GLORIOUS REALTY P.LTD, MUMBAI V. ITO 6(3)(1), MUMBAI

ITA 7312/MUM/2013

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0755 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-07-2015
• Appeal Filed By: Assessee
• Bench Allotted: G
• Assessment Year: 2010-2011
• Appeal Filed On: 12-12-2013
• Court: TRIBUNAL
• Department Lawyers: VIJAY KUMAR BORA
• Assessee Lawyers: PRASAD M BAPAT
• Keywords: Earning of tax free income; Revised return

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH G, MUMBAI BEFORE SHRI R.C. SHARMA, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER ITA NO.7312/M/2013 ASSESSMENT YEAR: 2010-11 M/S. GLORIOUS REALTY PVT. LTD., (SUBSEQUENTLY MERGED WITH PRUDENTIAL MANAGEMENT AND SERVICES PVT. LTD. W.E.F. 1 ST OCTOBER 2010), MAHINDRA TOWERS, DR. G.M. BHOSALE MARG, P.K. KURNE CHOWK, WORLI, MUMBAI 400 018 PAN: AAACG 2097E VS. INCOME TAX OFFICER 6(3)(1), AAYAKAR BHAVAN, CHURCHGATE, MUMBAI (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI PRASAD M. BAPAT, A.R. REVENUE BY : SHRI VIJAY KUMAR BORA, D.R. DATE OF HEARING : 13.05.2015 DATE OF PRONOUNCEMENT : 10.07.2015 O R D E R PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSES SEE AGAINST THE ORDER DATED 15.10.2013 OF THE COMMISSIONER OF INCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS THE CIT(A)] RELEVANT TO ASSESSMENT Y EAR 2010-11. 2. THE ASSESSEE HAS TAKEN THE FOLLOWING GROUNDS OF APPEAL: 1. THE LEARNED CIT(A) ERRED IN NOT DIRECTING TO AO TO GRANT EXEMPTION UNDER SECTION 10(34) IN RESPECT OF DIVIDEND INCOME OF INR 7,49,600/-. 2. THE LEARNED CIT(A) FURTHER ERRED IN NOT APPRECIA TING THE FACT THAT THE APPELLANT COULD NOT FILE THE REVISED RETURN SINCE B Y THE TIME WHEN THE ERROR WAS NOTICED BY THE APPELLANT THE DATE OF FILING REVISED RETURN ITA NO.7312/M/2013 M/S. GLORIOUS REALTY PVT. LTD. 2 HAD ALREADY LAPSED. THE APPELLANT CRAVES LEAVE TO ADD OR AMEND ANY OR ALL OF THE ABOVE GROUNDS OF APPEAL, IF NECESSARY. 3. THE BRIEF FACTS OF THE CASE ARE THAT DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE RECEIVED DIVIDEND INCOME OF RS.7.50 LA KHS WHICH WAS EXEMPT FROM TAX AS PER THE PROVISIONS OF THE INCOME TAX AC T. THE ASSESSEE, HOWEVER, INADVERTENTLY OFFERED THE SAME FOR TAXATION IN ITS RETURN OF INCOME. THE ASSESSEE, HOWEVER, DURING THE ASSESSMENT PROCEEDING S, SUBMITTED A REVISED COMPUTATION EXCLUDING THE DIVIDEND INCOME CLAIMING THAT THE SAME WAS EXEMPT UNDER SECTION 10(34) OF THE ACT. THE ASSESS ING OFFICER (HEREINAFTER REFERRED TO AS THE AO), HOWEVER, NOTED THAT THE ASS ESSEE WAS REQUIRED TO FILE A REVISED RETURN TO CLAIM THE ABOVE SAID EXEMPTION. HE THEREFORE REJECTED THE CLAIM OF THE ASSESSEE. 