Anil Manohar Deshmukh, Nashik V. ACIT, Bangalore

ITA 1522/PUN/2012

• Counselvise Citation: 152224514 RSA 2012
• Duration Of Justice: 1 year(s) 2 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-09-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 11-07-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S C SARANGI
• Assessee Lawyers: PUSHKAR H DAS
• Keywords: Business income; Rectification of order
• Section: 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES B, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NO.1522/PN/2012 (ASSESSMENT YEAR : 2009-10) ANIL MANOHAR DESHMUKH SUNNIK ENGINEERS, W-52, MIDC, AMBAD, NASHIK, MAHARASHTRA 422 010 PAN : AAUPD9309F . APPELLANT VS. ACIT (CPC), BANGALORE . RESPONDENT APPELLANT BY : MR. PUSHKAR H. DAS RESPONDENT BY : MR. S. C. SARANGI DATE OF HEARING : 24-09-2013 DATE OF PRONOUNCEMENT : 27-09-2013 ORDER PER G. S. PANNU, AM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST AN ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-I, NASHIK DATE D 27.04.2012 WHICH, IN TURN, HAS ARISEN FROM AN ORDER DATED 13.04.2011 PAS SED BY THE ASSESSING OFFICER, UNDER SECTION 154 OF THE INCOME TAX ACT, 1 961 (IN SHORT THE ACT), PERTAINING TO THE ASSESSMENT YEAR 2009-10. 2. IN THIS APPEAL, THE SHORT GRIEVANCE OF THE ASSES SEE IS AGAINST THE ORDER OF THE CIT(A) UPHOLDING THE ACTION OF THE ASSESSING OFFICER IN REJECTING THE ASSESSEES APPLICATION SEEKING RECTIFICATION OF MIS TAKE UNDER SECTION 154 OF THE ACT. THE RELEVANT FACTS IN ORDER TO APPRECIATE THE CONTROVERSY CAN BE SUMMARIZED AS FOLLOWS. THE ASSESSEE IS AN INDIVIDUA L WHO E-FILED A RETURN OF INCOME DECLARING TOTAL INCOME OF RS.14,90,790/-, WH ICH INTER-ALIA INCLUDED AN INCOME FROM BUSINESS OF RS.13,31,380/-. THE SAID E- RETURN WAS PROCESSED AND IN THE INTIMATION UNDER SECTION 143(1) OF THE ACT T HE TOTAL INCOME WAS ITA NO.1522/PN/2012 A.Y. 2009-10 COMPUTED AT RS.16,52,750/-; AND, THE ADDITIONAL INC OME ASSESSED WAS WITH RESPECT TO THE INCOME FROM BUSINESS WHICH WAS COMP UTED AT RS.14,93,340/- AS AGAINST THE DECLARED INCOME FROM BUSINESS OF RS. 13,31,380/-. 3. THE ASSESSEE APPROACHED THE ACIT(CPC), BANGALORE FOR RECTIFICATION OF MISTAKE WHICH HAS OCCURRED IN THE INTIMATION PASSED UNDER SECTION 143(1) OF THE ACT. IN THE SAID PETITION, THE CLAIM OF THE ASS ESSEE WAS THAT THE SUM OF RS.1,61,960/- ADDED TO THE TOTAL RETURNED INCOME ON ACCOUNT OF DISALLOWANCE UNDER SECTION 36(1)(II) OF THE ACT WAS NOT JUSTIFIE D. THE ASSESSEE SUBMITTED THAT IN COLUMN 6(C) OF INCOME TAX RETURN, FORM ITR 