MANISHA AJAY PATODIA, MUMBAI V. ASST CIT CPC, Bangalore

ITA 5050/MUM/2013

• Counselvise Citation: 505019914 RSA 2013
• Duration Of Justice: 1 year(s) 11 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 08-06-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 04-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DINESH CHAWLA
• Keywords: Speculation loss; Bonafide mistake
• Section: 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH B, MUMBAI BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER ITA NO.5050/M/2013 ASSESSMENT YEAR: 2009-10 MANISHA AJAY PATODIA, C-11, JAIDEEP APARTMENT, MARVE ROAD, BEHIND FIRE BRIGADE, MALAD (WEST), MUMBAI 400 095 PAN: AMRDP7621F VS. THE ASSISTANT COMMISSIONER OF INCOME-TAX (CPC), BANGALORE (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI DINESH CHAWLA, A.R. REVENUE BY : SHRI YOGESH KAMAT, D.R. DATE OF HEARING : 08.06.2015 DATE OF PRONOUNCEMENT : 08.06.2015 O R D E R PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSES SEE AGAINST THE ORDER DATED 15.04.2013 OF THE COMMISSIONER OF INCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS THE CIT(A)] RELEVANT TO ASSESSMENT Y EAR 2009-10. THE SOLE ISSUE RAISED BY THE ASSESSEE IS REGARDING THE REJECTION O F HIS APPLICATION MOVED UNDER SECTION 154 OF THE INCOME TAX ACT. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E FILED THE E-RETURN ONLINE WHICH WAS PROCESSED BY CENTRAL PROCESSING CENTRE AT BANGALORE. WHILE PROCESSING THE RETURN, THE CLAIM OF THE ASSESSEE IN RESPECT OF CARRY FORWARD LOSSES WERE ALLOWED TO THE TUNE OF RS.52,712/- AS A GAINST THE CLAIM OF ITA NO.5050/M/2013 MANISHA AJAY PATODIA 2 RS.13,02,709/-. THE ASSESSEE FILED A RECTIFICATION APPLICATION BEFORE THE ITO CPC, BANGALORE PLEADING THAT THE SPECULATIVE LOSS O F RS.12,49,997/- WAS NOT CONSIDERED TO BE CARRIED FORWARD WITHOUT ASSIGNING ANY REASONS. THE ITO CPC, HOWEVER, REJECTED THE APPLICATION OF THE ASSES SEE STATING THAT THERE WAS NO ERROR APPARENT ON RECORD AND THAT THE ASSESSEE HAD NOT FILLED THE SCHEDULE CFL WHICH IS MEANT FOR CARRY FORWARD LOSSES. BEING AGG RIEVED, THE ASSESSEE FILED THE APPEAL BEFORE THE LD. CIT(A). 3. THE LD. CIT(A) ALSO HELD THAT SINCE THE ASSESSEE HAD NOT FILLED THE SCHEDULE OF CARRY FORWARD LOSSES WHILE FILING THE R ETURN ONLINE, HENCE THE ASSESSING OFFICER (HEREINAFTER REFERRED TO AS THE A O) HAD RIGHTLY REJECTED THE RECTIFICATION APPLICATION. HE THEREFORE DISMISSED THE APPEAL OF THE ASSESSEE. THE ASSESSEE, THUS, HAS COME IN APPEAL BEFORE US. 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND HAVE ALS O GONE THROUGH THE RECORDS. THE LD. A.R. OF THE ASSESSEE HAS BROUGHT O UR ATTENTION TO THE RELEVANT COLUMNS OF THE RETURN FILED. HE HAS INVITED OUR AT TENTION TO SCHEDULE BP OF THE RETURN WHEREIN ALL THE DETAILS OF THE CARRY FORWARD LOSSES INCLUDING NET LOSS AS PER PROFIT & LOSS ACCOUNT OF RS.12,49,997/- HAS BEE N SHOWN MENTIONED IN COLUMN NO.38 OF THE SCHEDULE. THE ASSESSEE HAS FUR THER