TaxTMI 
TaxTMI 
2025 (5) TMI 1085
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.... aforesaid context, it is humbly submitted that order u/s 250 was passed by Ld. CIT(A) in the case of assessee company on 26.09.2024, which stood served on the e-portal of the assessee company. Against the order so passed, appeal could have been filed within 60 days, from the service of the order. However, the appeal got delayed by 84 days, as the appeal was filed on 19.02.2025 for the reasons as explained below: 1. That, the order was passed by The National Faceless Appeal Centre, Delhi on 26.09.2024. 2. That, upon review of the appeal status on the Income Tax E-Portal by the accountant of the assessee company, it was discovered that the order dated 26.09.2024 has been passed which was not received by the assessee company via E-mail ID i.e. on [email protected] [mentioned on Form 35] or hebothraassociates@ yahoomail.com [as mentioned in the notice of the Income Tax Department). Consequently, the present appeal is being submitted before your goodself with respect to the order dated 26.09.2024 which is delayed. 3. Thus, it is submitted that the delay in filing the appeal is absolutely inadvertent and has occurred due to circumstances beyond the control o....
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....o present its case. 2. That the Ld. CIT(A) erred in dismissing the appeal without appreciating the full facts of the case and in law. 3. That the Ld. CIT(A) further erred in law and on facts in upholding the demand of Rs. 66,11,560/- without properly appreciating the rectification request made under Section 154 of the Income Tax Act, 1961 before CPC against changes made by CPC and disallowing claim u/s 10AA. 3.1 That the Ld. CIT(A) failed to consider that the Centralized Processing Centre (CPC) made a mistake in processing the return by not interpreting the Section 115BAA of the Income Tax Act, 1961, properly and moreover the appellant had already paid tax under the normal provisions at 25% plus surcharge instead of availing concessional rate of tax u/s 115BAA. 3.2 That the Ld. CIT(A) erred in not allowing the legitimate claim of exemption under Section 10AA of the Income Tax Act, despite the fact that the appellant had filed the requisite Form 56F well before due date for claiming the exemption. 3.3 That the ld. CIT(A) has erred in upholding the rectification order passed by CPC dated 08.04.2024 despite the fact that it is apparent that....
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....sed the appeal of assessee company stating that the issue being controversial and not being a mistake apparent from record and therefore beyond the purview of section 154. The relevant finding of the ld. CIT(A) is reiterated here in below : "4. I have examined the facts and legal issues involved in this case and gone through the Order as well as grounds of appeal. The appellant has also relied upon various judgments of different courts of law on this issue, Since there are divergent views in this matter, the whole issue becomes contentious, This cannot, therefore, be said that there is an apparent mistake that had crept in the Order. It has been held by Hon'ble Supreme Court in Review Petition (Civil) no. 1620 of 2023 in Civil appeal no. 1661 of 2020 in the case of Sanjay Kumar Agarwal vs. State Tax Officer that an error which is not self-evident and has to be detected by a process of reasoning, cannot be said to be an error apparent on the face of record and that an error on the face of record must be such an error which, mere locking at the record should strike and it should not require any long-drawn process of reasoning on the points where there may conceivably be ....
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....to be "mistake apparent on record". Therefore, there is no scope in interfering with the Order and it is upheld. 7. In the result, the appeal is hereby dismissed. 9. As the assessee did not find any favour, from the appeal so filed before the ld. CIT(A), the assessee has preferred the present appeal before this Tribunal on the ground as reproduced hereinabove. To support the various grounds raised by the assessee, ld. AR of the assessee relied on the written submission which reads as follows : "With this background, ground-wise submission is made as under: Grounds of Appeal No. 1 to 2: In these grounds of appeal, assessee company has challenged the actions of ld. CIT(A) in passing the order without affording adequate opportunity of being heard and deciding the matter ignoring the facts stated by assessee company. In the matter, it is submitted that the impugned appellate order is vitiated by procedural irregularity and lack of adherence to the principles of natural justice. Ld. CIT(A) issued single notice dated 04.09.2024 with a due date to submit response on or before 11.09.2024. Further, the notice so issued was issued on the E-mail....
