High Court directed CPC Bangalore to accept the physical revised return from assessee.

High Court directs CPC Bangalore to accept physical revised return as time limit for relevant year had expired.

In a recent judgment, High Court of Meghalaya directed CPC Bangalore to accept the physical revised return as time limit for filing the revised returns for the relevant accounting year had expired.

ABCAUS Case Law Citation:
4652 (2025) (07) abcaus.in HC

The appellant was a company incorporated under the Companies Act 1956. The appellant was engaged in production of ferrous items.

The appellant filed its Income Tax Return for the relevant Assessment Year. During the relevant Financial Year, the appellant company had earned a profits from the sale of its investments, which the appellant company had duly disclosed in the Income Tax Return.

The appellant duly reported the said Profit on Sale of investment being assessable to tax under the head of income ‘Capital Gains’. The appellant company however in the return of income, by mistake omitted to exclude/reduce the said Profit on Sale of Investment by way of deduction and Sl. No. 3(b)- ‘Income/Receipts credited to profit and loss account considered under other heads of income chargeable u/s 115BBF/chargeable u/s 115BBG’ of Schedule BP in the ITR. 

As a result, there was doubling of income in the ITR once in Schedule BP under the head “income from business and profession” and secondly in the schedule Cpaital Gain under the head “capital gains”.

On the mistake being discovered by the appellant company filed an application under Section 154 of the Income Tax Act, 1961 before the Assistant Commissioner for rectification of the said mistake.

However, the AO did not pass any order on the said rectification application and the appellant preferred an appeal under Section 246A of the Act, whereby the Commissioner (Appeals) dismissed the appeal by holding that a mistake has to be corrected by filing revised return or under Section 264 of the Income Tax Act, as it was not an error apparent on record to be rectified under Section 154, or to be considered in appeal.

On further appeal, the Income Tax Appellate Tribunal, Guwahati partly allowed the appeal on other payments, however upheld the observation of the Commissioner (Appeals) with regard to the mistake having to be corrected by filing of a revised return or under Section 264. It was further directed that the CPC AO/CIT(A), consider the revised returns if filed. 

However, as the time limit for filing the revised returns for the relevant accounting year had since expired way back, the appellant was unable to do so, inasmuch as, the same had to be done digitally.

Challenging the order of the Tribunal, the appellant before the Hon’ble High Court submitted that it be allowed to file physical revised return, which was resisted by the Income Tax authorities, who submitted that the filing of physical returns is not permissible, as the same cannot be reconciled with the Centralised Processing Centre.

The Hon’ble High Court directed the counsel for the ITD to obtain specific instructions, as to whether this situation had occurred before, inasmuch as, the opportunity granted by the Commissioner (Appeals) and the Income Tax Appellate Tribunal to the appellant would be rendered useless if physical filing was not permitted.

The appellant placed a decision of the Delhi High Court where in similar circumstances the petitioner therein was allowed to file the returns manually.  The Department also submitted that the appellant will be permitted to file its physical returns for consideration before the Central Processing Centre.

Accordingly, the Hon’ble High Court disposed off the appeal by directing the CPC AO to accept the revised returns filed by the appellant manually/physically, for due consideration in accordance with law.  

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