SUBMITTED THAT SIMILARLY THE DETAILS OF LOSS TO BE CARRIED FORWARD TO FUTURE YEARS HAVE ALSO BEEN MENTIONED IN CFL FORM AT SL. NO.XI. IT HAS BEEN FU RTHER SUBMITTED THAT SINCE IT WAS THE ONLINE FILING OF THE RETURN, THE AMOUNT OF LOSSES ONCE FILLED AT A RELEVANT COLUMN IS AUTOMATICALLY PICKED UP BY THE SYSTEM IN SUBSEQUENT COLUMNS. THE LD. A.R. HAS THEREFORE CONTENDED THAT EVEN IF, DUE TO SOME CLERICAL ERROR ONE OF THE COLUMNS COULD NOT HAVE BEEN FILLED THAT ITSELF WAS NOT A GROUND TO REJECT THE ITA NO.5050/M/2013 MANISHA AJAY PATODIA 3 CLAIM OF THE ASSESSEE ESPECIALLY WHEN THE SAME FIGU RE REGARDING CARRY FORWARD LOSS APPEARS IN OTHER COLUMNS OF THE RETURN. ON THE OTHER HAND, THE LD. D.R. HAS SUPPORTED THE ORDER OF THE LOWER AUTHORITIES. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FI ND THAT THE DETAILS/FIGURES REGARDING THE CARRY FORWARD OF LOSS ES ALSO APPEAR IN SCHEDULE BP OF THE RETURN. EVEN, IF WE PRESUME THAT DUE TO SOM E MISTAKE OR ERROR OR MAY BE OF SYSTEM ERROR, THE COLUMN IN THE CFL IS LEFT BLAN K AND THE LOSS WAS NOT CONSIDERED BY THE CENTRAL PROCESSING AGENCY; THE AS SESSEE HAD RIGHTLY MOVED A RECTIFICATION APPLICATION UNDER SECTION 154. HOWEV ER, THE RECTIFICATION APPLICATION OF THE ASSESSEE HAS BEEN REJECTED BY TH E CONCERNED AO AT THE CENTRAL PROCESSING CENTRE WITHOUT GIVING OPPORTUNIT Y OF HEARING TO THE ASSESSEE. THE LD. CIT(A) HAS ALSO DISMISSED THE AP PLICATION OF THE ASSESSEE WITHOUT EVEN EXAMINING THE REAL FACTS ON THE FILE. 6. WE MAY OBSERVE HERE THAT THE JURISDICTION OF THE AO IS NOT PENAL IN NATURE SO AS TO PUNISH THE LITIGANTS EVEN FOR THEIR BONAFIDE MISTAKES. HE IS SUPPOSED TO ASSESS THE REAL INCOME OF THE ASSESSEE, IF ANY MISTAKE HAS OCCURRED WHILE FILLING THE COLUMNS OF THE RETURN ONLINE, THE AO IS SUPPOSED TO CONSIDER THE SAME AND ASSESS THE INCOME OF THE ASSESSEE ACCO RDINGLY. EVEN HE WAS SUPPOSED TO CONSIDER THE APPLICATION MOVED FOR RECT IFICATION AND ALLOW THE ADMISSIBLE CLAIM OF THE ASSESSEE, OTHERWISE THE VER Y PURPOSE OF THE PROVISIONS OF SECTION 154 OF THE ACT WOULD BE DEFEATED. WE FI ND HERE THAT EVEN THE LD. CIT(A) HAS ALSO ACTED LIKE A POST OFFICE TO STAMP T HE ORDER OF THE AO WITHOUT THE APPLICATION OF MIND. THE POWERS OF THE LD. CIT (A) ARE COTERMINOUS WITH THAT OF THE AO. HE WAS SUPPOSED TO APPLY HIS MIND AND ALLOW THE CARRY FORWARD LOSSES WHICH DULY APPEAR IN THE OTHER COLUM NS OF THE RETURN. WE FIND ITA NO.5050/M/2013 MANISHA AJAY PATODIA 4 THAT THERE IS A BONAFIDE MISTAKE IN ASSESSING THE R EAL INCOME OF THE ASSESSEE WHICH IS REQUIRED TO BE RECTIFIED. WE DIRECT THE A O TO CONSIDER THE CARRY FORWARD THE LOSSES OF THE ASSESSEE AS PLEADED AND A SSESS THE INCOME OF THE ASSESSEE ACCORDINGLY. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS HER EBY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 08.06.2015. SD/- SD/- (G.S. PANNU) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: .09.2015. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.