TaxTMI 
TaxTMI 
2025 (6) TMI 1405
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....ssment year 2018-19. 2. In this appeal, the Revenue has raised the following grounds: - "1. On the facts and in the circumstances of the case, the Ld. CIT(A) erred in deleting the addition for the MEIS subsidy without appreciating that the subsidy is a revenue receipt and should be treated as income under the Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Ld. CIT(A) erred in law and on facts in holding that the rectification carried out under Section 154 of the Income Tax Act, 1961 was beyond the permissible scope, ignoring the assessee's prior acceptance of the rectification. 3. On the facts and in the circumstances, the Ld. CIT(A) failed to appreciate that the reclassification of MEIS subsidy ....
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....me under section 139(1) of the Act on 30.10.2018, declaring a total income of Rs. 5,69,06,230/-. Subsequently, on 10.01.2020, search action under section 132 of the Act was conducted in the case of Aarti Group of cases, which included the assessee. In pursuance of the notice issued under section 153A of the Act, the assessee filed its return of income on 08.12.2020, declaring a total income of Rs. 5,64,50,140/- under the normal provisions of the Act and declared a book profit of Rs. 23,31,80,439/- under section 115JB of the Act. While filing the original return of income, as well as while filing the return of income under section 153A of the Act, the assessee claimed the MEIS subsidy amounting to Rs. 1,84,52,744/- as capital receipt. Vide o....
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....th the view that the above rectification is covered within in the purview of provisions of sec. 154 and also whether you have any objections to the proposed rectifications on the merits of the above issues." 5. In response to the notice issued under section 154 of the Act, the assessee accepted the rectification as a matter of consistency, however, reserved its right to contest the addition before the Appellate Authorities on the basis that the assessee did not accept the aforesaid addition made in the assessment orders of the group and appeals have been preferred on merits. Rejecting the submissions of the assessee, the AO passed the order under section 154 of the Act on 10.08.2021, treating the MEIS subsidy received by the assessee amoun....
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....he learned CIT(A), submitted that the issue whether MEIS subsidy is a revenue receipt or capital receipt is a debatable issue, and therefore, falls beyond the scope of the term "mistake apparent from the record" under section 154 of the Act. In support of this submission, learned AR placed reliance upon the decision of the Hon'ble Supreme Court in T.S. Balaram, ITO vs. Volkart Brothers & Ors., reported in (1971) 982 ITR 50 (SC). 9. We have considered the submissions of both sides and perused the material available on record. In the present case, it is undisputed that the rectification order under section 154 of the Act was passed only on the basis that the claim of deduction on account of MEIS subsidy to the tune of Rs. 1,84,52,744/- in th....