4, THE SUM OF RS.1,61,960/- WAS ERRONEOUSLY SHOWN AS AN AMOUNT DI SALLOWABLE UNDER SECTION 36(1)(II) OF THE ACT. THE ASSESSEE POINTED OUT THAT THOUGH THE SAID AMOUNT WAS SHOWN AS DISALLOWABLE UNDER SECTION 36(1 )(II) OF THE ACT YET IN THE COMPUTATION OF INCOME, ASSESSEE DID NOT DISALLOW SU CH SUM AS THE SAME WAS INDEED NOT DISALLOWABLE UNDER SECTION 36(1)(II) OF THE ACT. THE ACIT(CPC), BANGALORE AS WELL AS THE CIT(A) HAS NOT ENTERTAINED THE PLEA OF THE ASSESSEE PRIMARILY ON THE GROUND THAT ASSESSEE HAD HIMSELF D EPICTED THE SAID SUM IN THE RELEVANT COLUMN OF THE E-RETURN AS DISALLOWABLE UND ER SECTION 36(1)(II) OF THE ACT AND AT THE SAME TIME DID NOT DISALLOW THE SAME WHILE COMPUTING THE TOTAL INCOME. THEREFORE, ACCORDING TO THE LOWER AUTHORITI ES, THERE WAS NO APPARENT MISTAKE WHICH COULD BE RECTIFIED WITHIN THE MEANIN G OF SECTION 154 OF THE ACT. AGGRIEVED WITH THE AFORESAID STAND OF THE LOWER AUT HORITIES, ASSESSEE IS IN APPEAL BEFORE US. 4. BEFORE US, THE LEARNED COUNSEL FOR THE ASSESSEE POINTED OUT THAT ONLY BY OVERSIGHT/MISTAKE THE AMOUNT OF RS.1,61,960/- WAS E RRONEOUSLY SHOWN IN THE COLUMN 6(C) OF THE INCOME TAX RETURN, FORM ITR 4 A S DISALLOWABLE UNDER SECTION 36(1)(II) OF THE ACT. THE LEARNED COUNSEL P OINTED OUT THAT THE SAID SUM REPRESENTED BONUS PAID TO THE EMPLOYEES AND WAS N OT COVERED BY THE DISALLOWANCE PROVIDED FOR IN SECTION 36(1)(II) OF T HE ACT. THE LEARNED COUNSEL ITA NO.1522/PN/2012 A.Y. 2009-10 SUBMITTED THAT THE LOWER AUTHORITIES WERE NOT JUSTI FIED IN REJECTING THE ASSESSEES CLAIM FOR RECTIFICATION OF MISTAKE UNDER SECTION 154 OF THE ACT. 5. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL REPR ESENTATIVE SUPPORTED THE FINDING OF THE LOWER AUTHORITIES, WHICH HAVE BE EN ALREADY ADVERTED TO IN THE EARLIER PART OF THIS ORDER AND IS NOT BEING REPEATE D FOR THE SAKE OF BREVITY. 6. HAVING HEARD THE RIVAL STANDS, IN OUR VIEW, THE CASE OF THE ASSESSEE CANNOT BE SHUT-OUT WITHOUT EXAMINING THE MERITS OF THE SAME. AN INADVERTENT ERROR MADE BY THE ASSESSEE CANNOT BE FATAL SO AS TO ENABLE THE REVENUE TO COLLECT CERTAIN TAX, WHICH IS OTHERWISE NOT LAWFULL Y DUE TO IT. IN THE PRESENT, IT MAY BE NOTICED THAT IN THE E-RETURN FILED, THE TOTA L INCOME WAS DECLARED AT RS.14,90,790/- WHICH INCLUDED INCOME FROM BUSINESS OF RS.13,31,380/-. THE BUSINESS INCOME HAS BEEN COMPUTED WITHOUT CONSIDERI NG ANY DISALLOWANCE UNDER SECTION 36(1)(II) OF THE ACT ON ACCOUNT OF B ONUS PAYMENTS. HOWEVER, IN COLUMN 6 OF THE INCOME TAX RETURN, FORM ITR 4, WHI CH RELATES TO DETAIL OF AMOUNTS