2024 (6) TMI 1228 - AT - Income Tax

Addition of LTCG - differential amount between reported by tax auditor as LTCG and declared by the assessee in its return of income as LTCG - HELD THAT - In nutshell both the parties are at consensus/ad-idem that an income by way of LTCG to the tune of Rs. 9172/- could be added. Addl./JCIT(A) erred in making addition of Rs. 2, 62, 383/- towards long term capital gain as reported in clause16(d) of the tax audit report while the fact of the matter is that the assessee has duly declared long term capital gain of Rs. 2, 53, 211/- in the return of income filed by the assessee with department and paid due taxes on the same and at the best only differential amount of Rs. 9, 172/- could have been sustained by ld Addl/JCIT(A) . Both the parties are at consensus/ad-idem that the amount of Rs. 9, 172/- can be added and brought to tax otherwise the same amount of income by way of LTCG to the tune of Rs. 2, 53, 211/- would be doubly taxed which is not permissible. Thus we sustain the addition under the head LTCG to the tune of Rs. 9172/- and grant relief to the assessee by deleting the additions under the head LTCG as sustained by ld. CIT(A) as the LTCG to the tune of Rs. 2, 53, 211/- is reported by the assessee in the ROI filed with the department. Thus the appeal of the assessee is partly allowed

Issues involved:
1. Addition of capital gain of Rs. 2,62,383/- confirmed by the office of Commissioner of Income-tax, Appeals.
2. Discrepancy between long term capital gain reported in tax audit report and declared in the return of income.
3. Double taxation issue regarding long term capital gain.

Detailed Analysis:
1. The appeal in ITA No. 898/Ahd/2024 for assessment year 2021-22 arose from an appellate order confirming the addition of capital gain of Rs. 2,62,383/-. The assessee contended that the addition was illegal, unlawful, and against justice, leading to the grounds of appeal challenging the decision.

2. The discrepancy arose regarding the long term capital gain amount reported in the tax audit report and the amount declared in the return of income. The ld. Addl/JCIT(A) observed an inconsistency between the figures, leading to the decision to charge the entire amount of Rs. 2,62,383/- to tax. The assessee filed an application for rectification, arguing that Rs. 2,53,211/- had already been offered for taxation as long term capital gain.

3. The issue of double taxation emerged as the ld. Addl/JCIT(A) confirmed the addition of Rs. 2,62,383/- despite the assessee declaring long term capital gain of Rs. 2,53,211/- in the return of income. Both parties agreed that only the differential amount of Rs. 9,172/- should be added to avoid double taxation. The Tribunal sustained the addition of Rs. 9,172/- and granted relief to the assessee by deleting the remaining addition under the head LTCG, as the reported amount was already declared in the return of income.

Overall, the Tribunal partly allowed the appeal, addressing the discrepancies and ensuring that only the differential amount was added to avoid double taxation, thereby providing relief to the assessee.

← Previous Next →