2023 (10) TMI 623 - AT - Income Tax

Rectification u/s 154 - cash receipts do not constitute the business turnover of the assessee and therefore it was a mistake apparent form the record which need to be rectified to reduce the burden of the Higher Authority - HELD THAT - AO has examined the books of account of the assessee the cash book in particular while computing turnover of the assessee. At this stage the claim made by the appellant u/s 154 amounts to review of the assessment order by way of further verification and examination of books of account of the appellant the ledger cash book and other supporting documents. Meaning thereby that AO would again require to conduct scrutiny by further verification to verify quantum of turnover as claimed by the appellant. Claim of the appellant that there was a wrong computation of turnover based on cash receipts credited in the cash book is debatable and review of the assessment proceedings which do not call under the category of omission or apparent mistake from the record. As per provisions u/s 154 only a mistake which are apparent and patent from record and whose discovery is not depending on any further investigation/verification can be rectified u/s 154 thus instant case does not fall in the said category and hence we hold that the issue being debatable which cannot be rectified u/s 154. Decided against assessee.

Summary

Issues Involved:
The appeal filed by the assessee against the order of the ld. CIT (A) National Faceless Appeal Centre (NFAC), Delhi dated 27.12.2023 challenging the decision of the ld. CIT(A) in confirming the finding of the AO u/s 154 of the Act by holding that there was no mistake apparent from the record.

Details of the Judgment:

Issue 1: Mistake Apparent from the Record
The appellant argued that the turnover computation by the AO based on cash receipts credited in the cash book was incorrect as not all cash receipts constituted business turnover, thus a mistake apparent from the record. The appellant sought rectification under section 154 to reduce the burden of the Higher Authority. However, the Tribunal held that the claim was debatable and required further verification and examination of books of account, which did not fall under the category of omission or apparent mistake from the record. The Tribunal emphasized that only mistakes that are apparent and patent from the record, without the need for further investigation, can be rectified under section 154 of the Income Tax Act. Consequently, the Tribunal dismissed the challenge raised by the assessee as not maintainable.

In conclusion, the appeal of the assessee was dismissed by the Appellate Tribunal ITAT Jodhpur, citing that the issue raised was debatable and did not qualify as a mistake apparent from the record under section 154 of the Income Tax Act.