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2024 (1) TMI 207 - AT - Income TaxRectification u/s 154 - period of limitation - Deduction available u/s 10(10AA) - HELD THAT - The fact that the assessee did not make any claim in his return of income is undisputed. It is true that after the judgment of the Tribunal in the case of Ram Kanwar Rana 2016 (6) TMI 687 - ITAT DELHI the assessee became aware of the eligibility of the deduction available u/s 10(10AA) of the Act but that was on 16.06.2016 and the rectification application has been moved on 28.07.2020. Considering from all possible angles the application of the assessee is barred by limitation u/s 154 of the Act. Most importantly on the date of the processing of the return, there was no mistake apparent from record which could be rectified u/s 154 of the Act. The decisions relied upon by the Counsel are on a different set of facts mostly on the eligibility of the claim of deduction u/s 10(10AA) but the case of the assessee is the claim u/s 154 of the Act which according to our considered opinion is barred by limitation. We decline to interfere with the finding of the CIT(A). Appeal of the assessee is dismissed.
Issues involved:
The issues involved in this case are the validity of the order passed under section 154 of the Act, rejection of application for claim of gratuity amount exempt under section 10(10)(i) of the Act, and whether the rectification application was filed within the prescribed period. Validity of Order under Section 154: The Assessee filed an appeal against the order dated 12.01.2023 by NFAC, Delhi, pertaining to A.Y. 2010-11, challenging the validity of the order passed under section 154 of the Act. The Assessee contended that the order was without jurisdiction. The AO rejected the application for claim of gratuity amount exempt under section 10(10)(i) of the Act, stating that a fresh claim should be made through a revised return of income. The Assessee argued that the rectification application was moved beyond the period of limitation as provided in section 154 of the Act. Despite the Assessee's claim of eligibility for deduction under section 10(10AA) of the Act, the CIT(A) upheld the AO's decision, emphasizing that the claim should have been made through a revised return of income. The Tribunal, after considering all aspects, concluded that the rectification application was indeed barred by limitation under section 154 of the Act. The appeal of the Assessee was dismissed based on these findings. Rejection of Application for Gratuity Amount Exemption: The Assessee, in this case, filed an application under section 154 of the Act claiming exemption under section 10(10AA) of the Act for gratuity amounting to Rs. 6,50,000. However, the AO rejected this application, stating that a fresh claim should be made through a revised return of income. The Assessee argued that based on a Tribunal decision, they became aware of the eligibility for the exemption and hence moved a rectification application. The CIT(A) also upheld the rejection, emphasizing the requirement for a revised return of income for such claims. The Tribunal concurred with the lower authorities, stating that the rectification application was time-barred and that no mistake was apparent from the record at the time of processing the return. The Tribunal dismissed the appeal, affirming the rejection of the application for gratuity amount exemption under section 10(10AA) of the Act. Rectification Application Barred by Limitation: The Assessee's rectification application under section 154 of the Act was challenged on the grounds of being time-barred. The Assessee claimed eligibility for deduction under section 10(10AA) of the Act after becoming aware of it post a Tribunal decision. However, the application was moved beyond the period of limitation as per section 154 of the Act. The Tribunal, after careful consideration, found that the application was indeed barred by limitation and that no mistake was apparent from the record at the time of processing the return. Despite the Assessee's arguments and reliance on judicial decisions, the Tribunal upheld the decision that the rectification application was not maintainable due to being time-barred. The appeal was consequently dismissed by the Tribunal.
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