TaxTMI 
TaxTMI 
2018 (12) TMI 685
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....s at Rs. 3,85,05,000/- as against correct amount of loss of Rs. 14,27,10,063/-are available on record during the course of assessment proceedings. While computing the long-term capital loss, cost of acquisition of Government Securities of Rs. 21,65,30,000/- has been considered instead of considering the amount of indexed cost of acquisition of Rs. 32,07,35,063/-. The CIT(Appeals) ought to have directed theAssessing Officer to allow long-term capital loss at Rs. 14,27,10.063/-since it is a mistake apparent from record and all the details are available on record. 3. The learned CIT (Appeals) failed to appreciate that the Assessing Officer is duty bound to allow all legitimate allowances / deductions though not claimed or mistakenly considered in the return of income 4. The learned CIT (Appeals) failed to appreciate that the CIT (Appeals) can admit an additional ground / claim made before him which was even not raised before the Assessing Officer. Ground II: The Appellant craves leave to add, alter and /or amend all or any of the foregoing grounds of appeal." 3. Brief facts of the present case are that the assessment was completed by the AO u/s. ....
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.... First of all, we have to decide this aspect as to whether the claim made by the assessee before the AO in its petition u/s. 154 is allowable u/s. 154 of IT Act or not. For this purpose, we reproduce the provisions of section 154 of IT Act. The same are as under. "154. (1) With a view to rectifying any mistake apparent from the record an income-tax authority referred to in section 116 may,- (a) amend any order passed by it under the provisions of this Act ; (b) amend any intimation or deemed intimation under sub-section (1) of section 143; (c) amend any intimation under sub-section (1) of section 200A; (d) amend any intimation under sub-section (1) of section 206CB. (1A) Where any matter has been considered and decided in any proceeding by way of appeal or revision relating to an order referred to in sub-section (1), the authority passing such order may, notwithstanding anything contained in any law for the time being in force, amend the order under that sub-section in relation to any matter other than the matter which has been so considered and decided. (2) Subject to the other provisions of this section, the authority....
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....) making the amendment; or (b) refusing to allow the claim." 6. From the above provisions of section 154, it is seen that only those mistakes which are apparent from records can be rectified under the provisions of section 154. Hence, we have to examine this as to whether the assessee's claim for rectification is for apparent mistake or not. In the present case, it is noted by the AO on page no. 2 of the order passed by him u/s. 154 of IT Act that the assessee company vide its application for rectification has stated that the assessee company considered only the actual cost of acquisition instead of indexed cost of acquisition and determined the Long Term Capital Loss at Rs. 3,85,05,000/- instead of Rs. 14,27,10,063/-. In our considered opinion, this may be a mistake against which the appeal can be filed by the assessee by filing an appeal before CIT(A) against the assessment order but such mistake is not an apparent mistake which can be rectified by the AO u/s. 154 of IT Act. In the light of these facts, now we examine the applicability of various judicial pronouncements on which reliance is placed by ld. AR of assessee. 7. First of all, the ld. AR of assessee has r....
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....m capital loss is on the basis of original cost or indexed cost and for this reason also, this judgment of Hon'ble Apex Court is not applicable in the present case. 10. The second judgment relied upon before us is the Tribunal order of Delhi Bench of the Tribunal rendered in the case of Xerox India Ltd. Vs. DCIT (supra). In this case also, the issue in dispute was not in respect of any claim made u/s. 154 which has not been allowed by the AO. In that case, the issue before the Tribunal was in respect of assessment proceedings and not in respect of rectification of assessment proceedings and therefore, in the present case, this Tribunal order is also not applicable. 11. The next decision cited before us is the decision of Bangalore Bench of the Tribunal rendered in the case of Rakesh Singh Vs. ACIT (supra). In this case, it was held that although revised return cannot be filed by the assessee if the original return of income was not filed in time but still the assessee can make an additional claim before the appellate authority i.e. CIT(A) and he is duty bound to consider the same. Hence, this is clear that in that case also, the proceedings were not initiated u/s. 154 whereas....
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....ent that there was mistake in not granting relief u/s. 35B although the said relief was not claimed in the return of income. Against this Tribunal order, the revenue filed an appeal before Hon'ble Madhya Pradesh High Court and under these facts, it was held by Hon'ble Madhya Pradesh High Court that if it is apparent from the records that the assessee was entitled to relief admissible under Section 35B of the I.T. Act then such relief can be granted to assessee by an order under Section 154 of the I.T. Act by rectifying the assessment even though relief under that section had not been claimed by the assessee in the original assessment proceedings. In the present case, this is not the case that long term capital loss was not claimed by the assessee in the original return filed by him and such claim is made for the first time in the proceedings u/s. 154 of IT Act. In the present case, the long term capital loss was claimed and allowed by the AO in the assessment proceedings and now in the proceedings u/s 154,the assessee has made a higher claim regarding long term capital loss. Hence in our considered opinion, this is not a question of law but question of fact and therefore, it is not....
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....nd payable to the financial institutions was converted into equity of the company, by passing a resolution by the Board of Directors of the assessee company on 29th December, 1994, copy whereof has been placed at page 40 of the paper book. The lower authorities have also not denied this contention of the assessee that by way of Note in Schedule-1 it has been clearly mentioned in the Balance Sheet that Rs. 53 lacs being interest on the term loan has been converted into equity shares of equal value, nor the department has denied the existence of reply dated 12.10.96 of the assessee in response to the query raised in the notice under Section 143(2) placed at pages 5-8 of the paper book, wherein in para 12 it has been replied that no expenditure was incurred for increase in share capital or share application money as there was no public issue of the company's shares and that major increase of Rs. 53 lacs representing conversion of funded interest due to IDBI, IFCI and ICICI into equity under the rehabilitation package sanctioned by IDBI/BIFR. The query No. 12 raised in this regard by the department has been placed at page No. 4 of the paper book. In the CBDT Circular No. 669 dated ....