On August 31, 2023, the Income Tax Appellate Tribunal in Delhi made a significant ruling in the case of Jaquar and Company Private Limited vs. The Deputy Commissioner of Income Tax, Central Circle-19, Delhi, pertaining to the Assessment Year 2019-20. This case, documented as ITA No. 1985/DEL/2022, centers around a dispute over the denial of a deduction under section 80JJAA of the Income Tax Act, 1961.
Jaquar and Company Private Limited, a well-known entity in the industrial sector, faced discrepancies after the CIT(A)-27 in New Delhi, on June 27, 2022, disallowed a further deduction of Rs. 76,28,552 claimed under section 80JJAA. The company, dissatisfied with the decision, appealed to the Income Tax Appellate Tribunal, Delhi.
During the proceedings, the counsel for Jaquar argued that the CIT(A) erred in not allowing the deduction for additional employee cost, which was first claimed before the CIT(A). On the other hand, the Senior DR representing the Revenue contended that the claim was inadmissible as it was not claimed in the original return of income.
The Tribunal, led by Judicial Member Shri Chandra Mohan Garg and Accountant Member Dr. B.R.R. Kumar, deliberated on the legal and factual aspects of the claim. Their analysis included a detailed examination of the conditions under section 80JJAA, the powers of the CIT(A), and relevant case law.
The Tribunal ultimately concluded that the CIT(A) was incorrect in disallowing the deduction. They highlighted that the first appellate authority should have admitted the additional claim as it was in continuation of the assessment proceedings. The decision emphasized the tribunal’s authority to entertain and examine claims not included in the original return if they meet certain criteria.
This case sets a precedent for how deductions under section 80JJAA should be handled when they are claimed at the appellate level. It underscores the importance of the tribunal’s role in ensuring justice and fairness in tax assessments.
The outcome of ITA No. 1985/DEL/2022 serves as a critical reference for tax practitioners and assesses dealing with similar disputes. It provides clarity on the procedural aspects of claiming deductions under the Income Tax Act, particularly in appellate proceedings.
Manage the increasing number of hearings effortlessly by leveraging the legal AI revolution We are India's Leading revolutionary AI-powered legal platform where you can get enough insights into top cases and judgements.
Research Platform