Kamal Kumar Jangir (HUF) Vs ITO (ITAT Delhi)
Demand Notice and Computation Sheet Are Integral to Assessment Order; Delay Was 18 Days, Not 614 Days: Delhi ITAT
The assessee-HUF declared income of ₹2,25,780 and claimed exempt long-term capital gain of ₹48,96,230 under section 10(38) from the sale of IndusInd Bank shares.
In reassessment, the AO treated the share transaction as bogus and made additions of ₹52,61,866 under section 69A and ₹2,63,093 under section 69C for alleged commission. Total income was assessed at ₹57,50,739.
However, the computation sheet accompanying the assessment order erroneously showed total income of only ₹4,98,880 and raised a demand of merely ₹47,651. The assessee paid this demand and did not initially file an appeal.
Subsequently, the AO passed a rectification order under section 154 on 3 January 2025, corrected the assessed income to ₹57.50 lakh and raised additional tax of ₹16,81,577 and interest of ₹14,68,203. The assessee filed an appeal on 20 February 2025.
The CIT(A) computed limitation from the original assessment order dated 18 May 2023, treated the appeal as delayed by 614 days and refused to admit it.
The ITAT held that the computation sheet and demand notice under section 156 form an integral part of the assessment order. Since the original computation and demand arose from the AO’s own apparent mistake and the correct liability was communicated only through the rectification order, the relevant delay was only 18 days, not 614 days.
