M/s Goodluck Agencies, Indore V. THE ITO-5(3), Indore

ITA 278/IND/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 5484 (ITAT-INDORE)
• Duration Of Justice: 7 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-11-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 21-11-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 28-03-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MOHD JAVED
• Assessee Lawyers: GIRISH AGRAWAL
• Keywords: Presumptive income; Revised return
• Section: 44AD; 244A; 54; 154

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE .., .., % BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER M/S.GOODLUCK AGENCIES, SHOP NO.32, DEVSHRI COMPLEX, NEW LOHA MANDI, INDORE .. ./ PAN: AAEEG1214A VS. ITO, 5(3), INDORE. / APPELLANT / RESPONDENT / APPELLANT BY SHRI GIRISH AGRAWAL, C. A. / RESPONDENT BY SHRI MOHD. JAVED, SR. DR DATE OF HEARING 21.11.2016 DATE OF PRONOUNCEMENT 23.11.2016 / O R D E R PER O.P. MEENA, ACCOUTANT MEMEBR. THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER OF LD. COMMISSIONER OF INCOME-TAX (APPEALS)-II, INDORE DATED .. . / I.T.A. NO.278/IND/2016 %' ' / ASSESSMENT YEAR: 2011-12 I.T.A.NO. 278/IND/2016-A.Y.2011-12 PAGE 2 OF 8 M/S.GOODLUCK AGENCIES,INDORE 30.11.2015, WHICH ARISES OUT OF ORDER U/S 154 OF THE INCOME- TAX ACT, 1961, DATED 09.01.2014, PASSED BY THE AO I TO, 5(3), INDORE. 2. THE ASSESSEE HAS TAKEN ORIGINAL GROUND OF APPEAL BY STATING THAT PASSING THE ORDER IN CONTRARY TO MATER IAL ON RECORD AND PROVISIONS OF THE ACT AND LD. CIT(A) II ERRED I N HOLDING THAT ISSUE UNDER CONSIDERATION WAS NOT RECTIFIABLE U/S 1 54 OF THE ACT AND BY DENYING THE REFUND TO THE ASSESSEE ON AC COUNT OF COMPUTER SYSTEM CONSTRAINT. HOWEVER, DURING THE CO URSE OF HEARING BEFORE US, THE ASSESSEE HAS ALSO FILED REVI SED GROUNDS OF APPEAL BY WHICH IT WAS CLAIMED THAT LD. CIT(A)-II, INDORE, ERRED IN NOT CONSIDERING THE ISSUE UNDER APPEAL TOW ARDS CLAIM OF THE ASSESSEE TO ALLOW DEDUCTION OF ELIGIBLE REMUN ERATION AND INTEREST TO PARTNERS U/S 40(B) OF THE ACT, WHICH INA DVERTENTLY REMAINED TO BE CLAIMED IN THE ORIGINAL RETURN E-FIL ED ON 29.09.2011 AND THE LD. CIT(A) HAS NOT APPRECIATED T HE FACTS THAT SECTION 246A(1)(A) ITSELF PROVIDES THAT THE AS SESSEE IS ENTITLED TO DENY ITS CLAIM TO BE ASSESSED UNDER THE ACT. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS A PARTNERSHIP FIRM ENGAGED IN THE BUSIN ESS OF I.T.A.NO. 278/IND/2016-A.Y.2011-12 PAGE 3 OF 8 M/S.GOODLUCK AGENCIES,INDORE COSMETICS AND C&F AGENTS, WHO HAS FILED ITS RETURN O F INCOME ELECTRONICALLY ON 29.09.2011, DECLARING TOTAL INCOM E OF RS.6,01,851/- UNDER PRESUMPTIVE TAXATION PROVISIONS U/S 44AD OF THE ACT. THE ASSESSEE HAS FILED THE ORIGINA L RETURN OF INCOME ON 29.09.2011, ALTHOUGH THE DUE DATE WAS 31.0 7.2011, WHICH WAS DULY PROCESSED. HOWEVER, SUBSEQUENTLY, THE ASSESSEE HAD FILED REVISED RETURN OF INCOME RECTIFY ING AND POINTING OUT CERTAIN MISTAKES IN THE ORIGINAL RETUR N OF INCOME ON 01.10.2011, WHICH ELECTRONICALLY FILED WITH