S. 264 : Commissioner-Revision of other orders-Income wrongly offered to tax and paid taxes-Assessment completed under section 143(1)-Time for filing revised return under section 139(5) has expired-Double addition- Order of Commissioner dismissing the revision application is set aside-Commissioner is directed to allow the claim of the assessee by passing an appropriate order. [S. 43B, 139(5), 143(1), Art. 226 , 265]
Petitioner was making a provision for bonus, ex-gratia and incentives payable to employees, at the time of preparation of the financial statements. In the computation only the actual payment was claimed and excess provision was disallowed under section 43B of the Act. However in the next year the assesseee has offered entire provision to tax. The petitioner has realised the mistake while finalising the accounts of latter years. The petitioner moved an application under section 264 of the Act and prayed for refund of excess amount offered for taxation. The Commissioner rejected the application on the ground that the assessee should have filed revised return under section 139(5) of the Act and also in view of judgement of Apex court in Goetze (India) Ltd. v. CIT (2006) 284 ITR 323 (SC) the revision application is not maintainable. On Writ allowing the petition the Court held that Commissioner was not correct in rejecting the revision application filed by the petitioner on the ground that the petitioner had not filed a revised return within the prescribed limitation. Court also held that Section 264 is a salutary provision which also bridges the gap and / or removes vacuum to remedy a bona fide mistake and / or for correction of an inadvertent situation, which may take place in the assessment proceedings. By remedying such mistake by orders being passed under Section 264 of the Act, any illegality or injustice which would otherwise be caused to the assessee can be corrected so as to maintain a lawful course of action being followed in the course of assessment. The object of such provision also appears to be that the law would not be oblivious to any bona fide human mistake which may occur at the end of the assessee and which if otherwise permitted to remain, may lead to injustice or the provisions of law being breached. As regards the decision in Goetze (India) Ltd. v. CIT (2006) 284 ITR 323 (SC) is not in the context of the revisionary powers as conferred under the provisions of section 264 of the Income -Tax Act, but in the context of deduction claimed by the assessee by a letter, after the return was filed, without filing of a revised return . Accordingly the Revision petition is allowed and the Commissioner is directed to pass the order accordingly. (WP Nos. 2658 of 2024/2664 of 2024 / 3444 of 2024 dt. 23-9-2024) (AY. 2019 -20, 2020-21, 2021-22)
Bahar Infocons Pvt. Ltd. v. PCIT (Bom.)(HC) (UR)
[Coram : Hon’ble Shri Justice G. S. Kulkarni & Hon’ble Shri Justice Somasekhar Sundaresan]