2017 (9) TMI 578 - AT - Income Tax

Revised return rejected - return filed by the assessee processed u/s 143(1) - Held that - In this case processing u/s 143(1) of the Act was completed on 10.2.2012 therefore the revised return filed by the assessee is invalid and not considered. We find that the assessing officer is of the view that once the return filed by the assessee is processed u/s 143(1) of the Act therefore the assessment is completed and the revised return filed by the assessee is rejected. However the A.O. has completed the assessment in the assessee s case u/s 143(3) of the Act dated 13.3.2014 therefore the return filed by the assessee and processed u/s 143(1) of the Act is not amounting to assessment it is a mere process. In view of the above the A.O. is not correct in rejecting the revised return filed by the assessee. We also find that the Ld. CIT(A) deleted the addition made by the A.O. without considering that the A.O. failed to consider the revised return and addition made by the A.O. is on the basis of original return. Under these facts and circumstances of the case we are of the opinion that the order passed by the Ld. CIT(A) has to be set aside and we direct the A.O. to consider the revised return filed by the assessee dated 28.3.2013 and pass the assessment order de-novo in accordance with law. This appeal filed by the revenue is allowed for statistical purposes.

Summary

Issues:
Assessment based on revised return, Validity of revised return, Consideration of revised return by AO, Correctness of CIT(A)'s decision, Cross objection dismissal

Analysis:
1. Assessment based on revised return: The assessee, a Private Limited company, filed a return of income for the assessment year 2011-12 initially declaring total income of Rs. 3,32,45,620/-. Subsequently, a revised return was filed declaring total income of Rs. 2,63,45,860/-. The AO completed the assessment under section 143(3) of the Income Tax Act, 1961, without considering the revised return, leading to a dispute regarding the validity and consideration of the revised return.

2. Validity of revised return: The AO contended that the revised return filed by the assessee was invalid as it was submitted after the processing of the original return under section 143(1) of the Act. The AO relied on section 139(4) of the Act to argue that the revised return should have been filed before the completion of assessment. However, the Tribunal noted that the processing under section 143(1) does not amount to assessment but is a preliminary step, and the revised return can be considered even after such processing.

3. Consideration of revised return by AO: The Tribunal observed that the AO erred in rejecting the revised return solely based on the processing of the original return under section 143(1). The AO failed to recognize that the assessment was completed under section 143(3) and not under section 143(1), making the revised return valid and requiring consideration during assessment.

4. Correctness of CIT(A)'s decision: The CIT(A) had deleted the addition made by the AO, supporting the assessee's contention that the revised return should have been considered. However, the Tribunal set aside the CIT(A)'s decision, directing the AO to reconsider the revised return and pass the assessment order afresh in accordance with the law.

5. Cross objection dismissal: The cross objection filed by the assessee in support of the CIT(A)'s decision was dismissed in light of the Tribunal's decision to set aside the CIT(A)'s order and direct the AO to reassess based on the revised return.

In conclusion, the Tribunal allowed the appeal filed by the revenue for statistical purposes, directing the AO to consider the revised return and conduct a fresh assessment. The cross objection filed by the assessee was dismissed in line with the decision regarding the appeal.