THIAGARAJAN AUTOMOBILES,MADURAI vs. ITO NON CORPORATE WARD 3, MADURAI

आदेश / O R D E R

PER INTURI RAMA RAO, ACCOUNTANT MEMBER:

The appellant is a partnership firm engaged in the business of running petrol bunk. The original return of income for the assessment :- 2 -: year 2013-14 was filed on 18.03.2014 disclosing total income of �8,85,050/- and the same was revised on 19.03.2014 at total income of �7,62,230/-. Against the said return of income, the assessment was completed by the Income Tax Officer, Non Corporate Ward 3(5)Madurai, vide order dated 19.01.2016 passed u/s. 143(3) of the Income Tax Act, 1961 (for short ‘the Act’) at total income of �11,81,050/-. While doing so, the AO made adhoc disallowance of 10% of sales promotion expenses of �1,45,000/-, addition on account of funds lent to Mrs. Sangeetha, who is the spouse of one of the partners of �61,000/-, interest amount paid on car loan holding it to be personal expenditure to the extent of �20,000/- and also telephone expenses of �70,000/-. After the receipt of the assessment order, assessee moved a petition dated 10.02.2016 u/s.154 of the Act praying that revised return of income filed on 19.03.2014 was not considered. The Assessing Officer vide letter dated 29.08.2016 stated that the original return of income was not filed within the time period prescribed u/s.139(1) of the Act, hence the revised return of income was not considered.

Being aggrieved, an appeal was preferred before the 3. ld.CIT(A) who vide impugned order confirmed the action of the Assessing Officer (AO).

Being aggrieved by the order of the ld. CIT(A), the appellant 4. is in appeal before us in the present appeal. It is contended that :- 3 -: notwithstanding the fact that revised return of income was not valid in law, the Assessing Officer is expected to compute the income in accordance with the provisions of the Act and he placed reliance on the judgment of Hon'ble Supreme Court in the case of CIT vs. Shelly Products and Another (2003) 261 ITR 367 and CBDT circular No. 14(XL-35) dated 11.04.1955.

On the other hand, the ld. Sr. Departmental Representative 5. placed reliance on the orders of lower authorities.

We refer to the judgment of Hon’ble Jurisdictional High Court in the case of CIT vs Abhinitha Foundation Pvt Ltd, (2017) 396 ITR 251, wherein it was held as follows:-

‘’18. In sum, what emerges from a perusal of the ratio of the judgments cited above, in particular, the judgments rendered by the Supreme Court in Goetze's case and National Thermal Power Co. Ltd.'s case, and those, rendered by the Division Bench of this :- 4 -: court in Ramco Cements Ltd. and CIT v. Malind Laboratories P. Ltd., as also the judgments of the Delhi High Court in Sam Global Securities Ltd.'s case and Jai Parabolic Springs Ltd.'s case, that, even if, the claim made by the assessee-company does not form part of the original return or even the revised return, it could still be considered, if, the relevant material was available on record, either by the appellate authorities, (which includes both the Commissioner of Income- tax (Appeals) and the Tribunal) by themselves, or on remand, by the Assessing Officer. In the instant case, the Tribunal, on perusal of the record, found that the relevant material qua the claim made by the assessee-company under section 80-IB(10) of the Act was placed on record by the assessee-company during the assessment proceedings and therefore, it deemed it fit to direct its re-examination by the Assessing Officer’’. Keeping in view of the above position of law, we remit the issue back to the file of the Assessing Officer to consider the information contained in the revised return of income and redo the assessment in accordance with law.

In the result, the appeal of the assessee is partly allowed for 7. statistical purpose.

Order pronounced on 17th day of September, 2019, at Chennai.