Jalgaon Peoples Co-op. Bank Limited Vs ITO (ITAT Pune)
The appeal before the Income Tax Appellate Tribunal, Pune Bench, concerned Assessment Year 2015-16 and challenged the validity of a rectification order passed under Section 154 read with Section 143(1) of the Income Tax Act, 1961. The principal issue was whether the rectification order dated 17.09.2021 was barred by limitation under Section 154(7) and whether the Assessing Officer was justified in reducing the brought forward business loss claimed by the assessee.
The assessee had originally filed its return of income on 29.09.2015 declaring income of Rs. 9.14 crore and subsequently filed a revised return on 30.04.2016 declaring income of Rs. 10.51 crore. The revised return was processed under Section 143(1) on 15.09.2016 and the returned income was accepted. No scrutiny assessment under Section 143(3) or reassessment under Section 147 was initiated for AY 2015-16.
Subsequently, for AY 2014-15, an order under Section 143(3) read with Section 263 dated 16.10.2019 resulted in an addition of Rs. 12.80 crore on account of bad debts, reducing the loss available for carry forward. While examining AY 2015-16, the Assessing Officer noted that the assessee had set off business income against brought forward business losses and unabsorbed depreciation. According to the Assessing Officer, after the order for AY 2014-15, the assessee was entitled to a lower amount of brought forward business loss than what had been claimed. Accordingly, a notice under Section 154 was issued on 20.08.2021 proposing rectification.
