assessement u/s 143(3)

[CA kishore Maniyar]

while passing the Order, for a business income , does AO is supposed to calculate the Complete Income , showing Income from P& L A/c? can he just start with as per income computed as per Computation of Income and adding certain additions ..is there any citation , where he's suppose to calculate a complete income , even if assesses has not claimed benefit available under IT   

[Sunil Maloo]

Assessing Officer cannot assess an income which is not taxable as per law though shown in return of income:- 15 taxmann.com 52 (Kolkata Tribunal)

The Department should not take advantage of the ignorance of the assessee :- CBDT Circular No. 14 (XL-35) of 1955, dt. 11th April, 1955.

[pawansingla]

There are many other jdugements which says revised computation can be filed at any stage.If , your cliam is prima facie correct , you may file 154 or file an appeal to CIT(A) if AO is not willing to consider your claim.

[ashutosh majumdar]

Well the best judgement on the point is Balmukund Acharya vs. DCIT (Bombay High Court)
http://itatonline.org/archives/index.php/balmukund-acharya-vs-dcit-bombay-high-court/

The AO should not take advantage of the assessee's ignorance of the law.



Where the assessee erroneously offered capital gains to tax and the same was accepted by the AO vide Intimation u/s 143 (1)(a) and the assessee thereafter filed an appeal against such assessment of capital gains and the same was held not maintainable by the Tribunal, HELD, reversing the order of the Tribunal that:



(1) In view of the Explanation to s. 143 (prior to its deletion w.e.f. 1.6.1999) an Intimation is deemed to be an appealable order and appeal is maintainable;



(2) The authorities under the Act are under an obligation to act in accordance with law. Tax can be collected only as provided under the Act. If any assessee, under a mistake, misconceptions or on not being properly instructed is over assessed, the authorities under the Act are required to assist him and ensure that only legitimate taxes due are collected. If particular levy is not permitted under the Act, tax cannot be levied applying the doctrine of estoppel.

[pawansingla]

the Hon'ble Delhi High Court in the case of CIT v. Jai Parabolic Springs Ltd. [2008] 306 ITR 42/172 Taxman 258 after examining the judgment of Hon'ble Apex court in the case of Goetze (India) Ltd. (supra) has held that there is no prohibition on the powers of the Tribunal to entertain additional ground which according to the Tribunal arose in the matter for the just decision of the case. While dealing with the issue, their Lordships have also examined the judgments of the Hon'ble Apex Court in the cases of Jute Corpn. India Ltd. (supra) and National Thermal Power Corporation Co. (supra).
In the case of CIT v. Mahalaxmi Sugar Mills Co. Ltd. [1986] 160 ITR 920/27 Taxman 267 (SC) their Lordships of the Hon'ble Apex Court have held that there is a duty cast on the Income Tax Officer to apply the relevant provisions of the Indian Income Tax Act for the purpose of determining the true figure of the assessee's taxable income and the consequential tax liability. If the assessee fails to claim benefit of set-off cannot relieve the Income Tax Officer of his duty to apply section 24 in an appropriate case. We have also carefully gone through the judgments of the Hon'ble Apex court in the cases of Jute Corpn. India Ltd. (supra) and National Thermal Power Corpn. Ltd. (supra) in which it is categorically held that an Appellate Authority have all the powers which the original authority may have in deciding the question subject to certain restrictions or limitations. The Appellate Authority can also admit new grounds having satisfied that for the bona fide reasons it could not have been agitated before the lower authorities

[vsaiyar]

iN VIEW OF THE GUDGEMENT IN THE CASE OF GOETZ the AO has no power to assess the income at a figure less than the returned income though the assessee might have failed to claim certain exemptions etc.  The assessee has to file a revised return.  However this bar is not applicable to the CIT(A) and other appellate authorities.  In the appeal proceedings one may claim the exemption.  The issue cannot be remedied by an application for rectification.