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2023 (12) TMI 699 - AT - Income TaxRectification of mistake u/s 154 - claim of exemption u/s 54F - Power to review own order - HELD THAT - The claim is duly reflected in the return of income filed by the assessee. In the original assessment proceedings, the issue related to the claim made u/s 54F was raised vide order sheet entry dated 16.11.2015 a reply to this order sheet entry filed on 24.11.2015. Considering all these evidences placed on record, we are of the view that the claim of the assessee was very well considered in the proceedings u/s 143(3) completed on 15.01.2016. Thereafter invoking the provisions of section 154 of the Act to reconsider the claim of section 54F of the Act vide order passed u/s 154 of the Act dated 13.06.2018 is bad in law Thus, based on these conspectus of the case we are of the considered view that the action of the Assessing Officer passing an order u/s 154 of the Act is incorrect and bad in law. Thus we are of the view that under the law no one is permitted to review own order, the provision of section 154 of the Act does not permit to revisit the claim that has already been allowed. The Bench also noted that in this case the assessee was already confronted on the claim u/s 54F of the act and the same has been examined on its merit under the guise of section 154 of the Act the claim which has already been considered at length cannot be revised u/s 154 of the Act considering the arguments recorded hereinabove and discussion considering the various decision cited we quash the order passed u/s. 154 of the Act. Based on these observation ground No. 1 raised by the assessee is allowed.
Issues Involved:
1. Invocation of Section 154 of the Income Tax Act. 2. Addition under the head Long Term Capital Gains (LTCG) and disallowance of exemption under Section 54F. 3. Charging of interest under Section 234 of the Income Tax Act. 4. Procedural aspects and rights reserved by the appellant. Summary of Judgment: Issue 1: Invocation of Section 154 of the Income Tax Act The assessee contended that the Assessing Officer (AO) erred in invoking Section 154, which is meant for rectifying mistakes apparent from the record. The AO issued a notice under Section 154 proposing rectification concerning the allowability of exemption under Section 54F, restricting it to Rs. 44,51,997/- from Rs. 65,06,891/-. The Tribunal held that the AO's action of invoking Section 154 was incorrect and bad in law because the issue had already been considered and decided during the original assessment under Section 143(3). The Tribunal emphasized that Section 154 does not permit revisiting claims already allowed and quashed the order passed under Section 154. Issue 2: Addition under LTCG and Disallowance of Exemption under Section 54F The assessee claimed exemption under Section 54F for investment in two residential houses. The AO disallowed the exemption to the extent of Rs. 20,54,894/-, which was upheld by the CIT(A). The Tribunal noted that the assessee's claim was considered during the original assessment, and the law in force up to AY 2014-15 allowed exemption for investment in more than one residential house. The Tribunal also referred to various case laws, including CIT v/s Geeta Duggal and CIT v/s D Ananda Basappa, which supported the assessee's claim. Consequently, the Tribunal allowed the assessee's claim for exemption under Section 54F. Issue 3: Charging of Interest under Section 234 The Tribunal noted that the ground concerning the charging of interest under Section 234 was consequential in nature. Since the primary issues were resolved in favor of the assessee, this ground became infructuous. Issue 4: Procedural Aspects and Rights Reserved by the Appellant The appellant reserved the right to add, alter, amend, or withdraw any grounds of appeal. The Tribunal acknowledged the procedural aspects but primarily focused on the substantive issues. Conclusion: The Tribunal allowed the appeal of the assessee, quashing the order passed under Section 154 and allowing the exemption under Section 54F for investment in two residential houses. The grounds concerning the charging of interest and procedural rights were deemed consequential or general in nature.
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