C.P.C. BANGALURU, WHICH WAS TREATED AS INVALID FOR THE REASO NS THAT ORIGINAL RETURN WAS FILED BELATED. THEREFORE, THE AS SESSEE HAS FILED THE RECTIFICATION APPLICATION U/S 154 OF THE ACT ELECTRONICALLY WITH THE C.P.C. BANGALURU, WHICH ALSO STATED THAT NO MISTAKE WAS APPARENT FROM RECORD. THEN THE A SSESSEE ALSO FILED APPLICATION U/S 119(2)(B) OF THE INCOME- TAX ACT, 1961, BEFORE THE CIT(A)-II, INDORE, WHICH WAS ALSO RE JECTED BY THE CIT(A)-II, INDORE, FOR THE REASONS THAT NO CAU SE OF ACTION AROSE AS THERE WAS NO RETURN OF INCOME PHYSICALLY F ILED BEFORE HIM. AFTER EXHAUSTING ALL THE CHANNELS AS ABOVE, TH E ASSESSEE FILED A RECTIFICATION APPLICATION ON 24.10.2013, WHI CH WAS I.T.A.NO. 278/IND/2016-A.Y.2011-12 PAGE 4 OF 8 M/S.GOODLUCK AGENCIES,INDORE DISPOSED OF BY THE AO VIDE ORDER DATED 09.01.2014, BY STATING THAT THE ORIGINAL RETURN FILED BY THE ASSESSEE ON 2 0.09.2011 HAS BEEN PROCESSED ON 16.01.2012, IN WHICH THERE IS NO MISTAKE APPARENT FROM THE RECORD, WHICH CAN BE RECTI FIED AS PER PROVISIONS OF SECTION 154 OF THE ACT. THE AO HA S ALSO OBSERVED THAT THE LD. CIT(A)-II, INDORE HAS ALSO RE JECTED THE APPLICATION OF THE ASSESSEE FILED U/S 119(2)(B) OF THE ACT VIDE ORDER DATED 01.10.2013. THE ASSESSEE HAS FILED AN A PPEAL BEFORE THE CIT(A). THE LD. CIT(A) NOTED THAT THE AO AFTER CONSIDERING VARIOUS CORRESPONDENCE UNDERTAKEN BY TH E ASSESSEE WITH CPC. BANGALURU, AND TOTALITY OF THE FA CTS, THE AO HAS BEEN FOUND JUSTIFIED IN REJECTING AND NOT EN TERTAINING RECTIFICATION APPLICATION AS ORIGINAL RETURN OF THE ASSESSEE BELATED AND ISSUE UNDER CONSIDERATION WAS NOT RECTIF IABLE U/S 154 OF THE INCOME-TAX ACT, 1961. 4. BEING AGGRIEVED, THE ASSESSEE HAS FILED THIS APPEAL BEFORE US, WHEREIN THE ASSESSEE HAS CHALLENGED THE O RDER OF THE CIT(A) HOLDING THAT THE ISSUE UNDER CONSIDERATI ON WAS NOT RECTIFIABLE U/S 154 OF THE ACT AND THE ASSESSEE IS ENTITLED TO CLAIM THE DEDUCTION U/S 40(B) OF THE ACT. I.T.A.NO. 278/IND/2016-A.Y.2011-12 PAGE 5 OF 8 M/S.GOODLUCK AGENCIES,INDORE 5. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT T HE ORIGINAL RETURN FILED ON 29.09.2011 CONTAINED AN AP PARENT MISTAKE RELATING TO NON-DEDUCTION OF ELIGIBLE REMUN ERATION AND INTEREST ON THE CAPITAL TO PARTNERS IN ACCORDANCE WI TH THE PROVISIONS OF SECTION 40(B) OF THE ACT, WHICH IS APP ARENT AS COMPARED WITH THE REVISED RETURN OF INCOME. IN THE P AST, THE ASSESSEE FIRM HAD BEEN CONSISTENTLY CLAIMING REMUNE RATION AND INTEREST TO PARTNERS. THE IMPUGNED MISTAKE OCCU RRED DUE TO WRONG DATA ENTRY OF CLERICAL STAFF OF TAX CONSUL TANT AND SAME CONSULTANT FILED A REVISED RETURN ON 01.10.201 1, CLAIMING THE AFORESAID DEDUCTION. THE ASSESSEE HAS E-FILED O N 20.06.2012 RECTIFICATION APPLICATION U/S 154 BEFORE THE CPC, BANGALURU, BUT THE SAME WAS REJECTED BY CPC VIDE ORD ER DATED 29.10.2012, BY STATING THAT CHANGE OF INCOME NOT AL LOWABLE U/S 154 AS THE SAME IS NOT A MISTAKE FROM RECORD. T HE ASSESSEE FURTHER FILED A RECTIFICATION APPLICATION ON 22.10.2013, WITH ITO, 5(3), WHO HAS ALSO REJECTED THE