In the concerned case, the Cuttack bench of Income Tax Appellate Tribunal( ITAT ) partially allowed the appeal of the revenue appellant, by noting that the Commissioner of Income Tax (Appeals) [CIT(A)] had based their decision on an incorrect filing date of the return.
Emerlad Mining Private Limited, the respondent-assessee, the revenue-appellant filed an appeal against the order passed by the CIT(A) dated 26.03.2024 for the assessment year (AY) 2015-2016.
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During the arguments the revenue counsel pointed out that the AO had mistakenly noted in the assessment order dated 30.12.2017 that the return was filed on 25.11.2015, but it was actually filed on 27.11.2016.
The counsel argued that the CIT(A) allowed the appeal without considering the correct filing date and provided a copy of the return acknowledgment as evidence and asked for the CIT(A)’s decision to be canceled and the original assessment order to be restored.
The counsel of the assessee admitted that the CIT(A) did not consider the correct facts in the appeal. They asked for the appeal to be sent back to the CIT(A) for a proper review, as the CIT(A) had not addressed the issues raised by the assessee about the additions made.
The tribunal reviewed the submissions made by both the parties and noted that the respondent- assessee filed its return of income on 27.11.2016. Although the assessment order mistakenly stated the filing date as 25.11.2015, the CIT(A) allowed the appeal solely based on this incorrect date without examining the merits of the case or verifying the correct filing date.
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The CIT(A) overlooked the statement of facts from the respondent-assessee, which clearly mentioned the correct date of 27.11.2016.
The Tribunal found that the CIT(A) was incorrect in treating the notice issued under section 143(2) as time-barred and allowed the department’s appeal on this issue.
Section 143(2) of the Income Tax Act requires the Assessing Officer to issue a notice within six months of the end of the financial year if further scrutiny of the assessee’s return is needed. This notice allows for a detailed examination of the return, ensuring accurate assessment. If the notice is not issued within the specified time, the assessment becomes invalid due to being time-barred.
The division bench comprising George Mathan (Judicial Member) and Manish Agarwal(Accountant Member),decided to restore the appeal to the CIT(A) for a decision on the merits.
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