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Facts
The assessee filed their return of income for AY 2010-11, which was assessed. The AO re-opened the case under Section 147 and made an addition of Rs. 12,87,000/- as 'notional interest income'. The CIT(A) initially upheld this addition in an ex-parte order. However, a subsequent rectification order by the CIT(A) deleted the addition.
Held
The Tribunal noted that the CIT(A) had already granted full relief to the assessee through a subsequent rectification order, deleting the entire addition of 'notional interest income'. Therefore, the appeal became infructuous.
Key Issues
Whether the addition of notional interest income made by the AO can be sustained when the CIT(A) has subsequently deleted it through a rectification order.
Sections Cited
139, 147, 148, 143(3), 250, 154
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI B.M. BIYANI & SHRI PARESH M. JOSHI
आदेश/ O R D E R
Per B.M. Biyani, AM:
The captioned two appeals have been filed by assessee against the very same order of first-appeal passed by learned Commissioner of Income-tax (Appeals), Addl/JCIT(A)-2, Mumbai [“CIT(A)”] u/s 250 of the Income-tax Act, 1961 [“the Act”], which in turn arise out of assessment-order dated 26.12.2017 passed by ITO-3(3), Bhopal [“AO”] u/s 143(3) r.w.s. 147 of the Act for Assessment-Year [“AY”] 2010-11.
The brief facts are such that the assessee-individual filed her return of income of AY 2010-11 u/s 139 on 29.03.2011 declaring a total income of Rs. 2,29,230/- which was assessed. Subsequently, the AO, based on certain
Page 1 of 5 & 655/Ind/2024 AYs: 2010-2011 information regarding deposits in assessee’s bank a/c, re-opened assessee’s case u/s 147 through notice dated 27.03.2017 u/s 148. Finally, the AO completed re-opened assessment vide order dated 26.12.2017 after making an addition of ‘notional interest income’ of Rs. 12,87,000/-. Aggrieved, the assessee carried matter in first-appeal. The CIT(A) passed order dated 14.06.2024 ex-parte to assessee wherein he upheld the addition made by AO. Now, the assessee has come in next appeal before ITAT.
ITA No. 655/Ind/2024:
Ld. AR for assessee submitted that the assessee/appellant has due to oversight filed two appeals against the very same order of CIT(A). Therefore, one of these two captioned appeals may be dismissed straightaway. Ld. DR for revenue instantly agreed. In view of this, we dismiss the 2nd appeal being ITA No. 655/Ind/2024.
ITA No. 586/Ind/2024:
In so far this appeal is concerned, Ld. AR submitted that the issue relates to the addition of Rs. 12,87,000/- made by AO on account of ‘notional interest income’. Ld. AR pointed out that in the impugned order of first-appeal which is passed ex-parte to assessee, the CIT(A) has upheld the addition made by AO but subsequently the assessee has filed a rectification application u/s 154 to CIT(A) and the Ld. CIT(A) has passed a very recent order dated 24.03.2025 u/s 154 r.w.s. 250 deleting the addition of Rs. 12,87,000/- in entirety and giving full relief to assessee. Ld. AR has filed a Page 2 of 5 & 655/Ind/2024 AYs: 2010-2011 copy of the order passed by CIT(A). For reference, the first page and last page of the order passed by CIT(A) are scanned and re-produced below:
Page 3 of 5 & 655/Ind/2024 AYs: 2010-2011
Therefore, Ld. AR submitted that there is no surviving grievance to assessee. Ld. AR prayed this bench to close this appeal accordingly. Ld. DR for revenue instantly agreed.
Page 4 of 5 & 655/Ind/2024 AYs: 2010-2011 6. In view of the fact that the CIT(A) has also granted full relief to assessee and the assessee does not have any surviving grievance, this appeal becomes infructuous/meritless and the same is also dismissed. We only direct the AO to give effect to the latest order dated 24.03.2025 passed by CIT(A) u/s 154 r.w.s. 250 and accordingly delete the addition made in assessment-order.
Resultantly, both of these appeals are dismissed.
Order pronounced in open court on 24/07/2025