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Issues involved:
The judgment involves an appeal filed by the assessee against the order of Ld CIT(A) for assessment year 1998-99 on an order passed by the Assessing Officer u/s 154 of the Income Tax Act. Grounds of Appeal: 1. The CIT(A) did not accept the claim of payment of arrears of salary based on the 5th Pay Commission recommendation and Govt. notification. 2. The claim of arrears of salary is a genuine liability and permissible deduction under the law. 3. The claim is in conformity with the observations of the Assessing Officer and CIT(A) for the previous assessment year. 4. The claim is not of debatable nature and is a permissible deduction u/s 154 of the Income Tax Act. 5. The claim is supported by evidence and the mercantile system, and disallowance is unjustified. Details of Judgment: The assessment u/s 143(3) was completed without any discussion or disallowance regarding the provision for revision of pay as per the 5th Pay Commission Recommendations. The assessee filed a rectification application u/s 154, citing the Ld CIT(A)'s order for the previous year in support of the claim. However, the Assessing Officer rejected the application, stating that there was no obvious mistake apparent from the record. The assessee contended that the claim was genuine and permissible under the law, supported by case laws and circulars. The Assessing Officer's rejection was based on technical grounds, and the claim was rejected without proper examination of facts or law. The Ld CIT(A) upheld the Assessing Officer's order, stating that the claim should have been made during the assessment proceedings and not through a rectification petition after many years. The Tribunal observed that the rectification petition was time-barred and a claim not raised during assessment cannot be considered a mistake apparent from the record. In conclusion, the Tribunal dismissed the appeal, stating that the claim should have been raised during the assessment proceedings and rejected all grounds raised by the assessee. This judgment highlights the importance of timely and proper submission of claims during assessment proceedings to avoid issues with rectification petitions later on.
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