2021 (11) TMI 569 - AT - Income Tax

ITAT Mumbai remits Capital Gain claim back to Assessing Officer for reconsideration

The ITAT Mumbai allowed the appeal for statistical purposes, directing the Assessing Officer to reconsider the appellant's claim of addition to Long-Term ... Admission of claim without a revised return - consideration of claim during assessment proceedings - revised return under section 139(5) - power to remit to the Assessing Officer for fresh considerationAdmission of claim without a revised return - consideration of claim during assessment proceedings - revised return under section 139(5) - Whether the assessee's revised computation of long term capital gains could be considered by the revenue authorities without filing a revised return and whether the claim should be admitted for fresh consideration by the Assessing Officer. - HELD THAT: - The Tribunal held that the determinative question was not the availability of remedy under revised return under section 139(5) but whether the assessee's claim could be admitted and examined by revenue authorities notwithstanding that a revised return was not filed. The Tribunal noted the decision of the Hon'ble Bombay High Court in CIT v. Pruthvi Brokers and shareholders Pvt. Ltd. as mandating that an assessee's claim should be considered and decided according to law, and observed that the Hon'ble Supreme Court in Goetze (India) Ltd. v. CIT does not preclude the Tribunal from allowing the claim to be considered otherwise than by a revised return. Applying these authorities, the Tribunal concluded that the appropriate course was to remit the matter to the Assessing Officer for consideration of the assessee's revised computation after affording the assessee an opportunity of being heard, rather than finally deciding the correctness of the claim at the appellate stage. [Paras 7, 8]Matter remitted to the Assessing Officer to consider the assessee's revised computation and pass an order according to law after giving the assessee an opportunity of being heard; appeal allowed for statistical purposes.Final Conclusion: The Tribunal remitted the issue to the Assessing Officer for fresh consideration of the assessee's revised computation of long term capital gain (AY 2013 14) after hearing the assessee, and allowed the appeal for statistical purposes. Issues:1. Addition to Long Term Capital Gain by Rs. 16,30,302/-Analysis:Issue 1: Addition to Long Term Capital Gain by Rs. 16,30,302/-The appeal pertains to the assessment year 2013-14 and challenges the order of the Commissioner of Income Tax (Appeals) confirming the assessment of Long-Term Capital Gain. The appellant contested the addition of Rs. 16,30,302/-, arguing that the correct fair value of cost was inadvertently considered at a wrong amount in the return of income. The appellant also highlighted the quasi-judicial nature of the Assessing Officer's power and cited a circular from the Central Board of Direct Taxes (CBDT) to support their claim. The appellant further contended that the revised computation of Long-term Capital Gain was not considered by the authorities, emphasizing that it was a correction rather than a new claim of deduction.The Commissioner of Income Tax (Appeals) upheld the original assessment, citing the appellant's delayed payment of tax and late filing of the return as reasons for precluding the filing of a revised return under section 139(5) of the Income Tax Act. The Commissioner referred to relevant case law to support the decision, emphasizing that the legislative intent behind section 139(5) was to limit the benefits of filing a revised return to those who filed within the specified time frames of section 139(1) and (2).Upon appeal, the ITAT Mumbai considered the issue and noted that the crux of the matter was not the applicability of section 139(5) but rather whether the appellant's claim could be admitted without a revised return. Citing precedents, including a decision of the Hon'ble Bombay High Court and the Supreme Court, the ITAT directed the Assessing Officer to reconsider the appellant's claim and make a decision in accordance with the law, granting the appellant a proper opportunity to be heard. Consequently, the ITAT allowed the appeal for statistical purposes, remitting the issue back to the Assessing Officer for fresh consideration.In conclusion, the ITAT Mumbai's judgment focused on the procedural aspect of admitting the appellant's claim without a revised return, emphasizing the need for the revenue authorities to consider the claim in line with legal principles and precedents.