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....y 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. According to the provisions of sec154 of the Act, an income tax officer have the powers to rectify a mistake which was apparent from record that may have been occurred while passing an order u/s 143(1) of the Act. It is submitted the impugned error arising from the automated processing of return under Section 143(1), which led to the denial of deduction and incorrect alteration of the tax regime, clearly falls within the ambit of "mistake apparent from the record", as contemplated under Section 154 of the Income-tax Act, 1961. It is further submitted that the term "mistake apparent from the record" has not been explicitly defined in the Income tax Act, 1961. However, its legal scope and judicial contours have been decisively laid down by the Hon'ble Supreme Court in the authoritative judgment in the case of Assistant Co....
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....hat is verifiable without any need for fresh enquiry, investigation, or debatable reasoning, and therefore squarely falls within the parameters laid down by the Hon'ble Supreme Court in Saurashtra Kutch Stock Exchange Ltd. Hence, the rejection of rectification by CPC on the ground that "no mistake apparent from the record" exists is clearly unsustainable and contrary to the principle laid down in the binding precedent of the Hon'ble Supreme Court. Further with regard to the issue being controversial, it is submitted that the approach adopted by the ld. CIT(A) is erroneous both in law and in equity. The appellate authority, being a quasi-judicial forum, is expected to discharge its functions judiciously by applying mind to the facts of the case and rendering a reasoned decision. In the present matter, however, the ld. CIT(A) failed to exercise this quasi-judicial function in its true spirit. Instead of examining the grounds of appeal along with statement of facts on merits and making necessary factual or legal enquiries, the ld. CIT(A) chose to summarily reject the appellant's appeal by terming the issue as "controversial." It is respectfully submitted....
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....ection 143(1) by CPC vide intimation dated 22.12.2023, wherein the system treated the assessee company as having opted for taxation under Section 115BAA (which provides a concessional rate of tax but disallows certain deductions). As a result, the CPC disallowed the assessee company's claim under Section 10AA and raised a demand of Rs. 66,11,560/-. The appellant immediately filed a rectification request under Section 154 on 22.01.2024 (Rectification Request No. 9091774400220124) highlighting the error in CPC's processing. However, CPC rejected the application on the ground that there was no mistake apparent from the record. A subsequent rectification application was filed on 29.02.2024 (Request No. 139133340290224), specifically pointing out the incorrect selection recorded by CPC in the field "Taxation Option u/s 115BAA". However, even this second rectification was summarily rejected via order dated 08.04.2024. It is further submitted that an intern working at the previous counsel of the assessee company had inadvertently filed Form 10IC on 15.01.2021 for AY 2020-21 and onwards. According to the provisions of law, once the Form 10IC is filed by any domestic compan....
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.... concluded that the company who has opted to file its return of income u/s 115BAA of the Act cannot take the deduction of 10AA of the Act. Furthermore, according to the 1st proviso of the section 115BAA of the Act, it is further concluded that if a company fails to satisfy any conditions as mentioned in sub-section 2 to the sec 115BAA in any previous year, the provisions of this section will not apply in the assessment year relevant to that previous year and subsequent assessment years as well and it will be treated as this option was never exercised for that previous year and subsequent assessment year. AY 2020-21 In the case in hands, Form 10IC was filed inadvertently on 15.01.2021 for AY 2020-21 and later on assessee company filed its return on income on the same date (APB 1) after claiming deduction to the tune of Rs. 40,39,494/- u/s 10AA after paying tax on balance income at the rate of 25%. Furthermore, it stood processed u/s 143(1) of the Act by CPC wherein the deduction claimed u/s 10AA was allowed by CPC and return was accepted (APB 2-7). AY 2021-22 Similarly for AY 2021-22, assessee company filed its return of income on 28.02.2022 (APB ....
