TaxTMI 
TaxTMI 
2017 (7) TMI 143
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....'FY') relevant to the Assessment Year ('AY') 1997-98 in the sum of Rs. 2,50,00,000. 3. However, since the relevant notification giving effect to the Pay Commission recommendations was issued only on 4th March 1998, the Assessing Officer ('AO') disallowed in AY 1997-98 the claim in respect of the revised salary. This disallowance was upheld by the CIT(A) in AY 1997-98 confirming the action of the AO on the ground that the notification dated 4th March 1998 was relevant to AY 1998-99. Significantly, the CIT(A) observed that the claim could be considered in AY 1998-99. However, by the time the order of the CIT(A) was issued, the assessment for AY 1998-99 was complete, and in the return filed for the said AY, no claim for provision for arrears of wages was made. 4. To complete this narration it must be noticed that on 26th November 1998 the Petitioner filed its return of income for the AY 1998-99 declaring a total income of Rs. 23,50,62,778. 5. On 14th March 2001, the assessment order for the AY 1998-99 was made by the AO under Section 143(3) of the Act at the total income of Rs. 23,95,62,720. On 21st March 2001, the Petitioner made an application under Section 154 of the Act b....
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....t case under Section 264 of the Act. The revision application should be considered on its merits having regard to the peculiar facts and circumstances of this case and the fact that the appellant pursued a wrong remedy for the period from 2001 till date, if the appellant approaches the CIT under Section 264 within a month. Liberty to file an application under Section 264 is granted. The appeal is disposed of in the above terms." 9. On the basis of the above observations, the Petitioner filed an application before the CIT(A) under Section 264 of the Act on 27th September 2012. The Additional CIT Range-15 in a report dated 5th February 2014 stated that there was no dispute about the genuineness of the claim and that there was no loss of revenue. 10. By the impugned order dated 24th March 2014, the CIT(A) rejected the application filed by the Petitioner under Section 264 of the Act. The CIT(A) held that the Petitioner had not claimed the deduction in respect of provision for wage arrears by revising the return for AY 1998-99. Therefore, the issue did not emanate from the assessment order. A reference was made by the CIT(A) again to the decision of the Supreme Court in Goetze Ind....
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....Shree Manjunatheswar Packing Products & Camphor Works (1998) 231 ITR 53. 14. Mr. Shivpuri, on the other hand, submitted that Section 264 was not applicable in the case where the assessment order had been the subject matter of an appeal before the ITAT. Reliance was placed on the decision in Hindustan Aeronautics Limited v. CIT (2000) 243 ITR 808 (SC). It was further submitted that there is no provision in the Act which allows the entertaining of a fresh claim for deduction not made by the Assessee in the original return or even by filing a revised return. Reliance was again placed on the decision in Goetze (India) Limited (supra). He submitted that the CIT was bound to function within the frame work of the statute. He cannot indirectly permit that which cannot be permitted directly in the revisionary jurisdiction in the facts and circumstances of the case. Reliance was placed on the decision in Orissa Rural Housing Development Corporation (supra). 15. The above submissions have been considered. As regards the preliminary objection on the maintainability of the present petition under Article 226 of the Constitution when the remedy of challenging the decision of the AO by way o....
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....64, the Commissioner in exercise of his revisional power under the said section may pass such order as he thinks fit which is not prejudicial to the Assessee. There is nothing in s. 264 which places any restriction on the Commissioner's revisional power to give relief to the Assessee in a case where the Assessee detracts mistakes on account of which he was over-assessed after the assessment was completed. We do not read any such embargo in the Commissioner's power as read by the Commissioner in the present case. It is open to the Commissioner to entertain even a new ground not urged before the lower authorities while exercising revisional powers. Therefore, though the petitioner had not raised the grounds regarding under-totalling of purchases before the ITO, it was within the power of the Commissioner of admit such a ground in revision." 18. Likewise, the Kerala High Court in Parekh Brothers v. CIT (supra) observed: "We hold, that even though a mistake was committed by the Assessee and it was detected by him after the order of assessment, and the order of assessment is not erroneous, none the less it is open to the Assessee to file a revision before the Commission....
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....subsequent AY 1998-99. The observations in Goetze India Limited (supra) were explained by this Court in Sam Global Securities Limited (supra) where in para 8 it held that "wherein deduction claimed by way of a letter before the Assessing Officer, was disallowed on the ground that there was no provision under the Act to make amendment in the return without filing a revised return. Appeal to the Supreme Court, as the decision was upheld by the Tribunal and the High Court, was dismissed making clear that the decision was limited to the power of the assessing authority to entertain claim for deduction otherwise than by a revised return, and did not impinge on the power of the Tribunal." 22. Further, in CIT v. Mithlesh Impex (2014) 46 taxman.com 30 it was clarified that the decision of the Supreme Court in Goetze India Limited (supra) is confined to the powers of the AO. However, "when it comes to the power of Appellate Commissioner or the Tribunal, the Courts have recognized their jurisdiction to entertain a new ground or a legal contention." 23. Consequently, the Court is satisfied that in the present case, the CIT erred in rejecting the revision application of the Petitioner on....