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2021 (5) TMI 830 - ITAT MUMBAIRectification u/s 154 - unexplained cash credit u/s 68 to the assessee’s income under the normal provisions of the Act and instead wrongly adding the same to the ‘book profit’ of the assessee u/s 115JB - HELD THAT:- We concur with the view taken by the CIT(A) that as the omission on the part of the A.O to add the unexplained cash credit u/s 68 to the assessee’s income under the normal provisions of the Act and instead wrongly adding the same to the ‘book profit’ of the assessee u/s 115JB of the Act was a mistake which was glaring, apparent, patent and obvious from record, the A.O, thus had rightly rectified the same by invoking the powers vested with him u/s 154 We are unable to comprehend as to on what basis it is claimed by the ld. A.R that the issue in question being a debatable one would fall beyond the realm of the jurisdiction vested with the A.O u/s 154 of the Act. Be that as it may, in our considered view as the A.O remaining well within the scope of his jurisdiction had rectified the aforesaid mistake, thus, principally he cannot be held to have traversed beyond the scope of the jurisdiction that was vested with him u/s 154 of the Act. Withdrawal of the set-off of the brought forward unabsorbed depreciation that was earlier allowed by the A.O vide his assessment framed u/s 143(3) r.w.s 144C(1) - CIT(A) while disposing off the assessee’s appeal against the order passed by the A.O u/s 154, had directed him to ascertain the assessee’s claim of brought forward unabsorbed depreciation and allow set-off of the same as per law while computing its total income - CIT(A) that in case the assessee’s claim for brought forward depreciation (as was claimed by the assessee vide its letter dated 14.09.2017) was not admissible, then, the A.O shall in his order give reasons as to why the said claim was not admissible. In our considered view, the CIT(A) had in all fairness directed the A.O to ascertain the assessee’s claim of brought forward unabsorbed depreciation and allow set-off of the same as per law while computing its total income. A.O had been directed to give reasons in case the assessee’s claim for brought forward depreciation is not found to be admissible by him. No infirmity in the aforesaid view of the CIT(A) who in context of the aforesaid issue in question had rightly upheld the exercise of jurisdiction by the A.O u/s 154 of the Act, subject to certain verifications of facts.We are of a strong conviction that the claim of the ld. A.R that the A.O had exceeded his jurisdiction and rectified the aforesaid issues which were not free from debate and involved a long drawn process of reasoning is devoid and bereft of any substance and does not merit acceptance. The Ground of appeal No. 6 is dismissed. Reassessment order passed by the A.O u/s 143(3) r.w.s 147 was quashed by the CIT(A) by treating the same as void ab initio, therefore, no rectification of the said non-existent order could have been carried out - Though the reassessment order passed by the A.O u/s 143(3) r.w.s 147 was quashed by the CIT(A) by treating the same as void ab initio, however, the original assessment order passed under Sec. 143(3) r.w.s 144C(1), wherein the set-off of unabsorbed depreciation was allowed by the A.O therein continued to subsist and did hold the ground. The issue pertaining to allowing of set-off of unabsorbed depreciation by the A.O found its roots in the original assessment order passed by the A.O u/s 143(3) r.w.s 144C(1), and the same was not effaced pursuant to the quashing of the reassessment order passed by the A.O u/s 143(3) r.w.s 147. We, thus, are of the considered view that as the issue pertaining to allowing of set-off of unabsorbed depreciation by him vide the assessment order passed u/s 143(3) r.w.s 144C(1), had not merged in the reassessment order, the A.O, thus, was well within his jurisdiction in rectifying the mistake as regards allowing of set-off of unabsorbed depreciation vide his order passed under Sec. 143(3) r.w.s 144C(1), as the assessee had no unabsorbed depreciation left for set-off for A.Y 2008-09. Accordingly, we uphold the order passed by the A.O to the extent he had rectified his mistake as regards allowing of set-off of unabsorbed depreciation of ₹ 11,49,85,610/- vide his original assessment order passed u/s 143(3) r.w.s 144C(1). The directions given by the CIT(A) to the A.O, viz. (i). to ascertain the assessee’s claim of brought forward unabsorbed depreciation and allow set-off of the same as per law while computing the assessee’s total income; and (ii). to give reasons in case if the assessee’s claim for brought forward depreciation is not found to be admissible by him, are not being disturbed by us. The Grounds of appeal No(s). 1 to 4 to the extent relatable to the aforesaid issue in question are dismissed in terms of our aforesaid observations. Addition of the share premium that was added by the A.O vide his order passed u/s 154, dated 16.09.2017 as an unexplained cash credit within the meaning of Sec. 68 - If the rectification in question i.e addition of the share premium that was treated as an unexplained cash credit by the A.O u/s 68 vide his reassessment order passed under Sec. 143(3) r.w.s 147 to the income of the assessee determined under the normal provisions is sustained, then, the same would result to supplementing the original assessment order that was passed by him u/s 143(3) r.w.s 144C(1) with an addition that was never made by the A.O, which we are afraid is absolutely not as per the mandate of law. If the rectification order passed by the A.O u/s 154, dated 16.09.2017 qua the addition of share premium of ₹ 32,21,48,679/- to the income of the assessee determined under the normal provisions is sustained, then, it would result to a blatant traversing or in fact invalid assumption of jurisdiction on the part of the A.O resulting to an enhancement of the assessment originally framed by him vide his order passed u/s 143(3) r.w.s 144C(1), dated 28.01.2014, which we are afraid is not in conformity with the express provisions of law. We, thus are of the considered view that the rectification order passed by the A.O u/s 154 qua the addition u/s 68 of the share premium to the income of the assessee determined under the normal provisions cannot be sustained and is liable to be vacated. Thus issue in question and Ground of appeal No. 5 are allowed in terms of our aforesaid observations.
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