The income tax return once filed can be revised for any missing claims or deductions no later than three months prior to the end of the relevant assessment year.
On the other hand if the taxpayer has omitted to include incomes or claimed excess deduction or even failed to have submitted return then he may for once submit a return/updated return with additional amount of taxes upto 50% of normal tax until 24 months from the end of the relevant assessment year.
Interestingly on the other side the appellate authorities have been given the power to entertain a new claim for the first time though not made before the Assessing Officer as they are given to understand that the intention of the Revenue is to tax real income.
The Pune bench in unfolding this truth in ( 2023] 32 ITR (Trib)-OL 788 (ITAT[Pune] stated that the Income-tax proceedings are not strictly adversarial. A claim, though available in law, if not made, cannot be shut out for all times to come, merely because it is raised for the first time before the appellate authority without resorting to revising the return before the Assessing Officer.
This kind of dispensation is quite absurd considering that it is a settled law that an appeal is a continuation of assessment proceedings and therefore in all fairness what an Appellate authority could do the assessing officer should also be capable to do the same.
There ought to be no limitation imposed upon the AO to entertain revised return and claims as long as the assessment is not in challenge before any appellate authority.
Having a three months clause in section 139(5) is therefore a statutory handicap given that appellate proceedings are a continuation of assessment proceedings with common object being to tax real income in either of the scenario. And it must go.