TaxTMI 
TaxTMI 
2017 (6) TMI 539
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....said interpretation is directly contrary to the provisions of the Act and hence he has erred in allowing reduction of Rs. 9,25,932/- from book profit as against correctly claimed by the appellant at Rs. 58,28,298/- and has hence erred in enhancing the assessed book profit by Rs. 49,02,366/-. 3. That on law, facts and circumstances of the case, the Worthy CIT (A) was unjustified in not allowing the issue that computation of book profit and reduction of brought forward loss or depreciation whichever is less as per books of accounts cannot be taken up in proceedings u/s 154 and the rectification carried out is beyond the scope of the provisions of Section 154 of the Act. 2. Brief facts of the case are that the assessee filed return declaring total income of Rs. NIL. The case was selected for scrutiny. The assessee is running a hospital under the name and style of Mukut Hospital and Heart Institute at Chandigarh. The AO disallowed some expenses and computed the total income at Rs. 2,63,419/- and after reducing unabsorbed depreciation income was assessed at NIL vide order under section 143(3) dt. 25/11/2008. The assessee has calculated tax under section 115JB and shown tax l....
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....ment of losses and unabsorbed depreciation as per books of accounts is enclosed. The figures of brought forward total loss as on 31/03/2005 as per Balance Sheet is Rs. 2,66,66,990.86. Copy of relevant page of Balance sheet is enclosed. The breakup of this figure is Rs. 2,08,37,277.88 is business loss and Rs. 58,28,298.68 is unabsorbed depreciation. The lower of these two being Rs. 58,28,298.68 has been rightly claimed as deduction to arrive at figure of book profit." The AO however passed the order under section 154 of the Act dt. 18/03/2013 and raised the demand of Rs. 5,14,727/-. The order of the AO is reproduced as under: The reply given by the assessee has been considered. The assessee has "also furnished a chart in respect of business losses and depreciation losses in respect of previous years, on the basis of which the assessee arrived at the business loss of Rs. 2,08,37,277/- and depreciation loss to the tune of Rs. 58,28,298/-. The assessee has been asked to reconcile the figures by furnishing the balance sheets and computations of previous years on the basis of which the assessee arrived at such figures. The losses claimed are not substantiated by proper docume....
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..... Act provides that with a view to rectifying any mistake apparent from record, the Income Tax Authority may amend any order passed by it. Therefore, there should be a mistake apparent from the record of the Income Tax Authorities while exercising jurisdiction under Section 154 of the Act. 7.1. Hon'ble Calcutta High Court in the case of Hindustan Lever Ltd. Vs. Commissioner of Income-Tax and others [2006] 284 ITR 42 (Cal) held that mistake must be obvious that it can be easily corrected, to wit an arithmetical mistake, quotation of wrong section, etc. and not on datable issue. 7.2 Hon'ble Supreme Court in the case of ITO Vs. Volkart Brothers & Ors (1971) 82 ITR 50 (SC) held that a mistake apparent on the record must be 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. 8. The assessee filed return of income declaring loss of Rs. 9,81,556/-, which was accompanied by Auditor's report in which it has been certified by the Auditors that the tax payable under Section 115JB in respect of assessment year under appeal is Nil, which has ....
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....ons, which have been deleted by the Id. CIT(A) and confirmed by the Tribunal, the A.O. is not empowered to take a contrary view to review the entire assessment order already framed. It is against the spirit of provision of Section 154 of the Act. Therefore, Id. CIT(A) correctly held that there was no mistake apparent from record and A.O. cannot be allowed to pass the impugned order on debatable issue. Ld. CIT(A) correctly cancelled the order under Section 154 of the Act. Ld. counsel for the assessee also correctly demonstrated from the provision of Section 115JB(2) of the Act that whatever amount was reduced from the profit of business on account of loss to sick industrial company were in accordance with law. Therefore, there was no justification for A.O. to pass the order under Section 154 of the Act. We, therefore, do not find any merit in the appeal of the Revenue. The same is accordingly dismissed. 9. In the result, the appeal of the Revenue is dismissed. ITAT Delhi Bench in the case of ACIT Vs. Uflex Ltd. (supra) held as under: " If the issue requires debate and discussion, it cannot become a subject-matter of rectification under s. 154 of the Act because ....