2024 (5) TMI 1297 - AT - Income Tax

Appeal Dismissed: No Standard Deduction or Chapter VIA Deductions Allowed Under New Tax Regime for A.Y. 2022-23.

The Tribunal dismissed the appeal by the assessee concerning the denial of standard deduction and Chapter VIA deductions for A.Y. 2022-23. The appellant, ... Denial of standard deduction and Chapter VIA deductions u/s 80C - original return of income was filed under the Old Tax Regime which was revised under the New Tax Regime - CIT(A) confirmed the action of the AO placing reliance on the provisions of section 115BAC - appellant is an individual deriving income under the head “Salaries” - HELD THAT:- Admittedly, in the present case, the original return of income was filed on 29.07.2022 under the Old Tax Regime which was revised on 10.08.2022 under the New Tax Regime. Once the original return of income is substituted by filing a valid revised return, the natural consequence is that earlier return would be effaced or obliterated for all the purposes under the Income-tax Act. Therefore, it is not open for the AO to advert to the original return of income or the statement filed along with original return of income. Reference in this regard can be made to the judgments of Mangalore Chemicals and Fertilizers [1991 (1) TMI 70 - KARNATAKA HIGH COURT] and CIT Vs. Machine Tool Corporation of India Ltd. (1992 (8) TMI 37 - KARNATAKA HIGH COURT) to fortify our view. Admittedly, under the provisions of section 115BAC, once the assessee opts for the New Tax Regime, he is not entitled to either the standard deduction u/s. 16 or the Chapter VIA deductions. The CPC had rightly processed the return of income. Therefore, we do not find any error in the approach adopted by the CPC. Accordingly, the appeal filed by the assessee stands dismissed. Issues involved: Appeal against denial of standard deduction and Chapter VIA deductions under section 115BAC for assessment year 2022-23.Summary:Issue 1: Denial of standard deduction and Chapter VIA deductionsThe appellant, an individual deriving income under the head 'Salaries,' filed an original return for A.Y. 2022-23 under the Old Tax Regime, which was later revised under the New Tax Regime. The CPC denied standard deduction u/s. 16 and Chapter VIA deductions u/s. 80C in the processed return u/s. 143(1). The CIT(A) upheld this denial based on section 115BAC, which disallows these deductions under the New Tax Regime. The Tribunal noted that once a valid revised return is filed, the original return is no longer relevant for tax purposes, citing precedents like CIT Vs. Mangalore Chemicals and Fertilizers and CIT Vs. Machine Tool Corporation of India Ltd. Under section 115BAC, opting for the New Tax Regime precludes entitlement to standard deduction and Chapter VIA deductions. Consequently, the Tribunal upheld the CPC's processing of the return and dismissed the appeal.Decision:The Tribunal dismissed the appeal filed by the assessee against the denial of standard deduction and Chapter VIA deductions under section 115BAC for A.Y. 2022-23, as opting for the New Tax Regime precludes these deductions.