This article provides a comprehensive analysis of the proceedings and final judgment in ITA No. 1870/DEL/2020, involving Sudipta Basu and the Income Tax Officer (ITO) Ward-52(4), New Delhi. The case was filed on November 18, 2020, and the final order was pronounced on December 23, 2021.
Sudipta Basu, an individual, filed his return of income on August 29, 2018, declaring taxable income of Rs. 11,67,960 after claiming a carried forward loss of Rs. 8,67,803 pertaining to the Assessment Year (AY) 2017-18. The Centralized Processing Center (CPC), Bangalore, disallowed the setting off of the carried forward loss in the intimation issued on May 20, 2019, under Section 143(1) of the Income Tax Act, 1961. The reason for disallowance was that the return for AY 2017-18 was filed on January 22, 2018, beyond the due date specified under Section 139(1) of the Act.
Before the Commissioner of Income Tax (Appeals) [CIT(A)], the assessee argued that the delay in filing the return for AY 2017-18 was due to severe matrimonial disputes and a restraint order dated November 9, 2015, by the Metropolitan Magistrate, Patiala House Courts, New Delhi, which barred him from accessing the terrace portion of his flat where his business and financial documents were kept. Despite these arguments, the CIT(A) upheld the CPC’s decision, disallowing the carried forward loss.
The assessee, represented by Shri Rohit Tiwari, Advocate, contended that the delay in filing the return was due to circumstances beyond his control, specifically the matrimonial dispute and the court’s restraint order. He argued that this was the first time in 25 years such a delay had occurred and requested the tribunal to allow the set off of the carried forward loss.
The respondent, represented by Ms. Sangeeta Yadav, Senior Departmental Representative (DR), argued that the statute clearly specifies that for claiming the benefit of setting off carried forward loss, the return for the year in which the loss was incurred must be filed within the due date specified under Section 139(1) of the Act. Since the assessee failed to do so, the disallowance was justified.
The Income Tax Appellate Tribunal (ITAT), presided over by Shri R.K. Panda, Accountant Member, examined the facts of the case and the arguments presented. The tribunal noted that the assessee had indeed filed his return for AY 2017-18 after the due date, and as per the statutory provisions, the benefit of setting off carried forward loss could not be allowed.
The tribunal held that the reason provided by the assessee for the delay, i.e., the matrimonial dispute and the court’s restraint order, could not be accepted as a valid ground for allowing the set off of carried forward loss since the return was not filed within the due date specified under Section 139(1). The tribunal emphasized that the statute is very clear on this issue and does not provide any exceptions based on personal circumstances. Therefore, the ITAT upheld the order of the CIT(A) and dismissed the appeal filed by the assessee.
The final order, pronounced on December 23, 2021, reads:
In the result, the appeal filed by the assessee is dismissed.
Signed by:
Shri R.K. Panda, Accountant Member
This judgment underscores the importance of adhering to statutory deadlines for filing returns to avail benefits such as setting off carried forward losses, regardless of personal circumstances.
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