Search Results For: 154


QUERY: The assessee filed his return of income for A.Y. 2008-09 returning profit on sale of shares/units of mutual funds under the head ‘Income from Business’. The Assessing Officer completed the assessment u/s. 143(3) by reclassifying transactions of purchase and sale during the same day as Speculative Transactions. He did not allow interest claimed which was debited to P & L Account. Subsequently, he issued a notice u/s. 154 of the Act proposing to disallow interest claimed u/s. 14A on the ground that assessee has also earned dividend income. The assessee responded to the show cause by stating that this is not mistake apparent on the record but without prejudice also enclosed with the letter a working amount disallowable under Rule 8D. Subsequently, on the oral request of the AO, a further letter was filed giving consent to the AO to pass an order u/s. 154 and disallow amount u/s. 14A. The AO instead of disallowing the amount as per working filed, disallowed the entire amount debited to P & L Account. Can the assessee now file an appeal on the ground that the consent cannot confer jurisdiction on the AO when there is none under the statute? Kindly explain the principle that there is no estoppels against law.
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Yes, the right of appeal has been specially conferred on the assessee by the statute and it is unfettered right which cannot be taken away by any understanding.

QUERY: An Assessee, inadvertently due to mistake of Law, made a wrong Choice of option in computing the Long Term Capital Gains on Sale of Ancestorial House Property by deducting from the Sale Price, the value of the House Property as on 1-4-1981 as per the Valuation Report and paid Tax @10%.

The Learned Assessing Officer completed the Assessment under Section 143(1) of the Income-tax Act, 1961, and made demand for interest under Section 234B and Section 234C of the Income-tax Act, 1961.

Then, it was discovered that, had the Assessee deducted the indexed value of the House Property from the Sale Proceeds and paid Tax @ 20%. There would have been substantial Refunds.

The Assessee made an Application under Section 154 of the Income-tax Act, 1961, for rectification of the mistake of law committed by the Assessee in making wrong choice because of ignorance, which was rejected by the Learned Assessing Officer.

The Learned Commissioner of Income Tax (Appeals) also rejected the Assessee’s Appeal on the grounds that, that mistake would have been rectified by submitting a Revised Return. Since the time for filing of Revised Return of Income has expired, the Assessee has no remedy.

May we request you to suggest the Remedy in this particular situation, as per the Spirits and Legislations and Departmental Circular No. 14(XL 35) of 1955 dated 1-4-1955, which both the Assessing Officer as well as the Learned Commissioner of Income Tax (Appeals) rejected on the grounds that, the Circular being issued prior to 1961, is obsolete under what provisions of law CBDT may be approached for granting the relief.

I shall appreciate your considered response, at an early date.
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From the facts it is not clear for which assessment year the intimation was issued under section 143(1) of the Act and whether assessment under section 143(3) is pending or not? Further date of intimation is also not mentioned.

QUERY: Can an assessment be made subject to receipt of the report of the DVO? If Yes, whether recourse has to be taken of section 154 or 148 or section 263?
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The Calcutta High Court in Saharanpur Light Railway Co. Ltd. vs. CIT [208 ITR 882] has observed that the Assessing Officer loses his power in the matter of valuation only when the Valuation Officer makes a report, the power of valuation has to revert to the Assessing Officer, unless the Valuation Officer sends his report, there is no bar on the Assessing Officer’s