Income tax return processing of ITR U

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A chartered accountant filed an updated Income Tax Return (ITR-U) to correct a capital gains acquisition date error after the normal revision window closed. Despite filing the ITR-U and explaining the mistake to the tax department, the original return was processed, leading to a demand notice without the correct indexation benefit. The system now prevents rectification requests due to the pending ITR-U. The accountant is seeking advice on whether to file an appeal against the demand notice or wait for the ITR-U to be processed, as filing an appeal before the deadline is suggested.

VIJAY KUMAR

VIJAY KUMAR (Querist)
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21 May 2024 Dear Sir
My name is CA Vijay Kumar.
I have a query to the esteemd members and experts
pl give me your valuable comments if possible.
I have filed an iTR of my client on 29.07.2023 for AY 2023-24. Apart from normal income from business there was income from capital gains. in sch. capital gains wrong date of acquisition feeded despite correct indexation benefit is taken. I realised the mistake after 31.12.2023 so could not revise but filed an updated ITR U with some additional income and tax and corrected the dates.
Department sought clarification on 28.02.2024 with extra capital gains, I filed immediately reply with that mistake has happned and kindly consder ITR U or correct my data.
However, the Department on 30.04.2024 processed the original return and created the demand by not giving benefit of indexation. Now when I am filing, the rectification request u/s 154 system does not allow saying your latest return is pending (ITR U), Kindly wait till it is processed.
I submitted the response to the demand raised under section 143(1), filed a grievance and palanning a grievance on CPGRAM also.
My query is here should I file an appeal also against 143(1) order also as the window for appeal will close on 29.05.2024.
or what is best course of action ? Should I wait for processing of ITR U, which I have not seen happenning for any ITR U filed so far.
I shall be highly obliged to all of the experts.
Thanks and Regards.