Rectification under section 154 of the Act is not obligatory on the part of the Assessing Officer if clear data is not available: Nagpur ITAT
Recently, Nagpur ITAT in a case on the scope of section 154 held that rectification under section 154 of the Act is not obligatory on the part of the Assessing Officer if clear data is not available. ITAT further admitted the claim of the department that the Assessee has conceded the mistake before the learned CIT(A), he has no arguable case any further.
The case details is as under:
ITAT NAGPUR-HARIOM BIOTECH AGRI FARMING VERSUS DY. COMMISSIONER OF INCOME TAX CENTRAL PROCESSING CENTRE, BENGALURU
[ITA No. 300/Nag. /2023]
Let us have a short overview of the case:
1. During the year under consideration, the assessee has earned an agricultural income of ₹ 1,15,69,581 which was exempt from tax.
2. The resultant income (i.e.) ₹ 1,15,69,580, was claimed as an exempt by the assessee while filing return of income and the total income was returned as nil. However, the Central Processing Centre [CPC] processed return of income but did not grant exemption while computing the business income.
3. On perusal of the intimation, it was found that the said disallowance is based on incorrect claim as the schedule of exempt income was not filed.
4. Accordingly, the CPC has rejected the claim of the assessee and had computed total income at ₹ 1,15,69,580/-.
5. The CPC has correctly processed the return of income under section 143(1)(a)(ii) of the Act r/w the Explanation (a)(i) and (a)(ii).
6. The learned A.R. fairly accepted the mistake in filing the return of income Schedule–EI was not filled.
7. The communication of proposed adjustment dated 01/01/2019, was not responded within 30 days.
Hon’ble ITAT observed as under:
1. The entire profit claimed as agricultural income for ₹ 1,15,69,580, was not reported as exempt income in Schedule–E1. Hence, the CPC was justified in making the adjustment, because the claim was inconsistent with item in the return of income.
2. Rectification under section 154 of the Act is not obligatory on the part of the Assessing Officer if clear data is not available and in this regard we rely on the judgment of the Hon’ble Supreme Court passed in Anchor Processing Pvt. Ltd. v/s CIT, [1986] 161 ITR 159 (SC).
3. The assessee failed to submit revised return of income under section 139(5) of the Act to take care of the omission in the original return of income.
4. This is an appeal against order passed by the Assessing Officer under section 154 of the Act. The scope is narrow and constricted and merits of claim need not be explored.
5. The learned Authorised Representative pressed that the income was accepted to be exempt as agricultural income in the assessment order passed under section 143(3) of the Act. But at this stage, we are precluded from examination of the merit of the claim. The learned Departmental Representative rightly pointed out that when the assessee himself has conceded the mistake before the learned CIT(A), he has no arguable case any further.
6. The appeal has no merits since there is no patent and manifest error amenable for rectification and hence liable to be dismissed. Thus, we are in consonance with the order passed by the learned CIT(A) who upheld the order passed by the CPC.
7. Accordingly, all the grounds raised by the assessee in this appeal are dismissed.
Reference -SUPREME COURT [1986] 161 ITR 159 (SC),
ANCHOR PRESSING PRIVATE LIMITED VERSUS COMMISSIONER OF INCOME-TAX, UP, AND OTHERS
The copy of the order is attached herewith:
1723634837-300 - KMR + VDR - HARIOM BIOTECH AGRI FARMING - OK
