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2021 (1) TMI 290 - AT - Income TaxRectification u/s 254 - excess depreciation written back and shown negative under the head prior period expenses in the annual account - HELD THAT - We have observed that learned CIT(A) has given elaborate finding and reasoning wherein it is stated that the assessee has computed its Brought forwards losses and unabsorbed depreciation in an incorrect manner and further elaborations were made by learned CIT(A) while enhancing the income of the assessee on this issue. The tribunal has not dwelt upon /adjudicated this issue of enhancement of income by learned CIT(A) , which may require detailed arguments. The tribunal has dismissed the said ground of appeal raised by assessee on the grounds as being not pressed. The assessee is prejudiced by said dismissal in limine. Since Tribunal has restricted its finding to 43.95 lacs, it will be in the interest of justice that the Grounds No.5 and 6 which were not adjudicated completely by tribunal are restored back to the file of Tribunal for fresh adjudication and to this extent the MA filed by the assessee on this issue is partly allowed for statistical purposes, as indicated above. Restricting of the relief by tribunal u/s. 145A of the Act to the tune 48.33 lacs as was relatable to income enhanced by learned CIT(A) , while Tribunal has not adjudicated on the additions to the tune of ₹ 16.4 lacs made by the AO , on the grounds that the AR of the assessee has made amendment in Ground No. 7 which was made post hearing of the appeal by taking file by AR from Bench Clerk, which move by the learned AR was not appreciated by the Tribunal. Now the assessee, who is Government of India undertaking being Public Sector Enterprises has come out with three affidavits, two by the counsel namely, CA Ms. Tanu Singhal and CA Mr. Amitava Ray, who have categorically denied and averred that they did not made any amendment in Ground No.7 in the memo of appeal filed with tribunal, and further stated that the aforesaid amendments were made by Mr. Sanjay B. Gupta, Manager( Finance) of the assessee who was authorized and competent to make such additions.It is further averred in the affidavit that the said amendment in grounds of appeal was made under instructions from the Bench. They have also given specimen signatures/initials in the affidavit filed with the tribunal, which is placed on record in file. Without going into the dispute as to who instructed to amend the Ground No.7, we are of the considered view that the fundamental purpose and duties of tribunal is to grant justice to both the parties with an objective so that rightful and legitimate income-tax within provisions of the 1961 Act which is rightfully due and payable by tax-payer for an assessment year be computed and collected under the authority of law , and with a view to subserve interest of justice, we are inclined to restore Ground No.7 back to the file of Tribunal for fresh adjudication and to this extent the MA filed by the assessee on this issue is allowed.
Issues:
1. Correction of apparent mistakes in the appellate order related to relief granted to the assessee for depreciation write-back. 2. Discrepancy in adjudication of additions by the AO and CIT(A) in the income of the assessee. Issue 1: The assessee filed a miscellaneous application seeking correction of a mistake apparent from records in the appellate order dated 28.07.2016 by the Income Tax Appellate Tribunal, Allahabad Bench. The issue revolved around the relief granted to the assessee for a depreciation write-back. The tribunal had restricted the relief to ?43.95 lacs, whereas the assessee claimed relief to the tune of ?292.92 lacs. The tribunal found that the write-back did not affect the claim of depreciation under the Income Tax Act, as the WDV of assets had not been changed. The tribunal, in its order, deleted the addition of ?43.95 lacs made by the AO. However, the CIT(A) had enhanced the income of the assessee by adding the entire write-back amount. The tribunal did not fully adjudicate on this issue, leading to the assessee filing the MA to seek correction and restoration of the relief amount to ?292.92 lacs. Issue 2: Another mistake apparent from the appellate order was related to the addition made by the AO and further enhanced by the CIT(A) in the income of the assessee. The tribunal had granted partial relief to the tune of ?48.33 lacs, while the additions made earlier by the AO were not fully adjudicated due to amendments made post-hearing by the AR of the assessee. The assessee provided affidavits stating that the amendments were made under the instructions of the Bench by the Manager (Finance) of the assessee. The tribunal, emphasizing the need for justice and correct computation of income tax, decided to restore the issue back for fresh adjudication. The MA filed by the assessee was partly allowed on this issue. In conclusion, the tribunal partially allowed the MA filed by the assessee for statistical purposes, directing the restoration of certain issues for fresh adjudication. The fundamental purpose of the tribunal is to ensure justice for both parties and the correct computation of income tax within the provisions of the Income Tax Act, 1961. The detailed analysis of the issues highlighted the discrepancies in relief granted and the need for proper adjudication of additions to the income of the assessee.
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