TaxTMI 
TaxTMI 
2023 (8) TMI 1707
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..... counsel submitted that additional ground was moved before ld. CIT(A) which has not been rejected. The ld. CIT(A) was not correct and justified in holding that deduction u/s. 80JJAA of the Act, requires examination of fulfillment of various conditions as stipulated in that section and therefore, it cannot be allowed u/s. 143(1). The ld. counsel vehemently pointed out that the Ld. CIT(A) has erred in law and on facts in not allowing further deduction of Rs. 76,28,552/- u/s. 80JJAA as claimed by the assessee for the first time before CIT(A) and it is prayed that the further deduction of Rs. 76,28,552/- be allowed as claimed by the assessee. Therefore, the ld. counsel submitted that the remaining part of deduction u/s. 80JJAA of the Act may kindly be directed to be allowed to the assessee. 4. Replying to the above, the ld. Senior DR submitted that the amount claimed by the assessee u/s. 80JJAA of the Act, in the return of income has been allowed to the assessee and the assessee is seeking to allow additional deduction of Rs. 76,28,552/- without claiming the same in the return of income which is not permissible. Therefore the ld. CIT(A) was right in dismissing the claim of assessee....
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....ce of CIT(A)-27, New Delhi after pronouncement of judgement on 21.04.2021 by Hon'ble Karnataka High Court in the case of CIT vs. Texas Instruments India P Ltd. (supra). 7. From relevant part of first appellate order we note that the ld. CIT(A) though admitted the additional ground no. 5 of assessee but has dismissed the same only by observing that u/s. 143(1) only those adjustments should be made where there are no two opinions. He also noted that any fresh claim of allowability of additional deduction u/s. 80JJAA of the Act requires examination of fulfillment of various conditions as stipulated in the said section and thus the same cannot be allowed u/s. 143(1) of the Act. In our considered opinion when the appellant itself in its application for admission of additional ground as well as in the written submission vide dated 05.05.2022 in para 1.2 to 1.2.2 clearly stated that the said claim was neither included in the return of income nor while filing first appeal before the ld. CIT(A) and the assessee found itself eligible for claiming additional deduction u/s. 80JJAA of the Act after pronouncement of judgment of Hon'ble Karnataka High Court in the case of CIT vs. Texas Instrum....
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....ay of April, 2006 or any subsequent assessment year, any deduction is admissible under section 80-IA or section 80-IAB or section 80-IB or section 80-IC or section 80-ID or section 80- IE, no such deduction shall be allowed to him unless he furnishes a return of his income for such assessment year on or before the due date specified under sub-section (1) of section 139." 6. On going through the above provision, it is crystallized that the requirement of filing return before the time u/s 139(1) is sine qua non for claiming deduction under the six sections (80-IA or 80- IAB or 80-IB or 80-IC or 80-ID or 80-IE). In other words, if a return is filed belatedly u/s 139(4) or under any other section, claiming deduction under any of the six sections, the writ of the section 80AC will operate to prevent its granting. This section does not deal with granting or non-granting of deduction under any other sections of Part C of Chapter VI-A, including section 80P. Thus, to infer that since section 80AC does not cover section 80P, the latter section is immune from any other statutory requirement, is wholly incorrect. In fact, section 80AC is alien to deduction under any section except th....
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....n of income. Thus, there are twin conditions, viz., first, claiming deduction u/s 80P and second, claiming such deduction in the return of income. There is no dispute on the first condition, which has been satisfied in this case as the assessee did claim the deduction albeit during the course of assessment proceedings. The whole controversy revolves around the second condition, which says that the claim should be made in the return of income. The assessee in the extant case did not file any return of income, but made a claim of the deduction in computation of income filed during the course of the assessment proceedings. The moot question is whether the requirement of making a claim in the return of income is a mandatory or a directory requirement. If it is held as mandatory, then the claim must be made in the return of income, failing which the benefit of deduction would be lost. Au contraire, if it is held as directory, then the claim made either in the return of income or in any manner before the conclusion of assessment proceedings, as is the case under consideration, would validate the entitlement. 11. The Hon'ble Supreme Court in CIT vs. G.M. Knitting Industries (....
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....irement. The matter was brought by the Revenue before the Hon'ble Supreme Court. The assessee, inter alia, relied on the judgment of the Apex Court in G.M. Knitting Industries (supra). Their Lordships held that the requirement of filing the report in support of deduction u/s 10B was not a directory but a mandatory requirement. It further held that both the conditions of - filing the declaration and filing it before the time limit u/s 139(1) - were mandatory and had to be cumulatively satisfied. Rejecting the reliance on G.M. Knitting Industries (supra), the Hon'ble Supreme Court held that that decision was relevant in the context of deduction provisions and not the exemption provisions as given under Chapter III of the Act. As the Hon'ble Summit Court in Wipro Limited (supra) was dealing with section 10B, falling under Chapter III of the Act, it held qua G.M. Knitting Industries (supra) that: `Therefore, the said decision shall not be applicable to the facts of the case on hand, while considering the exemption provisions. Even otherwise, Chapter III and Chapter VI-A of the Act operate in different realms and principles of Chapter III, which deals with "incomes which do ....
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....h deals with 'deductions to be made in computing the total income.' Therefore, it was held that the fulfillment of requirement for making a claim of exemption under the relevant sections of Chapter III in the return of income is mandatory, but, when it comes to the claim of a deduction, inter alia, under the relevant section of Chapter VI-A, such requirement become directory. In a case where the assessee claims deduction under Chapter VI-A of the Act, the making of a claim even after filing of return, but, before completion of the assessment proceedings and passing of assessment order meets the directory requirement of making a claim in the return of income. 9. In view of the foregoing, first of all, from the proposition rendered by ITAT, Pune Bench in the case Krushi Vibhag Karmchari Vrund Sahakari Pat Sanstha vs. ITO (supra), we respectfully note that the coordinate Bench of the Tribunal, after considering the proposition rendered by the Hon'ble Supreme Court in the cases of G.M. Knitting Industries (supra) and Wipro Ltd. (supra) held that the Chapter III and Chapter VI-A of the Act operate in different realms and principles of chapter III, which deals with 'incomes which did ....