TaxTMI 
TaxTMI 
2013 (10) TMI 1456
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....espect of the following issues: (a) Non consideration of revised return of income filed by the assessee. (b) Confirmation of disallowance made u/s. 40(a)(ia) of the Act in respect of the advertisement expenses. (c) Non consideration of claim for deduction of "loss on clearance sale". 3. Though the assessee has raised two more grounds relating to jurisdiction of the Assessing officer and levy of interest u/s 234B of the Act, the Ld. Counsel did not argue on those grounds. Hence, they are not considered for adjudication. 4. The facts relating to the case are stated in brief. The assessee is engaged in the retail business in textiles. It filed its return of income for the year under consideration on 31-10-2006 ....
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....40(a)(ia) by treating the revised return as explanation given by the assessee for the disallowance to be made u/s 40(a)(ia) of the Act. 6. In the appellate proceedings, the Ld. CIT(A) also held that the assessee has filed the revised return only to reduce the tax liability and hence it is clearly an afterthought. Accordingly, the Ld CIT(A) held that the AO was justified in ignoring the revised return. In this regard the Ld. CIT(A) placed reliance on the following decisions: (a) CIT vs. Radhey Shaym (1980) (123 ITR 125) (All.) (b) CIT vs. Grey Cast Foundry Works (2006) (99 ITD 515)(Ahd.) The Ld. CIT(A) confirmed the disallowance made u/s. 40(a)(ia) of the Act on the reasoning that the assessee himself has disall....
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.... to make the balance sheet satisfy the lending norms of the bank, the assessee has to mend with the sales, stock and profit figures. This is evidenced by the fact that during the course of survey, the value of stock found by the survey team was only 2.69 crores as against the book stock of Rs. 7.50 crores. Accordingly, the Ld. AR submitted that the assessee has corrected the above said mistakes by filing the revised return of income within the due date prescribed u/s. 139(5) of the Act. Accordingly, he submitted that the tax authorities are not justified in holding that the revised return of income filed by the assessee is an afterthought and rejecting the same. The Ld. Counsel for the assessee further submitted that the assessee has incurr....
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..... 9. We have heard the rival contentions and carefully perused the record. The first question that needs to be considered is whether the tax authorities are justified in declining to consider the revised return of income. We notice that the AO did not consider the same on the reasoning that the filing of revised return of income is an afterthought. The ld CIT(A) also agreed with the said view expressed by the AO and in this regard he placed reliance on the two decisions referred supra. We have carefully gone through the above said two decisions and find that they have been rendered in the context of penalty levied u/s 271(1)(c) of the Act. Hence, in our view, these two decisions do not support the view of the Ld CIT(A). 10. We notice ....
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....sing officer that two adjustments made by the assessee in the revised return do not fall in the category of "omission or any wrong statement" as stated in sec. 139(5) of the Act. We notice that the power to treat a return of income as "invalid" is given to the assessing officer u/s 139(9) of the Act. We notice that the AO has not followed the procedures laid down in sec. 139(9) of the Act for the purpose of rejecting the revised return of income. Thus, it is seen that the assessing officer has not drawn support from any of the statutory provisions for the decision taken by him to reject the revised return of income. The only reason given by the AO is that it is an afterthought on the part of the assessee. We have already noticed that the pr....