Roshaniben Tusharbhai Patel, Patan V. The DCIT, CPC, Benglore

ITA 96/AHD/2021

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 4953 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: SMC-3
• Assessment Year: 2017-2018
• Appeal Filed On: 16-05-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: MEHUL K. PATEL
• Keywords: Business income; Revised return
• Section: 154; 44AD

Judgement Text

ITA No.96/Ahd/2021 A.Y. 2017-18 Page 1 of 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “SMC-3” BENCH, AHMEDABAD BEFORE SHRI P.M. JAGTAP, VICE PRESIDENT AND Ms. SUCHITRA KAMBLE, JUDICIAL MEMBER ITA No.96/Ahd/2021 Assessment Year: 2017-18 Roshaniben Tusharbhai Patel, vs. The D.C.I.T., 6, Ashtavinayak Tenament, CPC, Bangalore. Near Upan Bungalows, Chanasma Deesa Road, Patan - 384 265. [PAN – AVFPP 1471 J] (Appellant) (Respondent) Appellant by : Shri Mehul K. Patel, AR Respondent by : Shri Atul Pandey, Sr. DR Date of hearing : 29.07.2022 Date of pronouncement : 21.09.2022 O R D E R PER SUCHITRA KAMBLE, JUDICIAL MEMBER : This appeal is filed by the assessee against the order dated 26.03.2021 passed by the CIT(A), National Faceless Appeal Centre (NFAC), Delhi for the Assessment Year 2017-18. 2. Grounds of appeal raised by the assessee are as under :- “1. That on facts, and in law, the learned CIT(A) has grievously erred in holding that the application u/s.154 of the Act is rightly rejected and that there was no mistake apparent from record. 2. That, on facts, and in law, it ought to have been held that the appellant ought to have been assessed only on the correct income liable to be taxed u/s. 44AD of the Act, and the appellant had rightly pointed out the error in filing the return of income through a bona fide mistake.” 3. The assessee carried on business in shares during the year. The assessee filed return which was processed by the CPC, Banglore raising demand of Rs. 1,14,308/-. The assesse filed application under section 154 before the Assessing ITA No.96/Ahd/2021 A.Y. 2017-18 Page 2 of 3 Officer thereby stating that in the return of income she had erroneously stated business income at Rs. 9,56,570 instead of Rs. 5,12,833. The said application seeking to rectify the said mistake was rejected by the CPC, Bangalore on 16.12.2019. 4. Being aggrieved by the order under Section 154 of the Act, the assessee filed appeal before the CIT(A), NFAC. The CIT(A) dismissed the appeal of the assessee. 5. The Ld. AR submitted that the assessee has net loss of Rs.44,435/- as per Profit & Loss account and she is eligible assessee for Section 44AD and hence opted to show income from business at 6% on the gross receipts of business. The assessee has gross receipts from business of Rs.85,47,216/- and 6% of the said receipts comes to Rs.5,12,833/- which is the admitted income under Section 44AD of the Act. However, at the time of filing income tax return the Ld. AR contented that by mistake the assessee has wrongly mentioned Rs.9,56,670/-. The Ld. AR submitted that as the mistake which is rectifiable under Section 154 of the Act the assessee has filed application before the CPC, Bangalore which should have been taken into consideration as the details of the income was properly filed but 6% of gross receipts were wrongly calculated under Section 44AD of the Act. Therefore, the CIT(A) should have considered the same. 6. The Ld. DR submitted that Section 154 application cannot be taken into account in respect of rectifying the figures in return of income. Thus, the CIT(A) has rightly dismissed the appeal of the assessee. 7. We have heard both the parties and perused all the relevant material available on record. The assessee at the time of hearing filed decision of Hon’ble Gujarat High Court in the case of S.R. Koshti vs. CIT, 276 ITR 165. From the perusal of the said case laws, it can be seen that the assessee filed revised return of income and Hon’ble Jurisdictional High Court observed that when the Assessing Officer has adopted one of the courses permissible in law and which has resulted in loss of revenue or where two views are possible and the Assessing Officer has taken one view with which the Commissioner does not agree, order cannot be treated to be erroneous and prejudicial to interest of revenue, unless view taken by the Assessing Officer is unsustainable in law. The facts of that case though are different from the present ITA No.96/Ahd/2021 A.Y. 2017-18 Page 3 of 3 assessee’s case. Yet since the assesse has filed application for rectification in the figures of business income as the assesse has gross receipt of Rs. 85,47,216 and its 6% comes to Rs. 5,12,833, the same should have been taken into consideration by the Assessing Officer. In the present case, the assessee has filed rectification application under Section 154 of the Act thereby stating that there was mistake in filing return of income. When there is a mistake in filing of return of income the same was pointed out to the Assessing Officer and because of which application under Section 154 of the Act was filed by the assesse. Therefore, the CIT(A) should have looked into this aspect. Thus, the CIT(A) erred in holding that application u/s 154 of the Act was rightly rejected. Therefore, we direct the Assessing Officer to allow the rectification application of the assessee and assessed the correct income liable to be taxed under Section 44AD of the Act. The appeal of the assessee is partly allowed. 8. In result, appeal of the assessee is partly allowed. Order pronounced in the open Court on this 21 st day of September, 2022. Sd/- Sd/- (P.M. JAGTAP) (SUCHITRA KAMBLE) Vice President Judicial Member Ahmedabad, the 21 st day of September, 2022 PBN/* Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY Assistant Registrar Income Tax Appellate Tribunal Ahmedabad benches, Ahmedabad