Income Tax Dept Permits to file Physical Return Even After Expiry of Revised Returns’ Filing Period: Meghalaya HC Directs CPC AO to accept Return [Read Order]
The petitioner was allowed to file the returns manually.
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The Meghalaya High Court, in a recent case, directed the CPC AO to accept the physical Income Tax Return (ITR) filed bythe assessee as the Income Tax department permitted the filing of a physical return even after the expiry of the period for filing the revised returns.
Shyam Century Ferrous Ltd., the appellant company filed its Income Tax Return on 14.02.2022 for the Accounting year 2020-21 indicating income of Rs. 1,68,20,990/- with a total Income Tax liability of Rs. 43,78,669/- . During the relevant Financial Year, the appellant company had earned a profit of Rs. 6,38,81,925/- from the sale of its investments, which the appellant company had duly disclosed in the Income Tax Return.
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The appellant duly reported the said Profit on Sale of investment being assessable to tax under the head of income ‘Capital Gains’. The appellant company, however by mistake omitted to exclude/reduce the Profit of Rs. 6,38,81,925/- on Sale of Investment by way of deduction and Sl. No. 3(b)- ‘Income/Receipts credited to profit and loss account considered under other heads of income chargeable u/s 115BBF/chargeable u/s 115BBG’ of Schedule BP in the ITR.
On the mistake being discovered by the appellant company, an application under Section 154 of the Income Tax Act, 1961 was filed before the Assistant Commissioner for rectification of the mistake. As no order was forthcoming, an appeal was preferred under Section 246A of the Act, whereby the Commissioner (Appeals) vide order dated 11.01.2024 dismissed the appeal by holding that a mistake has to be corrected by filing revised return or under Section 264 of the Income Tax Act, as it was not an error apparent on record to be rectified under Section 154, or to be considered in appeal.
On a further appeal, which was preferred under Section 253 of the Act before the Income Tax Appellate Tribunal, Guwahati Bench, the Tribunal vide order dated 25.10.2024, while partly allowing the appeal on other payments, however upheld the observation of the Commissioner (Appeals) with regard to the mistake having to be corrected by filing of a revised return or under Section 264. It was further directed that the CPC AO/CIT(A), consider the revised returns if filed.
However, as the time limit for filing the revised returns for the accounting year 2020-21 had since expired, the appellant therefore was unable to do so, inasmuch as, the same had to be done digitally.
Mr. S. Sen, counsel for the appellant in the backdrop of the above noted facts, had limited his prayer for directions to allow the appellant to file physical returns, which was resisted by Mr. S. Pandey, counsel for the Income Tax authorities, who submitted that the filing of physical returns is not permissible, as the same cannot be reconciled with the Centralised Processing Centre.
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The Court thereafter, had directed Mr. S. Pandey, counsel for the respondent to obtain specific instructions, as to whether this situation had occurred before, inasmuch as, the opportunity granted by the Commissioner (Appeals) and the Income Tax Appellate Tribunal to the appellant would be rendered useless if physical filing was not permitted.
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When the matter was taken Mr. S. Pandey on instructions, submitted that the appellant will be permitted to file its physical returns for consideration before the Central Processing Centre AO.
The counsel for the appellant has placed a decision of the Delhi High Court, in the case of Cosmo Films Limited vs. Central Board of Direct Taxes, Ministry of Finance, North Block, New Delhi & Anr., where in similar circumstances the petitioner therein was allowed to file the returns manually.
A division bench of Justice H. S. Thangkhiew and Justice B. Bhattacharjee, as the concession has been made by the respondents, nothing remains for further consideration in the appeal, and the same is disposed of by directing the CPC AO to accept the revised returns filed by the appellant manually/physically, for due consideration in accordance with law.
The petitioner was allowed to file the returns manually.
