Smt. Prameela Krishna, Mysore V. ITO, Mysore

MA 33/BANG/2012

• Counselvise Citation: [2012] 123 COUNSELVISE.COM (IT) 9258 (ITAT-BANGALORE)
• Duration Of Justice: 6 month(s) 26 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 23-11-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 16-11-2012
• Assessment Year: 2002-2003
• Appeal Filed On: 27-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BIJOY KUMAR PANDA
• Assessee Lawyers: GANESH
• Keywords: Revised return

Judgement Text

PAGE 1 OF 8 M.P. NOS.33 & 34/BANG/2012 1 IN THE INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCH A BEFORE SHRI N BARATHVAJA SANKAR, VICE PRESIDENT AND SHRI GEORGE GEORGE K, J.M M.P. NOS.33 & 34/BANG/2012 (ASSESSMENT YEARS 2002-03 & 2003-04) SMT. PRAMEELA KRISHNA, NO.33, SHALIVAHANA ROAD, NAZARBAD, MYSORE. PAN : AJJPP 4456 F VS THE INCOME TAX OFFICER, WARD-1(2), MYSORE. (APPELLANT) (RESPONDENT) DATE OF HEARING : 16.11.2012 DATE OF PRONOUNCEMENT : 23.11.2012 ASSESSEE BY : SHRI GANESH, ADVOCAT E REVENUE BY : SHRI BIJOY KUMAR PA NDA, ADDL. CIT ORD ER PER GEORGE GEORGE K : THESE TWO MISCELLANEOUS PETITIONS AT THE INSTANCE OF THE ASSESSEE ARE FILED TO RECTIFY CERTAIN MISTAKES WHICH HAD CREPT IN THE ORDER OF THE TRIBUNAL IN ITA NOS.765 & 766/BANG/2008 CONC ERNING ASSESSMENT YEARS 2002-03 AND 2003-04. 2. SINCE COMMON ISSUES ARE INVOLVED IN THESE TWO M ISCELLANEOUS PETITIONS, THEY ARE DISPOSED OFF BY THIS CONSOLIDATED ORDER. 3. IN THESE MPS, THE ASSESSEE SUBMITS THAT THE GRO UND NO.13 FOR BOTH THE APPEALS HAD NOT BEEN DISPOSED OFF. IN BOT H THE APPEALS, GROUND NO.13 IS IDENTICAL AND THEY READ AS FOLLOWS:_ PAGE 2 OF 8 M.P. NOS.33 & 34/BANG/2012 2 THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN N OT PERMITTING THE ASSESSEE TO EXERCISE HER OPTION TO C HOOSE ANY RESIDENTIAL HOUSE FOR THE PURPOSE OF EXEMPTION A S PROVIDED UNDER THE HEAD INCOME FROM HOUSE PROPERTY . 4. IN THE ABOVE GROUND, THE CLAIM OF THE ASSESSEE IS TO SEEK EXEMPTION FOR ONE SELF OCCUPIED PROPERTY IN RESPECT OF THE FLAT AT BANGALORE IN PLACE OF THE FLAT IN MYSORE. WE HAVE PERUSED THE CONSOLIDATED ORDER OF THE TRIBUNAL IN ITA NOS.764 TO 767/BANG/2008 DATED 28.9.2009. WE NOTICED THAT THOUGH THERE IS A REFERENCE OF THE ISS UE AT PAGES 17 AND 18 OF THE IMPUGNED ORDER OF THE TRIBUNAL, THE SAME HAS NO T BEEN DISPOSED OFF IN THE TRIBUNALS FINDING RENDERED FROM PARA 18 ONWARD S. 4.1 IN THE ABSENCE OF THE FINDING BY THE TRIBUNAL IN ITS IMPUGNED ORDER DATED 28.9.2009 WITH REGARD TO THE ISSUE OF E XEMPTION IN RESPECT OF SELF OCCUPIED PROPERTY SITUATED IN BANGALORE IN PREF ERENCE TO THE MYSORE