INCOME TAX ACT, 1961

Section 154

Rectification under section 154 - Maintainability of application - Denial of deduction under section 80P due to late filing of return - Rectification application dismissed on incorrect assumption that merits of deduction was contended by assessee

Assessee claimed deduction under section 80P, which stood disallowed by AO on allegation that return was not filed in time. Assessee contended that return was actually filed in time and in order to correct mistake apparent from record, rectification application under section 154 was filed. AO alleged that permissibility of deduction under section 80P on merits could not be decided in rectification application. Held: AO failed to consider actual issue that was raised in rectification application, and proceeded on assumption that what was agitated in rectification application was merits of disallowance of deduction under section 80P. The issue urged in rectification application was propriety of observation in assessment order that return was filed beyond time, whereas it was specific contention of assessee that return was filed within time. Thus, AO was directed to consider rectification application under section 154 afresh, after hearing assessee.

REFERRED :

FAVOUR : In assessee's favour

A.Y. :

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