TMI Blog2019 (8) TMI 1822X X X X Extracts X X X X X X X X Extracts X X X X ..... nvolved an explanation of the assessee is required, then on such issue, no prima facie adjustment in an ex parte proceedings can be made. Reading of judgment of Hon ble Kolkatta High Court in case of Natwarlal Chowdhury Charity Trust [ 1989 (8) TMI 19 - CALCUTTA HIGH COURT ] and if facts are looked into, then it would reveal that both the issues were debatable one, where more than one opinion was possible. Adjustment under section 143(1)(a) is not permissible on both these aspects. Therefore, we allow appeal of the assessee, and delete both the disallowances. Appeal of assessee allowed. - ITA No.2337/Ahd/2017 - - - Dated:- 21-8-2019 - SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI PRADIPKUMAR KEDIA, ACCOUNTANT MEMBER Assessee by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee could not utilize that accumulated income and offered it for taxation at Rs.8,79,000/-. The assessee was of the view that on this unutilized income, it is entitled for further accumulation at the rate of 15%. In other words, the assessee was of the view that income which set apart for future utilization of the objects of the trust, and if not utilized and offered in future, then that income would be part of the current income of that figure year, and the assessee will be entitled to accumulate 15% from that income. A prima facie adjustment was made vide which its claim was rejected and addition of Rs.4,03,435/- under section 11(1)(a) of the Act was made. In other words, the AO was of the view that it is the deemed income, and on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11(3) of the Income-tax Act, 1961, added therein in the circumstances mentioned above ? 2. The facts found by the Tribunal as stated in the statement of case are as follows : The assessee-trust accumulated Rs.46,184 during the accounting years relevant to the assessment years 1973-74 to 1976-77. During the previous year relevant to the present assessment year, accumulated income ceased to be invested in fixed deposit with the Indian Bank and it was, therefore, deemed to be the income of the trust in the previous year in which it ceased to remain invested or deposited in terms of clause (b) of sub-section (3) of section 11 of the Income-tax Act, 1961. The Income-tax Officer was of the opinion that the assessee was not entitled to accu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case. ` But, in the instant case, no argument at all has been advanced to show any infirmity in the order of the Tribunal. Since Mr. Moitra has failed to show us any infirmity in the order passed by the Tribunal, the question is answered in the affirmative and in favour of the assessee. 7. In the light of the above, let us consider the scope of section 154 for making prima facie adjustment while processing return under section 143(1)(a) of the Act i.e. process of dealing with the return is an ex parte process. It is pertinent to observe that whenever any debatable issue is involved an explanation of the assessee is required, then on such issue, no prima facie adjustment in an ex parte proceedings can be made. Reading of judgment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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