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2023 (3) TMI 1193 - ITAT ALLAHABADErroneous order of CIT(A) - Processing of return of income by the CPC u/s 143(1) - Addition of income being interest on PPF and interest on REC tax free bonds - Scope of double taxation as assessee has specifically claimed these two items being interest on PPF account and interest on REC bonds as exempt income u/s 10 - HELD THAT:- CIT(A) without considering the main grievance of the assessee regarding double taxation of the income already declared by the assessee in the return of income as well as taxation of the exempt income has confirmed the adjustment / additions made by the CPC by ignoring the bare facts available on record in the return of income, submissions of the assessee as well as the facts reported in the tax audit report. It is not the case that the assessee has claimed the rental income and interest income on saving bank and FD as well as dividend income are not liable to be taxed but the assessee has pleaded before the CIT(A) that these incomes are already declared by the assessee and due tax was paid while filing the return of income. This fact has been completely ignored by the CIT(A) while passing the impugned order. The two item of income being interest on PPF and interest on REC bonds which are exempt incomes under section 10 of the Income Tax Act are also overlooked by the CIT(A) while passing the impugned order. It appears that the CIT(A) has simply confirmed the adjustments made by the CPC by referring to the guidance note on the tax audit under section 44AB and ignoring relevant and crucial fact that the rental income as well as income from other source has already been declared by the assessee in the return of income and adjustment to that extent has resulted double taxation of the income already declared by the assessee and further the exempt income has been taxed by the CPC which is absolutely against the provisions of the Income Tax Act. Hence, we find that the impugned order has been passed by the CIT(A) mechanically without application of mind which has forced the assessee to file this second appeal and suffered financial loss on account of appeal fee of Rs. 10,000/- and the litigation expenditure including the counsel fees etc., as well as mental agony and suffering therefore, this Bench takes a serious view of the matter regarding the callous approach of the CIT(A) while passing the impugned order. Accordingly, the additions / adjustments made by the CPC are deleted. Appeal of the assessee is allowed.
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