3i Infotech Limited Vs DCIT/ACIT (ITAT Mumbai)
ITAT Mumbai held that adjustments made by Central Processing Centre [CPC] under section 143(1) of the Income Tax Act is deleted since the entire adjustments were on account of technical glitches of the CPC system.
Facts- The assessee filed its return of Income on 29/03/2019 declaring total income of Rs. Nil after setting off the Profits amounting to Rs. 83,70,22,403/-against brought forward loss under the normal provisions of the Income Tax Act 1961. Thereafter the assessee received the intimation order u/s 143(1) of the Act dated 12/11/2019. The intimation u/s 143(1) of the Act was passed assessing the Income from Business or Profession of Rs. 89,66,13,329/-under the normal provisions of the Act after making the aforesaid adjustments aggregating to Rs. 5,95,90,926/-.
First Appellate Authority has confirmed the adjustment. Being aggrieved, the present appeal is filed.
Conclusion- Held that inadvertently errors may have crept into the system generated process of software modules employed by CPC during the mechanized handling of the returns, such lapses, though unintended must not be allowed to go unchecked or unaddressed, once the matter is brought to the notice of the ld. AO or First Appellate Authority. If the assessee has cogently brought these facts before the First Appellate Authority, it becomes incumbent upon such authority to transcend the rigidity of algorithmic determination and exercise their judicial mind. The very purpose of the appellate scrutiny is to apply reasoned human judgment over automated determinations. The decision making process when it deviates from such mindful applications, risks reducing adjudication to a sterile exercise in digital formalism. Adjudication is not merely a function of computation; it is a human endeavor, imbued with fairness, discernment and duty to correct that which machines may have misread. Thus, Ld. First Appellate Authority ought to have appreciated and applied his mind to the fact that such kind of adjustment could not have been warranted and matter need not have travelled to the second appellate stage on such trivial issue. Accordingly, all the adjustments made are deleted.
