TaxTMI 
TaxTMI 
2025 (4) TMI 1869
X X X X Extracts X X X X
X X X X Extracts X X X X
....e and style as "Chitra Sales and Services. He filed its return of income on 30.09.2015 for A.Y. 2015-16 declaring the total income of Rs. 20,03,260/-. The return was processed u/s. 143(1) of the Act by the CPC passing intimation dated 01.08.2016 wherein the CPC made disallowance of Rs. 33,53,759/-. 3. Before the Ld. Addl./JCIT(A), it was submitted that the variance made by the CPC is due to the interest paid by the assessee. It was submitted that since there was no basis for disallowance, the assessee filed rectification petition, however, no such order was passed. The power of the CPC to makes such disallowance was also challenged before the Ld. Addl./JCIT(A). 4. However, the Ld. Addl./JCIT(A) was not satisfied with the arguments adv....
X X X X Extracts X X X X
X X X X Extracts X X X X
....from any information in the return" shall mean a claim, on the basis of an entry, in the return.- Of an item, which is inconsistent with another entry of the same or some other item in such return On perusal of intimation and annexure of profit and loss account attached and retum of income, it is noted that the adjustment of Rs. 33,53,759/- was made in respect of interest claimed in the profit and loss account. So, it cannot be said that nature of adjustment is not available in the intimation. On careful examination of profit and loss account given in return of income, it is noted that at Sl. No. 43 of profit and loss account, the appellant had entered the amount '0' at Row 43(1)-interest to non residents and also ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... incorrect column. This technical mistake cannot be the basis for disallowance of an expenditure allowable under the Act. On perusal of the details of above interest expenditure made available by the appellant, the interest been paid to different entities as under- Interest paid to Nationalised banks Rs. 7,60.148/- Interest paid to Co-op Bank Rs. 5,61,045/- Interest paid to Commercial banks Rs. 8,57,439/- Interest paid to Financial corp Rs. 11,74,767/- Interest paid to Financial corporations includes interest to non banking financial companies on which TDS provisions are applicable. If the tax has not been deducted as per section 194A of the Act. disallowance is required to be made as per section 40....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n the interest of natural justice." 7. We have heard the rival arguments made by both the sides and perused the record. So far as the first ground is concerned, the same relates to the order of Ld. Addl./JCIT(A) upholding the power of CPC to make such adjustment. We find the provisions of section 143(1) of the Act read as under : "143. (1) Where a return has been made under section 139, or in response to a notice under sub-section (1) of section 142, such return shall be processed in the following manner, namely:- (a) the total income or loss shall be computed after making the following adjustments, namely:- (i) any arithmetical error in the return; (ii) an incorrect claim, if such incorrect claim is a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he basis of the total income computed under clause (a), (c) the sum payable by, or the amount of refund due to the assessee shall be determined after adjustment of the tax and interest, if any, computed under clause (b) by any tax deducted at source, any tax collected at source, any advance tax paid, any relief allowable under an agreement under section 90 or section 90A, or any relief allowable under section 91, any rebate allowable under Part A of Chapter VIII, any tax paid on self-assessment and any amount paid otherwise by way of tax or interest: (d) an intimation shall be prepared or generated and sent to the assessee specifying the sum determined to be payable by, or the amount of refund due to, the assessee under cl....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ii) of clause (a) of section 143(1) of the Act existing at the relevant time the adjustment can be made in respect of an incorrect claim, if such incorrect claim is apparent from any information in the return. Further, the different circumstances under which a claim will be considered as an incorrect claim apparent from any information in the return have also been provided in Explanation to section 143(1) of the Act. A perusal of the intimation and annexure of profit and loss account attached to the return of income show that the adjustment of Rs. 33,53,759/- was made in respect of interest claimed in the profit and loss account. A perusal of the profit and loss account given in return of income show that at Sl. No. 43 of profit and loss ac....