TMI Blog2022 (11) TMI 188X X X X Extracts X X X X X X X X Extracts X X X X ..... e of filing return of income was that though the assessee was not required to maintain the books of accounts since the return was filed under section 44AD of the Act, however in the return form the assessee had made inadvertently stated yes in the option asking whether the books of accounts are required to be maintained or not by the assessee. HELD THAT:- We observe that in the instant set of facts, the demand is arising on the assessee owing to the fact that at the time of filing return of income, the assessee inadvertently made certain errors as a result of which the remuneration and interest paid to partners was not allowed to the assessee. It is not the claim of the Department that the assessee was not eligible to be assessed to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st the order of the ld. Commissioner of Income Tax (Appeals)-3, Rajkot in Appeal no. CIT(A)- 3/10015/17-18 vide order dated 03/02/2020 passed for the assessment year 2014-15. 2. The assessee has taken the following grounds of appeal:- 1. That the learned CIT(A)-3 Rajkot has grievously erred in confirming the assessment of the returned loss of Rs.-22699/- at a taxable income of Rs. 1,38,279/- whilst processing us 143(1) of the Act. 2. That the learned CIT(A)-3 Rajkot has erred in not allowing claim of interest and remuneration paid to partners amounting to Rs.1,60,978/- which was to be allowed u/s 44AD(2) read with section 40(b) of the I.T. Act, 1961. 3. That the learned CIT(A)-3 has grievously erred in confirming that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CPC did not allow the interest and remuneration paid to partners and assessed the return loss at in income of ₹ 1,38,280/-. The mistake committed by the assessee at the time of filing return of income was that though the assessee was not required to maintain the books of accounts since the return was filed under section 44AD of the Act, however in the return form the assessee had made inadvertently stated yes in the option asking whether the books of accounts are required to be maintained or not by the assessee. As a followup step, the assessee was required to enter the details of the profit and loss account and balance sheet in the return of income. However, the contention of the assessee is that since the notice under section 139 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the interest to partner and remuneration are duly authorized by the partnership deed and intimation u/s 143(1) deserves to be rectified since the opportunity u/s 139(9) could not be utilized by the assessee. Having considered facts and circumstances of the case, I find that the assessee has acknowledged that notice u/s 139(9) was received by 23/02/2017 and it is also uncontroverted that the processing had taken place on 27/03/2017. That means the assessee could very well have removed the defect between 23/02/2017 and 27/03/2017. However, the assessee did not utilizes this opportunity to remove the defect and as such there is no fault on part of CPC in the impugned intimation. Therefore no interference can be made in the said inti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made certain errors as a result of which the remuneration and interest paid to partners was not allowed to the assessee. It is not the claim of the Department that the assessee was not eligible to be assessed to tax under section 44AD of the Act or that the interest and remuneration paid to partners did not find support from the terms of the partnership deed, however, the Ld. DR has suggested that the assessee is open to pursuing alternate remedy under section 154 of the Act. We also note that the DR has not challenged the fact that notice under section 139(9) of the Act had not been served upon the assessee within the due time. In the case of Kongu Educational Trust Vs DCIT (ITAT Chennai) in ITA No.113/Chny/2022 , the assessee was denied ..... X X X X Extracts X X X X X X X X Extracts X X X X
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