Smart Ceramics Private Limited, Chennai V. Corporate Ward 6(3), Chennai

ITA 86/CHNY/2023

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The case involves M/s. Smart Ceramics Pvt. Ltd, which appealed against the decision of the CIT(A) regarding the incorrect processing of their income tax return for the assessment year 2017-18. The primary issue was the incorrect filling of ITR forms by the assessee, which led to the wrong computation of income. The assessee had earned business income and capital gains, which were not properly reflected in the tax return due to incorrect schedule fillings. The CIT(A) had previously held that the issue could not be considered under section 154 of the Income Tax Act, leading to the current appeal before the Income Tax Appellate Tribunal.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 134380 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 25-06-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 26-01-2023
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: B. PRATHAP LD
• Keywords: Business income
• Section: 154

Judgement Text

आयकर अपीलीय अिधकरण “सी” ायपीठ चे ई म । IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, CHENNAI माननीय ी महावीर िसंह, उपा एवं माननीय ी मनोज कु मार अ%वाल ,लेखा सद( के सम । BEFORE HON’BLE SHRI MAHAVIR SINGH, VP AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकरअपील सं./ ITA No.86/Chn y/2023 (िनधा)रण वष) / As sessment Year: 2017-18) M/s. Smart Ceramics Pvt. Ltd 87, 100 Feet Road, Sastri Nagar, Vadapalani, Chennai -600 026. बनाम / V s . AO Corporate Ward-6(3) Chennai. थायीलेखासं./जीआइआरसं./PAN/GIR No. A AJC S - 4237-P (अपीलाथ /Appellant) : ( थ / Respondent) अपीलाथ कीओरसे/ Appellant by : Shri B. Prathap (CA)- Ld.AR थ कीओरसे/Respondent by : Shri P.Sajit Kumar (JCIT)- Ld. DR सुनवाईकीतारीख/Date of Hearing : 26-06-2023 घोषणाकीतारीख /Date of Pronouncement : 26-06-2023 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. During hearing of captioned appeal, Ld. AR submitted that the assessee filed wrong ITR forms which has led to wrong computation of income. The Ld. AR also submitted that correct schedules have been filled up by the assessee and rectification application as filed u/s 154 is pending for disposal by CPC. Thus, Ld. AR seeks early disposal of rectification application. The Ld. Sr. DR opposed the same on the ground that the assessee should file correct return of income after seeking 2 ITA No.86/Chny/2023 condonation u/s 119(2)(b). Having heard rival submissions and upon perusal of case records, the appeal is disposed-off as under. 2. The assessee earned business income and also income under the head capital gains which were routed through Profit & Loss Account. Accordingly, it was required to make necessary computation in Schedule BP and Schedule CG in accordance with applicable provisions. But the assessee failed to fill up the schedules properly which led to processing of return without allowing the deduction to the assessee. The assessee filed rectification application several time without any success. Upon further appeal, Ld. CIT(A), vide para 9.10 of the impugned order, held that this issue could not be considered u/s 154 of the Act. Aggrieved, the assessee is in further appeal before us. 3. Quite clearly, it is the fault of the assessee in filling the correct schedules which has led to wrong processing of return of income since computerized processing is done on the basis of assessee’s inputs on ‘garbage-in garbage-out’ principle. However, taxes are to be collected as per the authority of law only and the revenue authorities could not take advantage of assessee’s mistake. Therefore, considering the principle of nature justice, we direct concerned jurisdictional AO / AO-CPC to allow the rectification of the return of income after verification of computation of income. The assessee is directed to fill the correct schedules and provide all the information / documents as required by the assessing authority to facilitate the same. 3 ITA No.86/Chny/2023 4. The appeal stand allowed for statistical purposes. Order pronounced on 26 th June, 2023. Sd/- Sd/- (MAHAVIR SINGH) (MANOJ KUMAR AGGARWAL) उपा23 / VICE PRESIDENT लेखा सद5 / ACCOUNTANT MEMBER चे7ई Chennai; िदनांक Dated : 26-06-2023 DS आदेश क त ल प अ े षत/Copy to: 1. अपीलाथ /Appellant 2. थ /Respondent 3. आयकर आयु?/CIT 4. िवभागीय ितिनिध/DR 5. गाडD फाईल/GF