Re: Rectification u/s. 154/155

One of the client has filed an appeal before the CIT for A Y 2009-2010. The hearing is still pending as the case was remanded back to the AO.
Through oversight application u/s. 154/155 was not made within the prescribed limit of 4 years.
LTCG and BP Income are taxed at the same rate by the AO. The said point alongwith others is taken in appeal.
Rectification is made in November, 2020, though it was time barred.
Q1 : Whether any alternative is available to the client as they want to go for VSVS as the difference between BP Tax and LTCG Tax is much higher.

If the issue is taken in appeal the CIT (A) has  to grant the relief .  If the said ground is not taken in appeal , you may raise the additional ground before the CIT( A), which is bound to consider . As per   Article. 265 of the Constitution of India  which provides that “No tax shall be levied or collected except by authority of law“. The collection of tax has to be also within the frame work of law. The Circular No. 14 (XL-35), dt. 11/04/1955, also states that a duty is cast upon the Assessing Officer  to assist and aid the assessee in the matter of taxation. Assessing Officers  are supposed to advise the assessee and guide them and not  take advantage of any error or mistake committed by the assessee or of their ignorance. The function of the Assessing officer  is to administer the statute with solicitude for public exchequer with an inbuilt idea of fairness to taxpayers. The scope of the above circular is explained in CIT v. Ahmedabad  Keiser-E. Hind Mills Co. Ltd  (1981)  128 ITR 486 (Guj.) (HC) (492), Parekh Bros v. CIT (1984) 150 ITR 105 (Ker) (HC) (118 ),  Dattatraya Gopal Sathe v. CIT (1984) 150 ITR 460 (Bom.)(HC) (463-464)

In Raghavan Nair  v. ACIT (2018) 402 ITR 400(Ker.)(HC),Capital gains wrongly shown in the return as taxable. Duty of Assessing Officer to refrain from assessing such income. No tax shall be levied or collected except by authority of law.

The assessee can request the AO to pass the rectification order which he  may pass in favour of assessee.

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