GITA POWER & INFRASTRUCTURE PVT. LTD.,CHENNAI vs. ACIT, CENTRAL CIRCLE - 1 (1), CHENNAI

The aforesaid appeal by assessee for Assessment Year [AY] 2011- 12 arises out of the order of learned Commissioner of Income Tax (Appeals)-16, Chennai [CIT(A)] dated 28/11/2019 in the matter of assessment framed by Ld. Assessing Officer [AO] u/s.143(3) r.w.s. 153A on 30/12/2016. In this appeal, the assessee is aggrieved by the fact that losses as determined in the assessment order have not been allowed to be carried forward to the subsequent years.

The material facts are that an assessment was framed against the assessee u/s 143(3) r.w.s. 153A on 30/12/2016. The assessee claimed business loss of Rs.53.53 Lacs in the original return of income which was reduced to Rs.30.13 Lacs in return filed in response to notice u/s 153A. However, in this return, the assessee claimed short-term capital losses of Rs.23.40 Lacs. Consequent to disallowance u/s 14A as computed by Ld. AO, returned business loss was reduced to Rs.16.05 Lacs in the assessment order. However, Ld. AO did not allow these losses to be carried forward in subsequent years on the ground that return u/s 153A was not filed within the time specified in the notice.

During appellate proceedings, the assessee, drawing attention to the statutory provisions, sough carry forward of these losses. However, Ld. CIT(A) confirmed the stand of Ld. AO in terms of decision of Hon’ble High Court of Calcutta in the case of Srikant Mohta V/s CIT (2018; 95 Taxmann.com 224). Aggrieved, the assessee is in further appeal before us. 4. We find that notice u/s 153A was issued to the assessee on 07/01/2015 requiring the assessee to file the return within 15 days. The assessee has filed the return on 15/02/2015 which has led Ld. AO deny the carry forward of losses. However, it could be seen that the business loss of Rs.53.53 Lacs was claimed by the assessee in the original return filed on 26/09/2011 which was well within due date. As per this return, the assessee was entitled to carry forward these losses. In the return filed in response to notice u/s 153A, the amount of overall loss remains the same. The only difference is that the loss has been split as Business Loss and short term capital loss. These computations have been accepted by Ld. AO barring the disallowance of 14A. This being so, the lower authorities, in our opinion, we not justified in denying the carry forward of losses as claimed by the assessee. We order so. 5. The appeal stand allowed in terms of our above order. Order pronounced on 11th October, 2021.