2018 (10) TMI 2006 - HC - Income Tax

ITR - whether Annexure-II is the original Income-Tax Return filed? - HELD THAT - The dispute and issue whether Annexure-II is the true and correct Return of Income is factual. Normally, the Income-Tax Returns do not get uploaded to the official website unless the entire amount of tax and interest has been paid. Prima facie, it appears that Annexure-II relied upon by the Revenue is a computation made by the Central Processing Centre at Bengaluru. We are not aware whether Annexure-II filed with this appeal was filed by the Revenue before the Income-Tax Appellate Tribunal. Principal Commissioner of Income Tax will personally examine the matter, if required, ascertain full facts form Central Processing Centre at Bengaluru and file his affidavit within 21 days on different issues highlighted above.

Summary

Issues Involved:
1. Discrepancy in total income declared in the Income-Tax Return.
2. Allegation of tax default by the respondent-assessee.
3. Claimed deduction under Section 35 of the Income Tax Act.
4. Authenticity of Annexure-II as the true Return of Income.
5. Verification of the filing process of Annexure-II.
6. Examination by the Principal Commissioner of Income Tax.

Analysis:

1. The judgment addresses a significant issue of a discrepancy in the total income declared in the Income-Tax Return filed by the respondent-assessee. The original return showed a total income of Rs.7,97,34,064, while a subsequent return for the Assessment Year 2010-11 declared a total income of Rs.4,18,70,038 with a claimed deduction under Section 35 of Rs.3,46,32,280.

2. The court noted that the respondent-assessee was alleged to be a tax defaulter as per an order dated 07.07.2011 under Section 143(1) of the Income Tax Act, 1961, due to non-payment of the entire self-assessment tax and interest. This discrepancy raised questions about the accuracy and compliance of the tax obligations by the assessee.

3. A crucial aspect of the case involved the claimed deduction under Section 35 of the Act, amounting to Rs.3,46,32,280. The authenticity and validity of this deduction claim were pivotal in determining the correct assessment of the total income and the corresponding tax liability of the respondent-assessee.

4. The court deliberated on the authenticity of Annexure-II as the true Return of Income. It was observed that the Income-Tax Returns are typically not uploaded to the official website unless the entire tax and interest amounts have been paid, raising doubts about the accuracy and source of the information contained in Annexure-II.

5. Concerns were raised regarding the verification of the filing process of Annexure-II, with indications that it might be a computation generated by the Central Processing Centre at Bengaluru. The court highlighted the need for a thorough examination to ascertain the origin and accuracy of the information presented in Annexure-II.

6. To address the various issues highlighted in the case, the court directed the Principal Commissioner of Income Tax to personally examine the matter, gather full facts from the Central Processing Centre at Bengaluru, and submit an affidavit within 21 days. This step aimed to ensure a comprehensive investigation and clarification of the discrepancies and factual disputes surrounding the Income-Tax Returns filed by the respondent-assessee.

The judgment underscores the importance of accurate income declaration, compliance with tax obligations, and the need for thorough verification and examination in cases of discrepancies or alleged defaults. It reflects a commitment to ensuring the integrity and transparency of the tax assessment process through detailed scrutiny and verification by competent authorities.