Section 54 claim must be raised during assessment; capital gains valuation under section 50C may be remitted for verification.

A deduction claim under section 54 was treated as unavailable when it was not raised in the return of income or during assessment proceedings; the Tribunal noted that Goetze India limits the Assessing Officer's power, but does not itself create a basis to entertain a fresh claim absent an earlier claim on record. The section 50C capital gains issue was remitted for verification and recomputation because the stamp valuation and property value required factual examination, and the Assessing Officer did not respond to the remand request. The appellate order was sustained, with the deduction disallowed and the remand upheld.

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Issues: (i) whether the assessee's claim for deduction under section 54 of the Income-tax Act, 1961 could be entertained when it was not made in the return of income or during assessment proceedings; and (ii) whether the remand of the section 50C capital gains issue to the Assessing Officer for verification and recomputation was justified.

Issue (i): whether the assessee's claim for deduction under section 54 of the Income-tax Act, 1961 could be entertained when it was not made in the return of income or during assessment proceedings.

Analysis: The claim was raised for the first time before the first appellate authority. The ruling in Goetze India was held to be confined to the Assessing Officer's power and not to bar the Tribunal, but the claim still had to be founded on a claim made at least during assessment proceedings. Since no such claim had been made in the return or before the Assessing Officer, the appellate claim was treated as unavailable on merits.

Conclusion: The claim for deduction under section 54 was rejected and the assessee's challenge on this issue failed.

Issue (ii): whether the remand of the section 50C capital gains issue to the Assessing Officer for verification and recomputation was justified.

Analysis: The first appellate authority had sought a remand report and verification of the stamp valuation, but the Assessing Officer did not respond. In those circumstances, the direction to reverify the property value and recompute capital gains was treated as a proper exercise of appellate procedure under Rule 46A, because the factual basis for determination of capital gains required verification by the Assessing Officer first.

Conclusion: The remand to the Assessing Officer on the section 50C issue was upheld.

Final Conclusion: The appellate order was sustained in full, with the deduction claim disallowed and the remand for recomputation of capital gains maintained, resulting in dismissal of the assessee's appeal.

Ratio Decidendi: A claim for deduction not made in the return of income or during assessment proceedings cannot be introduced for the first time before the first appellate authority, while a factual capital-gains valuation dispute may be remitted for verification when the revenue authorities fail to assist the appellate process.

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