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Facts
The assessee, Kerala State Warehousing Corporation, filed a revised return declaring a loss for AY 2017-18. The AO completed the assessment at a higher income under Section 143(3), refusing to consider the revised computation and audit report based on the Supreme Court's Goetze (India) Ltd. vs. CIT decision. The CIT(A) confirmed the AO's action.
Held
The Tribunal, citing the Gujarat High Court in Mitesh Impex, held that the Goetze decision is confined to the AO's powers and does not restrict the CIT(A) or Tribunal from entertaining new grounds. Consequently, the matter was remitted back to the AO to consider the revised computation of total income and audit report.
Key Issues
Whether the Assessing Officer and CIT(A) correctly refused to consider the assessee's revised computation based on the Goetze judgment, and the extent of appellate authorities' power to entertain new claims or contentions.
Sections Cited
143(3)
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Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM & SHRI PRAKASH CHAND YADAV, JM
O R D E R Per: Inturi Rama Rao, AM This appeal filed by the assessee is directed against the order of the Learned Addl / Joint Commissioner of Income Tax (Appals)-4, Chennai (in short “CIT(A)”), dated 26/11/2024 for the Assessment Year (AY) 2017-18.
Briefly the facts of the case are that the appellant is a Government of Kerala Undertaking engaged in the business of warehousing and other allied activities. The Return of Income for the AY 2017-18 was filed on 20/10/2017 declaring a loss. Subsequently, the same was revised on 19/12/2018 at a loss of Rs.57,31,304/-. Against the said return of income, the assessment was completed by the AO vide the order dated 27/12/2019 passed U/s. 143(3) of the Income Tax Act, 1961 (in short “the Act”) at a total income of Rs. 1,71,32,845/- before set off of the brought forward losses for the AYs 2014- 15, 2015-16 and 2016-17. While doing so, the AO refused to take the cognizance of revised computation of income, audit report and placing reliance on the decision of the Hon'ble Supreme Court in the case of Goetze (India) Ltd vs. CIT (284 ITR 323) for the purpose of computation of total income.
2. Being aggrieved by the above order of the AO, an appeal was filed before the CIT(A), who vide the impugned order confirmed the action of the AO by holding that in view of the decision of the Hon'ble Supreme Court in the case of Goetze (India) Ltd vs. CIT (supra) an assessee cannot amend a return of income filed by him.
Being aggrieved the appellant is in appeal before us in the present appeal.
It is submitted that the CIT(A) had grossly fell in error in confirming the action of the AO by non-adoption of the audited financial statement, tax audit report and revised statement of total income etc. It was also submitted that the Hon'ble Supreme Court in the case of Goetze (India) Ltd vs. CIT (supra) has no application to the facts of the present case. Further, it was submitted that the CIT(A) ought to have considered that the issue involved in the present appeal is covered in favour of the assessee in view of the decision of the Hon'ble jurisdictional High Court in the case of Kerala Shipping and Inland Navigation Corporation Ltd (ITA No. 782/Coch/2013).
On the other hand, the Ld. Sr. DR placed reliance on the decision of the Hon'ble jurisdictional High Court in the case of CIT vs. Kerala State Construction Corporation Ltd [2019] 267 Taxman 256 (Kerala) and submitted that there is no interference is called for by the Tribunal.
We heard the rival submissions and perused the material available on record. The Hon'ble High Court of Gujarat in the case of CIT vs. Mitesh Impex has held that the decision of the Supreme Court in the case of Goetze (India) Ltd. vs. Commissioner of Income-tax (supra) is confined to the powers of the assessing officer and accepting a claim without revised return and it does not affect the powers of CIT(A) or Tribunal to entertain a new ground or a legal contention. In view of this decision of the Hon'ble Gujarat High Court in the case of CIT vs Mitesh Impex (supra), we remit the matter back to the file of the AO to consider the revised computation of total income and revised audit report while framing the assessment order.
In the result, appeal filed by the assessee is partly allowed.
Order pronounced in the open court on 26th June, 2025.