Illaben Jayantkumar Doshi vs ITO (ITAT Rajkot)
ITAT Rajkot held that appellate authorities have power to entertain fresh claim and accordingly, claim of erroneously addition to computation of income accepted and direction given to AO to determine taxable income of assessee afresh.
Facts- Vide the present appeal, the appellant contested disallowance of proportionate interest u/s. 14A of the Income Tax Act. However, the appellant further contented that it is entitled to claim the deduction before the appellate authorities which was not claimed in the original or revised income-tax return but was claimed in the assessment and appellate proceedings. It is contended that an amount of Rs.13,32,054/-, was erroneously added twice to the computation of income, which leads to an incorrect determination of the taxable income, therefore, an instruction may be given to AO to correct the error.
Conclusion- Held that object of the assessment proceedings/ scrutiny proceedings, u/s 143(3) of the Act is to determine the correct income and correct taxes thereon. There is no bar to a taxpayer for making a claim by a letter without filing a revised return in a case u/s 143(3) of the Act. The assessing officer is not entitled to grant a deduction on the basis of a letter requesting an amendment to the return filed, however, the appellate authorities are entitled to consider the claim. Therefore, I direct the assessing officer to correct the amount of Rs.13,32,054/-, which was erroneously added twice to the computation of income, as it leads to an incorrect determination of the taxable income, and determine the taxable income of the assessee, afresh in accordance with law. In the result, appeal filed by the assessee, is allowed.