SAME VIDE ORDER DATED 09.01.2014, WHICH IS UNDER THE SUB JECT MATTER OF APPEAL BEFORE THE CIT(A) AND IS NOW BEFORE THE TRIBUNAL. THE LD. COUNSEL FOR THE ASSESSEE HAS ALSO CITED I.T.A.NO. 278/IND/2016-A.Y.2011-12 PAGE 6 OF 8 M/S.GOODLUCK AGENCIES,INDORE NUMBER OF CASE LAWS IN SUPPORT OF HIS CONTENTION AND SUBMITTED THAT THE AO MAY BE DIRECTED TO COMPUTE TH E TOTAL INCOME OF THE ASSESSEE BY ALLOWING THE DEDUCTION TO WARDS REMUNERATION AND INTEREST TO THE PARTNERS AS CLAIME D IN THE REVISED RETURN ALREADY ON RECORD AND GRANT THE REFU ND DUE ALONGWITH APPLICABLE INTEREST U/S 244A OF THE ACT. 6. ON THE OTHER HAND, THE LD. SR. DEPARTMENTAL REPRESENTATIVE RELIED ON THE ORDERS OF THE LOWER AU THORITIES. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND T HAT THE ASSESSEE HAS FILED ORIGINAL RETURN OF INCOME ON 29. 09.2011, WHICH WAS BELATED ONE AS THE DUE DATE OF FILING OF RE TURN OF INCOME WAS 31.07.2011. ON GOING THROUGH THE ORIGINA L RETURN, WE FIND THAT THERE IS NO APPARENT MISTAKE ON RECORD, WHICH CAN BE RECTIFIABLE U/S 154 OF THE ACT ON THE BASIS OF ORIGINAL RETURN. WE FURTHER NOTE THAT THE ASSESSEE HAS FILED A REVISED RETURN ON 01.10.2011 BEFORE CPC, BANGALURU. SINCE T HE ORIGINAL RETURN OF INCOME WAS ITSELF BELATED ONE, TH EREFORE, THE CPC HAS REJECTED THE SAID RETURN BY HOLDING THAT TH ERE IS NO PROVISION TO FILE REVISED RETURN WHEN THE ORIGINAL R ETURN WAS I.T.A.NO. 278/IND/2016-A.Y.2011-12 PAGE 7 OF 8 M/S.GOODLUCK AGENCIES,INDORE BELATED ONE IN ACCORDANCE WITH THE ACT. THEREFORE, T HE RECTIFICATION APPLICATION FILED BEFORE THE CPC BANG ALURU, AS WELL AS BEFORE THE AO WERE CAME TO BE REJECTED. WE A LSO NOTE THAT THE APPLICATION WAS ALSO NOT ENTERTAINED BY THE CIT-II, INDORE, FILED BY THE ASSESSEE UNDER PROVISIONS OF S ECTION 119(2)(B) OF THE ACT. THE ISSUE BEFORE US IS WHETHER THE LOWER AUTHORITIES WERE JUSTIFIED IN REJECTING THE CLAIM O F THE ASSESSEE MADE U/S 154 OF THE ACT, IN RESPECT OF ORIGINAL RET URN FILED BY THE ASSESSEE. SINCE WE FOUND THAT THERE IS NO MI STAKE APPARENT FROM THE RECORD IN THE ORIGINAL RETURN FIL ED BY THE ASSESSEE AND THE REVISED RETURN IS NOT A VALID RETU RN IN THE EYES OF LAW, THEREFORE, WE ARE OF THE CONSIDERED OPIN ION THAT THE LOWER AUTHORITIES ARE JUSTIFIED IN REJECTING TH E CLAIM OF THE ASSESSEE U/S 154 OF THE INCOME-TAX ACT, 1961. IN VI EW OF THESE FACTS, WE UPHOLD THE ACTION OF THE LOWER AUTHORITIES AND WE ALSO NOTE THAT THE VARIOUS DECISIONS RELIED UPON BY THE ASSESSEE ARE NOT DIRECTLY RELATED TO THE ISSUE UNDE R CONSIDERATION. THEREFORE, THE SAME ARE DISTINGUISHA BLE ON FACTS. IN VIEW OF THE ABOVE, ALL THE ORIGINAL GROUND S AS REVISED GROUNDS OF APPEAL ARE TREATED AS DISMISSED. I.T.A.NO. 278/IND/2016-A.Y.2011-12 PAGE 8 OF 8 M/S.GOODLUCK AGENCIES,INDORE 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMIS SED. THE ORDER HAS BEEN PRONOUNCED IN OPEN COURT ON THE 23 RD NOVEMBER, 2016. SD/- (..) (D.T.GARASIA) JUDICIAL MEMBER SD/- (..) (O.P.MEENA) ACCOUNTANT MEMBER * / DATED : 23 RD NOVEMBER, 2016. CPU* 2223