Pavithra Sugichandran Vs DCIT (ITAT Chennai)
Summary: ITAT Chennai allowed the assessee’s appeal and held that the rectification order passed under Section 154 of the Income Tax Act, 1961 for recomputing interest under Section 234A was illegal and unsustainable. The assessee had filed her return of income for AY 2021-22 on 30.03.2022, while it was e-verified on 23.05.2022. In the original assessment, interest under Section 234A had been charged for only three months. Subsequently, the Assessing Officer invoked Section 154 and increased the interest from Rs.66,222/- to Rs.2,20,742/-, treating 23.05.2022, the date of e-verification, as the date of filing of the return. The Tribunal rejected this approach, holding that once a return is e-verified, the verification relates back to the date on which the return was filed. The Tribunal also took note of the COVID-19 period, during which statutory compliance timelines had been extended from time to time, including extensions granted by the Supreme Court in Suo Motu Writ Petition (C) No. 3 of 2020 – 441 ITR 722 (SC). It concluded that no interest under Section 234A could be levied because the return had been filed within the extended time. Accordingly, the Section 154 rectification order was quashed and the assessee’s appeal was allowed.