PROPERTY, WE DEEM IT FIT AND PROPER TO CONSIDER THI S GROUND AND DISPOSE OFF THE SAME AS UNDER:- 5. THE BRIEF FACTS OF THE CASE ARE AS FOLLOWS:- THE ASSESSEE IS AN INDIVIDUAL. IN HER RETURN OF INCOME FOR THE ASSESSMENT YEARS 2002-03 AND 2003-04, THE ASSESSEE H AD MADE A CLAIM OF EXEMPTION UNDER SECTION 23 OF THE ACT WITH REFERENC E TO HER PROPERTY SITUATED IN MYSORE. IN THE ASSESSMENTS COMPLETED FOR THE ABOVE SAID ASSESSMENT YEARS, THE PROPERTY IN MYSORE WAS EXEMPTED UNDER SECTION 23 OF THE ACT. PAGE 3 OF 8 M.P. NOS.33 & 34/BANG/2012 3 5.1 AMONG OTHER ISSUES, THE ASSESSEE TOOK THE PLE A (GROUND NO.7) BEFORE THE CIT(A) THAT HER FLAT AT BANGALORE SHOULD BE EXEMPTED UNDER SECTION 23 OF THE ACT INSTEAD OF THE MYSORE PROPERTY, WHICH IS CLAIMED AS EXEMPT IN HER RETURN OF INCOME. THE PLEA OF THE AS SESSEE BEFORE THE CIT(A), FOR BETTER APPRECIATION, IS REPRODUCED BELO W: THE ASSESSEE MAY BE GIVEN AN OPTION TO EXERCISE FOR THE PURPOSE OF EXEMPTION OF INCOME UNDER THE HEAD HOUS E PROPERTY THE FLAT AT BANGALORE WHOSE ANNUAL LETTING OUT VALUE HAS BEEN ESTIMATED BY THE ASSESSING OFFICER AN D THE INCOME THEREOF MAY BE TAKEN AT NIL. THIS IN FAC T HAS BEEN ACCEPTED BY THE ASSESSING OFFICER FOR THE ASSESSMENT YEAR 2004-05. THE ANNUAL LETTING OUT VAL UE OF THE PROPERTY AT MYSORE WHICH IS AVAILABLE IN THE INCOME-TAX RECORDS MAY BE ORDERED TO BE BROUGHT TO T AX. THE ASSESSEE BEING AN AGED LADY UNAWARE OF THE POSIT ION IN LAW WAS WRONGLY ADVISED ABOUT HER CHOICE IN THIS REGARD AND CHOSE TO CLAIM EXEMPTION IN RESPECT OF MYSORE PROPERTY WHICH WAS TO HER DETRIMENT. SHE MAY NOT BE TIED DOWN TO THAT OPTION AND IN THE INTERESTS OF JU STICE SHE MAY BE GIVEN THE CHOICE TO CHOOSE THAT WHICH IS MORE ADVANTAGEOUS TO HER UNDER THE TAX LAWS. 5.2 THE CIT(A) DISPOSED OFF THE ABOVE GROUND BY OBS ERVING THUS:- AS CAN BE SEEN FROM THE ABOVE SUBMISSION, THE APPE LLANT HAD EXERCISED HER OPTION AT THE ASSESSMENT STAGE IN RESPECT OF MYSORE PROPERTY BUT WANTS TO CHANGE THE OPTION NOW TO BANGALORE PROPERTY DURING APPEAL PROCEEDINGS. TO MY MIND, THOUGH THE APPELLANT WOUL D HAVE BEEN WITHIN HER RIGHTS TO CHANGE HER OPTION AT ANY TIME DURING ASSESSMENT PROCEEDINGS, SHE CANNOT DO S O AFTER THE ASSESSMENT IS COMPLETED. PAGE 4 OF 8 M.P. NOS.33 & 34/BANG/2012 4 5.3 AGGRIEVED BY THE CONCLUSION OF THE CIT(A), THE ASSESSEE FILED APPEAL BEFORE THE TRIBUNAL FOR THE ASSESSMENT YEARS 2002-03 AND 2003-04 AMONG OTHER ISSUES, THE ISSUE OF EXEMPTION UNDER SE CTION 23 FOR HER RESIDENTIAL HOUSE IN BANGALORE WAS RAISED. 