LATE DEV KUMAR GOPALDAS AGGARWAL (THROUGH LEGAL REPRSENTATIVE-MR. YOGESH DEVKUMAR AGGARWAL),MUMBAI V. INCOME TAX OFFICER WARD 20(1)(1), MUMBAI

ITA 2861/MUM/2025

AI Insights

The case involves an appeal by the late Devkumar Gopaldas Aggarwal against the order of the Commissioner of Income Tax (Appeals) which upheld the rectification order passed by the Central Processing Centre (CPC). The CPC had erroneously doubled the long term capital gain amount in the intimation and rectification order under section 154 of the Income Tax Act, leading to an excessive tax demand. The assessee contested this error, which was initially rejected by the CPC and upheld by the CIT(A). The Tribunal found that the mistake was apparent from the records and directed the assessing officer to rectify the error and accept the income as declared by the assessee.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 668988 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: UMA SHANKAR PRASAD
• Assessee Lawyers: RASHMIKANT MODI AW KETKI
• Keywords: Opportunity of being heard; Rectification of order
• Section: 154

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, MUMBAI BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER & SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER ITA No. 2861/MUM/2025 (AY : 2016-17) (Physical hearing) Late DevkumarGopaldas Aggarwal 2nd Floor, Gupta Mills Estate, Darukhana, Reay Road, Mumbai-400010. [PAN No. AABPA0675J] Vs ITO, Ward-20(1)(1) Mumbai Appellant / Assessee Respondent / Revenue Assessee by Sh. Rashmikant Modi A/w Ms. Ketki Rajeshirke CAs Revenue by Sh. Umashankar Prasad, CIT-DR Date of hearing 25.06.2025 Date of pronouncement 25.06.2025 Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER; 1. This appeal by assessee is directed against the order of ld. CIT(A) dated 05.02.2025 for A.Y. 2016-17. The ld CIT(A) rejected the application of assessee under section 154 of Income Tax Act (Act) The assessee has raised following grounds of appeal: “1. On the facts and in the circumstances of the case, the appellant submits that the Hon’ble Commissioner of Income Tax (Appeals)S- NFAC erred in upholding the rectification order passed u/s 154 by Central Processing Centre wherein the application for rectification sought u/s 154 to rectify the mistake apparent from records was rejected. The appellant submits that the jurisdictional assessing officer be directed to rectify the mistake apparent from record and the demand raised be deleted. 2. On the facts and in the circumstances of the case, the appellant submits that the Hon’ble Commissioner of Income Tax (Appeals)S- NFAC erred in upholding the action of CPC of computing the Long Term Capital Gain chargeable to at special rate of 10% u/s 112 at Rs. ITA No. 2861/Mum/2025 Late Devkumar Gopaldas Aggarwal 2 71.39.912/- in the intimation as well as rectification order passed u/s 154 instead of Rs. 35,69,956/- as per return of income, thereby doubling the long term capital gain without bringing on record any mistake apparent from records leading to excessive tax demand. The appellant submits that the long term capital gain of Rs. 35,69,956/- be taxed u/s 112 and the double addition of Rs. 71,39,912/- be deleted. 3. On the facts and in the circumstances of the case, the appellant submits that the Hon’ble Commissioner of Income Tax (Appeals)S- NFAC erred in dismissing the appeal without granting any proper opportunity and without considering appreciating the statement of facts and grounds of appeal raised by the appellant. The appellant submits that an opportunity of being heard been given. 2. Rival submissions of both the parties have heard and record perused. The learned Authorised Representative (ld. AR) of the assessee submits that the assessee while filing return of income has disclosed Long Term Capital Gain (LTCG) of Rs. 38,53,567/-. Such amount is chargeable to tax at special rate under section 112 of the Act. The assessee offered gross total income at Rs. 38,96,293/-. The income chargeable at special rate was Rs. 35,69,956/-, however, the CPC considered its exact double figure i.e. Rs. 71,39,912/-. The assessee filed application for rectification under section 154, which was rejected in a mechanical manner. The appeal of the assessee was also dismissed by ld. CIT(A) by holding that there is no mistake apparent from the record which require rectification. The ld. AR while carrying us through return of income and order of CPC pointed out all the figures of total income as well as the long term capital gain taken (considered) at double amount. 3. On the other hand, learned Senior Departmental Representative (ld. Sr. DR) for the revenue submits that case of assessee has not been verified by ITA No. 2861/Mum/2025 Late Devkumar Gopaldas Aggarwal 3 assessing officer, therefore, matter may be restored back to the file of assessing officer to pass the order afresh. During the hearing, the ld. Sr. DR was confronted with the fact that this case is not the case of scrutiny rather an adjustment made by CPC in a mechanical manner, wherein as per assessee there is apparent mistake. The ld. Sr. DR for the revenue reiterated that it will be better if the matter is examined by assessing officer afresh. 4. We have considered the rival submissions of both the parties and have gone through the orders of lower authorities. We find that in the order of CPC, there is mistake which is apparent from the record. The CPC while processing the return of income consider one income component from assessee tht is long term capital gain(LTGC) which is chargeable to tax at special rate is considered at double of the amount which was offered by assessee, thus, it is clear mistake from the order, which was liable to be rectified. And in case such figure is corrected/rectified, no adjustment would be left in order of CPC, therefore, we accept the plea of ld. AR of the assessee and direct the assessing officer to accept the returned income. 5. In the result, the appeal of assesseeis allowed. Order was pronounced in the open Court on 25/06/2025. Sd/- PRABHASH SHANKAR ACCOUNTANT MEMBER Sd/- PAWAN SINGH JUDICIAL MEMBER MUMBAI, Dated:/06/2025 Biswajit ITA No. 2861/Mum/2025 Late Devkumar Gopaldas Aggarwal 4 Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; (3) The PCIT / CIT (Judicial); (4) The DR, ITAT, Mumbai; and (5) Guard file. By Order Assistant Registrar ITAT, Mumbai "