Whether date of filing revised return is relevant for carry forward of loss benefit?


Whether date of filing revised return is relevant for carry forward of loss benefit?

Ashok Walia, Kolkata vs Department Of Income Tax on 24 July, 2013


Before Shri Pramod Kumar (Accountant Member), 

and Shri Mahavir Singh (Judicial Member)

I.T.A. No.: 1186/ Kol. / 2012

Assessment Year : 2009-2010

Deputy Commissioner of Income Tax,......................Appellant

Circle-2, Kolkata,

P-7, Chowringhee Square,

Kolkata-700 069


Ashok Walia,.......................................................Respondent

LX 11303, Utsa Bengal Ambuja, Newton,

Rajarhat, Kolkata-700 156

[PAN : AAMPW 6341 K]


Appearances by:

Shri Basudev Hazra, JCIT, Sr. D.R., for the appellant

Shri Ashok Walia, for the Respondent

Date of concluding the hearing 	: July 24, 2013

Date of pronouncing the order	          : July 24, 2013


Per Pramod Kumar:

1. By way of this appeal, the Assessing Officer has called into correctness of ld. Commissioner of Income Tax (Appeals)’s order dated 11th May, 2012, in the matter of assessment under section 143(3)of the Income Tax Act, 1961 for the assessment year 2009-10.

2. Grievances raised by the Assessing Officer are as follows:-

(1) That on the circumstances of the case, the ld. CIT(A)-1 has erred in law by directing the A.O. to verify whether the assessee furnished his original return of income within due date u/s 139(1) or not, which tantamounts to setting aside of the proceedings.

(2) That on the circumstances of the case, the ld. CIT(A)-1 has erred in fact an law by admitting acknowledgment of return dated 31.07.2008 of the assessee in violation of provision of Rule 46A of the I.T. Rules, 1962.

3. To adjudicate on these grievances, only a few material facts need to be taken note of. The assessee before us is an individual, who has earned income from salary, capital gain and other sources. During the course of assessment proceedings, the Assessing Officer noticed that the assessee has claimed brought forward short-term capital loss amounting to Rs.31,08,911/-. The Assessing Officer further noticed that, based on the ITD database it appears that the return for the assessment year 2008-09, i.e. the assessment year in which loss was incurred, was filed on 23.03.2009. The Assessing Officer was of the view that since due date of filing of return under section 139(1) was 31.07.2008 and since the income tax return disclosing the said loss brought forward was filed beyond the due date, the assessee was not entitled for carry forward of loss to the subsequent years. It was in this backdrop that the claim of set off of brought forward loss of Rs.31,08,911/- was declined. Aggrieved with the stand so taken by the Assessing Officer, the assessee carried the matter in appeal before ld. CIT(Appeals).

4. In the grounds of appeal before CIT(Appeals), it was the contention of the assessee that “the ld. Assessing Officer inadvertently overlooked the original date of filing of income tax returns and took into consideration only the revised return filing date”. It was thus contended that the action of the Assessing Officer is in error in declining the set off. In the course of appellate proceedings, the assessee also produced a copy of the original income tax return, which was filed on 31.07.2008. On these facts, ld. CIT(Appeals) was of the view that in the event of assessee’s claim incorrect, which the Assessing Officer was directed to verify the claim from the records and allowed the claim as per law, the assessee is entitled to set off the loss so carried forward against current year’s capital gains. The Assessing Officer is not satisfied with the stand so taken by the CIT(Appeals) and is in appeal before us.

5. We have heard the parties, perused the material on record and duly considered facts of the case in the light of the applicable legal position.

6. We have noted that Assessing Officer’s grievance is two fold, i.e. (i) the CIT(Appeals) has erred in law by directing the Assessing Officer to verify the date of furnishing the original income tax return; and (ii) against by admitting acknowledgment of return of the assessee, which Assessing Officer claimed as additional evidence, by way of a copy of the original income tax return filed on 31.07.2008 within the due date as prescribed under section 139(1).

7. None of these grievances, however, are sustainable in law. As for the contention that CIT(Appeals) erred in directing the Assessing Officer to verify the date of filing of the original return, we see no merits in this contention. The reason is simple. The disentitlement for carry forward of loss under section 80 comes into play only when income tax return disclosing the loss sought to be carried forward, is not filed within the time prescribed under section 139(1). There is no dispute in the present case that the income tax return was originally filed within the due date and, therefore, in our considered view that disentitlement under section 80 cannot come into play. As the Assessing Officer has himself noted that in the assessment order at page 2 is stand of declining the carry forward was based on the database information available to him. It is thus clear that the Assessing Officer did not even bother to examine the records in assessee’s case and preferred to be guided by database records. The CIT (Appeals), in his order, remitted the matter to the file of Assessing Officer for necessary verification for allowing the set off of carry forward loss if same is admissible in accordance with the scheme of law set out above. There is no infirmity in the same.

8. As far the second limb of Assessing Officer’s grievance, i.e. against the admission of additional evidence by way of admitting a copy of acknowledgment of the return dated 31.07.2008, we find that this contention is also devoid of legally sustainable merits. A document which is already on the file of Assessing Officer, by no stretch of logic, can be treated as additional evidence. The original income tax return was filed before the Assessing Officer and was very much part of his assessment records. The question of additional evidence comes into play only when a document, which is not already on the assessment records, is produced before and admitted by the appellate authority. In view of these discussions as also bearing in mind entirety of the case, we confirm the action of ld. CIT(Appeals) and decline to interfere in the matter.

9. In the result, the appeal filed by the Revenue is dismissed.

Order pronounced in the open Court on 24th day of July, 2013.

      		Sd/-								Sd/-

   Mahavir Singh					      Pramod Kumar

        (Judicial Member)	 	                   (Accountant Member)

Kolkata, the 24th day of July, 2013

Copies to :	(1)	The appellant,

		(2)	The Respondent,

		(3)	CIT(Appeals),  

		(4)	CIT,

		(5)	The Departmental Representative

		(6)	Guard File

By order etc

Assistant Registrar

Income Tax Appellate Tribunal

Kolkata benches, Kolkata

Laha/Sr. P.S.

.T.A. No.1186/ Kol. / 2012

Assessment Year : 2009-2010