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....e contention so raised in the written submission reliance was placed on the following evidence / records: S. No. PARTICULARS PAGE NOS. 1. Copy of Acknowledgement of return of Income along filed u/s 139 of the Act for A.Y. 2020-21. 1 2. Copy of Intimation order passed u/s 143(1) of the Act for A.Y. 2020-21 2-7 3. Copy of Acknowledgement of return of Income filed u/s 139 of the Act for A.Y. 2021-22. 8 4. Copy of Intimation order passed u/s 143(1) of the Act for A.Y. 2021-22 9-11 5. Copy of Acknowledgement of return of Income filed u/s 139 of the Act for A.Y. 2022-23. 12 6. Copy of Intimation order passed u/s 143(1) of the Act for A.Y. 2022-23 13-18 7. Copy of Assessment order passed u/s 143(3) of the Act dated 14.02.2024 for A.Y. 2022-23 19-27 8. Copy of Rectification order passed u/s 154 r.w.s.143(3) of the Act dated 12.02.2025 along with demand notice for A.Y. 2022-23 28-31 9. Copy of Acknowledgement of return of Income along with computation of total income filed u/s 139 of the Act for A.Y. 2023-24. 32-37 10. Copy of Intimation order passed u/s 143(1) of the Act for A.Y. 2023-24 38-4....
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.... Tax Details Tax Liability after relief 2,39,23,401 2,97,00,117 04 Interest and Fee Payable Total Interest And Fee (234A, 234B, 234C & 234F) 13,29,225 21,64,069 05 Pre-paid Taxes Total Taxes Paid (Advance Tax, TDS, TCS, Self Assessment Tax) 2,52,52,624 2,52,52,624 06 Tax Payable Net Amount Payable 0 66,11,560 12. Per contra, ld. DR relied upon the finding of ld. CIT(A) and vehemently stated that the matter may be demanded to the Assessing Officer to the contention as the assessee did not represent the case. 13. We have heard the rival contentions and perused the material placed on record. Though the assessee in this appeal has raised various grounds but the apple of discord is that whether even though the assessee has submitted that they have not availed the benefit of section 115BAA of the Act while filling the ITR. Even though while processing the ITR CPC can change that option from "No" to "Yes" or not?. Since that adjustment was made as per the provision of section 143(1)(a) of the Act it would be appropriate to deal with that provision of the Act, which reads as under: Assessment. 143. (1) Where a....
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....ssessee under normal provision of the Act. The matter the CPC is taking up cannot be subjected to processing of ITR u/s. 143(1)(a) of the Act. We support of our view from the decision of our Jurisdictional High Court in the case of JKs Employees Welfare Fund Vs. ITO [ 66 Taxman 447(Raj) ] where in our High Court has held that ; 6. A bare perusal of section 143(1)( a) contemplates that the ITO has to accept the return as it is and in the proviso, three exceptions have been given, which confer the jurisdiction on him for making adjustment. The action under this section cannot be taken beyond the power permitted by these three exceptions. The third exception provides that where any loss carried forward, deduction, allowance or relief claimed in the return, which, on the basis of the information available in such return, accounts or documents, is prima facie inadmissible, shall be disallowed. This clause contemplates that power could be exercised only (a)( i) in respect of loss carried forward, (a)( ii) deduction or (a)( iii) allowance, and (a)(iv ) relief claimed; (b) the power in respect of the above four items should be on the basis of information available in the return, a....
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....ounts and documents filed by the assessee. The Income-tax Officer is not bound to make any enquiry before making a provisional assessment; he is not bound even to give to the assessee any notice of his intention to make a provisional assessment, nor to hear the assessee. He may, if he desires, call upon the assessee to elucidate the return or the entries posted in the accounts and documents, but he is not obliged to do so. Section 141 has been enacted with the object of expediting collection of tax on the basis of the return made by the assessee. . . ." (p. 802) 10. The object of summary assessment contemplated under section 143(1)(a) is not only to reduce the work of the department but is also to minimise the litigation and create confidence of taxpayers for submitting true and correct returns. If it appears that the return submitted by the assessee cannot be accepted for the purpose of taking action under section 143(1)(a) then the rights of the ITO are not fettered and he can proceed to finalise the assessment after giving an opportunity to the assessee in respect of any arguable point only under section 143(2). Thus, on the proper interpretation of this section, the ri....