Scope of Sec.143 substituted by Direct Laws(Amendment) Act, 1987.

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....the basis of the return it shall be granted to the assessee. 3. For the purposes of computing the tax or interest payable by or refundable to the assessee the following adjustments are required to be made, under the proviso to sub clause (a) of sub-sec.(1) of section 143 to the income or loss declared in the return:- i. Any arithmetical error in the return, accounts or documents accompanying it shall be rectified. ii. Any loss carried forward, deduction allowance or relief which on the basis of the information available in such return, accounts or documents is PRIMA FACIE admissible but which is not claimed in the return, shall be allowed. iii. Any loss carried forward deduction, allowance or relief claimed in the return, which ....

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....en within the time limit laid down on this behalf the Assessing officer will have to take action u/s.147 of the act. 6. It has also to be noted that for purposes of making the adjustments under the aforesaid proviso, it will not be permissible to refer to the record of past assessments in the case of the assessee. For instance, it will not be permissible for the assessing officer to make an addition to the profits by applying a higher rate of gross profit than that shown in the books, even though in an assessment for an earlier year the profits so estimated may have been confirmed in appeal. Similarly it will not be permissible for the assessing officer to disallow any claim in respect of interest on loans even though the amounts on whic....

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....for determining whether there is a prima facie error for purposes of making an adjustment under the aforesaid proviso it will be correct and proper to apply the same test as has been laid down by the Supreme Court for purposes of rectification of mistakes u/s.154 of the act. According to the Supreme court a mistake can be rectified u/s.154 of the Act only if it is an obvious and patent mistake and not something which can be established by a long drawn process of reasoning on points on which there may conceivably be two opinions vide T.S. Balaram ITO Vs. M/s.Volkart Brothers 80 ITR 50 (SC). 9. In the context of the legal position as outlined above, it follows that it will not be permissible for the Assessing officer to disallow a claim fo....