STEP IN ,KAMLA NEHRU MARG vs. DCIT/ACIT 1(1), UJJAIN , UJJAIN

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ITA 425/IND/2025Status: HeardITAT Indore04 December 2025AY 2018-194 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the assessment for the immediately preceding AY 2017-18, which determined the quantum of loss to be carried forward, had been set aside by the CIT(A) to the AO for a fresh decision. The learned representatives for both the assessee and the revenue were in agreement that the present matter for AY 2018-19 should also be restored to the file of the AO. This would allow the AO to consider the outcome of the fresh assessment for AY 2017-18 and consequently allow the correct amount of brought forward loss to the assessee. Accordingly, the Tribunal remanded the matter back to the AO. The AO was directed to allow the correct amount of brought forward loss as would be finalized in the order of the fresh assessment for AY 2017-18. The appeal was allowed for statistical purposes.

What were the facts?

The assessee, a partnership firm, filed its return for AY 2018-19 declaring Nil income after setting off brought forward losses of Rs. 51,90,463. The Assessing Officer (AO) completed assessment under section 143(3) but allowed set-off of only Rs. 23,06,433, reducing the carried forward loss based on the assessment for AY 2017-18. The assessee appealed to the CIT(A), who upheld the AO's order. The assessee then filed an appeal before the ITAT. Notably, the CIT(A) had previously set aside the assessment for AY 2017-18 to the AO for fresh decision. The parties agreed that the present matter should also be restored to the AO to consider the outcome of the AY 2017-18 fresh assessment.

What were the issues?

1. Whether, on the facts and circumstances, the CIT(A) erred in upholding the assessment proceedings without remanding the matter to the AO, especially when the main matter (AY 2017-18) was set aside to the AO for fresh adjudication, and whether the additions should be deleted. - Assessee's contention: The CIT(A) should have remanded the matter to the AO, as the preceding year's assessment was set aside. The additions should be quashed or deleted. - Revenue's contention: Not recorded. 2. Whether, on the facts and circumstances, the AO erred in not allowing the set-off of brought forward losses amounting to Rs. 28,84,030. - Assessee's contention: The full brought forward loss should be allowed as set-off against the current year's income. - Revenue's contention: Not recorded.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 143(3A),Section 143(3B),Section 139

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, INDORE BENCH, INDORE

Before: SHRI B.M. BIYANI

For Appellant: Shri Soumya Bumb, AR
For Respondent: Shri Ashish Porwal, Sr. DR
Hearing: 01.12.2025Pronounced: 04.12.2025

आदेश/ O R D E R

Per B.M. Biyani, A.M.:

1.

Feeling aggrieved by order of first appeal dated 22.11.2024 passed by learned Commissioner of Income-Tax (Appeals)-NFAC, Delhi [“CIT(A)”] which in turn arises out of assessment-order dated 03.03.2021 passed by learned National e-assessment Centre, Delhi [“AO”] u/s 143(3) r.w.s. 143(3A) & 143(3B) of Income-tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2018- 19, the assessee has filed this appeal on following grounds:

“1.On the facts and circumstances of the case and in law, the learned Commissioner of Income tax (Appeals) ("CIT(A)") erred in upholding the assessment proceedings without remanding the matter to the file of AO as the main matter is already set aside to the file of AO. The Appellant Page 1 of 4 AY 2018-19 prays that the said order be quashed or set aside and the additions thereby be deleted.

2. On the facts and circumstances of the case and in law the learned AO erred in not allowing the set off of brought forwarded losses amounting to Rs.28,84,030/-. The Appellant prays that the said brought forward of loss be allowed from the income of the year under consideration.”

2.

The background facts leading to present appeal are such that the assessee, a partnership firm, filed its return of income of AY 2018-19 u/s 139 declaring a total income of Rs. Nil after set-off of brought forward loss of Rs. 51,90,463/- against income of current year. The case of assessee was selected under scrutiny and notices u/s 143(2)/142(1) were issued.

Ultimately, the AO completed assessment u/s 143(3). However, in the assessment so completed, the AO allowed set off of brought forward loss of Rs. 23,06,433/- only considering the status of immediately preceding AY 2017-18 in which the AO completed assessment u/s 144 and reduced the quantum of loss to be carried forward by assessee from Rs. 51,90,463/- to Rs. 23,06,433/-. Aggrieved, the assessee carried matter in first-appeal but, however, the CIT(A) did not grant any relief. Still aggrieved, the assessee has come in next appeal before us.

3.

We have heard learned Representatives of both sides and perused the orders of lower authorities.

Page 2 of 4 has been drawn by Ld. AR for assessee, we find that the CIT(A) has noted thus:

7.1…..Further, the Appellant’s case for the AY 2017-18 was also in receipt of this office and the same has been set aside to the file of AO to decided afresh.

5.

Thus, the assessee’s case of immediately preceding AY 2017-18 in which the AO reduced the quantum of loss to be carried forward by assessee from Rs. 51,90,463/- to Rs. 23,06,433/- has been remanded by CIT(A) to AO to decide afresh and as informed by Ld. AR, the proceeding of fresh assessment is pending before AO as on date. Faced with this situation, learned Representatives of both sides were ad idem that the present matter of AY 2018-19 should also be restored at the level of AO so that the AO shall consider the outcome of fresh assessment of AY 2017-18 and allow the correct amount of brought forward loss to assessee finalized in the order of fresh assessment. Accordingly, we remand this matter back to the file of AO in terms of consensus generated by learned Representatives. The AO is directed to allow correct amount of brought forward loss as would be finalized in order of fresh assessment.

Order pronounced in open court on 04/12/2025

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