SH. AYUSH BIYANI ,GURGAON vs. ITO, WARD-1(3), GURGAON, GURGAON

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ITA 4113/DEL/2025Status: DisposedITAT Delhi27 August 2025AY 2016-17Bench: SHRI M. BALAGANESH (Accountant Member)1 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that Section 80AC of the Act, which bars deductions under certain heads, was introduced only from 01.04.2018. Prior to that, there was no bar to claiming deductions under Section 80C if a return was furnished, which the assessee had done.

What were the facts?

The assessee inadvertently omitted a deduction of ₹1,50,000/- under Section 80C in their income tax return. This omission led to reassessment proceedings initiated under Section 147 of the Income-tax Act, 1961.

What were the issues?

Whether the assessee was justified in claiming a deduction under Section 80C of the Act for AY 2016-17 when it was omitted in the original return, and the subsequent proceedings were initiated under Section 147.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 147,Section 148A,Section 144B,Section 80C,Section 80AC

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “SMC”: NEW DELHI

For Appellant: Shri P. C. Parwal, CA
For Respondent: Shri Manoj Kumar, Sr. DR
Hearing: 13/08/2025Pronounced: 27/08/2025

O R D E R

1.

The appeal in AY 2016-17 arises out of the order of the ld. National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘ld. NFAC’, in short] in Appeal No. ITBA/NFAC/S/250/2025- 26/1075987781(1) dated 01.05.2025 against the order of assessment passed u/s 143(3) r.w.s. 147 of the Income-tax Act, 1961 dated 12.03.2024 (hereinafter referred to as ‘the Act’) by NFAC, Delhi (hereinafter referred to as ‘ld. AO’).

2.

The only short issue to be decided in the appeal is as to whether the ld NFAC was justified in confirming the denial of deduction u/s 80C of the Act of ₹1,50,000/- in the facts and circumstances of the instant case.

3.

I have heard the rival submissions and perused the material available on record. The assessee is an individual. Proceedings u/s 147 of the Act stood initiated for assessment year 2016–17 vide order passed u/s 148A(b) of the Act on 26.03.2023. No compliance was made by the assessee and order u/s 148A(d) of the Act was passed for initiation of proceedings u/s 147 of the Act. Later the reassessment proceedings were framed u/s 147 r.w.s. 144B of the Act on 12.03.2024. The return of income of ₹13,18,200/- was filed by the assessee. In the said return, the assessee inadvertently omitted the claim of deduction u/s 80C of the Act in the sum of ₹1,50,000/-. Accordingly, the assessee by way of additional ground before the ld NFAC made this claim which stood rejected by the ld NFAC by holding non- claiming of deduction u/s 80C of the Act was deliberate and cannot said to be ignorance of the assessee. Accordingly, the reliance placed by the assessee on CBDT Circular No. 14(XL-35) dated 11.04.1955 was held to be not applicable.

4.

I find that provisions of Section 80AC of the Act are very clear wherein deductions clamed under the head “"C.-Deductions in respect of certain incomes" were introduced only from 01.04.2018 in the Act. Prior to that, there was no bar for claiming deduction u/s 80C of the Act. What is required is only a return to be furnished by the assessee. This has been duly complied and hence assessee is entitled for deduction u/s 80C of the Act in the sum of ₹1,50,000/-. The ld AO is directed accordingly.

5.

In the result, the appeal of the assessee is allowed.

Order pronounced in the open court on 27/08/2025.

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