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TMI Blog2023 (7) TMI 503X X X X Extracts X X X X X X X X Extracts X X X X ..... submission of the assessee, therefore, the same should have been considered as a mistake apparent from the record. We, thus, do not find any merit in the contention raised by the revenue and are of the view that since a mistake was apparent from the record and the AO, who was mandated by the law to consider the response of the assessee, which was submitted within the prescribed time of 30 days but has not considered the same and crystallized the addition, therefore, the mistake is apparent from record and curable within the provisions of Section 154 of the Act. Department s plea that the assessee should have revised the audit report which was carrying the mismatch with figures in ITR, cannot be considered to be a reason for not granting relief to the assessee otherwise the provision of Section 143(1)(a) of the Act and the provisos therein would become redundant. In such circumstances, we are unable to comprehend the contention of the revenue and, therefore, the same cannot be considered concurred with. Since the issue before the ld. CIT(A) wherein the submission of the assessee were taken into consideration but were not carefully read into. - CIT(A) has not gone through t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y in payment of Employee's Contribution to Provident fund in spite of the fact that same has been paid before due date of filing ITR. CIT(A) ignored the submission of the assessee and has confirmed the addition which is bad in law, against law of natural justice and uncalled for; disallowance made and, sustained may kindly be deleted. 4. Ground 3: Disallowance for delay in payment of PF is not a mistake apparent from record, thus addition of same in Rectification order/Intimation u/s 154 r.w.s 143(1) and sustaining the same by CIT(A) is bad in law and may kindly be deleted. 5. Ground 5: The appellant craves leave to add, amend, alter and delete the ground(s) of appeal at the time of hearing the appeal. I. RELIEF SOUGHT That above mentioned disallowance amounting to Rs. 7,78,538/- made by Ld. AO sustained by CIT(A) is uncalled for, against the natural justice may kindly be deleted. 2. Ld. AR, at the outset, did not press the ground No.3. Accordingly, ground No.3 is dismissed as not pressed. Ground No.5 is general in nature. 3. The issue remained before us to be decided with respect of the amount of Rs. 7,66,312/- which were disallowed on account of di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce, the disallowance made by the AO was uncalled for and unjustified. In support of this contention, ld AR submitted the fact that the amount of Rs. 7,66,312/- was paid in time and the same was duly informed to the AO while responding to the communication for proposed adjustments u/s. 143(1)(a) of the Act dated 21.01.2019, however, the response of the assessee was not considered by the AO and the addition proposed was crystalized. It was the submission of the ld. AR that the response of the assessee was well within the time of 30 days as mandatory under the provisions of Section 143(1)(a) of the Act, therefore, the same should have been considered and if the addition was to be made opportunity of being heard or rebuttal should have been provided to the assessee which was not done by the ld. AO. Considering such a conduct of the AO, since the mistake of not considering the assessee s submission towards notice u/s. 143(1)(a) is apparent from records, the assessee opted to file a rectification application u/s. 154 of the Act to have the mistake apparent from records rectified and requisite relief to be granted to the assessee. An order u/s. 154 of the Act dated 28.11.2019 was passed, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the transaction entered in audited report. Based on the data in audited report, and entry made in matching column of ITR, found not verifiable, the CPC rightly disallowed the expenditure claimed by the assessee. 2. The genesis of the grievances of the assessee is not based on some issues required legal interpretation and cannot be said as debatable issues and is out of the scope of section 143(1) of the Act. It is omission and commission on the part of the assessee while uploading his audited report and ITR of transaction value of his business. Section 143(l)(iv) categorically defined any difference in expenditure claimed in ITR mismatched with the audited report is subject to disallowances. It is not restricted to arithmetical error but beyond that also in some of the legal matter. The Mismatch of figures in ITR is subject matter of disallowances and cannot equated with legal interpretation. Hence, disallowances made by CPC is mismatch expenditure is within the scope of section 143(1) of the act. 3. Disallowances of mismatch entry in ITR is provided in section 143(1) of the Act. .Section 143(l)(iv) empowers the AO CPC to process ITR . The processing of ITR is based ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by, or refundable to, the assessee under clause (c), and where no adjustment has been made under clause (a). 