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Deduction not claimed earlier can be claimed during the proceeding under Section 151A: Bombay HC [Read Judgment]

Section 151A - Hybrid Amplifier - Bombay High Court - Taxscan

The Bombay High Court while affirming the right of the assessee and held that the deduction which is not claimed earlier can be claimed during the proceeding under Section 151A.

In the case of Commissioner of Income Tax vs. M/s. JSW Steel Ltd. the court reinstated the rights of the assessee by stating that once assessment gets abated, it is open for the assessee to lodge a new claim in a proceeding under Section 153A(1) of the Income Tax Act, which was not claimed in his regular return of income because the assessment was never finalized in the case of the assessee in such a situation. Consequently, the assessee was entitled to lodge a new claim for deduction which remained to be claimed in his earlier/ regular return of income.

The assessee (respondent) was engaged in various activities including the production of sponge iron, galvanized sheets, and cold-rolled coils through its steel plants located at Kalmeshwar in Maharashtra. The assessee filed an original return of income for Assessment Year 2008-09 declaring the loss of a certain amount. In this return of income,

The assessee made a new claim for treating gain on pre-payment on the basis of ‘capital receipt’ which was disallowed by the Assessing Officer (AO).

The issue raised in this case was whether the claim which was not made in the earlier original return of income filed under Section 139(1), could be filed and considered in the subsequent return filed by the assessee in pursuance to notice under Section 153A or not?

The division bench of High Court of Bombay comprising of Justice Ujjal Bhuyan and Justice Milind N. Jadhav affirming the right of the assessee and held that the deduction which is not claimed earlier can be claimed during the proceeding under Section 151A.

To Read the full text of the Judgment CLICK HERE
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