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2023 (8) TMI 76 - ITAT KOLKATAExemption u/s. 11 denied - Validity of intimation issued u/s. 143(1)(a) - delay in completing the books of account - assessee has filed its return of income and Form 10B without compliance of Section 139(4A) i.e. after the due date of filing the return - HELD THAT:- Assessee in the present case has filed a belated return u/s. 139(4) of the Act which the department has not held it to be a defective return u/s. 139(9) and has processed it by accepting the revenue and capital expenditure though denying the exemption claimed u/s. 11 and computed the total income equal to the total receipts of the assessee for the year. Once a return has been processed as a valid return, there are restrictions within section 143(1)(a) which lists down six specific adjustments which can be made in the processing of return. In respect of any adjustment which is proposed to be made, a prior intimation is required to be served on the assessee, either in writing or electronically, as contained in 1st proviso to section 143(1)(a) of the Act. Ld. Counsel has evidently demonstrated before us, the failure on the part of CPC to issue such prior intimation to the assessee before making an adjustment by way of disallowing the claim of exemption u/s. 11 of the Act. Thus, there are two aspects which emerges on this issue as to whether the disallowance made is a permissible adjustment contained in sec. 143(1)(a) and whether this adjustment, if permissible, has been made in compliance to 1st proviso to sec. 143(1)(a) of the Act. As perusal of the provisions contained in sec. 143(1)(a) of the Act, we find that on both the aspects, the revenue fails. This position has not been controverted by Ld. Sr. DR also In case, where there is no response received from the assessee then, within thirty days of the issue of such intimation, department is free to make such adjustment or disallowance. The documentary evidence placed on record and the e-proceedings downloaded from the Income Tax portal, no where suggests that such a process has been followed. Thus, we find that the impugned intimation issued u/s. 143(1)(a) of the Act, dated 30.11.2021 is not in compliance with the 1st proviso to section 143(1)(a) of the Act and thus, the impugned intimation is invalid under the Act. Decided against revenue.
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