Kumbakonam Central Cooperative Bank Vs DCIT (ITAT Chennai)
The ITAT Chennai dismissed the assessee’s appeals for Assessment Years 2013-14 and 2020-21, upholding the orders of the Commissioner of Income Tax (Appeals).
For AY 2013-14, the dispute arose from an addition of ₹9.66 crore on account of disallowance of bad debts made in the original assessment order passed under Section 143(3). The assessee did not challenge that order before any appellate authority. Subsequently, the Assessing Officer reopened the assessment under Section 147 to verify the claim for deduction under Section 36(1)(viia) relating to rural branches. The reassessment order made no fresh additions and retained the income determined in the original assessment. The assessee appealed against the reassessment order, seeking to challenge the original disallowance by invoking the doctrine of merger. The Tribunal rejected this contention, holding that the reassessment order and the original assessment order operated on different footings and could not be treated as a composite order. Since the reassessment resulted in no additional tax liability, the assessee was not an “aggrieved” person for the purpose of filing an appeal under Section 246. The Tribunal held that an issue accepted in the original assessment could not later be challenged indirectly through an appeal against a reassessment order that made no fresh additions. It therefore upheld the CIT(A)’s decision dismissing the appeal.
