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Facts
The assessee appealed against an assessment order under Section 143(3) read with Section 144B, which adopted an addition of INR 45,64,90,905/- related to Goods and Service Tax (GST), originally made in an intimation under Section 143(1). The CIT(A) dismissed this appeal as infructuous, stating that the same issue was pending in an appeal against the Section 143(1) intimation and no fresh additions were made in the Section 143(3) assessment.
Held
The Income Tax Appellate Tribunal (ITAT) noted that the appeal against the Section 143(1) intimation, which contained the disputed addition, was subsequently allowed by the CIT(A) on 13.12.2025, finding the addition incorrect. Consequently, the ITAT held that the assessed income should be the same as the assessee's returned income and allowed the appeal, directing the Assessing Officer to recompute the total income.
Key Issues
Whether an appeal against a Section 143(3) assessment, which merely adopts an adjustment from a Section 143(1) intimation, can be dismissed as infructuous when the underlying Section 143(1) adjustment itself has been set aside in a separate appeal.
Sections Cited
143(1), 143(2), 143(3), 144B
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Income Tax Appellate Tribunal, ‘B’ BENCH: BANGALORE
Before: SHRI PRASHANT MAHARISHI, VICE – & SHRI SOUNDARARAJAN K.
ORDER PER PRASHANT MAHARISHI, VICE – PRESIDENT 1.
Taegu Tec India Private Limited (the Assessee/Appellant) for Assessment Year 2021–22 against the Appellate Order passed by the National Faceless Appeal Centre, Delhi (the Ld. CIT(A)) dated 18.08.2025 wherein the Appeal filed by the Assessee against the Assessment Order dated 28.11.2023 passed u/s. 143(3) r.w.s. 144B of the Income Tax Act, 1961 (the Act) by the National Faceless Assessment Centre, New Delhi (the AO) was dismissed as infructuous.
The Assessee is in appeal before us wherein the Assessee has raised a ground of the addition of INR for 45,64,90,905/- on account of Goods and Service Tax (GST) along with other supportive grounds. The ground says that the order of the Ld. CIT(A) in holding that the Appeal is infructuous on the basis that the same issue of disallowance is pending in Appeal against the intimation issued u/s. 143(1) wherein similar adjustment has been made. The Ld. CIT(A) also held that no grievance arises to the Assessee from the Assessment Order as the Ld. Assessing Officer has Page 2 of 4 not made any fresh additions or disallowances in assessment order but merely repeated the adjustment made u/s 143(1) of the Act.
The claim of the Assessee is that the Ld. CIT(A)should have appreciated that upon passing of the Assessment Orderu/s. 143(3) the intimation issued u/s. 143 (1) gets merged with the Assessment Order and therefore the Appeal before the CIT(A) should have been adjudicated on the merits of the case.
The brief fact of the case shows that that the Assessee filed its return of income on 14.03.2022 at a total income of Rs. 63,92,75,880/–. The Assessee is engaged in the business of manufacturing and trading of tungsten carbide inserts and tool holders. The return of income was picked up for scrutiny by issuing a notice u/s. 143(2) of the Act. The Assessee also entered certain international transactions, and the reference was made to the Ld. Transfer Pricing Officer. No adjustment was proposed.
However, the Ld. Assessing Officer noted that as per the intimation passed by the Central Processing Centre on 22.09.2023, the adjustment of Rs. 45,64,90,905/- has been madeu/s. 143(1) of the Act wherein the adjustment was on account of there is inconsistency in the amount mentioned in the return of income and the tax audit report.
During assessment proceedings, the Assessing Officer further asked the query about the same to the Assessee and the Assessee stated that it has filed an Appeal before the learned CIT(A) which is pending. The return of income as computed by the CPC was taken by the Assessing Officer as a starting point and assessed the assessee at the same income at Rs. 1,09,57,66,790/- as per the Assessment Order passed u/s. 143(3) r.w.s. 144B of the Act on 28.11.2023.
Aggrieved with the Assessment Order, the Assessee preferred an Appeal before the Ld. CIT(A). The learned CIT(A) noted that the Appeal pertains to the addition of Rs. 45,64,90,905/– on account of Goods and Service Tax which has been adjusted u/s. 143(1) of the Act and Appeal against such intimation is pending before the Ld. CIT(A) and therefore the Ld. Assessing Officer while computing the total income of the Assessee adopted the total income as computed by Central Processing Centre and finalised the Assessment Order u/s. 143(3) of the Act at Rs.1,09,57,66,790/-. The Ld. CIT(A) therefore held that the present appeal against the order u/s. 143(3) is not maintainable independently when the same issue is already pending in Appeal against the Central Processing Centre’s intimation passed u/s. 143 (1) of Page 3 of 4 the Act as the Assessing Officer has not made any fresh addition or disallowances in the scrutiny Assessment Order other than adopting the income as previously processed. As there is no grievance in the scrutiny assessment, the Appeal of the Assessee was dismissed.
The Ld. Authorised Representative Smt. Tanmayee Rajkumar, Advocate submitted that the Assessee's appeal filed before the Ld. CIT(A) against the intimation issued u/s. 143 (1) has been allowed by the Ld. CIT(A) as per order dated 13.12.2025 and therefore now even on the merits of the case the starting of the computation made by the Ld. Assessing Officer with the total income as computed by the Central Processing Centre u/s. 143 (1) of the Act at Rs. 1,09,57,66,790/- is incorrect and the correct return of income and assessed income should be at Rs. 63,92,75,880/-.
The learned CIT DR also agreed that when the addition has been deleted by the Ld. CIT(A) which was made in the intimation passed u/s. 143 (1) of the act, the issue does not survive.
We have carefully considered the rival contention and perused the orders of the Ld. lower authorities. The facts clearly shows that the income of the assessee returned at Rs. 63,92,75,880/– was subject to variation by the intimation passed by the Central Processing Centre on 22.09.2023 wherein the adjustment of Rs. 45,64,90,905/– was made and pursuant to that the total income was computed at Rs. 1,09,57,66,790/-. The Assessee preferred an Appeal against the Assessment Order also which commenced the computation of total income as per income computed under section 143 (1) of the act and Assessee also filed an Appeal before the Ld. CIT(A) against the intimation issued u/s. 143 (1) of the Act which came to be decided by the Ld. CIT(A) on 13.12.2025 wherein it has been held that the addition of ₹ 45,64,90,905/– made u/s. 143 (1) is incorrect. The Appeal of the Assessee was allowed. Therefore, in nutshell the assessed income and the returned income of the assessee remain the same at Rs. 63,92,75,880/–.
Thus, in the result Appeal filed by the Assessee is allowed directing the Assessing Officer to compute the total income of the Assessee at Rs. 63,92,75,880/–.
Order pronounced in the open court on 11th March, 2026.