TaxTMI 
TaxTMI 
2021 (1) TMI 158
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....the provisions of Income-tax Act. 3. That the Learned Commissioner has erred in confirming the action of AO of erroneously and incorrectly computing long term capital gains at INR.13,90,206 and short term capital gains of INR.37,14,599. 4. That the learned Commissioner has erred in not considering exemption u/s 54B of Rs. 40,95,341 for acquisition of agricultural land against sale of agricultural lands being short term capita! gains Rs. 37,71,014 as well as against long term capital gains of Rs. 3,24,327. 5. That the learned Commissioner is not justified in rejecting the claim of the appellant on the ground that the exemption u/s 54B is not claimed in the original return and in original grounds of appeal before the learned Commissioner though the revised grounds of appeal are duly considered and not expressly rejected by the learned Commissioner. 6. That the learned Commissioner is not justified in incorrectly applying the Supreme Court decision in Goetze (India) Ltd v. CIT [2006] 284 ITR 323(SC) and incorrectly holding the if the power of CIT (Appeals) are coterminous with Assessing Officer, the Hon'ble Supreme Court's decision rendered in the case of Goetze India ....
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.... examine the issue, whether the assessee is entitled for additional deduction of Rs. 13,90,206 u/s. 54F with regard to long term capital gain. 6. With regard to exemption u/s. 54B of the Act, we find that the reason for rejection by the CITA is that assessee has not filed revised return of income before the AO. The assessee relied on the order of Tribunal in the case of Rakesh Singh v. ACIT, 139 ITD 128 (Bang) wherein it was held that the first appellate authority could entertain new claim of assessee, though there is no revised return filed by the assessee before the AO. 7. Now the question before us is, whether the first appellate authority could have examined the claim of assessee u/s. 54B of the Act, though there was no revised return filed by the assessee. In our opinion, at this stage it is proper to go through certain case laws on this issue:- 8. The Hon'ble Supreme Court in the case of Jute Corpn. of India Ltd. v. CIT [1991] 187 ITR 688/[1990] 53 Taxman 85 was considering the following facts:- For the assessment year 1974-75, the appellant did not claim any deduction of its liability towards purchase tax under the provisions of the Bengal Raw Jute Taxation Act, 1941....
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....t place any restriction or limitation on the exercise of appellate power. Even otherwise an Appellate Authority while hearing appeal against the order of a subordinate authority may have in deciding the question before it subject to the restrictions or limitations if any prescribed by the statutory provisions. In the absence of any statutory provision the Appellate Authority is vested with all the plenary powers which the subordinate authority may have in the matter. There appears to be no good reason and none was placed before us to justify curtailment of the power of the Appellate Assistant Commissioner in entertaining an additional ground raised by the assessee in seeking modification of the order of assessment passed by the ITO". [Emphasis supplied]. 10. It is clear, therefore, that an assessee is entitled to raise not merely additional legal submissions before the appellate authorities, but is also entitled to raise additional claims before them. The appellate authorities have the discretion whether or not to permit such additional claims to be raised. It cannot, however, be said that they have no jurisdiction to consider the same. They have the jurisdiction to entertain th....
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....es it clear that for the purpose of enhancement, the Appellate Assistant Commissioner cannot travel beyond the proceedings which were originally before the Income Tax Officer or refer to new sources of income which were not before the Income Tax Officer at all. For this purpose, there are other separate remedies provided under the Income-tax Act". 13. The Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd. v. CIT [1998] 229 ITR 383 was considering a case where the assessee had deposited its funds not immediately required by it on short term deposits with banks. The interest received on such deposits was offered by the assessee itself for tax and the assessment was completed on that basis. Even before the Commissioner of Income-tax (Appeals), the inclusion of this amount was neither challenged by the assessee nor considered by the Commissioner of Income-tax (Appeals). The assessee filed an appeal before the Tribunal. The inclusion of the amount was not objected to even in the grounds of appeal as originally filed before the Tribunal. Subsequently, the assessee by a letter raised additional grounds to the effect that the said sum could not be included in the t....
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....der of the Commissioner of Income Tax (Appeals). Both the assessee as well as the Department has a right to file an appeal/cross objections before the Tribunal. We fail to see why the Tribunal should be prevented from considering questions of law arising in assessment proceedings although not raised earlier. 15. The Hon'ble Supreme Court in the case of Goetze (India) Ltd. (supra) relied on by the CIT is distinguishable on the facts. The question before the Court was whether the appellant-assessee could make a claim for deduction, other than by filing a revised return. After the return was filed, the appellant sought to claim a deduction by way of a letter before the Assessing Officer. The claim, therefore, was not before the appellate authorities. The deduction was disallowed by the Assessing Officer on the ground that there was no provision under the Act to make an amendment in the return of income by modifying an application at the assessment stage without revising the return. The CIT(Appeals) allowed the assessee's appeal. The Tribunal, however, allowed the department's appeal. In the Supreme Court, the assessee relied upon the judgment in National Thermal Power Co.....