Typographical error should be rectified via rectification application u/s 154

Manjush Kumar Vs ACIT (ITAT Delhi)

ITAT Delhi held that typographical error is to be rectified by filing a rectification application under section 154 of the Income Tax Act and not by preferring an appeal.

Facts- The assessee preferred an appeal mainly that due to type error the exempt income declared in ITR was reported as Rs. 1,33,79,514 instead of actual exempt amount of 1,26,29,418/-. Capital account of M/s Jjrs Projects was provided to the Ld. AO where as capital introduction of Rs. 7,50,000/- was wrongly added to exempt income. Although capital account of M/s JjrS projects was provided to the Ld. AO but the same was not considered.

Conclusion- Held that CIT (A) has rightly provided liberty to the assessee to move rectification application u/s 154 of the Act before the A.O. Further, we are of the opinion that, if there is any typographical error the assessee has to invoke the Section 154 of the Act and not the Appellate Jurisdiction to rectify the mistakes committed during the assessment proceedings.

FULL TEXT OF THE ORDER OF ITAT DELHI

This appeal is filed by the assessee against the order of the ld. Commissioner of Income Tax (Appeals)-15, New Delhi [hereinafter referred to CIT (Appeals) dated 04.07.2019 for assessment year 2016-17.

2. The assessee has raised the following substantive grounds of appeal:-

“1. The impugned order of the learned CIT (A) dated 7th July 20 19 bad in law and on facts in sustaining the additions. The Ld. CIT(A) has failed to appreciate typo error which was also present on record.

2. Assessee has been wrongly declared exempted income in ITR amounting Rs.1,33,79,514/- instead of amounting Rs.1,26,29,418/- through typo error. This addition need to be delete.

3. On the facts and in law and in the circumstances of the case, the Ld. AO erred in disallowing the deduction claimed u/s 24 amounting to Rs.30,000/- in complete disregard to the details placed on”

3. None appeared for the assessee, the notice issued by the registry was duly served on the assessee and even after service of the notice, the assessee or his representative fail to appear before the Tribunal.

4. There is 14 days delay in filing the present appeal and an application has been filed by the Ld. DR. By considering the reasons mentioned in the application, the delay of 14 days in filing the appeal is condoned.

5. Brief facts of the case are that, the assessee has filed his return declaring an income of Rs.1,08,39,740/-, The assessment proceedings have been initiated against the assessee and an order u/s 143(3) of the Income Tax Act (‘Act’ for short) was passed on 13/12/2018 by assessing the income of the assessee as under:-

“In view of the above discussion, the total income of the assessee is recomputed as under:-

6. As against the assessment order the assessee has preferred an appeal before the CIT(A) on following grounds are as under:-

“1. That the Ld. AO failed to appreciate that the due to type error the exempt income declared in ITR was reported as Rs. 1,33,79,514f-instead of actual exempt amount of 1,26,29,418/-. Capital account of M/s Jjrs Projects was provided to the Ld. 40 where as capital introduction of Rs. 7,50,000/- was wrongly added to exempt income. Although capital account of M/s JiRS projects was provided to the id. AO but the same was not considered. The appellant craves leave to further substantiate art the above addition at the time of hearing.

2. The assessee showed an amount of Rs. 30,000/- as deduction under the head income from house property, the Ld, AO failed to appreciate that deduction claimed during the year is as per law because actual interest income is more than 30,000/- and since the property was constructed in more than 5 years, deduction was restricted to Rs, 30,000/ only as allowable under section 24 of the Act The appellant craves leave to further substantiate on the above addition at the time of hearing.”

7. The Ld.CIT (A) has confirmed the assessment order and observed that the addition of Rs. 7,50,096/- on account of difference in exempt income claimed by the assessee and the document furnished during the assessment proceedings further the assessee himself has admitted that the addition was due to the clerical error done on the part of the assessee while filing the return. Therefore, the Ld. CIT(A) was of the opinion that the assessee is free to move rectification application u/s 154 of the Act to the A.O. Accordingly, dismissed the appeal on 13/12/2018.

8. Aggrieved by the order of the CIT(A) dated 13/12/2018 the present appeal has been preferred by the assessee.

9. We have heard the parties perused the material available on record and gave our thoughtful consideration.

10. It is the specific case of the assessee before the CIT(A) that the addition of Rs. 7,50,096/- was on the account of difference in exempt income claimed by the assessee and the document furnished during the assessment proceedings. It has been admitted by the assessee himself vide written statement filed before the A.O., that the above addition was made due to the clerical error done on the part of the assessee while filing the return and accordingly, the Ld. AR has made a submission before the CIT(A) to allow the assessee to rectify his mistake u/s 154 of the Act. Considering the admitted error of the assessee, the Ld.CIT (A) has rightly provided liberty to the assessee to move rectification application u/s 154 of the Act before the A.O. Further, we are of the opinion that, if there is any typographical error the assessee has to invoke the Section 154 of the Act and not the Appellate Jurisdiction to rectify the mistakes committed during the assessment proceedings.

11. In our opinion, the order of the Ld.CIT(A) neither erroneous nor has any legal infirmity in providing the liberty to more rectification application u/s 154 of the Act before A.O., thus, we do not find merit in the grounds of appeal of the assessee, therefore, the Assessee’s grounds of appeal are dismissed.

12. In the result, the appeal filed by the assessee is dismissed.

Order pronounced in the Open Court on : 13.12.2022.