V. NAGARAJAN (HUF),ERODE vs. ACIT, ERODE

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ITA 2901/CHNY/2016Status: DisposedITAT Chennai27 March 2017AY 2012-134 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that it has the power to admit legal issues raised for the first time at the appellate stage. Therefore, the matter was remitted back to the Assessing Officer to decide the issue on merits.

What were the facts?

The assessee filed a belated original return and then a revised return claiming deduction under Section 57(iv). The Assessing Officer rejected the revised return and the deduction claim, which was upheld by the CIT(A).

What were the issues?

Whether a revised return filed after the due date is valid for claiming deductions, and whether a legal issue can be raised for the first time before the appellate tribunal.

Which sections of the Income-tax Act were involved?

Section 57(iv),Section 143(3),Section 250(6)

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Cases cited in this judgment(2)Show list

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Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI

Before: SHRI A.MOHAN ALANKAMONY & SHRI G. PAVAN KUMAR

Hearing: 27.03.2017

आदेश / O R D E R

Per A. Mohan Alankamony, AM:-

1.

This appeal by the assessee is directed against the order passed by the Ld. Commissioner of Income Tax (Appeals)-3, Coimbatore dated 08.07.2016 in IT Appeal No.63/15-16 for the assessment year 2012-13 passed u/s. 250(6) r.w.s. 143(3) of the Act.

2.

The assessee has raised several grounds in its appeal, however the crux of the issue is that the Ld.CIT(A) has erred in not allowing deduction u/s.57(iv) of the Act by upholding the order of the Ld.AO, who had rejected the claim of the assessee stating that the revised return filed by the assessee is not valid. earning income from house property and income from other sources filed its return of income for the relevant assessment year belatedly on 29.03.2013 admitting total income of Rs.71,45,960/- and agricultural income of Rs.30,000/-.

Thereafter the assessee filed a revised return on 17.04.2013 wherein total income of Rs.38,18,480/- was disclosed along with the agricultural income of Rs.30,000/-. The case was taken up for scrutiny under CASS and assessment was completed u/s.143(3) of the Act on 23.03.2015, wherein the Ld. AO disallowed the claim of deduction u/s.57(iv) of the Act to the assessee on the ground that the revised return filed by the assessee is not valid and by placing reliance in the decision of the Hon’ble Apex court in the case Goetze India Ltd v. CIT reported in 284 ITR 323 wherein it was held that any fresh claim made by the assessee otherwise than in the return of income cannot be entertained. On appeal, the Ld.CIT(A) also upheld the order of the Ld.AO by observing as under:

“I have carefully considered the grounds and submissions of the appellant and the assessment order. The appellant had filed return of income for the assessment year 2012-13 on 29/3/2013 admitting total income of Rs.71,45,960/-. This is after the due date. The appellant claimed 50% deduction on enhanced compensation by filing revised return of income on 17/4/2013. If the revised return to be accepted as valid the appellant should have filed the original return within the due date. Since this has not been done the Assessing Officer is correct in treating the revised return as invalid”

4.

The Ld. AR submitted before us that the assessee has every right to raise a legal issue even in the appellate stage for the first time. Reliance was placed on the decision National Thermal Power Company Ltd vs. CIT reported in 229 ITR 383.

She therefore argued stating that the issue with respect to the deduction U/s.57(iv) of the Act towards interest received against compensation for acquisition of land by the State Government may be decided on merits. The Ld. DR could not controvert to the submission of the Ld.AR.

5.

We have heard the rival submissions and carefully perused the materials on record. By virtue of the decision of the Hon’ble Apex court Goetze India Limited and National Thermal Power Company Limited cited supra, it is clear that the Tribunal has power under the Act to admit any legal issue raised by the 4 assessee even for the first time during the appellate proceedings. Therefore in the interest of justice, we hereby admit the ground raised by the assessee for the first time at the appellate stage and further remit the matter back to the file of Ld.AO with directions to decide the issue raised by the assessee in accordance with law and merits.

6.

In the result the appeal of the assessee is allowed for statistical purposes.

Order pronounced on the 27th March, 2017.

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