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| DATE: | November 30, 2011 (Date of publication) |
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| Click here to download the judgement (c_n_c_construction_additional_ground_260A.pdf) |
S. 260A: High Court has no power to consider issue not raised before Tribunal
The assessee filed an appeal before the Tribunal in which it argued that it had constructed a “temporary construction” which was eligible for 100% depreciation. This was rejected by the Tribunal on the basis that the construction was permanent. Before the High Court, the assessee argued for the first time that the expenditure was “revenue” in nature and admissible as business expenditure. HELD not permitting the assessee to raise the plea:
A contention/ issue, which is not raised, dealt with or answered by the Tribunal, cannot be raised before the High Court for the first time in an appeal u/s 260A. Though s. 260A(6) empowers the High Court to “determine any issue which has not been determined by the Appellate Tribunal”, the word “determined” means that the issue is not dealt with, though it was raised before the Tribunal. The word “determined” presupposes an issue was raised or argued but there is failure of the Tribunal to decide or adjudicated the same. However, as the issue whether the expenditure is capital or revenue was not raised before the Tribunal, it does not arise from the order of the Tribunal and cannot be entertained (Mahalakshmi Textile Mills 66 ITR 710 (SC) distinguished)
The argument raised in the present case was that the Tribunal should have suo moto decided the issue even if it was not raised. The High Court has held that before deciding whether the expenditure is capital or revenue requires examination of facts from a different perspective which has not been done in this case. This case should not be read as a blanket ban on raising a new contention before the High Court. This issue has been dealt with by the Supreme Court in CIT v. NTPC 229 ITR 383 (SC), which has not been considered in this judgement by the High Court.