Representation on Incorrect Processing of Income Tax Returns Filed

KARNATAKA STATE
CHARTERED ACCOUNTANTS ASSOCIATION (R)

Date: 01st September 2023

To,
Commissioner of Income Tax,
CPC, Bengaluru

Honourable Sir,

SUBJECT: REPRESENTATION REGARDING INCORRECT PROCESSING OF INCOME TAX RETURNS FILED FOR THE AY 2023-24 [DENIAL OF DEDUCTION EVEN IN CASES WHERE IT HAS NOT BEEN CLAIMED]

The Karnataka State Chartered Accountants Association (R) (in short ‘KSCAA’) is an association of Chartered Accountants, registered under the Karnataka Societies Registration Act, in the year 1957. KSCAA is primarily formed for the welfare of Chartered Accountants and represents before various regulatory authorities to resolve the professional problems faced by Chartered Accountants and the business community.

In the past, we have written to your good selves many times populating various issues, challenges and hardships being faced by taxpayers and Chartered Accountants and suggesting possible solutions on the same. Herein, we are presenting before your good selves, an issue regarding the Proposed Adjustments u/s 143(1) (a) of the Income-tax Act, 1961 (the Act) for deduction u/s 80P, which is causing hardship to the taxpayers.

Applicable Provisions:

• Sec 143(1)(a) of the Act provides for preliminary validation and assessment of the Income Tax Return filed after making necessary adjustments where there is a prima facie mismatch.
• Section 80P of the Income Tax Act, 1961 provides for deduction in respect of certain specified income of Cooperative Societies.

Challenges faced:

We wish to bring to your kind attention that the Income Tax Returns filed for the FY 2022-23 by various persons (Limited Liability Partnership, Partnership Firm, Trust and Association of Person) are being processed u/s 143(1)(a) with a proposed adjustment u/s 80P for a deduction which is in fact not claimed by such assessees u/s 80P. This has been unique to the electronic processing system where although the Assessee has not claimed any such deduction u/s 80P while filing their income tax returns, yet it is observed that there are wrongful proposals to make additions made u/s 80P. This technical glitch has resulted in unnecessary confusion.

Representation:

We herewith earnestly request your good selves to kindly direct the concerned authorities to check their system of processing the returns in this regard, correct the technical glitch and recall the erroneous communications issued.

Taking into consideration the hardships caused due to the issue highlighted above, we the members of Karnataka State Chartered Accountants Association, on behalf of the entire Chartered Accountants community and also on behalf of the trade and industry in the state of Karnataka appeal to your good selves to kindly consider our above request and initiate resolutions for the removal of technical glitches.

Yours sincerely,

For Karnataka State Chartered Accountants Association ®

Cc to:

1. Smt. Nirmala Sitharaman, Hon. Union Minister of Finance and Corporate Affairs, Government of India

2. Shri. Pankaj Choudhary, Hon’ble Minister of State, Finance.

3. Shri. Sanjay Malhotra, Hon’ble Revenue Secretary

4. Shri Nitin Gupta, Chairperson, Central Board of Direct Taxes

5. Smt. Chaitali P, PCCIT, Karnataka and Goa