Tribunal Orders Re-examination of Tax Exemption Claim on BCCI Sum; Emphasizes Legal Compliance and CBDT Guidelines.

The ITAT Delhi partially allowed the appeal, directing the Assessing Officer to re-examine the assessee's claim for exemption of the sum received from BCCI under Section 10(17A) of the Income Tax Act. The Tribunal emphasized adherence to legal provisions and the CBDT Circular, asserting that exemptions must be granted if legally permissible.

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Issues:
1. Whether the sum received by the assessee as an award from BCCI is exempt under section 10(17A) of the Income Tax Act.
2. Whether the assessee's claim to exclude the sum of Rs.30 lakhs from taxable income for Assessment Year 2013-14 is justifiable under Section 154.

Analysis:
1. The appeal was filed against the order passed by the Commissioner of Income Tax (Appeals) for the Assessment Year 2013-14 regarding the sum of Rs. 30 lakhs received by the assessee as an award from BCCI. The assessee contended that the amount was exempt under section 10(17A) of the Income Tax Act. However, both the Assessing Officer and the CIT (A) rejected the claim, stating that the assessee had initially shown the amount as taxable income in the return. The ITAT Delhi, in its judgment, emphasized that if an income is not in accordance with the law and is entitled to exemption, the Assessing Officer cannot reject the claim solely based on the initial declaration in the return. The Tribunal referred to the well-settled principle that tax can only be levied under express provisions of the law and if an exemption is allowable, the Assessing Officer must compute the income accordingly. The Tribunal remitted the matter back to the Assessing Officer to re-examine the claim in light of the law and the CBDT Circular, directing that if the claim is allowable under section 10(17A) along with Circular No.2 of 2014, it should be granted.

2. The second issue revolved around the assessee's application under Section 154 to rectify the mistake of including the exempt sum in the taxable income. The Assessing Officer and CIT (A) both rejected the application, stating that it was beyond the scope of Section 154 as it was a debatable issue. The ITAT Delhi, however, disagreed with this reasoning and held that the Assessing Officer cannot deny the exemption if it is allowable under the law. The Tribunal emphasized that the CBDT Circular supporting the exemption is binding on Revenue Authorities, and thus, the claim should be examined based on the provisions of law. Consequently, the ITAT allowed the appeal of the assessee partly for statistical purposes, directing the Assessing Officer to reconsider the claim in accordance with the law.

In conclusion, the ITAT Delhi partially allowed the appeal of the assessee, directing the Assessing Officer to re-examine the claim of exemption for the sum received from BCCI in light of the provisions of law and the CBDT Circular, emphasizing that tax can only be levied under express provisions and exemptions must be granted if allowable.

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