TaxTMI 
TaxTMI 
2025 (12) TMI 1285
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....is prayed *that the disallowance and addition of Rs. 25,04,887/- may kindly be deleted. 2) The Commissioner of Income Tax (Appeals) has erred on facts of the case and law that suo-moto rectification order passed u/s. 154 of the Act on 16/02/2024 is without affording opportunity of being heard to the appellant and therefore the rectification order passed on 16/02/2024 is illegal and against the principle of natural justice. 3. The brief fact of the case are that the assessee is engaged in the business of (i) Sale of cement, sanitary items and hardware items and (ii) Carriage and forward of goods (transportation business). The assessee filed his return of income for the AY 2021- 22 u/s. 139(1) of the Act on 14/02/2022 declaring total income of Rs. 67,84,820/- and paid the total tax and interest amounting to Rs. 21,57,843/-. The said return of income was thereafter processed by the CPC and accordingly intimation u/s. 143(1) of the Act was passed on 05/12/2022 by computing the total income at Rs. 92,89,710/- as against the returned income of Rs. 67,84,820/- and accordingly raised the tax demand of Rs. 11,94,370/-. While passing the intimation u/s. 143(1) of the Act, the tot....
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....d.CIT (A)/NFAC did not accept the contention of the assessee by holding that the order passed by the AO is not a suomoto order but the same was in pursuance to the assessee's claim through the grievance petition. The ld. CIT(A)/NFAC held that it was not the intention of the AO to make an amendment to intimation u/s. 143(1) of the Act which had the effect of enhancing the assessment or reducing the refund or otherwise increasing the liability of the assessee and hence the provision of section 154(3) of the Act do not come in to play. Further, the ld.CIT (A)/NFAC was of the view that under the provisions of section 154 of the Act, only mistake which is apparent, patent and obvious from the case record can be rectified and where process of detail verification is required, the same cannot be considered u/s. 154 of the Act. In the present case the claim of depreciation on vehicle used in the business of carriage and forward need detail verification of facts and necessary documentary evidences, which is not permissible within the meaning of provisions u/s. 154 of the Act. 5.2 Further, with regard to claim of depreciation, the ld.CIT (A)/NFAC held that as per I. T. Act, the depreciatio....
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....ment, sanitary items and hardware items and (ii) Carriage and forward of goods (transportation business). Ongoing through the profit and loss account, we take note of the fact that assessee had declared sales/ turnover from sale of cement, sanitary, hardware and lighting and CPVC, GGBS amounting to Rs. 31,14,20,620/- and from transportation charges amounting to Rs. 10,37,36,440/-. It is submitted that the assessee is also engaged in the business of carriage and forward (transportation of goods business and therefore claimed the higher rate of depreciation @ 30% on goods carriage vehicles aggregating to Rs. 50,09,776/-. The CPC while passing the intimation u/s. 143(1) of the Act disallowed the claim of depreciation @ 30% on such goods carriage vehicles and restricted the claim to the tune of 15% as allowable on other plant and machinery. Thus, the only dispute in the present case is with regard to allowing of depreciation @ 15% on goods carriage vehicles as against assessee's claim of depreciation @30%. We are of the considered opinion that the CPC while passing the intimation u/s. 143(1) of the Act, ought not to have disallowed the claim of depreciation outrightly as the aspect whi....
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....of the considered opinion that where the issue is arguable or two views are possible, it is "debatable" and therefore cannot be adjusted with the total income declared by the assessee in his return of income while processing intimation u/s. 143(1) of the Act. As the ld.CIT (A)/NFAC observed that only mistake which is apparent, patent and obvious from the case record can be rectified and where process of the detail verification is required, the same cannot be considered u/s. 154 of the Act, the same principles also applied while processing the return u/s. 143(1) of the Act. The CBDT vide its circular No.581 dated 28/09/1990 had reiterate that the scope of the powers to make prima facie adjustments under section 143(1) of the Act is somewhat co-terminus with the power to rectify a mistake apparent from the record under section 154 of the Act. 9.2 The Hon'ble Bombay High Court in the case of Khatau Junkar Ltd. v. K.S. Pathania, Dy. CIT [1992] 196 ITR 55 (Bom.) has held as follows- "This is because the scope of the powers to make prima facie adjustments under s. 143(1)(a) is somewhat co-terminous with the power to rectify a mistake apparent from the record under s. 154 In i....