TMI Blog2018 (5) TMI 1012X X X X Extracts X X X X X X X X Extracts X X X X ..... ort, therefore, there is no violation of Rule 46A of the Rules. Thus, this ground of appeal of revenue is dismissed. Claim of exemption regarding principal sum of investment in mutual fund - assessee had voluntarily offered the said sum in her return of income - CIT-A allowed the claim - Held that:- CIT(A) has decided the issue raised by the assessee and has directed the AO to go through the details of the mutual fund investment and tax only the amount which is taxable after excluding the principal sum of investment which was mistakenly shown as income in the facts as narrated above is fair and reasonable order. Taking into consideration the facts discussed above, we note that the legal issue that has been raised by the assessee that only the right income has to be taxed has been rightly decided by the Ld. CIT(A) which does not call for any interference. Coming to the question as to whether the assessment can be completed below the returned income CIT(A)’s direction even if it results in an assessment below the returned income and consequently refund arises, it is valid as per law. Moreover we note that the relief sought cannot be refused merely because the assessee has omitt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erence in the Balance Sheet in respect of the FD at Bank of India vis a vis the ITS details downloaded by him, the assessee had in fact brought to the notice of the AO that her accountant had inadvertently wrongly reported the figure of FD with the Bank of India in her Balance Sheet at ₹ 3,31,83,887/- instead of actual figure of ₹ 3,76,65,625/-. Taking note of this mistake the assessee immediately filed a revised Balance Sheet before the AO reflecting the correct figure of her FD with the Bank of India which we note has been placed before us at page 1 of the paper book. The AO had simply taken note of the mistake crept into the Balance Sheet in respect of the FD at BOI and the difference shown by the ITS details has made the addition of ₹ 44,81,738/- (i.e. ₹ 3,76,65,025 ₹ 3,31,83,887). 5. Before us, the Ld. AR in order to show the source of the figures in assessee s balance of FD with Bank of India submitted that the balance of FD with Bank of India had increased from ₹ 1,77,55,419.13/- from AY 2010-11 to ₹ 3,76,65,625.26/- during the relevant AY 2011-12 i.e. by an amount of ₹ 1,99,10,206.13/- and the source of the same was her b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndia was not her undisclosed income as alleged by the AO and we do not find any infirmity in this finding of Ld. CIT(A) and we concur with the same. 6. Coming to the ground raised by the revenue in respect of violation of Rule 46A, we note from the impugned order of the Ld. CIT (A) that the Ld. CIT (A) has called for a remand report from the AO. Our attention was drawn to page nos. 22 and 23 of the paper book which is the remand report forwarded by the AO dated 02.12.2015 wherein the AO has given his remand report, therefore, there is no violation of Rule 46A of the Rules. Thus, this ground of appeal of revenue is dismissed. 7. Coming to the next ground of appeal of revenue is against the action of the Ld. CIT (A) in allowing the claim of exemption of ₹ 21,88,300/- regarding principal sum of investment in mutual fund without appreciating the fact that the assessee had voluntarily offered the said sum in her return of income. The revenue has also challenged the issue that assessment cannot be completed below the returned income and that admitted tax cannot be refunded as there is no revised return of income. 8. Brief facts of the case are that the assessee had inherit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax only the amount which is taxable after excluding the principal sum of investment which was wrongly shown as income. As a result this ground is allowed. Aggrieved, revenue is before us. 9. We note that the Ld. CIT(A) has decided the issue raised by the assessee and has directed the AO to go through the details of the mutual fund investment and tax only the amount which is taxable after excluding the principal sum of investment which was mistakenly shown as income in the facts as narrated above is fair and reasonable order. Taking into consideration the facts discussed above, we note that the legal issue that has been raised by the assessee that only the right income has to be taxed has been rightly decided by the Ld. CIT(A) which does not call for any interference. 10. Coming to the question as to whether the assessment can be completed below the returned income, we note that Ld. AR drew our attention to the decision of the Hon ble Gujarat High Court in the case of CIT Vs Milton Laminates Ltd (218 Taxman 108). We find that this question has been answered in affirmative by the Hon ble Gujarat High Court in the case of CIT Vs Milton Laminates Ltd (supra) wherein it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al income or loss and determine the sum which was payable or refundable on the basis of the assessment. Meaning thereby, the A.O. was legally empowered in law to make assessment of the total income of the assessee at a lower sum than the returned income, which would result in sum refundable to the assessee. 13. The provision sub-section (3) was substituted by the following provision by the Direct Tax Laws (Amendment) Act, 1987 with effect from 1st April 1989, which read as follows ( 3) On the day specified in the notice issued under sub-section (2), or as soon afterwards as may be, after hearing such evidence as the assessee may produce and such other evidence as the Assessing Officer may require on specified points, and after taking into account all relevant material which he has gathered, the Assessing Officer shall, by an order in writing, make an assessment of the total income or loss of the assessee, and determine the sum payable by him on the basis of such assessment. 14. On perusal of the above provision, it is noted the Legislature specifically excluded the A.O. s power to determine sum refundable to the assessee on completion of assessment under sub- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CBDT Circular No. 14(XL-35 dated 11.04.1955) wherein the CBDT has observed as under: 3. Officers of the Department must not take advantage of ignorance of an assessee as to his rights. It is one of their duties to assist a taxpayer in every reasonable way, particularly in the matter of claiming and securing reliefs and in this regard the Officers should take the initiative in guiding a tax payer where proceedings or other particulars before them indicate that some refund or relief is due to him. This attitude would, in the long run, benefit the department for it would inspire confidence in him that he may be sure of getting a square deal from the department. Although, therefore, the responsibility for claiming refunds and reliefs rests with assessees on whom it is imposed by law, officers should 18. Moreover we note that the relief sought cannot be refused merely because the assessee has omitted to claim the relief as held by the Hon ble Supreme Court in Anchor Pressings P. ltd. Vs. CIT 161 ITR 159. Therefore, for the aforesaid reasons given above, the revenue s ground of appeal is dismissed. 19 . In the result, appeal of revenue is dismissed . Order is pronoun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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