4. IN APPEAL, THE LD. CIT(A) CONFIRMED THE ORDER OF THE AO RELYING UPON THE DECISION OF THE HONBLE SUPREME COURT IN THE CA SE OF GOETZ INDIA LIMITED VS. CIT [2006] ITR 323. THE ASSESSEE HAS, THUS, C OME IN APPEAL BEFORE US. 5. ADMITTEDLY, THE ASSESSEE HAS INADVERTENTLY OFFER ED THE DIVIDEND INCOME FOR TAXATION WHICH IS EXEMPT UNDER SECTION 10(34) O F THE ACT. THE ASSESSEE HAS MADE A GENUINE CLAIM BEFORE THE LD. CIT(A) WHICH WA S ADMISSIBLE AS PER PROVISIONS OF THE LAW. THE HONBLE BOMBAY HIGH COU RT IN THE CASE OF PRUTHVI BROKERS & SHAREHOLDERS PVT. LTD. (SUPRA), WHILE RE LYING UPON THE VARIOUS DECISIONS OF THE HONBLE SUPREME COURT AND OTHER HO NBLE HIGH COURTS, HAS HELD THAT EVEN IF A CLAIM IS NOT MADE BEFORE THE AO IT CAN BE MADE BEFORE THE APPELLATE AUTHORITIES. THE JURISDICTION OF THE APP ELLATE AUTHORITIES TO ENTERTAIN SUCH A CLAIM IS NOT BARRED. THE HONBLE BOMBAY HIG H COURT WHILE RELYING UPON THE DECISION OF THE HONBLE SUPREME COURT IN T HE CASE OF JUTE CORPORATION OF INDIA LIMITED VS. CIT 1991 SUPP (2) ITA NO.7312/M/2013 M/S. GLORIOUS REALTY PVT. LTD. 3 SCC 744 = (1991) 187 ITR 688 HAS OBSERVED THAT THE POWER OF THE APPELLATE COMMISSIONER IS COTERMINOUS WITH THAT OF THE INCOME TAX OFFICER AND AN APPELLATE AUTHORITY WHILE HEARING APPEAL AGAINST TH E ORDER OF THE SUBORDINATE AUTHORITY, HAS ALL THE POWERS WHICH THE ORIGINAL AU THORITY MAY HAVE IN DECIDING THE QUESTIONS BEFORE IT, SUBJECT TO THE RESTRICTION S OR LIMITATIONS, IF ANY, PRESCRIBED BY STATUTORY PROVISIONS. IN THE ABSENCE OF ANY STATUTORY PROVISION, THE APPELLATE AUTHORITY IS VESTED WITH ALL THE PLEN ARY POWERS WHICH THE SUBORDINATE AUTHORITY MAY HAVE IN THE MATTER. AN A SSESSEE IS ENTITLED TO RAISE NOT MERELY ADDITIONAL LEGAL SUBMISSIONS BEFORE THE APPELLATE AUTHORITIES BUT IS ALSO ENTITLED TO RAISE ADDITIONAL CLAIMS BEFORE THE M. THE APPELLATE AUTHORITIES HAVE THE DISCRETION WHETHER OR NOT TO PERMIT SUCH A DDITIONAL CLAIMS TO BE RAISED. IT CANNOT, HOWEVER, BE SAID THAT THEY HAVE NO JURISDICTION TO CONSIDER THE SAME. THE APPELLATE AUTHORITIES HAVE JURISDICT ION TO DEAL NOT MERELY WITH ADDITIONAL GROUNDS WHICH BECAME AVAILABLE ON ACCOUN T OF CHANGE OF CIRCUMSTANCES OR LAW, BUT WITH ADDITIONAL GROUNDS W HICH WERE AVAILABLE WHEN THE RETURN WAS FILED BUT COULD NOT HAVE BEEN RAISED AT THAT STAGE OR THE GROUNDS WHICH BECAME AVAILABLE ON ACCOUNT OF CHANGE OF CIRC UMSTANCES OR LAW. THE WORDS COULD NOT HAVE BEEN RAISED MUST BE CONSTRUE D LIBERALLY AND NOT STRICTLY. IT IS OPEN TO THE ASSESSEE TO CLAIM A DEDUCTION BEF ORE THE APPELLATE AUTHORITY WHICH COULD NOT HAVE BEEN CLAIMED BEFORE THE AO. T HE HONBLE BOMBAY HIGH COURT HAS FURTHER OBSERVED THAT THE DECISION O F HONBLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LIMITED V. CIT (2006) 157 TAXMAN 1, REGARDING THE RESTRICTION OF MAKING THE CLAIM THROUGH A REVIS ED RETURN WAS LIMITED TO THE POWERS OF THE ASSESSING AUTHORITY AND THE SAID JUDG MENT DOES NOT IMPINGE ON THE POWER OR NEGATE THE POWERS OF THE APPELLATE AUT HORITIES TO ENTERTAIN SUCH CLAIM BY WAY OF ADDITIONAL GROUND. ITA NO.7312/M/2013 M/S. GLORIOUS REALTY PVT. LTD. 4 6. IN VIEW OF THE ABOVE STATED LEGAL POSITION, THE ORDER OF THE LD. CIT(A) IS THEREFORE SET ASIDE AND THE AO IS DIRECTED TO ALLOW THE ADMISSIBLE CLAIM OF TAX EXEMPT INCOME TO THE ASSESSEE. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS HER EBY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 10.07.2015. SD/- SD/- (R.C. SHARMA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 10.07. 2015. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.