2023 (1) TMI 654 - AT - Income Tax

CIT(A) justification in holding that the appellant did not press ground no. 3 raised in the appeal - HELD THAT - As stated that in the return processed u/s 143(1) such claim of brought forward loss and current year loss was not allowed and for the proposed adjustments Centralized Processing Centre did not provide any opportunity before making the said adjustments as provided under the proviso to Section 143(1)(a) of the Act. After hearing for the assessee and on perusal of the impugned order we find force in the contention of the ld. Counsel for the assessee that reasonable opportunity was not provided to the assessee before declining the claim and thus, restore this issue of claim of brought forward loss to be carried forward to future years as well as loss of current year to be carried forward for set off in the future years to CIT(A) for necessary adjudication and to pass a speaking order on this issue. The assessee is also directed to furnish all relevant details which it had mentioned in the written submission placed before CIT(A) agitating ground no. 3 relating to disallowance of losses. Needless to mention that proper opportunity of being heard should be provided to the assessee. Thus, ground no. 1 is allowed for statistical purposes.

Summary

Issues involved:
Appeal against order u/s 250 of the Income Tax Act, 1961 for AY 2018-19; Allegation of not pressing a ground by the assessee; Claim of brought forward losses not allowed; Lack of opportunity before making adjustments; Direction to restore the issue of claim of losses for adjudication; Ground 2 being general in nature; Appeal allowed for statistical purposes.

Analysis:

1. The appeal was filed by the assessee against the order passed under section 250 of the Income Tax Act, 1961 for the Assessment Year 2018-19. The main contention raised by the assessee was that the Commissioner of Income Tax (Appeals) was not justified in holding that the appellant did not press ground no. 3 in the appeal before the Commissioner. The Tribunal heard both sides and observed that the claim of brought forward losses from earlier years and the current year's losses were not allowed during the processing of the return under section 143(1) of the Act. The Centralized Processing Centre did not provide an opportunity before making these adjustments, as required under the proviso to Section 143(1)(a) of the Act. Consequently, the Tribunal found merit in the assessee's argument that a reasonable opportunity was not given before declining the claim. Therefore, the Tribunal directed to restore the issue of the claim of losses to be carried forward for future years and the loss of the current year for set off in the future years to the Commissioner for necessary adjudication and to pass a speaking order on this issue. The assessee was also instructed to provide all relevant details related to the disallowance of losses. It was emphasized that the assessee should be given a proper opportunity to be heard. As a result, ground no. 1 of the appeal was allowed for statistical purposes.

2. The second ground raised by the assessee was of a general nature and did not require specific adjudication. Therefore, the Tribunal did not delve into this ground and mentioned that it was general in nature.

3. In conclusion, the Tribunal allowed the appeal of the assessee for statistical purposes. The decision was made on the 2nd of January, 2023, in Kolkata.

This detailed analysis outlines the issues raised in the appeal, the arguments presented by both parties, and the Tribunal's decision on each ground, providing a comprehensive understanding of the judgment delivered by the Appellate Tribunal ITAT Guwahati.