SAMANWAY SANSTHAN,KODERMA JHARKHAND vs. ITO EXEMPTION WARD NO. 1, PATNA

ITA 330/PAT/2026Status: HeardITAT Patna23 September 2026AY 2018-193 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the assessee's claim for exemption under Section 11 was disallowed because Form 10BB was not filed within time. The Tribunal noted that if the exemption under Section 11 is disallowed, the income of the assessee is liable to be shown only under the head 'business income', which would require determination by drawing up books of account and a Profit & Loss Account. The Tribunal found that this was not done by the JCIT, and the JCIT did not have the power to do so. The Tribunal further observed that the provisions of Section 143(1) do not provide for such an adjustment. Therefore, the intimation issued under Section 143(1) was in violation of the provisions of Section 143(1) and was not permissible. The intimation issued for the impugned assessment year was accordingly quashed. The appeal of the assessee was allowed.

What were the facts?

The assessee, Samanway Sansthan, filed its return of income for Assessment Year 2018-19 on 30.10.2018. An intimation under Section 143(1) was issued on 04.03.2020 by the CPC, disallowing the assessee's claim for exemption under Section 11 of the Income Tax Act. The disallowance was due to the non-filing of the audit report in Form 10B within the prescribed time. The assessee contended that its funds are used for charitable purposes and that if exemption was to be denied, its income should have been assessed as business income, which was not done. The assessee argued that the intimation issued under Section 143(1) should be quashed. The revenue supported the order of the JCIT and submitted that Form 10BB was also not filed within time.

What were the issues?

1. Whether the intimation issued under Section 143(1) of the Income Tax Act, 1961, disallowing the claim of exemption under Section 11 on account of non-filing of Form 10B within time, is valid? Assessee's contentions: The assessee argued that its funds are used for charitable purposes. It further contended that if the exemption under Section 11 was to be disallowed, the income should have been assessed as business income, which was not done. The assessee argued that the intimation issued under Section 143(1) is required to be quashed as it was not permissible under the said section. Revenue's contentions: The revenue's representative vehemently supported the order of the JCIT and submitted that Form 10BB had also not been filed within time.

Which sections of the Income-tax Act were involved?

Section 11,Section 143(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PATNA BENCH PATNA

Before: SHRI GEORGE MATHAN & SHRI LAXMI PRASAD SAHU

Hearing: 23/09/2026Pronounced: 23/09/2026

Per George Mathan, JM: This is an appeal filed by the assessee against the order of CIT(A), ADDL/JCIT(A)-5, Mumbai in Appeal No.NFAC/2017-18/10293506 dated 11/08/2025 for the assessment year 2018-19. 2. None appeared on behalf of the assessee and Shri Ravi Kant Chowdhary, Sr. DR appeared on behalf of the revenue.

3.

It was the submission by the ld. AR that the assessee for the impugned assessment year had filed its return of income on 30.10.2018. The return was processed and an intimation u/s 143(1) was issued on 04.03.2020 wherein the assessee’s claim of exe

The order continues below.

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