2022 (6) TMI 740

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....f Rs. (-)1,89,90,32,020/-. Thereafter, a search and seizure action was carried out at the premises of the assessee on 30/11/2017 and as a consequence of search action, notice under section 153A of the Act was issued on 04/07/2018. In response, the assessee filed return of income on 14/07/2018, declaring loss of (-) Rs.1,54,21,64,359/-. This return was further revised to (-) Rs.1,49,75,40,455/-. 2.1 During the scrutiny proceedings before the Assessing Officer, the assessee explained the cause of reduction of loss as inadvertent mistake in computing the loss under the head "income from capital gain". The assessee submitted that it had purchased shares of "Intime Properties Private Limited" on 30/04/2013 for a sum of Rs.54,90,47,767/- and were sold on 31/03/2016 for a sum of Rs.54,32,72,901/-, thus, the shares are held for a period of 35 months and therefore loss of Rs.57,74,866/- arising from the sale of those shares should have been reported as 'short-term capital loss', whereas by mistake the assessee treated the loss as 'long-term capital loss' and therefore after reducing indexed cost of acquisition of Rs.63,20,77,335/-out of the sale consideration, resulted in loss of Rs.8,88,0....

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....come-tax2013] 36 taxmann.com 523 (Rajasthan), the Hon"ble High Court of Rajasthan has held that it is not open for the assessee to seek deduction or claim expenditure which has not been claimed in the original assessment, which assessment already stands completed, only because a assessment under Section 153A of the Act in pursuance of search or requisition is required to be made." 4. On further appeal, the Ld. CIT(A) also upheld the non-allowance of the carry forward of 'short-term capital loss' observing as under: "5.3 The submission made by the assessee has been examined. The case of the assessee is that of an abated assessment. As such, the assessment was open both for the assessee as well as the AO as far as nature of addition and extent of claim was concerned. It was the duty of the AO to correct an error of computation if the appellant had made a boda fide mistake. Hence, the action of the assessee in filing a revised return to correct certain errors relating to change in the head of income noted after filing of return in response to section 153A of the Act is found tenable. 5.4 However, on the issue of claim of the assessee for allowing carry forward of short term capit....

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....d in the return of income filed in terms of section 139(1) of the Act and has been claimed in the return of income filed u/s 153A of the Act. The issue in dispute before us is whether the 'short-term capital loss' claimed in the return of income filed in response to notice issued under section 153A of the Act can be allowed to carry forward to the assessee for subsequent years. The Ld. CIT(A) has reproduced the relevant section 80 of the Act, according to which any loss which has not been determined in pursuance to a return of income filed under the provision of section 139(1)/139(3) of the Act, shall not be carried. forward for subsequent years under the provisions of the Act. The Ld. Assessing Officer has relied on the decision of the Hon'ble Rajasthan High Court in the case of Jai Steel (India) Jodhpur (supra) wherein it is held that no fresh claim is eligible under section 153A proceedings. The Ld. counsel of the assessee has referred to the decision of the Tribunal in the case of BE Billimotrai & Co Ltd (supra), wherein the assessee filed regular return of income on 27/09/2013 i.e. within the due date prescribed under section 139(1) of the Act, but same was not accompanied by ....

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....ginal return of income filed within the due date prescribed under section 139(1) of the Act, the assessee had claimed loss at a higher figure. Section 44AB of the act requires the assessee to get his accounts audited and furnish the audit report within the due date prescribed under section 139(1) of the Act. Admittedly, in the facts of the present case the assessee did not furnish the audit report within the date prescribed under section 139(1) of the Act. A reading of section 139(9) of the Act makes it clear that non filing of audit report along with return of income within the due date under section 139(1) of the Act is one of the causes for which the return of income has to be considered as defective. Further, as per section 139(9) of the Act, the defective return of income is to be treated as invalid, unless, the assessee removes the defect within the time provided by the Assessing Officer. However, on a reading of section 139(9) of the Act it becomes clear that the Assessing Officer unilaterally cannot declare a defective return of income invalid without providing opportunity to the assessee to remove the defect within specified time limit. In the facts of the present case, it....