2026 (1) TMI 140

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....and religious purposes and is registered under Section 12A of the IT Act. 4. For the relevant Assessment Year 2018-19 the petitioner filed its return of income declaring a total income of Rs.16,46,630/-. 5. On 16.12.2019 the above referred ITR was processed under Section 143(1) wherein certain adverse adjustments were made and a demand of Rs. 1,94,144/- was raised. 6. On perusal of the above intimation, the Petitioner realized mistakes/errors committed by it in the ITR and filed an application on the e-portal for rectification on 14.01.2020 before Respondent No. 3 (i.e. Asst. Director of Income tax, Centralized Processing Centre, Bengaluru). However, vide communication dated 12.02.2020 the ITR was reprocessed as it was processed in the original intimation issued under Section 143(1). On 15.02.2021 the Petitioner made another rectification application before Respondent No. 3 (i.e. the Jurisdictional Assessing Officer). The Petitioner thereafter filed a third rectification application on 05.01.2023. However, the same was again rejected vide order dated 30.01.2023 on the ground that there was no mistake apparent from the record as rectifiable under Section 154 of the IT Act. ....

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.... while processing the return of income, the processing system has recognized the errors committed by the Petitioner in the ITR and accordingly made the adverse adjustments. 10. Mr. Jain, fairly stated that the Petitioner committed certain punching errors in the ITR leading to denial of exemption under Section 11 of the IT Act in the intimation issued under Section 143(1). Consequent to the same, the Petitioner vigilantly applied for rectification of the impugned intimation issued under Section 143(1), several times where it did not succeed. Hence, it filed the application for revision before Respondent No. 1 pursuant to the provisions of Section 264 of the IT Act. 11. Mr. Jain submitted that Respondent No. 1, under Section 264, can also adjudicate on mistakes/errors committed by the assessee in the ITR and can also consider the claims not made by the assessee in the return of income. In support of this proposition reliance was placed on the decision of this Court in the case of Pramod R. Agrawal vs. Principal Commissioner of Income-tax [(2023) 156 taxmann.com 126 (Bombay) dated 13-10-2023] and Diwaker Tripathi vs. PCIT [(2024) 466 ITR 371 (Bombay) dated 29-08- 2023]. In the p....

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....er Section 264 before the prescribed authorities. Exercising this discretion, the Petitioner preferred to file the revision application under Section 264. He also relied upon the decision of this Court in the case of Bahar Infocons (P.) Ltd. vs. PCIT [(2025) 476 ITR 615 (Bombay) dated 23-09-2024] and Hapag Lloyd India Pvt. Ltd. Vs. PCIT [WP No.2332 of 2021 order dated 09.02.2022] and submitted that there is no bar under Section 264 which prevents Respondent No. 1 to consider claims not made in the ITR. 15. We have heard both the parties at length and have also perused the records produced before us and also the affidavit in reply filed by the Respondents. 16. Firstly, we are in agreement with the submission made by Mr. Jain that the assessee has the discretion to either file an appeal under the provisions of Section 246A of the IT Act before the Commissioner of Income tax (Appeals) against an appealable order or to apply for revision under Section 264 of the IT Act before the prescribed authorities. There is nothing in the statute which mandates the assessee only to pursue the appeal remedy and deny the remedy under Section 264 (when no such appeal is filed). In fact, this Co....

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....d to the application filed by the assessee and pass such order thereon. Section 264 of the Act also empowers respondent No. 1 to call for the record of any proceedings under the Act in which any order has been passed and make such inquiry or cause such inquiry to be made and pass such order as he thinks fit. Therefore, if respondent No. 1 feels that detailed inquiry is necessary and he will be hard pressed for time, he may cause such inquiry made by the Assessing Officer and direct the Assessing Officer to file a report. 9. In the present case, as per petitioner in his return of income he has made mistakes as noted earlier in this order. Looking at the mistake, it is rather obvious that it was not a deliberate mistake or an attempt to gain some unfair advantage or to evade any tax. 10. In the circumstances, we quash and set aside the order dated 27th March 2017 passed under Section 264 of the Act, order dated 21st September 2021 under section 154 of the Act and intimation dated 17th October 2015 issued under section 143(1) of the Act and remand the matter for denovo consideration to respondent No. 1 to dispose petitioner's application under section 264 of the ....