Circular - exemption benefit

[gurmukh kotwani]

Can someone provide number and date of an old income tax circular permitting assessing officer to give benefit of exemptions and deduections to assesse not claimed by him in return but to which he is otherwise entitled.

[DEV KUMAR KOTHARI]

CIRCULAR nO. 14 (xl-35) DT. 11.04.1955. BUT RAIRELY PRACTICED AND FOLLOWED BY A.O. NOW IN VIEW OF SC DECISION IN CASE OF GOIETZ INDIA, THE ASSESSEE HAS TO BE CAREFUL TO MAKE ALL CLAIMS IN RETURN OR REVISED RETURN. ANY CLAIM BY LETTER SHALL NOT BE PERMITTED BY AO.

AI Summary

Exemption claims must be made in the tax return or revised return; claims by letter will not be accepted.
Circular guidance historically allowed assessing officers to grant exemptions and deductions omitted from a taxpayer's return, but in practice this is rarely followed. Current authority requires taxpayers to make all claims in the original return or a revised return; claims made by letter or informal correspondence are not an acceptable substitute for lodging claims through the statutory return mechanism.