48. The assessee’s dependent mother a senior citizen had open heart surgery performed by a general surgeon in a private hospital, and he has incurred expenses towards surgery and treatment a sum of Rs, 3,00,000/- and claimed exemption u/s 80DDB a sum of Rs.60,000I The assessing officer rejected the claim and levied tax. Is the assessing officer correct or not? As department counsel defends the assessing officer with reasons.

1. Facts of the Case

• The assessee’s dependent mother, a senior citizen, underwent open heart surgery in a private hospital.
• The surgery was performed by a general surgeon, not a specialist in neurology, oncology, nephrology, etc.
• The assessee incurred medical expenses amounting to ₹3,00,000.
• He claimed deduction of ₹60,000 under Section 80DDB of the Income Tax Act, 1961.
• The Assessing Officer (AO) rejected the claim, stating that the treatment does not fall within the scope of specified diseases mentioned under Section 80DDB, and levied tax accordingly.
• The assessee challenges the rejection.

2. Issues in the Case [Questions]

1. Does open heart surgery qualify as a specified disease or ailment under Section 80DDB of the Income Tax Act?
2. Is the treatment carried out by a general surgeon sufficient to claim deduction under the said section?
3. Was the Assessing Officer justified in rejecting the deduction and levying tax?

3. Legal Principles Covered

A. Section 80DDB of the Income Tax Act, 1961

• This section provides deduction for expenditure incurred on medical treatment of specified diseases or ailments, prescribed under Rule 11DD of the Income Tax Rules.
• For senior citizens, the maximum deduction allowable was ₹60,000 at the time of the relevant assessment year (amounts revised in subsequent years).
• However, the deduction is allowed only for specified diseases, such as:
  • Neurological diseases (e.g., dementia, Parkinson’s)
  • Cancer
  • AIDS
  • Chronic renal failure
  • Hematological disorders like hemophilia and thalassemia

B. Rule 11DD of the Income Tax Rules

• Lists diseases eligible for deduction under Section 80DDB.
• Cardiac or heart-related surgeries (including open-heart surgery) are not included in the list.
• Moreover, treatment must be certified by a specialist as defined under the Rules (e.g., neurologist, oncologist, nephrologist).

C. CBDT Circulars and Case Law

• CBDT has clarified that only specified ailments as listed are eligible for deductions under this section.
• In CIT v. V.K. Kapoor (Delhi HC), the court reaffirmed that deduction under 80DDB cannot be allowed for diseases not listed under Rule 11DD.

4. Possible Judgement

As department counsel, the AO’s position is legally sound for the following reasons:

• The disease (heart condition) is not covered under Rule 11DD, which is mandatory for claiming Section 80DDB benefits.
• The treatment was conducted by a general surgeon, and not certified by a specialist prescribed under the rule.
• The assessee did not submit a valid certificate in Form 10-I (or its updated format) from a qualified specialist in a government hospital, which is required.
• As per statutory interpretation, benefit-oriented provisions like deductions must be strictly construed, and the onus lies on the taxpayer to comply.