6. THE ASSESSEE AGITATED BY THE NON-CONSIDERATION B Y THE TRIBUNAL OF GROUND NO.13 RAISED IN THE APPEAL MEMO IN ITS IM PUGNED ORDER IN ITA NOS.765 & 766/2008 HAS FILED THESE MISCELLANEOUS PE TITIONS. THE CONTENTION RAISED ON MERITS READ AS FOLLOWS:- ADVERTING TO THE MERITS OF THE APPLICANTS CASE, W E HAVE TO SUBMIT THAT THE DECISION IN 284 ITR 323 CLEARLY NOTICED THAT REGARDING A NEW CLAIM NOT TAKEN EARLIE R DOES NOT IMPINGE ON THE POWER OF THE ITAT WITH RESPECT T O SUCH A CLAIM AGITATED AS HERE. THUS IT MEANS THAT ON THE BASIS OF THE RECORDS A CLAIM CAN BE MADE FOR THE FI RST TIME BEFORE THE APPELLATE AUTHORITIES EVEN THOUGH N OT MADE AT THE ASSESSMENT STAGE IN THE INTEREST OF JUS TICE. THAT A REVISED RETURN SHOULD HAVE BEEN FILED IF A F RESH CLAIM WAS THERE BEFORE THE ASSESSING OFFICER AND IT S ABSENCE PREVENTS AN ASSESSEE FROM AGITATING BEFORE AN APPELLATE FORUM IS DISAPPROVED NOT ONLY BY THE ABOVE DECISION OF THE SUPREME COURT BUT MORE SPECIFICALLY BY THE BOMBAY HIGH COURT IN ITS DECISION IN ITA NO.3908/2010 VIDE ITS ORDER DATED 21.06.2012 WHERE A CLAIM MADE FOR THE FIRST TIME EVEN WITHOUT THE FILI NG OF A REVISED RETURN WAS ORDERED TO BE ENTERTAINED BY THE TRIBUNAL. THUS, THERE IS NO DIFFICULTY IN ENTERTAIN ING THE MISCELLANEOUS PETITION AND DISPOSING IT OFF ON MERI TS. WE ALSO RELY UPON THE DECISION IN 107 ITR 63 WHERE THE HIGH COURT ON PAGE 70, 71 ADVERTED TO A CIRCULAR OF THE CBDT DIRECTING THAT THE ASSESSING OFFICER SHOULD IN EVER Y REASONABLE WAY ASSIST THE ASSESSEE TO MAKE AN APPROPRIATE CLAIM FOR RELIEF. IN THIS CASE, THE AS SESSING PAGE 5 OF 8 M.P. NOS.33 & 34/BANG/2012 5 OFFICER OBVIOUSLY KNEW THAT IT WOULD BE MORE ADVANTAGEOUS TO CLAIM EXEMPTION IN RESPECT OF THE BANGALORE FLAT AS AGAINST THE CLAIM IN RESPECT OF T HE MYSORE HOUSE AS MADE IN THE RETURN. HERE WE MAY ADVE RT TO THE OBSERVATIONS OF THE SUPREME COURT IN 160 ITR 920 AT PAGE 928 WHERE THE ASSESSEE HAD FAILED TO CLAIM RELIEF AVAILABLE TO IT AND EVEN THEN THEIR LORDSHIP OBSERV ED AS UNDER: THERE IS A DUTY CAST ON THE INCOME TAX OFFICER TO APPLY THE RELEVANT PROVISIONS OF THE INDIAN INCOME-TAX ACT FOR THE PURPOSE OF DETERMINING THE TRUE FIGURE OF THE ASSESSEES TAXABLE INCOME AND THE CONSEQUENTIAL TAX LIABILITY. MERELY BECAUSE THE ASSESSEE FAILS TO CLAIM THE BENEFIT OF A SET-OFF, IT CANNOT RELIEVE THE INCOME TAX OFFICER OF HIS DUTY TO APPLY SECTION 24 IN AN APPROPRIATE CASE. 7. FOR THESE REASONS WE SUBMIT THAT THE MISC. PETITION BE ENTERTAINED AND IT BE DIRECTED THAT THE EXEMPTION FOR RESIDENTIAL PROPERTY MAY BE GRANTED IN RESPECT OF THE BANGALORE FLAT INSTEAD OF THE MYSORE PROPERTY. 