Introduction
Navigating the intricate web of income tax disputes, the Income Tax Appellate Tribunal (ITAT) in Delhi, comprising Shri Shamim Yahya, Accountant Member, and Ms. Astha Chandra, Judicial Member, recently deliberated on an appeal (ITA No.2299/Del./2018) for the assessment year 2011-12. The appellant, Navneet Dutta, challenged the order of the ld. CIT (Appeals)-21, New Delhi, dated 31.01.2018.
Background
The crux of the matter revolved around the disallowance of the claim of Loss from House Property under section 24 of the Income Tax Act, 1961, amounting to Rs.6,44,732/-. The assessing officer, Circle 67(1), had restricted the claim to Rs.1,50,000/, considering the property as self-occupied. The appellant contended that this limitation was erroneous, emphasizing a clerical error in the initial return filing.
Grounds of Appeal
The appellant presented the following grounds of appeal:
- Erroneous disallowance and restriction of Loss from House Property.
- Failure to acknowledge the correct claim of Loss from House Property and refusal of rectification under section 154.
- Inadequate assessment of Income from House Property, resulting in an incorrect restriction of loss.
- Overlooking a typographical error in the claim of Loss from House Property.
- Assertion that both the CIT (A) and AO failed to grasp the typographical error’s impact on the Tax Computation.
- Allegation that the orders of CIT (A) and AO are legally unsound and contrary to the case facts.
Proceedings
The appellant filed a rectification application under section 154, citing a clerical error in the original return. The AO, in response, rejected the application, citing the filing after the due date as a procedural impediment. The CIT (A) concurred with this view, emphasizing the need for a proper return for revised claims.
ITAT’s Verdict
The ITAT, in a nuanced analysis, noted that the crux of the issue lay in the inadvertent claim of lesser interest on the house property loan. Citing the precedent set by the Hon’ble Supreme Court in Goetze (India) Ltd. vs. CIT, the ITAT allowed the claim for the sake of substantial justice. The matter was remitted to the AO for a fresh consideration based on the revised return.
Conclusion
This ITAT judgment underscores the significance of fair consideration for rectification claims and the overarching pursuit of substantial justice in income tax matters. As the legal saga unfolds, it offers insights into the intricacies of tax litigation and the role of appellate tribunals in adjudicating complex disputes.
