Jouhar Ali
(Article)
(126 Points)
Replied 13 December 2016
Sanjay S
(Chartered Accountant)
(1375 Points)
Replied 13 December 2016
Eventhough the Power to review has not been expressly provided anywhere in the Act. The Governing sections of the Income Tax Act, 1961 would be section 260A.
This issue has been put to rest by the recent Supreme Court decision in CIT vs. Meghalaya Steels Ltd. (2015) 377 ITR 112. The SC had held that the High Courts being courts of record under Article 215 of the Constitution of India, the power to review would inhere in them. There is nothing in the Act to prevent a High Court from exercising the power of review, to prevent miscarriage of justice or to correct Grave and Palpable errors committed by it while delivering its judgements.
Hence it is right in saying that High Courts do have the power to review its own judgment (mainly to correct grave errors or to prevent miscarriage of justice)
Hope this helps.
Sanjay S
(Chartered Accountant)
(1375 Points)
Replied 13 December 2016
For your first question regarding Revised loss returns being filed for first time, my view would be as follows:-
Your query touches upon two aspects of income tax Act?
1.Validity of Filing a Revised Loss Return where Original Return was filed on or before Due date u/s 139(1)
For deciding this we go straight to the Madras HC decision in CIT. v. Periyar District Co-Operative Milk Producers Union Ltd. (2004), where it was held that "There is no bar in filing Revised Return u/s 139(5) showing a loss for First time". This means, eventhough your original return was an income return, you may subsequently file a revised return u/s 139(3) showing a loss.
2. Whether the term "DEDUCTION" you have used implies Deductions under Chapter VIA?
If its a Chapter VIA deduction, then the deduction (Rs. 2.1 Lakhs in your case) shall have to restricted to the amount of Gross Total Income (Rs.1.2 Lakhs in your case). The excess of deduction available (Chapter VIA) over income cannot be carried over as a Loss and shall lapse instead.
However, if the term deduction is not a Chapter VIA deduction, then you may claim the loss by filing a revised loss return.
Hope this helps.
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