BHUVANA RAJESWARI VIJAYASANKAR,SALEM vs. ITO, WARD 1(1), SALEM, SALEM

The Assessee raised the following grounds of appeal :

Briefly, the facts of the case are that the appellant is an Individual. The Return of Income for the Assessment Year 2023-24 was filed on 31.07.2023 disclosing a total income of Rs.42,35,460/-. While doing so, the appellant computed the tax liability in accordance with the provisions of section 115BAC of the Income Tax Act, 1961. The said Return of Income was processed by CPC u/s.143(1) vide intimation dated 28.09.2023 accepting the returned income. However, computed the tax liability under old regime. On receipt of the said intimation, a petition u/s.154 was filed on 21.01.2025 stating that the option exercised u/s.115BAC for the Assessment Year 2022-23 equally holds good under the provisions of 115BAC (5)(ii) of the Act ever for subsequent assessment year i.e. 2023-24 also. However, the CPC has rejected the above application without assigning any reasons.

Being aggrieved by the said order passed u/s.154, an appeal was filed before the ld.CIT(A), who vide impugned order confirmed the action of CPC taking into consideration the fact that for the Assessment Year 2022-23 was filed on 31.10.2022 which is belated return and therefore, it is presumed that the Return of Income for the A.Y.2022-23 was filed under Old Regime, consequently, the option available under provisions of 115BAC(5)(i) became invalid for the subsequent year i.e. assessment year under consideration.

Being aggrieved, the appellant is in appeal before us in the present appeal. The Ld.Counsel submits that even if the Return of Income for the earlier years was filed belatedly by exercising the option to be govern under New Regime that would not preclude the assessee from claiming the benefit of New Tax Regime placing reliance on the Co-ordinate Bench of this Tribunal. He further submitted that the Tribunal in ITA No.3379/CHNY/2024 vide order dated 27.01.2026 allowed the appeal of the assessee against the intimation u/s.143(1) of the Income Tax Act, 1961.

On the other hand, ld.Sr.DR opposed the above submissions.

We heard rival submissions and perused the material available on record. The issue in the present appeal stands covered by the decision of ITAT Chennai Bench in the case of Bhuvana Rajeswari Vijayasankar Vs. ITO in ITA No.3379/CHNY/2025 for A.Y.2023-24 held as under: “5. We have heard rival contentions and gone through facts and circumstances of the case. We noted that the Co-ordinate Bench of this Tribunal in the case of Shri Ranganathan Anantharaman vs. DCIT in ITA No. 1558/CHNY/2024 and the Pune Bench of this Tribunal in the case of Akshay Devendra Birari reported in 164 Taxmann.com 58 has taken a view that even if concessional rate benefit was not allowed in earlier assessment year for the reason that the return of income for earlier year i.e., assessment year 2021-22 was filed belatedly u/s.139(4) of the Act will not preclude the assessee from claiming / opting for new tax regime u/s.115BAC of the Act. The Co-ordinate Bench of Chennai in the case of Shri Ranganathan Anantharaman, supra, has considered this issue and held as under:-" 1. The sole grievance of the assessee, in the captioned appeal, is application of correct rates of taxes. The impugned order has been passed by Learned Addl. / JCIT Commissioner of Income Tax (Appeals)- 2, Gurugram [CIT(A)] on 29-03-2024 in the matter of an intimation issued by CPC u/s 143(1) of the Act on 22-02-2023 raising certain demand against the assessee. This was on account of the fact that the assessee claimed concessional rate of tax u/s 115BAC which was computed by CPC under old regime i.e., at normal rates. The assessee laid its claim on the strength of Form 10-IE which was filed on 22-03-2022 starting from AYs 2021-22. The assessee submitted that it was not required to exercise this option every year since option once exercised, would apply to subsequent years as well. However, CPC denied the benefit of the same. The Ld. CIT(A) confirmed the action of CPC on the ground that the return of income for AY 2021-22 was filed belatedly u/s 139(4). The benefits of Sec. 115BAC would not be applicable for belated filings. Given the fact that the claim for the provisions of Sec. 115BAC was not valid for AY 2021- 22, the assessee did not fresh Form in this year. Aggrieved, the assessee is in further appeal before us. The Ld. AR has submitted that this form could be filed only once and since the assessee had already filed this form once, it could not file another form on the system / ITBA portal. In other words, the assessee is precluded from claiming the benefits in all the subsequent years also.

In the present case also the Assessee had filed return of income earlier year belatedly u/s.139(4) of the Act. For subsequent year, the Assessee has opted for the New Tax Regime. Hence, the present case is similar to the referred case, we find that the CPC, Bengaluru as well as CIT(A) erred in not allowing the claim of option u/s.115BAC of the Act to the assessee. We direct the AO / CPC to allow the assessee to opt for new tax regime u/s.115BAC of the Act for the relevant Assessment Year 2023-24.

In the result, appeal filed by the assessee stands allowed. Order pronounced in the open Court on 9th July, 2026.