4. The CPC have the jurisdiction and power to process under section 143(1) of the Act all the ITR ..... : Vide Notification by CBDT, New Delhi, the 10th June, 2022 (INCOME-TAX) S.O. 2693(E). The AO CPC Authorised undersection 120 of the Act to process the ITR filed under section 139(1) by the assessee for specified class of person and business and area and is reproduces as under:- . . In exercise of the powers conferred by sub-sections (1), (2) and (5) of section 120 of the Income-tax Act, 1961 (43 of 1961) (hereinafter referred to as the said Act) and in supersession of Notification No. 23/2021 bearing S.O. 1435(E) dated the 31st March, 2021 published in the Gazette of India, Extraordinary, Part II, Section 3, sub-section (ii), except as respects things done or omitted to be done before such supersession, the Central Board of Direct Taxes hereby directs that the Income-tax Authorities of Units specified in Column (2) of the Schedule below, having their headquarters at the places mentioned in Column (3) of the said Schedule, shall exercise the powers a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rected by the assessee him self. The simple answer to it, is corrects the entry which has been incorrectly entered due to omission by filing revised audited report or ITR. The assessee without exhausting remady available at his door wrongly stepped to filing application under section 154 of the act. The Act and ITBA has given him sufficient scope for filing a revised audited report to cure wrong entry made by the assessee. The assessee objection in context with quasy judicial functioning of the CPC is base less and is not accepted..'-. D. Redressal of mismatch entry in ITR, disallowed by CPC. The CBDT by its notification dated 01-04-2021, provided services to redress the grievances of the assessee generated from the any omission or commission of the assessee while filing his ITR or in audited report. It reads as under. MINISTRY OF FINANCE (Department of Revenue) (CENTRAL BOARD OF DIRECT TAXES) NOTIFICATION New Delhi, the 1st April, 2021 (INCOME-TAX) G.S.R. 246(E). In exercise of the powers conferred by section 44AB read with section 295 of the Income tax Act (43 of 1961), the Central Board of Direct Taxes, hereby, mokes the following rules further to amend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore, the order passed by the ld. CIT(A) confirming the disallowance is sustainable. This contention of the revenue cannot be acceded to for the reason that any addition made u/s. 143(1) of the Act has to go through the process as prescribed in Section 143(1)(a) of the Act, which is extracted hereinunder for better analysis :- 143. (1) Where a return has been made under section 139, or in response to a notice under sub-section (1) of section 142, such return shall be processed in the following manner, namely: (a) the total income or loss shall be computed after making the following adjustments, namely: (i) any arithmetical error in the return; [***] (ii) an incorrect claim, if such incorrect claim is apparent from any information in the return; [(iii) disallowance of loss claimed, if return of the previous year for which set off of loss is claimed was furnished beyond the due date specified under sub-section (1) of section 139; (iv) disallowance of expenditure indicated in the audit report but not taken into account in computing the total income in the return; (v) disallowance of deduction claimed under sections 10AA, 80-IA, 80-IAB, 80-IB, 80-IC, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the addition, therefore, the mistake is apparent from record and curable within the provisions of Section 154 of the Act. Department s plea that the assessee should have revised the audit report which was carrying the mismatch with figures in ITR, cannot be considered to be a reason for not granting relief to the assessee otherwise the provision of Section 143(1)(a) of the Act and the provisos therein would become redundant. In such circumstances, we are unable to comprehend the contention of the revenue and, therefore, the same cannot be considered concurred with. 13. Admittedly, a notice u/s. 143(1)(a) of the Act, dated 21.01.2019, wherein the assessee was asked to explain about the errors/incorrect claims/inconsistencies pertaining to certain payments disallowable u/s. 43B 36(1)(va) of the Act. In response, the assessee submitted its clarification on the issue immediately on 21.01.2019 itself, but the same was not considered while framing the intimation u/s. 143(1) of the Act. The assessee tried to have this mistake rectified through the course of provisions of Section 154 of the Act, but failed to succeed. Therefore, the issue was raised before the ld. CIT(A). Going thr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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