1. Claim of deduction after filing return to be made only by revised return and not otherwise

Goetze (I) Ltd. vs. CIT (284 ITR 323, SC)

For the A.Y. 1995-96 the assessee filed its return on 30th November, 1995 and on 12th January, 1998 and sought to claim a deduction by way of a letter addressed to the A.O. The said claim was not allowed by the A.O. on the ground that there was no provision in the Act allowing an amendment in the return without a revised return. The Tribunal and the High Court upheld the order of the A.O. Before the Supreme Court relying on the decision of the Supreme Court in the case of National Thermal Power Company Limited vs. CIT (229 ITR 383) it was contended that it was open to the assessee to raise the points of law for the first time before the Appellate Tribunal.

Their Lordships held that in the case of National Thermal Power Company Limited (supra) a question was that the power of the Tribunal was to entertain for the first time a point of law provided the facts are on the record. This decision does not in any relate to the power of the A.O. to entertain a claim for deduction otherwise than by filing a revised return. Therefore, the civil appeal of the assessee was dismissed.

Editorial Note :

This decision has far reaching consequences inasmuch as a claim of an assessee can be rejected at the threshold by the A.O. relying on this decision on the ground that the assessee had not filed a revised return for claiming deduction and thereafter the assessee will be without any recourse for claiming the said deduction. However this decision cannot be invoked when the assessee is revising or rectifying his claim of deduction before the A.O.

2. Determination of tax u/s. 115J only after end of the relevant year – Interest u/ss. 234B and 234C not leviable

CIT vs. Kwality Biscuits Ltd. (284 ITR 434).

The Karnataka High Court (243 ITR 519) held that interest was not leviable u/ss. 234B and 234C of the Act on the basis of book profits u/s. 115J since the entire exercise of computing income u/s. 115J could only be done at the end of the financial year and the provisions of sections 207, 208, 209 and 210 could not be made applicable until and unless the accounts were audited and the balance sheet prepared. The appeals of the Department against this decision were dismissed by the Supreme Court.