The Tax Publishers2020 TaxPub(DT) 1610 (Mad-HC) : (2020) 274 TAXMAN 0038

INCOME TAX ACT, 1961

Section 154

Claim for interest deductions under section 43B which was omitted by assessee company while filing original return could be adjudicated by AO only through a process of investigation. Even in the computation of income filed along with rectification applications filed under section 154. Assessee had produced a self serving statement of account disclosing interest payments which did not exactly tally witt computation of income filed along with section 154 applications. Therefore, unless and until a complete investigation was done by AO, quantum of deduction for interest payments could not be ascertained. Hence, omission claimed by assessee did not fall under the caregory of a 'mistake apparent from the record and was not a rectifiable issue within the purview of section 154.

Rectification - Mistake apparent - Claim for interest deductions under section 43B which was omitted by assessee-company while filing original -

Assessee omitted to claim deduction for interest amounts paid by it to IDBI under section 43B. After noticing mistake of omitting to claim deduction for interest payments, filed separate petitions under section 154 seeking rectification of the mistake on account of said omission. The AO rejected the rectification petitions by separate orders on the ground that mistake was not apparent from record as it involved debatable point of law. Tribunal upheld this. Assessee approached High Court.Held: Claim for interest deductions under section 43B which was omitted by assessee company while filing original return could be adjudicated by AO only through a process of investigation. Even as seen from computation of income filed along with rectification applications filed under section 154. Assessee had produced a self serving statement of account disclosing interest payments which did not exactly tally with computation of income filed along withs ection 154 applications. Therefore, unless and until a complete investigation was done by AO quantum of deduction for interest payments could not be ascertained. Hence, omission claimed by assessee did not fall under the caregory of a 'mistake apparent from the record and was not a rectifiable issue within the purview of section 154.

Supported by:Anchor Pressings (P) Ltd. v. CIT & Anr. 1986 3 SCC 439 : (1986) 161 ITER 159 (SC) : 1986 TaxPub(DT) 1667 (SC). Distinguished:CIT v. Pruthvi Brokers & Shareholdrs (P) Ltd. (2012) 252 CTR (bom) 151 : 2012 TaxPub(DT) 2671 (Bom-HC).

REFERRED :

FAVOUR : Against the assessee.

A.Y. : 2003-04 & 2004-05

IN THE MADRAS HIGH COURT

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