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Income Tax Appellate Tribunal, “A” BENCH, MUMBAI
Per Amarjit Singh (AM): This appeal filed by the assesse is directed against the order passed by the NFAC, Delhi, dated 17.02.2023 for A.Y. 2012-13. The assessee has raised the following grounds before us:
“1. On the facts and in the circumstance of the case, the Ld AO and the CIT(A) erred in disregarding the Appellant's plea that its correct income from business and profession is Rs.4,94,61,469/- and the difference of Rs.1,61,00,000/- is the provision for income- tax which was inadvertently added in the "profit before tax" while filing its e-return of income.
On the facts and in the circumstance of the case, the Ld AO and the CIT(A) erred in rejecting the Appellant's plea that, the addition of provision for taxation to the profit before tax, for computation of income from business or profession, is nothing but a mistake apparent on the record of assessment.
P a g e | 2
On the facts and in the circumstance of the case, the Ld AO and the CIT(A) erred in concluding that non-filing of revised return by the Appellant for the A.Y. 2012-13 precludes the Appellant from seeking relief u/s 154 of the Income-tax Act, 1961. 4. The Appellant craves leave to, add to, alter, amplify, modify or delete all or any of the aforesaid grounds at or before the hearing.”
Fact in brief is that the assessment u/s 143(3) of the Act was finalised in the case of the assessee company on 11.03.2016 and total income was assessed at Rs.655,61,469/-. Thereafter, the assessee filed rectification application u/s 154 of the Act on 01.06.2016. In the rectification application the assessee explained that the correct taxable income of the assessee for the year under consideration was Rs.4,94,61,469/- and as per the computation the correct taxable income was of Rs.494,61,469/- as against income of Rs.655,61,469/- assessed u/s 143(3) of the Act. The assesse further explained that the difference of Rs.1,61,00,000/- was arised on account of provision of Income Tax which had already been reduced from it income and added again to the taxable income due to error in the income tax software while converting the same in XML. However, the tax amount in the return of income remain unchanged which prove that the aforesaid error happened because of technical reasons. The assessing officer has rejected the rectification application vide letter dated 18.07.2016. 3. Thereafter, the assessee filed the appeal before the ld. CIT(A). The ld. CIT(A) has dismissed the appeal of the assesse after referring the decision of the ld. PCIT in rejecting the application filed by the assessee u/s 264 of the Act.
During the course of appellant proceeding before us the ld. Counsel furnished paper book comprising various details and copies of document furnished before the lower authorities. The ld. Counsel submitted that no addition was made to the returned income in the assessment order, however, the AO determined the income of the P a g e | 3 Longulf Trading (I) Pvt. Ltd. Vs. ACIT, Circle 10(2)(1) asseses at Rs.655,61,469/- as against the income of Rs.494,61,469/- computed by the assessee. The ld. Counsel further submitted that the provision for income tax of RS.1,61,00,000/- was inadvertently added in the profit before tax which is a mistake apparent on record, however, without any valid reason the claim of the assessee has not been decided on merit by the lower authorities. On the other hand, the ld. D.R supported the order of lower authorities.
Heard both the sides and perused the material on record. The assesse has filed return of income on the ITR-6 Form for the assessment year under consideration comprising 24 pages as placed in the paper book filed by the assessee during the course of appellate proceedings before us. The assesse has also filed the copy of computation of Income for the A.Y. 2012-13 placed as Annexure B to the paper book filed. The assessee has also filed copy of audited financial statement for F.Y.2011- 12 along with tax audit report for the A.Y. 2012-13. The aforesaid information were also filed before the lower authorities. With the assistance of ld. Representatives we have perused the copy of computation of total income filed by the assesse. In the computation of income under the head profit/gains of Business/Profession the assesse has shown net total Income of Rs.494,61,469/- on which tax payable was computed at Rs.1,60,47,774/-. On the computation of Income statement the assesse has also shown the working of taxable business income as under:
P a g e | 4 In the Audited profit and loss a/c for the year ended 31st March 2012 the profit before tax and profit after tax is computed as under:
In the ITR Form 6 under the Part- Profit and Loss account for the previous year 2011-12 the assessee has correctly shown the profit before tax as per column no. 43 at Rs.432,64,700/- and thereafter reduced provision for the current taxes of Rs.16,00,000/- other provisions and shown amount available for appropriation to the amount of Rs.40,49,06,177/-. However, in the Form 6 at part A-01 (other information) at column no. 8 under the head amount debited to the profit and loss account to the extent disallowance u/s 40 of the Act, the assessee has inadvertently at column 8(A)(b) mentioned about amount of tax at Rs.161,00,000/-. Because of entering the said amount of Income tax of Rs.161,00,000/- under the column no. 8 under the items disallowable u/s 40 of the Act profit and gains from business and profession was shown at Rs.655,61,469/-as against correct profit and gains of business/profession as per Profit and Loss account and computation of taxable income of Rs.494,61,469/- (Rs.655,61,469 –
P a g e | 5 1,60,000). This is undisputed fact that as per the computation of total income the assessee had computed tax payable at Rs.160,47,774/- on the basis of business profit before tax of Rs.494,61,469/-.
In view of the above facts and circumstances the assesse has demonstrated that due to technical/typographical error the amount of Rs.1,61,00,000/- was incorrectly added twice to the income of the assessee which is required to be verified. In the light of the above facts and circumstances we observe that ld. CIT(A) has ignored the submission made by the assesse supported with relevant supporting material as discussed supra which were available before the lower authorities, therefore, the decision of the ld. CIT(A) is not justified. Therefore, we restore this issue to the file of the assessing officer for deciding on merit de novo after verification/examination of the relevant supporting material furnished by the assesse. Accordingly, this ground of appeal of the asessse is allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 12.07.2023 (Kavitha Rajagopal) (Amarjit Singh) Judicial Member Accountant Member Place: Mumbai Date 12.07.2023 Rohit: PS
P a g e | 6 आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : 1. अपीलाथी / The Appellant 2. प्रत्यथी / The Respondent. आयकर आयुक्त / CIT 3. विभागीय प्रविविवि, आयकर अपीलीय अविकरण DR, ITAT,
Mumbai 5. गार्ड फाईल / Guard file.
सत्यावपि प्रवि //// आदेशानुसार/ BY ORDER,
उि/सहायक िंजीकार (Dy./Asstt.