Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2023 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (11) TMI 232 - AT - Income TaxDefective return - Rectification u/s 154 for invalidating the return filed by the Assessee - non audit of books of accounts u/s 44AB - order u/s 139(9) as passed treating the return as invalid return stating that Tax Payer has shown gross receipt or income under the head “profit and gains of Business or Profession” more than Rs. 1 Crore, however Part A of the Profit and Loss Account and/or Balance Sheet have not been filed and/or the books of accounts have not been audited.” HELD THAT:- If the order passed by the AO u/s 139(9) of the Act contains apparent mistake then it is curable u/s 154 of the Act. Since there is no defect in the ITR filed by the assessee, therefore it is a valid Income Tax Return. It is imperative to mention that the gross receipt of the assessee from the business carried out by the assessee was not more than to Rs. 1 Crore, therefore the assessee was not required to get his accounts audited u/s 44AB. In this regard reference is drawn towards the Guidance Note on Tax Audits under section 44AB of the Act issued by ICAI and on perusal of Para 5.13 of the Guidance note it is apparent that the Sales proceeds of Fixed Assets would not form part of gross receipts in business for the purposes of section 44AB of the Act. As decided in Y.K. Patel Securities (P) Ltd. [2023 (6) TMI 1327 - ITAT MUMBAI] there is merit in the submission of the assessee that it is not required to get its accounts audited u/s 44AB - Accordingly, we are of the view that the defect notice issued by CPC u/s 139(9) of the Act is not in accordance with law and accordingly, we quash the said defect notice, meaning thereby, the return of income filed by the assessee should be considered as valid return. As defect notice issued by CPC u/s 139(9) of the Act is not in accordance with law and accordingly, we quash the said defect notice, meaning thereby, the return of income filed by the assessee should be considered as valid return. Accordingly, we direct the AO/CPC to treat the return of income filed by the assessee as valid return and process the same in accordance with law. Thus the appeal of the assessee is allowed.
|