GHCL Limited Vs DCIT (ITAT Ahmedabad)
Section 153C Assessment Must Start from Last Assessed Income — Rectification Allowed Despite No Fresh Claim
The Ahmedabad Bench of the ITAT held that where no incriminating material is found during a section 153C search, the Assessing Officer must start from the last assessed income and cannot ignore crystallised, determined losses already allowed in earlier proceedings. In GHCL’s case, unabsorbed depreciation and brought-forward business losses aggregating to ₹150.21 crore had crystallised through appellate orders and were given effect by an order u/s 154 dated 30.08.2017.
During the subsequent section 153C assessment, the assessee inadvertently declared income as per the original return instead of the rectified figure; the AO accepted it without additions and later rejected rectification, citing Goetze (India) Ltd. The Tribunal rejected this approach, holding that the omission was a mistake apparent on record. Since the losses formed part of the assessment record and no incriminating material existed, the AO was bound to adopt the rectified income and allow rectification u/s 154. The appeal was allowed, directing that the returned income be aligned with the u/s 154 order dated 30.08.2017.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
This appeal has been filed by the assessee against the order of the Ld. Commissioner of Income-tax (Appeals)-11, Ahmedabad (hereinafter referred to as “CIT(A)” for short) dated 10.06.2025, passed under Section 250 of the Income-tax Act, 1961 [hereinafter referred to as “the Act” for short], for Assessment Year (AY) 2015-16.
