MRS. GAURI HIREN BHANU,MUMBAI vs. ITO WARD 17(3)(1), MUMBAI

Without Prejudice to the above, this Commissioner of Income tax Appeals ought to have directed the CPC to rectify the calculation of the tax instead of dismissing the appeal on the ground, that the appellant's contentions regarding brought forward losses is without any documentary evidence having failed to ask the appellant to substantiate the initial submission made by the appellant.

The appellant prays that the AO be directed to recalculate the tax on the assessed income after granting set off of brought forward losses as claimed and allowed in the assessment order.

WITHOUT PREJUDICE The appellant submits that a similar error and calculation of tax in not setting off the brought forward losses made in the intimation u/s 143(1) has been deleted by the Commissioner of Income Tax Appeals in the appeal filed against the said intimation order.”

The brief facts of the case are, that the assessee’s return was selected for scrutiny and the assessment was completed u/s 143(3) on 30.01.2024, wherein after deliberations the returned income of the assessee has been accepted with no variation. Further, while issuing the computation sheet the CPC had taken the assessed / taxable income at Rs. 2,31,66,530/- as against the income of Rs. 1,91,67,730/- shown by the assessee in her ITR, which is accepted as assessed

Being aggrieved with the aforesaid computation-sheet attached to the assessment order, assessee preferred an appeal before the ld. CIT(A), however the ld. CIT(A) dismissed the appeal of assessee stating that the issue raised by the assessee does not arise out of the assessment order, as the assessee has not raised this issue before the ld. AO.

Being aggrieved with the aforesaid decision by ld. CIT(A), the assessee is in appeal before us.

At the outset, ld. Counsel for the assessee submitted that the issues of computational error by the CPC, Bangalore was raised before the ld. CIT(A) as per Ground No. 7 of the appeal in Form-35 stating that “in computation sheet attached with the assessment order the total income at item no. 15 has been taken at Rs. 2,31,66,530/- in place of Rs. 1,91,67,730/- as per assessment order, thus, there is a difference of Rs. 39,98,800/- in total income. This difference is on account of fact that post completion of the assessment on the returned income set off of brought forward losses has not been given properly in the computation- sheet attached with the assessment order”. Referring to the aforesaid ground, it is submitted that there was no adjudication by the ld. CIT(A) on this issue, whereas this is a simple computational error on the part of ld. AO, which should have been Gauri Hiren Bhanu directed to be corrected, so as to arrive at the correct taxable income of the assessee.

Per contra, the ld. DR submitted that such errors can be rectified even if an application for rectification under section 154 would have been furnished by the assessee before the ld. AO.

Having considered the rival submissions, on perusal of the records, we find that there was an error in the computation-sheet enclosed with the assessment order and that needs verification and effect by the ld. AO, we therefore deem it fit to restore this matter back to the file of ld. AO for verification of the facts and to correct the computation-sheet in accordance with the facts on record.

Needless to say, that the assessee shall be afforded with reasonable opportunities of being heard in the set aside proceedings. Assessee is direct to assist with information if any as sought by the AO.

In result, the appeal of assessee is allowed for statistical purposes, in terms of our aforesaid observations.