Ratanben Hargovandas Patel Vs DCIT (ITAT Ahmedabad)
A deduction omitted from the original return cannot ordinarily be introduced through rectification under Section 154 when there is no apparent mistake; however, where the assessee has evidence of an otherwise eligible claim, relief may be pursued by seeking condonation for filing a revised return under Section 119(2)(b).
Summary: ITAT Ahmedabad disposed of the assessee’s appeal for AY 2020-21 by directing her to approach the Principal Commissioner under Section 119(2)(b) for permission to file a revised return and claim a ₹1,50,000 deduction under Section 80C. The assessee had filed her return on 30.12.2020 declaring total income of ₹63,98,501, which was processed under Section 143(1) by the CPC on 25.11.2021, resulting in a demand of ₹9,81,370. She subsequently filed a rectification application under Section 154 on 08.08.2022, pointing out that deduction under Section 80C for an investment of ₹1,50,000 in a Fixed Deposit had not been allowed. The CPC passed a rectification order on 25.07.2025 determining income at ₹63,98,500, but did not allow the deduction because no such claim had been made in the original return. The CIT(A) dismissed the assessee’s appeal. Before the Tribunal, the assessee submitted that the omission was inadvertent, that the ₹1,50,000 investment had actually been made during the year and was eligible for Section 80C deduction, and requested either restoration to the Assessing Officer for verification or permission to pursue relief under Section 119(2)(b). The Tribunal held that, since the deduction had admittedly not been claimed in the return, the Section 143(1) intimation and CPC rectification order could not be faulted. At the same time, the assessee had produced evidence of the eligible investment. In the interest of justice, the Tribunal directed that an application under Section 119(2)(b) be filed and sympathetically considered by the PCIT, with permission to file a revised return and claim the Section 80C deduction as per law. The appeal was dismissed for statistical purposes.
