals)] by the appellant. 12.2 Reliance can also be placed on the order of Bombay Bench in Income Tax Officer 21(3)(2) Versus Shri Sanjay Gurudasmal Chawla vide ITA NO.2931/MUM/2017 (A.Y: 2012-13) decided on 30/11/18 where it was considering the question whether assessee can amend a return filed by him for making additional claim for deduction o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to costs. [emphasis supplied] 23. It is clear to us that the Supreme Court did not hold anything contrary to what was held in the previous judgments to the effect that even if a claim is not made before the assessing officer, it can be made before the appellate authorities. The jurisdiction of the appellate authorities to entertain such a claim has not been negated by the Supreme Court in this judgment. In fact, the Supreme Court made it clear that the issue in the case was limited to the power of the assessing authority and that the judgment does not impinge on the power of the Tribunal under section 254. 24. A Division Bench of the Delhi High Court dealt with a similar submission in Commissioner of Income-tax v. Jai Parabolic Springs Limited, (2008) 306 ITR 42. The Division Bench, in paragraph 17 of the judgment held that the Supreme Court dismissed the appeal making it clear that the decision was limited to the power of the assessing authority to entertain a claim for deduction otherwise than by a revised return and did not impinge on the powers of the Tribunal. In paragraph 19, the Division Bench held that there was no prohibition on the powers of the Tribunal to ent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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