By C. N. Vaze, Shailesh Kamdar, Jagdish T. Punjabi, Chartered Accountants
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25 (2008) 303 ITR (AT) 110 (Cochin)
Thomas Kurian v. ACIT
A.Y. : 1999-2000. Dated : 5-5-2006
Whether a claim for deduction made for the first time before
the Commissioner (Appeal) is to be considered by him — Held, Yes.
The assessee, an exporter, did not claim deduction u/s.80HHC
in the return of income and not even before the Assessing Officer. Such claim
was made for the first time before the Commissioner (Appeals), who rejected the
claim.
On assessee’s appeal, the ITAT held that :
(i) Being a quasi-judicial authority, the Assessing Officer
must act in a fair and not in a partisan manner. He is duty bound to determine
the correct tax liability of the assessee.
(ii) In discharging such duty, he is bound to consider all
the deductions and exemptions available to the assessee.
(iii) When the facts were available with the Assessing
Officer that the assessee was in the export business of seafoods, he should
have asked the assessee why deduction u/s.80HHC has not been claimed.
(iv) The Commissioner (Appeal) should have asked for a
remand report from the Assessing Officer to verify the claim of deduction and
then decide the issue in accordance with law. He cannot plainly refuse to
consider a legal claim made by the assessee.
(v) The judgment of a larger Bench of Supreme Court in the
case of National Thermal Power Co. Ltd. v. CIT, (229 ITR 383) should
prevail over the judgment of Division Bench in the case of Stepwell Industries
Ltd. (228 ITR 171). Hence the Department cannot reject the assessee’s claim by
relying on Stepwell Industries case.
Based on the above reasonings, the ITAT restored the matter
to the Assessing Officer for considering the assessee’s claim for deduction
u/s.80HHC in accordance with law.
Cases referred to :
(i) National Thermal Power Co. Ltd. v. CIT, 229 ITR
383
(ii) Stepwell Industries Ltd., 228 ITR 171
