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Facts
The assessee, a senior citizen deriving income from medical profession and other sources, also a partner in a firm, filed a return declaring income. The CPC processed the return under Section 143(1) and made additions. The assessee filed a rectification application under Section 154, which was accepted, and a rectified order was issued accepting the returned income. However, the CIT(A) passed an ex-parte order confirming the original addition without being aware of the rectification.
Held
The Tribunal held that the CIT(A) was unaware of the CPC's rectification order which had already accepted the assessee's returned income. Therefore, the ex-parte order passed by the CIT(A) needed to be set aside.
Key Issues
Whether the CIT(A) order confirming addition was valid when the CPC had already rectified its intimation under Section 154, accepting the returned income, and the assessee could not appear before the CIT(A) due to lack of proper notice or awareness of the rectification.
Sections Cited
143(1), 154, 147
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCH “SMC”, PUNE
Before: SHRI MANISH BORAD & SHRI VINAY BHAMORE
Assessment Year : 2020-21 Chitra Uttam Khare, Vs. ITO, Ward-12(1), Pune. 691, Saraswati Vilas Hospital, Laxmi Road, Opp. Shiva Sadan, Narayan Peth, Pune- 411030. PAN : ACDPK5474D Appellant Respondent Assessee by : Shri S. S. Puranik Revenue by : Shri Aviyogi Ambadkar Date of hearing : 12.03.2025 Date of pronouncement : 26.05.2025 आदेश / ORDER
PER VINAY BHAMORE, JM:
This appeal filed by the assessee is directed against the order dated 29.11.2024 passed by Ld. Addl/JCIT(A)-6, Delhi [‘Ld. CIT(A)’] for the assessment year 2020-21.
The appellant has raised the following grounds of appeal :-
1. Commissioner of Income Tax has erred in Confirming Income Processed u/s 143(1) at Rs. 15,03,390/- against the returned Income of Rs. 5,85,800/- Appellant Prays for deletion of addition.
2. Commissioner of Income Tax has erred in misstating "Income declared in return after claiming declared loss of Rs. 9,17,600/ under the head share of loss from firm. Appellant Prays to cancel the addition of Rs.9,17,600/- as income declared Rs.5,85,800/- is without claim of said loss.
3. Commissioner of Income Tax has erred in, not holding that intimation u/s 143(1) with variation in income is bad in law as CPC did not intimate proposed variation before processing final intimation.
4. CIT(A) has not acted just and fair in confirming addition twisting submission in statement of facts and further passing exparte order.
5. Appellant prays to add, alter, amend, modify and/or withdraw the ground.
Facts of the case, in brief, are that the assessee is an individual senior citizen deriving income from medical profession, income from other sources and also a partner in Saraswati Vilas Hospital. The return of income for the period under consideration was furnished on 07.01.2021 declaring taxable income of Rs.5,85,800/- after claiming deductions under Chapter VI-A of the IT Act. Apart from above income, the assessee also declared loss of Rs.9,17,590/- from partnership firm Saraswati Vilas Hospital. The return of income was processed u/s 143(1) of the IT Act by CPC vide order dated 15.12.2021 wherein CPC has added back Rs.9,17,592/- as income of the assessee under the head “business and profession”
Rs.15,03,394/- as against the income returned by the assessee at Rs.5,85,800/-. Being aggrieved with the intimation order dated 15.12.2021, assessee filed a rectification application u/s 154 of the IT Act before CPC on 18.12.2021. Since the assessee did not received any rectification order within 30 days, he also preferred first appeal before the Ld. CIT(A) on 14.01.2022. Fortunately, CPC accepted the mistake and rectified the intimation vide order dated 12.04.2022 and accepted the income returned by the assessee. However, Ld. CIT(A) remained ignorant about the rectification order passed by the CPC, since the assessee failed to intimate Ld. CIT(A) that the addition has already been deleted by CPC rectification order dated 12.04.2022. Ld. CIT(A) issued notices for hearing on 18.10.2024 and also on 07.11.2024, however the assessee could not see and missed the above two notices of hearing which resulted in passing of ex-parte order by Ld. CIT(A), who consequently confirmed the original intimation order passed by CPC vide dated 15.12.2021. It is this order against which the assessee is in appeal before this Tribunal.
4. We have heard Ld. counsels from both the sides and perused the material available on record including the paper book furnished by the assessee. In this regard, we find that CPC vide original intimation order dated 15.12. 2021 made certain addition and subsequently on an application filed by the assessee u/s 154 of the IT Act rectified the earlier intimation and accepted the income returned by the assessee and also issued a rectified order on 12.04.2022. We further find that when the appeal was listed for hearing the assessee could not appear before Ld. CIT(A) and consequently the appeal was dismissed for want of prosecution resulting in confirmation of original intimation passed by CPC since Ld. CIT(A) was ignorant of the fact that CPC has already passed a rectification order accepting the income returned by the assessee. Under these circumstances of the case, we find force in the arguments of Ld. counsel of the assessee that the order passed by Ld. CIT(A) needs to be set-aside. Considering the totality of the facts of the case and in the light of rectification order dated 12.04.2022 passed by CPC wherein income returned by the assessee was accepted, we deem it appropriate to set-aside the order passed