Demand raised by Dept. for error on part of assesse.

This query is : Resolved

Kumar (Querist)
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30 November 2010 Sir,

One of my client filled electronic return for the AY 2009-2010.

In the said return he committed the following errors:

1. Took Basic exemption limit as160,000/- instead of150,000/-
2. Claimed Deduction of House Building Loan Interest U/s. 80C and not U/s 24(b).
3. Did not claimed Deduction of Principal amount of House Building Loan repaid under any section.
4. Did not claimed Interest on NSC and on PPF under any section.
5. (Deduction Under Point No. 4 and 5 are available U/s. 80C.)
6. Claimed deduction U/s. 80C for School fees paid on children education for24,000/- instead of24,000/- shown in Balance Sheet.
(Had the client claimed all these deduction under correct provision of the act, then the net income of the client would have become non taxable.)
Now the client has received an Intimation U/s 143(1) as demand notice.

There was an error on part of Department also. It disallowed the deduction claimed U/s. 80C for school fees.

My query in this regard is that what the client should do now.
Should he file a revised return?
- Is he eligible to file the revised return once the assessment has been done and an demand order raise.
Should he file a prayed for rectification U/s. 154.
- In case if he files a prayed U/s 154, should he just rectify the fact that Deduction of House building loan Interest was claimed under wrong section of the act.
- Or, should he also apply for the unclaimed deduction which he is eligible for.

CA Sanat Pyne

CA Sanat Pyne (Expert)
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30 November 2010 IN MY OPINION ,YOU SHOULD REVISE THE RETURN.
NOTICE U/S 143(1) IS AN INTIMATION . IT IS NOT AN ASSESSMENT.SO YOU CAN REVISE THE RETURN WITHIN ONE YEAR FROM THE END OF RELEVANT ASSESSEMENT YEAR.