7. THE LEARNED DR HAD CONTENDED THAT THE ASSESSIN G OFFICER HAS RIGHTLY CONSIDERED THE PROPERTY AT MYSORE AS SELF OCCU PIED HOUSE PROPERTY AND THE RENTAL VALUE OF THE HOUSE PROPERTY AT BANGAL ORE WAS COMPUTED IN ACCORDANCE WITH LAW FOR ARRIVING AT THE CORRECT INC OME FROM HOUSE PROPERTY. IT WAS SUBMITTED BY THE LEARNED DR THAT IF THE ASSES SEE HAS CHANGED HER STAND WITH REGARD TO SELF OCCUPIED PROPERTY, SHE COU LD HAVE FILED A REVISED RETURN, WHICH IN THE CASE WAS NOT PERMISSIBLE AS NO RETURN OF INCOME WAS FILED UNDER REGULAR TERMS UNDER SECTION 139(1) OF THE ACT WITHIN THE DUE DATE. FOR PAGE 6 OF 8 M.P. NOS.33 & 34/BANG/2012 6 THE ABOVE PROPOSITION, THE LEARNED DR RELIED ON THE JUDGMENT OF THE HONBLE APEX COURT IN THE CASE OF GOETZE INDIA LTD. V CIT R EPORTED IN 284 ITR 323. 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS ON RECORD. IT IS NOT IN DISPUTE THAT THE ASSESSEE S GROUND NO.13 RAISED BEFORE THE TRIBUNAL IN ITA NOS.765 AND 766/2008 HAS NOT DISPOSED OFF IN ITS IMPUGNED ORDER DATED 28.9.2009. THE HONBLE S UPREME COURT IN THE CASE OF GOETZE (INDIA) LIMITED V. COMMISSIONER OF I NCOME-TAX (SUPRA) RELIED ON BY THE CIT IS DISTINGUISHABLE ON THE FACTS. THE QUESTION BEFORE THE COURT WAS WHETHER THE APPELLANT-ASSESSEE COULD MAKE A CLAIM FOR DEDUCTION, OTHER THAN BY FILING A REVISED RETURN. AFTER THE RE TURN WAS FILED, THE APPELLANT SOUGHT TO CLAIM A DEDUCTION BY WAY OF A LET TER BEFORE THE ASSESSING OFFICER. THE CLAIM, THEREFORE, WAS NOT BE FORE THE APPELLATE AUTHORITIES. THE DEDUCTION WAS DISALLOWED BY THE ASS ESSING OFFICER ON THE GROUND THAT THERE WAS NO PROVISION UNDER THE ACT TO MAKE AN AMENDMENT IN THE RETURN OF INCOME BY MODIFYING AN APPLICATION AT T HE ASSESSMENT STAGE WITHOUT REVISING THE RETURN. THE COMMISSIONER OF IN COME-TAX (APPEALS) ALLOWED THE ASSESSEE'S APPEAL. THE TRIBUNAL, HOWEVE R, ALLOWED THE DEPARTMENT'S APPEAL. IN THE SUPREME COURT, THE ASSE SSEE RELIED UPON THE JUDGMENT IN NATIONAL THERMAL POWER COMPANY LIMITED C ONTENDING THAT IT WAS OPEN TO THE ASSESSEE TO RAISE THE POINTS OF LAW EVE N BEFORE THE TRIBUNAL. THE SUPREME COURT HELD :- 4. THE DECISION IN QUESTION IS THAT THE POWER OF T HE TRIBUNAL UNDER SECTION 254 OF THE INCOME-TAX ACT, 1961, IS TO ENTERTAIN FOR THE FIRST TIME A POINT OF LAW PROVIDED THE FACT ON THE BASIS OF WHICH THE ISSUE O F LAW PAGE 7 OF 8 M.P. NOS.33 & 34/BANG/2012 7 CAN BE RAISED BEFORE THE TRIBUNAL. THE DECISION DOE S NOT IN ANY WAY RELATE TO THE POWER OF THE ASSESSING OFFICER TO ENTERTAIN A CLAIM FOR DEDUCTION OTHERWIS E THAN BY FILING A REVISED RETURN. IN THE CIRCUMSTANCE S OF THE CASE, WE DISMISS THE CIVIL APPEAL. HOWEVER, WE MAKE IT CLEAR THAT THE ISSUE IN THIS CASE IS LIMITED