LOKMANGAL CO-OP. BANK LTD,SOLAPUR vs. ASSISTANT COMMISSIONER OF INCOME TAX, SOLAPUR

This appeal by the assessee against the order dated 02-01-2017 passed by the Commissioner of Income Tax (Appeals)-7, Pune [„CIT(A)‟] for assessment year 2009-10.

The only issue is to be decided is as to whether the CIT(A) justified in confirming the addition made by the AO u/s. 154 of the Act proceedings in the facts and circumstances of the case.

Heard both parties and perused the material available on record. We note that new incumbent, the AO found that there was mistake on account of allowance of deduction u/s. 36(1)(viia) of the Act. Accordingly, a notice u/s. 154 of the Act issue and in response, the assessee filed a letter dated 21-10-2013. According to AO the ld. AR representing the assessee consented to the rectification in principle and accordingly the disallowances made to an extent of Rs.10,42,608/-. The CIT(A) confirmed the same. Before us, the ld. AR submits that the disallowances u/s. 36(1)(viia) is a subject matter of litigation and the same cannot be matter of rectification u/s. 154 of the Act. Further, the issue is debatable and the disallowances made by the AO as confirmed by the CIT(A) is bad in law. Further, he submits that there was no reference to this issue nor any discussion made by the AO in the original order passed u/s. 143(3) of the Act. He submits that when there is no reference or discussion in the assessment proceedings the order u/s. 154 does not lie. On perusal of the record, we find that the contentions made before us by the ld. AR were not raised before the AO and fairly conceded that if this Tribunal remand the matter to the file of AO the assessee will take the same contentions before this Tribunal.

The ld. DR reported no objection in remanding the matter to the file of AO for its fresh consideration.

Taking into consideration the facts and circumstances of the case and submissions of ld. AR and ld. DR, we deem it proper to remand the issue to the file of AO for its fresh consideration. The assessee is liberty to file evidences if any in support of its claim. Thus, only issue raised by the assessee is allowed for statistical purpose.

In the result, the appeal of assessee is allowed for statistical purpose.