2023 (12) TMI 1089 - AT - Income Tax

Rectification of mistake - Benefit of brought forward loss - CIT(A) directed the AO to recompute the income of appellant for A.Y. 2009-10 after taking into consideration the brought forward loss for A.Y. 2008-09 as determined by AO by replacing the disallowance of loss - HELD THAT - It can be appreciated that consequent to the order of the Tribunal however, for A.Y. 2008-09 the effect giving order was passed by Ld. AO on 12.12.2018 by which the total loss for A.Y. 2008-09 was recomputed at Rs. 4,92,05,810/- . That thus made available loss for set off or carry forward in the subsequent years. Same has been taken into consideration by Ld. CIT(A) while passing the direction in the impugned order. The appeal has no merit. Same is dismissed.

Summary

Issues:
The appeal by Revenue against the order for assessment year 2009-10 passed by Commissioner of Income Tax (Appeals)-28, New Delhi, regarding the rectification order issued u/s 154/143(3) of the Income Tax Act, 1961 by the Assessing Officer.

Rectification Order Issue:
The Assessing Officer (AO) rectified the assessment order for A.Y. 2009-10 by disallowing the brought forward loss of Rs. 5,04,64,408/- after finding an error in the assessment order of A.Y. 2008-09. The AO issued a notice u/s 154 of the Act but proceeded with the rectification in absence of any reply from the assessee. The total income was reassessed at Rs. 12,46,98,440/- against the earlier computed income of Rs. 7,42,36,031/- u/s 143(3) of the IT Act.

Appellate Tribunal Decision:
The appellant contended before the Ld. CIT(A) that the loss of A.Y. 2008-09 had been reinstated to the extent of INR 4,92,05,810/- by the order of the ITAT and subsequent appeal effect order by the AO. Ld. CIT(A) considered the AO's order giving effect to the ITAT's decision and concluded that the disallowance of loss made by the AO did not stand. Consequently, Ld. CIT(A) directed the AO to recompute the income for A.Y. 2009-10 by considering the brought forward loss of Rs. 4,92,05,810/- for A.Y. 2008-09 as determined by the AO.

Revenue's Appeal:
The Revenue appealed against the CIT(A)'s order, contending that the benefit of the brought forward loss of Rs. 4,92,05,810/- for A.Y. 2008-09 should not have been allowed to the assessee. However, the Tribunal upheld the CIT(A)'s decision, emphasizing that the AO had correctly given effect to the ITAT's order, thereby reinstating the loss for set off or carry forward. The Tribunal found no merit in the Revenue's appeal and dismissed the same.

Conclusion:
The Tribunal dismissed the Revenue's appeal, upholding the CIT(A)'s decision to allow the benefit of the brought forward loss for A.Y. 2008-09 to the assessee, as reinstated by the AO in compliance with the ITAT's order.