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TMI Blog2023 (7) TMI 1090X X X X Extracts X X X X X X X X Extracts X X X X ..... permitted u/s 74A and that section permits carry-forward of a particular type of loss i.e. loss from owning and maintaining race horses. Since the assessee s loss had not arisen from such a source, there was no enabling provision to allow carry forward benefit. Therefore, the software utility itself did not allow set off in current year or even carry forward. Be that as it may, irrespective of whether it was the assessee who voluntarily did not claim any set off or carry forward of loss of Income from Other Sources or it was automatic in the situation by virtue of law, the fact remains that the Total Income as per return was Rs. Nil and the AO has also assessed Total Income at Rs. Nil. Coupled with this, it is also a fact that the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs. Nil. The case was subjected to scrutiny through notices u/s 143(2)/142(1). While framing assessment vide order dated 18.05.2021 u/s 143(3), the AO disallowed depreciation of Rs. 4,93,672/- one Building at Tal on the footing that the said building was not put to use during the year. Accordingly, the AO determined total income at Rs. Nil as under: Income (loss) claimed in ITR - (Rs. 6,28,061) Add: Depreciation on Building - Rs. 4,93,672/- Assessed Income - Rs. Nil 4. Simultaneously, the AO initiated penalty-proceeding u/s 270A and issue show-cause notice dated 18.05 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... placed in ITR: (a) At Page No. 19 and 20 of ITR, the assessee furnished 4. Income from other sources 0 , 6. Loss of current year to be set off against 5 0 . Loss of current year to be carried forward 0 . (b) At Page No. 41 and 42, in the Schedule relating to Set-off of Current Year Losses, the assessee has furnished i. Loss to be set off Rs. 6,28,061/- and xiv. Loss remaining after set off Rs. 6,28,061/- . This clearly indicates that the assessee has not claimed any set off in current year. (c) At Page No. 43 and 44, in the Schedule of Losses to be Carried Forward to future years , the assessee has not claimed any kind of carry forward of loss. (d) The acknowledgement of ITR shows 3a. Current Year loss, if any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 270A(2) and in the present case, there is no such situation. He submitted that the clause (g) of section 270A(2) is also not applicable because in the present case for the reason that the total income was reported by assessee at Rs. Nil which remained Rs. Nil at the time of assessment, it is not a case where the assessment has the effect of reducing the loss or converting loss into income. Ld. AR submitted that the penalty imposed by AO is, therefore, not correct in present case; the same must be deleted. 9. Ld. DR for the Revenue relied upon the orders of lower-authorities and prayed to uphold the penalty. 10. We have considered rival submissions of both sides and perused the documents to which our attention is drawn. On cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om other sources head to next year is permitted u/s 74A and that section permits carry-forward of a particular type of loss i.e. loss from owning and maintaining race horses. Since the assessee s loss had not arisen from such a source, there was no enabling provision to allow carry forward benefit. Therefore, the software utility itself did not allow set off in current year or even carry forward. 11. Be that as it may, irrespective of whether it was the assessee who voluntarily did not claim any set off or carry forward of loss of Income from Other Sources or it was automatic in the situation by virtue of law, the fact remains that the Total Income as per return was Rs. Nil and the AO has also assessed Total Income at Rs. Nil. Coupled ..... X X X X Extracts X X X X X X X X Extracts X X X X
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