Tribunal upholds disallowance of loss set off for late filing: Compliance key for tax benefits

The Tribunal affirmed the disallowance of setting off the carried forward loss due to late filing of the return for AY 2017-18. Despite the appellant's arguments citing uncontrollable circumstances for the delay, the Tribunal upheld the CIT(A)'s decision, emphasizing the necessity of adhering to statutory timelines for claiming such benefits. The appeal challenging the Assessing Officer and CIT(A)'s orders was dismissed, reiterating the importance of timely compliance with tax regulations to access deductions and set off provisions under the IT Act.

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Issues:
1. Disallowance of setting off carried forward loss due to late filing of return for AY 2017-18.
2. Rejection of claim for setting off carried forward loss by CIT(A).
3. Appeal against the order passed by the Assessing Officer and CIT(A).

Issue 1: Disallowance of setting off carried forward loss due to late filing of return for AY 2017-18

The appellant, an individual assessee, filed the return of income for AY 2018-19 on 29th August, 2018, declaring taxable income and claiming a carried forward loss of &8377; 8,67,803 from AY 2017-18. The CPC disallowed the setting off of the loss as the return for AY 2017-18 was filed beyond the due date specified under section 139(1) of the IT Act. The appellant argued that the delay was due to a matrimonial dispute and a court order preventing access to crucial documents. However, the CIT(A) upheld the disallowance, stating that the b/f losses can only be allowed if the return is filed on time, and the action of the Assessing Officer was justified.

Issue 2: Rejection of claim for setting off carried forward loss by CIT(A)

The appellant contended before the CIT(A) that the delay in filing the return for AY 2017-18 was due to circumstances beyond control, such as a court order restricting access to necessary documents. The CIT(A), however, was not convinced by the arguments presented and upheld the disallowance of setting off the carried forward loss. The CIT(A) emphasized that for claiming the benefit of setting off carried forward loss, the return for the relevant assessment year must be filed within the specified due date under section 139(1) of the IT Act. Therefore, the CIT(A) rejected the appellant's claim based on the clear statutory provisions regarding the filing timeline for carrying forward losses.

Issue 3: Appeal against the order passed by the Assessing Officer and CIT(A)

The appellant raised multiple grounds in the appeal before the Tribunal, challenging the orders passed by the Assessing Officer and CIT(A). The appellant argued that the Assessing Officer's order was without jurisdiction and illegal, and the CIT(A) erred in disallowing the set off of carried forward losses without considering the facts and submissions made. The Tribunal, after considering the arguments from both sides and examining the records, affirmed that since the return for AY 2017-18 was not filed within the due date, the appellant could not carry forward the loss to AY 2018-19 for set off. The Tribunal concurred with the CIT(A)'s decision, upholding the disallowance of setting off the carried forward loss. Consequently, the Tribunal dismissed the appeal filed by the assessee.

In conclusion, the Tribunal upheld the disallowance of setting off the carried forward loss due to the late filing of the return for AY 2017-18, emphasizing the importance of adhering to the statutory timelines for claiming such benefits. The decision highlights the significance of timely compliance with tax regulations to avail of deductions and set off provisions under the IT Act.

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