Income Tax

Question affecting tax liability of assessee can be raised before Tribunal first time – High Court

Question affecting tax liability of assessee can be raised before the Tribunal first time and it is obliged to consider them and pass appropriate orders – High Court

ABCAUS Case Law Citation:
ABCAUS 2101 (2017) (10) HC

In the instant case, the Income Tax Department (Revenue/Department ) had challenged the common order passed by the Income Tax Appellate Tribunal (ITAT) directing the Assessing Officer (AO) to consider the claim of the assessee(s) for the benefit of Section 10A of the Income Tax Act, 1961 (the Act).

In all the cases the claims of the assesseesu/s 10B had been originally allowed by the AO which was later denied due the Commissioner of Income Tax (CIT) invoking his jurisdiction u/s 263 and directing the AO to to withdraw the exemption under Section 10B.

Before the CIT, the assessees had raised an alternative contention that they were entitled to the benefit of Section 10A. However, in the order passed u/s 263, the CIT did not consider the claim of the assessees for the benefit of Section 10A.

Before the Hon’ble High Court, the primary contention of the Revenue was that the Commissioner having found that the benefit of section 10B granted to the assessee being erroneous and prejudicial to the interest of the revenue, it was not opened to the assessee to claim the benefit of Section 10A either before the Commissioner or the Tribunal.

The Hon’ble High Court opined that the appeal filed by the assessee was liable to be considered by the Tribunal exercising its power under Section 254 of the Act which obliged the Tribunal to consider the appeal and pass such orders thereon as it thinks fit.

The Hon’ble High Court observed that the Hon’ble Supreme Court in NTPC’s case had held that where the Tribunal is only required to consider the questions of law arising from the facts which are on record, there is no reason why such a question should not be allowed to be raised when it is necessary to consider that question in order to correctly assess the tax liability of an assessee.

With respect to the contention raised by the Revenue that the power conferred on the CIT under Section 263 only authorised him to examine whether the order passed by the Assessing Officer is erroneous and prejudicial to the interest of the revenue, the Hon’ble High Court observed that restriction of power of CIT cannot affect the powers of the Tribunal which is bound to exercise under Section 254 of the Act. 

Download Full Judgment

Share

Recent Posts

  • Income Tax

Assessee eligible for Chapter VIA deduction u/s 80IE on increased income due to disallownces

Assessee is eligible for claiming deduction under Chapter VIA under Section 80IE of the Income Tax Act 1961 on the…

1 day ago
  • Income Tax

Assessee filing ITR under presumptive tax can’t be faulted for not giving details not mandated

Assessee could not be faulted for showing only cash in hand and bank balance as capital following presumptive taxation when…

1 day ago
  • Income Tax

Sale of flats in a real estate project held capital gains considering intention of assessee

Sale of flats in a real estate project held capital gains as intention of the assesee was to hold that…

2 days ago
  • Income Tax

Interest liability recognised by journal entries at the close of year, can’t be termed as fictitious – ITAT

Merely because interest liability was recognised by journal entries at the close of the year, it does not make expenditure…

3 days ago
  • Income Tax

Cash deposits in bank which were immediately transferred to other accounts – addition deleted

Addition for cash deposits in bank account which were immediately transferred to other accounts deleted in absence any enquiry by…

3 days ago
  • Income Tax

ITAT disallows 6% for alleged bogus purchases being appropriate

ITAT disallows 6% for alleged bogus purchases as purchases from unregistered dealers could not be ruled out. In a recent…

3 days ago