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2024 (4) TMI 200 - HC - Income TaxPower of CBDT u/s 119 to condone the delay in claiming loss - petitioner filed his return of income for the year 2015-16 belatedly u/s 139(4) - denial of carry forward the loss arising out of the derivative transaction as the same was not claimed in the return of income and added this amount to the income of the petitioner raising a demand on the said income. HELD THAT - If the petitioner had made a claim belatedly then delay in making such claim can be condoned by the respondent no. 1 for purpose of permitting the petitioner to claim loss, so as to carry forward in the next year for set off. On perusal of the return of income along with the computation of income placed on record it is apparent that the petitioner has not made any claim for the loss incurred by the petitioner out of derivative transactions for Assessment Year 2015-16. It is also pertinent to note that at the time of assessment proceeding also the petitioner has not sought to file a revised return of income, claiming the carry forward of loss for the AY 2015-16. Assessment Order u/s 143(3) of the Act is already passed by the AO on 15.12.2017 for Assessment Year 2015-16. Therefore the Assessment for Assessment Year 2015-16 for all intents and purpose has come to an end and has achieved finality. Therefore, while exercising the jurisdiction under Section 119(2)(b) of the Act, the respondent no. 1 could not have condoned the delay to claim the loss to be carried forward when the same was not even claimed by the petitioner in the original return of income. Section 139(3) of the Act provides for filing return of income so as to enable the assessee to carry forward if the return is filed within time as per Section 139(1) of the Act. Therefore, there was no question to condone the delay to carry forward such loss by the petitioner, moreover, the petitioner has also failed to show any hardships, much less any genuine hardship for filing the return of income for Assessment Year 2015-16 belatedly on 29.03.2016. It is also appearing from the impugned order passed by the respondent no. 1 that the petitioner is habitual in late filing the return of income from Assessment Year 2011-12 to 2017-18 in the month of March of the relevant Assessment Year only. No interference is called for in the impugned order passed by the respondent no. 1 under Section 119(2)(b) of the Act. The petition therefore being devoid of any merit is accordingly dismissed.
Issues involved:
The issues involved in the judgment are related to the petitioner's claim for carrying forward losses for Assessment Year 2015-16, the rejection of the application by the respondent no. 1 authority, and the interpretation of Section 119(2)(b) of the Income Tax Act, 1961. Claim for Carrying Forward Losses (Assessment Year 2015-16): The petitioner filed the return of income for the year 2015-16 belatedly under Section 139(4) of the Income Tax Act, declaring a total income. The petitioner had incurred a loss on derivative transactions but did not claim it in the return. The Assessing Officer made an addition to the income, disallowing the carry forward of the loss. The petitioner applied to condone the delay in claiming the loss, but the application was rejected by the respondent no. 1 authority on grounds of lack of genuine hardships shown by the petitioner. The petitioner approached the Court seeking relief. Interpretation of Section 119(2)(b) of the Act: The petitioner argued that genuine hardships existed due to the use of an unqualified accountant and personal reasons for not filing the return on time. The respondent no. 1 authority rejected the application based on a circular and lack of loss claim in the original return. The Court noted that the petitioner did not make a claim for the loss in the original return and did not seek to file a revised return during assessment proceedings. The Court referred to Section 119(2)(b) which allows condonation of delay if a claim is made belatedly. Since the loss was not claimed in the original return, the delay could not be condoned. The Court found no genuine hardships shown by the petitioner and dismissed the petition.
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