Case Law Details
Kothari Brothers Vs ITO (ITAT Ahmedabad)
The assessee submitted that the appeal before the CIT(A) was filed in respect of rejection of rectification application and thereby disallowance of claim for carry forward losses in revised return needs to be looked into. The original return of income for A.Y. 2007-08 was filed on 24.11.2007 declaring total income of Rs.3,52,690/-. As the assessee came to know that inadvertently the claim of set off of carry forward and assessed loss pertaining to 2005-06 were taken into account while filing original return of income. Therefore, the assessee filed revised return on 27.02.2018 declaring nil income by set off of carry forward losses. At the time of assessment proceedings the assessee has filed all the details of return as well as revised returns before the Assessing Officer. The assessee in the submissions mentioned that neither any reason nor any opportunity was given to the assessee as to why the Assessing Officer has ignored return on which notice was issue and why assessment is being done on original return filed on 24.11.2017. Therefore, the assessee submitted that as per law and principles of natural justice assessment made on the original return filed on 24.11.2007 on the basis of which no notice was issued is not a valid assessment. On the basis of revised return filed by the assessee firm the assessee requested the Assessing Officer to give them refund for A.Y. 2007-08.
The assessee submitted that the Assessing officer never said that the claim made in the revised return was not valid. The assessee filed rectification application dated 17.08.2016 for A.Y. 2007-08 and explained the Assessing Officer to allow the claim of refund of Rs.1,21,310/- for A.Y. 2007-08 which was issued to set off of carry forward of earlier years assessed loss.
The Assessing officer rejected the application without adjudicating as to how the claim is tenable. The Assessing officer said that revised return is not valid as original return is not filed under Section 139(1) of the Act. The assessee in its submissions submitted that it is correct that revised return was not filed under Section 139(1) of the Act but while making assessment under Section 143(3) of the Act the Assessing Officer ought to have allowed the set off of carry forward losses.
The assessee relied upon CBDT Circular No.14 dated 11.04.1955 as well as relied upon the decision of Hon’ble Apex Court in the case of Collector, Land Acquisition vs. Mst. Katiji & Ors. (1987) 167 ITR 471. The assessee also relied upon the decision of Tribunal in the case of Padamlal Dua vs. ITO in ITA No.2007/Del/2016, order dated 23.12.2016, and the decision in the case of Hemant Mittal vs. ITO. After going through the submissions of the assessee as well as the submissions made by Ld. DR it is pertinent to note that in the assessment order the Assessing Officer has not taken cognisance of the revised return filed by the assessee. Once the revised returns were filed, the Assessing Officer should take cognisance of the claim made by the assessee and accordingly should proceed in assessment stage. The original return was not filed under Section 139(1) of the Act but the revised returns were filed in proper manner and no discrepancy was pointed out by the Assessing Officer at any stage. In fact, the CIT(A) has also not given any finding as to why revised return should be rejected.
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