2014 (7) TMI 330 - AT - Income Tax

Admission of additional evidence under Rule 46A(3) of the Rules Income from sale of furniture treated as STCG Held that - The AO has not discussed about whether the assessee has filed any revised return, however, the CIT(A) has given a finding that the assessee has filed revised return in time and the AO should have considered the same assessee filed revised return in time, AO should have considered the same - the AO has not given any finding, the issue should be decided by the AO afresh after verifying the claim of the assessee in revised return Decided in favour of Revenue. Income from house property - House property treated as deemed let out Held that - The assessment is based on the basis of original return filed by the assessee, but there is no whisper about the return being revised by the assessee - the assessee candidly conceded that the issue may be restored back to the file of the AO to consider it afresh thus, the matter is remitted back to the AO for fresh adjudication Decided in favour of Revenue.

Summary

Issues Involved:
1. Appeal by Revenue challenging order of CIT(A) regarding depreciation claim and income from sale of furniture.
2. Cross objection by Assessee regarding addition made for income from house property.

Analysis:

Issue 1: Appeal by Revenue
The Revenue challenged the order of CIT(A) regarding the claim of depreciation and income from sale of furniture. The CIT(A) directed the Assessing Officer (AO) to consider the depreciation claim of &8377; 13,48,51,978/- as per the revised return filed by the assessee. The Revenue contended that the CIT(A) erred in allowing the depreciation claim from the revised return without giving a reasonable opportunity to the AO. The Revenue also disputed the deletion of the addition on account of income from the sale of furniture as short-term capital gain. The CIT(A) partly allowed the appeal, directing the AO to consider the revised return's depreciation claim and deleting the addition related to short-term capital gain. The Tribunal found that the AO did not discuss the revised return but upheld the CIT(A)'s decision to consider the depreciation claim. The Tribunal allowed the Revenue's appeal for statistical purposes, directing the AO to verify the revised return's claim for depreciation.

Issue 2: Cross Objection by Assessee
The Assessee filed a cross objection regarding the addition made by the AO for income from house property. The Assessee argued that the CIT(A) erred in not deleting the addition of &8377; 2.52 lacs made by the AO. The assessment was based on the original return, and there was no mention of a revised return during the proceedings. The Assessee requested the issue to be reconsidered by the AO after verifying the revised return and supporting evidence. The Tribunal allowed the Assessee's cross objection for statistical purposes, remanding the issue back to the AO for fresh consideration. In the combined result, both the appeal by Revenue and the cross objection by the Assessee were allowed for statistical purposes.

This judgment highlights the importance of proper consideration of revised returns by the AO and the need for a thorough review of all relevant claims and evidence before making additions or deletions in the assessment process.