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of <h1>Tribunal Upholds CIT(A)'s Decision in Favor of Assessee</h1> <h3>ITO, Ward 28(1), New Delhi Versus M/s. Rajat Finvest</h3> ITO, Ward 28(1), New Delhi Versus M/s. Rajat Finvest - TMI Issues involved:1. Whether the Ld. CIT(A) erred in directing the AO to examine the matter and rectify the mistake, which amounts to setting aside the matter.2. Whether the AO wrongly treated the loss as positive income and raised a demand against the assessee.3. Whether the Ld. CIT(A) was justified in allowing the assessee's appeal and directing the AO to rectify the mistake.Analysis:1. The appeal by the Revenue was against the order of the Ld. Commissioner of Income Tax (Appeals-XXV), New Delhi for the assessment year 2009-10. The issue raised was regarding the Ld. CIT(A) directing the AO to examine the matter and rectify the mistake, which the Revenue contended amounted to setting aside the matter impermissibly.2. The assessee, a partnership firm, had filed a NIL return with the ITO, (CPC), Bangalore. The AO processed the return and demanded Rs. 34,11,580 from the assessee. The assessee's appeal under section 154 was rejected. The assessee then approached the Ld. CIT(A) stating that they had earned exempt income but the AO had wrongly treated the disallowed business expenses as positive income, leading to the demand raised against them.3. The Ld. CIT(A) considered the submissions and found merit in the assessee's argument that there was no justification for assessing the loss as positive income. The Ld. CIT(A) directed the present AO to rectify the mistake and redress the grievance of the assessee. The Revenue appealed against this order. During the hearing, the Revenue contended that the Ld. CIT(A)'s directions amounted to setting aside the matter, which was not permissible. However, the Tribunal upheld the Ld. CIT(A)'s order, stating that the directions were consequential and there was no infirmity in the decision.4. Ultimately, the Tribunal dismissed the appeal filed by the Revenue, affirming the Ld. CIT(A)'s decision to allow the assessee's appeal and direct the AO to rectify the mistake. The Tribunal found no fault in the Ld. CIT(A)'s order and upheld the same, leading to the dismissal of the Revenue's appeal.This detailed analysis outlines the key issues raised, the arguments presented by both parties, and the final decision of the Tribunal in favor of the assessee.
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