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2021 (12) TMI 1260 - AT - Income TaxBenefit of carry forward losses - assessee has filed its return of income beyond the stipulated due of 30.09.2013 - HELD THAT - It is an undisputed fact that assessee had filed the return of income for A.Y. 2013-14 on 22.11.2013 whereas as per Explanation 2(a) to Section 139, the last date for filing the return of income was 30.09.2013. It is also an undisputed fact that assessee had filed Form 3CEB. The perusal of Form 3CEB placed in the paper book reveals that it has been certified by the Chartered Accountant on 30.11.2013 and further as per the aforesaid form, the value of international transactions or specified domestic transactions is reported at Rs. Nil. Return of income has been filed by assessee on 22.11.2013 meaning thereby that the Form 3CEB has been obtained after the filing of return of income - the perusal of the Form 3CEB also reveals that there is no mention of the amount received on capital account nor does it state any reason for not reporting the receipt amount on capital account in the Form 3CEB. Considering the totality of the aforesaid facts, we find that the CIT(A) was fully justified in holding that since assessee has filed its return of income beyond the stipulated due of 30.09.2013, the assessee was not eligible to claim the carry forward of the losses. We thus find no infirmity in the order of CIT(A) and therefore we uphold the order of CIT(A). Thus the grounds of assessee are dismissed.
Issues:
1. Validity of the return filed by the assessee. 2. Eligibility of the assessee to claim carry forward of losses. 3. Applicability of transfer pricing provisions. 4. Penalty proceedings under section 271 of the Act. Issue 1: Validity of the return filed by the assessee The appeal was against the order of the Commissioner of Income Tax (Appeals)-23 relating to Assessment Year 2013-14. The Assessee, a non-resident Indian company, established a branch office in India for trading activities. The Assessing Officer (AO) noted that the return was filed after the due date and raised concerns about the validity of the return. The Assessee argued that it believed transfer pricing provisions applied, justifying the late filing. The AO disallowed carry forward losses due to the late filing. The CIT(A) upheld the AO's decision, leading to the appeal. Issue 2: Eligibility of the assessee to claim carry forward of losses The main controversy was whether the return filed by the assessee on 22.11.2013 was considered filed on time to claim carry forward of losses. The Assessee argued that the return was filed on time based on the belief that transfer pricing provisions applied. The Department argued that since the Form 3CEB showed Nil international transactions, the extended filing deadline benefit was not applicable. The Tribunal upheld the CIT(A)'s decision, denying the carry forward of losses due to the late filing. Issue 3: Applicability of transfer pricing provisions The Assessee contended that capital contributions from its associated enterprises (AEs) constituted international transactions under transfer pricing provisions. The Assessee filed Form 3CEB reporting Nil transactions to comply with transfer pricing regulations. The Department argued that the Form 3CEB did not mention capital contributions, undermining the Assessee's claim. The Tribunal did not find merit in the Assessee's arguments, upholding the decision that the late-filed return did not qualify for carry forward losses. Issue 4: Penalty proceedings under section 271 of the Act The Assessee raised concerns about penalty proceedings under section 271 of the Act, arguing no concealment or inaccuracies in income reporting. However, the Tribunal did not delve into this issue as the main focus was on the validity of the return filing and eligibility for carry forward losses. In conclusion, the Tribunal dismissed the appeal, upholding the decision that the return filed by the assessee after the due date was not valid for claiming carry forward losses. The Tribunal found no justification for extending the filing deadline based on transfer pricing provisions, ultimately denying the Assessee's claim for the benefit of carry forward losses.
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