DEBITED TO THE PROFIT AND LOSS ACCOUNT, TO THE EXTENT DISALLOWABLE UNDER SECTION 36 OF THE ACT, ASSESSEE STATED AN AMO UNT OF RS.1,61,960/- PURPORTED TO BE PAYMENT OF BONUS TO EMPLOYEES WHI CH WAS DISALLOWABLE UNDER SECTION 36(1)(II) OF THE ACT. THE ACIT(CPC), BANGALORE, WHILE PROCESSING THE RETURN ADDED THE SAID AMOUNT TO THE DECLARED INCOME AND ENHANCED THE INCOME TO THAT EXTENT. BY WAY OF AN AP PLICATION UNDER SECTION 154 OF THE ACT, BEFORE THE LOWER AUTHORITIES, ASSES SEE SOUGHT TO POINT OUT THAT SUCH SUM WAS INDEED NOT COVERED BY SECTION 36(1)(II ) OF THE ACT AND FOR THAT REASON NO SUCH DISALLOWANCE WAS MADE IN THE COMPUTA TION OF INCOME, WHICH WAS A PART OF THE E-FILED RETURN OF INCOME. 7. IN OUR VIEW, THE POSSIBILITY OF SOME INADVERTENT ERRORS CANNOT BE RULED OUT WHILE E-FILING OF RETURN AND THE ONCE THE ASSES SEE SEEKS TO POINT OUT THE SAME IT CANNOT BE SHUT-OUT ON MERE TECHNICALITIES. IN THE PRESENT CASE, OSTENSIBLY, THE E-RETURN FILED BY THE ASSESSEE SHOW S A CONTRADICTION INASMUCH ITA NO.1522/PN/2012 A.Y. 2009-10 AS IN COLUMN 6(C) OF THE INCOME TAX RETURN, FORM IT R 4 AN AMOUNT OF RS.1,61,960/- REPRESENTING BONUS HAS BEEN SHOWN A S DISALLOWABLE UNDER SECTION 36(1)(II) OF THE ACT WHEREAS IN THE INCOME COMPUTED THEREOF NO SUCH DISALLOWANCE WAS MADE. THE ASSESSEES CLAIM IS THAT THE DEPICTION OF RS.1,61,960/- IN COLUMN 6(C) OF THE INCOME TAX RETU RN, FORM ITR 4 WAS AN INADVERTENT MISTAKE. IN OUR VIEW, IT WOULD BE APPRO PRIATE THAT THE PLEA OF THE ASSESSEE IS EXAMINED ON ITS MERITS BY THE ASSESSING OFFICER. THEREFORE, WE SET-ASIDE THE ORDER OF THE CIT(A) AND RESTORE THE M ATTER BACK TO THE FILE OF THE ASSESSING OFFICER WHO SHALL EXAMINE THE PLEA OF THE ASSESSEE ON ITS MERITS AND THEREAFTER PASS AN APPROPRIATE ORDER IN ACCORDA NCE WITH LAW. NEEDLESS TO SAY, IN THE COURSE OF ENSUING ASSESSMENT PROCEEDING S, THE ASSESSING OFFICER SHALL ALLOW THE ASSESSEE A REASONABLE OPPORTUNITY O F BEING HEARD AND TO PUT-FORTH SUBMISSIONS/MATERIAL IN SUPPORT OF HIS ST AND. AFTER CONSIDERING THE MATERIAL AND SUBMISSIONS PUT-FORTH BY THE ASSESSEE, THE ASSESSING OFFICER SHALL PASS AN APPROPRIATE ORDER IN ACCORDANCE WITH LAW. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 27 TH SEPTEMBER, 2013. SD/- SD/- (R.S. PADVEKAR) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 27 TH SEPTEMBER, 2013 SUJEET COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A)-I, NASHIK; 4) THE CIT-I, NASHIK; 5) THE DR, B BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// SR. PRIVATE SECRETARY I.T.A.T., PUNE