TMI Blog2018 (12) TMI 685X X X X Extracts X X X X X X X X Extracts X X X X ..... In our considered opinion, this may be a mistake against which the appeal can be filed by the assessee by filing an appeal before CIT(A) against the assessment order but such mistake is not an apparent mistake which can be rectified by the AO u/s. 154 of IT Act - rectification sought for by the assessee u/s. 154 is not in respect of an apparent mistake which can be rectified u/s. 154. - decided against assessee. - ITA No. 2022/Bang/2018 - - - Dated:- 7-12-2018 - SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER AND SHRI LALIET KUMAR, JUDICIAL MEMBER For The Appellant : Smt. Srinandini Das, Addl. CIT (DR) For The Respondent : Shri Sunil Jain, CA ORDER Per Shri A.K. Garodia, Accountant Member This appeal is filed by the assessee and the same is directed against the order of ld. CIT(A)-3, Bangalore dated 16.05.2018 for Assessment Year 2011-12. 2. The grounds raised by the assessee are as under. Ground I: Computation of long term capital loss 1. On the facts and in the circumstances of the case and in law, the learned CIT(Appeals) has erred in holding that claims made during the course of assessment proceedings other than by filing revised ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lable on pages 84 to 106 of paper book. As per the order passed by the AO u/s. 154 on 27.09.2017, the AO held that there is no mistake apparent from the records which could be rectified u/s. 154 because the loss determined by the AO as per the assessment order is the same as claimed in the original and revised return of income. Thereafter, the assessee preferred an appeal before ld. CIT(A) against this order passed by the AO u/s. 154. But ld. CIT(A) has decided the issue against the assessee and now the assessee is in further appeal before us. Before us the ld. AR of assessee submitted that as per para no. 3 of the CBDT Circular No. 14(XL-35) dated 11.04.1955 available on pages 1 to 3 of paper book, the assessee s claim for rectification should have been allowed by the AO. He also placed reliance on the following judicial pronouncements. A. National Thermal Power Corporation Ltd. Vs. CIT (229 ITR 383)(SC) B. Xerox India Ltd. Vs. DCIT in ITA No. 1580/Del/2010, copy available on pages 79 to 85 of paper book. C. Rakesh Singh Vs. ACIT (26 taxmann.com 240) (Bangalore Tribunal), copy available on pages 14 to 22 of paper book. D. Sri Lakhan Sing Vs. ACIT in ITA No. 1025/Bang/2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r otherwise reducing the liability of the assessee or the deductor or the collector, the Assessing Officer shall make any refund which may be due to such assessee or the deductor or the collector. ( 6) Where any such amendment has the effect of enhancing the assessment or reducing a refund already made or otherwise increasing the liability of the assessee or the deductor or the collector, the Assessing Officer shall serve on the assessee or the deductor or the collector, as the case may be a notice of demand in the prescribed form specifying the sum payable, and such notice of demand shall be deemed to be issued under section 156 and the provisions of this Act shall apply accordingly. ( 7) Save as otherwise provided in section 155 or sub-section (4) of section 186 no amendment under this section shall be made after the expiry of four years from the end of the financial year in which the order sought to be amended was passed. ( 8) Without prejudice to the provisions of sub-section (7), where an application for amendment under this section is made by the assessee or by the deductor or by the collector on or after the 1st day of June, 2001 to an income-tax authori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y have omitted to claim for some reason or other; ( b) freely advise them when approached by them as to their rights and liabilities and as to the procedure to be adopted for claiming refunds and reliefs. 8. From the above Para reproduced from the CBDT Circular, it is seen that this para of this Circular is not in respect of rectification u/s. 154 and hence, in our considered opinion, this Para of CBDT Circular is not relevant in the present case. 9. Reliance has been placed by ld. AR of assessee on the judgement of Hon ble Apex Court rendered in the case of National Thermal Power Corporation Ltd. Vs. CIT (supra). As per this judgement, it was held by Hon ble Apex Court that in a case where the Tribunal is only required to consider a question of law arising from the facts which are on record in the assessment proceedings, there is no reason why such a question should not be allowed to be raised when it is necessary to consider that question in order to correctly assess the tax liability of an assessee. In that case, the proceedings were not initiated u/s. 154 of IT Act and for this reason alone, we have no hesitation in holding that this judgment has no applicability ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eet was not accepted by the AO as per the reasons mentioned in para 3 of the assessment order in that case. Against this assessment order, the assessee filed an appeal before CIT(A) and when CIT(A) decided the issue against the assessee, the assessee filed appeal before the Tribunal. Hence it is seen that in that case also, the issue in dispute was not in respect of section 154 proceedings and therefore, in our considered opinion, this Tribunal order is not rendering any help to assessee in the present case. Although the assessee can raise additional ground before the appellate authority in course of assessment proceedings completed by the AO u/s. 143 (3) if any appeal is filed by the assessee in those proceedings but the assessee s claim is not allowable in section 154 proceedings. 13. The next judgment cited before us is the judgement of Hon ble Madhya Pradesh High Court rendered in the case of CIT Vs. K N Oil Industries as reported in [1983] 12 Taxman 189 (MP). In this case, it was noted that the assessee did not claim relief u/s. 35B in the return of income but in course of proceedings u/s. 154 initiated by the AO for rectifying the rebate u/s. 80J, the assessee made this cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id through converting into shares issued to them @ ₹ 10/- each. It has also not been denied by the lower authorities that application under Section 154 to allow the aforesaid claim was moved before the AO well within the prescribed time limitation of 4 years. Now the question before us is as to whether there was any mistake in the assessment order in not allowing the aforesaid claim of the assessee for which it was very much entitled to, within the meaning of provisions laid down under Section 154 of the Act. The lower authorities have rejected the application under Section 154 of the Act moved by the assessee for allowing the deduction under Section 43B of the Act of payment of interest of ₹ 53 lacs by it to the financial institutions by way of converting the same into issuance of shares to them, on the basis that no such claim was made out by the assessee in its return of income nor on subsequent occasion of passing of an order under Section 154 of the Act by the AO any objection in this regard was raised, hence there is no mistake apparent in the order to allow the application under Section 154 of the Act. There is no dispute on facts that under some sanctioned schem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expression apparent from the record in Section 154. 'Record' would mean the record of the entire proceeding of the case including documents and materials produced by the parties and taken on record by the authorities, which were available at the time of passing of the order which is the subject matter of proceeding for rectification. It is admitted by the assessing authority that the assessee company filed its return of income with other statutory reports, accounts etc. The Company has taken loans from financial institutions. In the year 94- 95, the financial institutions converted interest due on loan amounting to ₹ 53 lacs into share capital. This has clearly been shown on the face of Balance sheet by way of a note in Schedule-1, where it was mentioned that ₹ 53 lacs has been converted into 530000 equity shares of ₹ 10 each fully paid up, out of outstanding, funded interest of the financial institutions during the year as per the scheme sanctioned by BIFR, therefore the mistake is apparent from the record. As nowhere in the assessment order the assessing authority has stated that the matter is debatable. When the materials were available in the assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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