2006 (5) TMI 547 - AT - Income Tax

Tribunal orders reassessment of deduction issue, emphasizes assessing officer's duty to allow eligible deductions.

The Tribunal allowed the appeal for statistical purposes, directing the issue of deduction under Section 80HHC to be reconsidered by the assessing ... - Issues:- Appeal against CIT(A) order regarding deduction under Section 80HHC for assessment year 1999-2000.Detailed Analysis:1. The appellant, an exporter, claimed deduction under Section 80HHC for profits from the export business for the first time before the first appellate authority. The appellant cited various case laws to support the claim, emphasizing that the omission to claim was due to inadvertence. The first appellate authority rejected the claim, stating that the appellant failed to show reasonable cause for not raising the issue before the assessing officer and that obtaining a certificate from a Chartered Accountant constituted new facts for the claim. The authority also referenced specific court decisions to support its decision.2. During the hearing before the Tribunal, the appellant reiterated the same submissions made before the CIT(A) and relied on relevant case laws and court decisions. The departmental representative argued that the appellant had multiple opportunities to raise the claim during the assessment process and that the claim not made before the assessing officer or first appellate authority cannot be made before the Tribunal, citing a specific court decision to support this argument.3. The Tribunal analyzed the facts and materials on record, noting that the assessing officer was aware of the appellant's export business based on the assessment order. The Tribunal emphasized that the assessing officer, being quasi-judicial, should have questioned the omission of the deduction claim since the relevant facts were available. The Tribunal criticized the CIT(A) for not admitting the claim and emphasized the duty of the assessing officer to allow eligible deductions. The Tribunal also discussed the precedence of court decisions in determining the validity of claims.4. Ultimately, the Tribunal found that the issue of deduction under Section 80HHC, being a legal issue with facts available on record, should have been considered by the CIT(A). The Tribunal directed the issue to be restored back to the assessing officer for a decision in accordance with the law, with the appellant instructed to provide necessary details. The appeal of the assessee was allowed for statistical purposes only, emphasizing the need for a fair consideration of deductions and exemptions available to the assessee.This detailed analysis of the judgment highlights the procedural aspects, legal arguments, court decisions, and the Tribunal's reasoning in addressing the issue of deduction under Section 80HHC for the assessment year 1999-2000.