TO THE POWER OF THE ASSESSING AUTHORITY AND DOES NOT IMPING E ON THE POWER OF THE INCOME-TAX APPELLATE TRIBUNAL UNDER SECTION 254 OF THE INCOME-TAX ACT, 1961. THER E SHALL BE NO ORDER AS TO COSTS. [EMPHASIS SUPPLIED] 8.1 THE HONBLE SUPREME COURT DID NOT HOLD ANYTHIN G CONTRARY TO WHAT WAS HELD IN THE PREVIOUS JUDGMENTS TO THE EFFE CT THAT EVEN IF A CLAIM IS NOT MADE BEFORE THE ASSESSING OFFICER, IT CAN BE MA DE BEFORE THE APPELLATE AUTHORITIES. THE JURISDICTION OF THE APPELLATE AUTH ORITIES TO ENTERTAIN SUCH A CLAIM HAS NOT BEEN NEGATED BY THE SUPREME COURT IN T HIS JUDGMENT. IN FACT, THE SUPREME COURT MADE IT CLEAR THAT THE ISSUE IN T HE CASE WAS LIMITED TO THE POWER OF THE ASSESSING AUTHORITY AND THAT THE JU DGMENT DOES NOT IMPINGE ON THE POWER OF THE APPELLATE AUTHORITIES. 8.2 A DIVISION BENCH OF THE HONBLE DELHI HIGH C OURT IN THE CASE OF COMMISSIONER OF INCOME-TAX V. JAI PARABOLIC SPRINGS LIMITED (2008) REPORTED IN 306 ITR 42 HAD DISTINGUISHED THE HONBL E APEX COURT JUDGEMENT IN THE CASE OF GOETZE (INDIA) LTD. (SUPRA ). THE HONBLE DELHI HIGH COURT, IN PARAGRAPH 17 OF THE JUDGMENT HELD THAT TH E SUPREME COURT DISMISSED THE APPEAL MAKING IT CLEAR THAT THE DECIS ION WAS LIMITED TO THE POWER OF THE ASSESSING AUTHORITY TO ENTERTAIN A CLAI M FOR DEDUCTION OTHERWISE THAN BY A REVISED RETURN AND DID NOT IMPIN GE ON THE POWERS OF THE TRIBUNAL. IN PARAGRAPH 19, THE HONBLE HIGH COURT HELD THAT THERE WAS NO PROHIBITION ON THE POWERS OF THE TRIBUNAL TO ENTERT AIN AN ADDITIONAL GROUND PAGE 8 OF 8 M.P. NOS.33 & 34/BANG/2012 8 WHICH, ACCORDING TO THE TRIBUNAL, ARISES IN THE MAT TER AND FOR THE JUST DECISION OF THE CASE. 8.3 IN THE INSTANT CASE, THE ISSUE THAT ARISES FOR OUR CONSIDERATION WAS RAISED BEFORE THE CIT(A) AND THE CIT(A) OUGHT T O HAVE CONSIDERED THE ISSUE ON MERITS. IN THE LIGHT OF THE JUDGEMENT OF THE HONBLE MUMBAI HIGH COURT IN ITA NO.3908/2010 AND THE HONBLE DELHI HIG H COURT CITED SUPRA, WE DIRECT THE CIT(A) TO CONSIDER WHETHER THE ASSESSEE IS ENTITLED TO CLAIM EXEMPTION UNDER SECTION 23 OF THE ACT WITH REFERENC E TO HER BANGALORE HOUSE PROPERTY INSTEAD OF MYSORE PROPERTY WHICH SHE HA D ORIGINALLY CLAIMED IN HER RETURN OF INCOME. IT IS ORDERED ACCORDINGLY. 5. IN THE RESULT, THE MISCELLANEOUS PETITIONS FILE D BY THE ASSESSEE ARE ALLOWED. THE ORDER PRONOUNCED ON THE 23 RD DAY OF NOVEMBER, 2012 AT BANGALORE. SD/- SD/- (N BARATHVAJA SANKAR) (GEORGE GEORGE K) VICE PRESIDENT JUDICIAL MEMBER COPY TO : 1. THE REVENUE 2. THE ASSESSEE 3. THE CIT CONCERNE D. 4. THE CIT(A) CONCERNED. 5. DR 6. GF MSP/ BY ORDER SENIOR PRIVATE SECRETARY, ITAT, BAN GALORE.