PRAYANK VIKRAM DHADDHA,PUNE vs. DCIT(IT), CIRCLE-1, PUNE, PUNE

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ITA 1248/PUN/2025Status: DisposedITAT Pune22 July 2025AY 2021-224 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the assessee had claimed Rs. 8,87,962/- as exempt income under section 10(2A) of the Act, representing profit from firms. However, the CIT(A) observed that the assessee had declared the share in profit as 'Zero (0)' in the relevant schedule of the Income Tax Return. The Tribunal, in its findings and analysis, stated that it had heard both parties and perused the record. While the grounds of appeal were presented, the detailed reasoning and the final decision on the merits of the claim under section 10(2A) are not fully elaborated in the provided excerpt. The Tribunal acknowledged the procedural ground regarding the amendment of appeal grounds but did not explicitly rule on it in the provided text. The operative directions or the final outcome of the appeal are not discernible from the given text.

What were the facts?

The assessee, Prayank Vikram Dhaddha, filed an appeal before the Income Tax Appellate Tribunal (ITAT), Pune Bench, challenging an order passed by the Additional/Joint Commissioner of Income Tax (Appeal) dated March 20, 2025. This order emanated from a processing order under section 143(1) of the Income Tax Act, 1961, dated March 22, 2022. The assessment year in question is 2021-22. The assessee had claimed Rs. 8,87,962/- as exempt income under section 10(2A) of the Act, representing profit from firms. However, the Centralized Processing Center (CPC) disallowed this claim during the processing of the return under section 143(1). The assessee's subsequent appeal to the CIT(A) was also dismissed, with the CIT(A) noting that the assessee had shown the share in profit as 'Zero (0)' in the relevant schedule of the Income Tax Return.

What were the issues?

1. Whether the order passed by the learned CIT(A) under section 250 of the Income Tax Act, 1961, is in accordance with the provisions of the Act, and if the appeal should have been allowed after considering the relevant provisions, thereby granting just and proper relief to the appellant (mixed question of law and fact, concerning Section 250). 2. Whether the appellant may be allowed to add, amend, modify, rectify, delete, and raise any grounds of appeal at the time of hearing (procedural issue). Assessee's contentions: - The order passed by the CIT(A) is not in accordance with the Act and the appeal should have been allowed. - The assessee seeks permission to amend or add grounds of appeal during the hearing. Revenue's contentions: - The judgment records no specific contentions for the Revenue regarding the disallowance or the procedural aspect.

Which sections of the Income-tax Act were involved?

Section 10(2A),Section 143(1),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCHES “SMC” :: PUNE

Before: MS.ASTHA CHANDRA & DR.DIPAK P. RIPOTE

For Appellant: Shri Sarvesh Khandelwal – AR
For Respondent: Smt. Shilpa NC – Addl.CIT(DR)
Hearing: 03/07/2025Pronounced: 22/07/2025

आदेश/ ORDER

PER DR. DIPAK P. RIPOTE, AM:

1.

This is an appeal filed by Assessee against the order of ld.Addl./Joint Commissioner of Income Tax(Appeal), Agrapassed under section 250 of the Income Tax Act, 1961 for the A.Y.2021-22 dated 20.03.2025, emanating from order u/s.143(1)of the Income Tax Act, 1961, dated 22.03.2022. The Assessee has raised following grounds of appeal :

1. On the facts & circumstances prevailing in the case and as per the provisions of the Act, it may please be held that the order passed u/s 250 of the Act by the Hon'ble CIT Appeals is not in accordance with the provisions of the Act. The appeal should have been allowed after considering the provisions of the Act in this regard. Just and proper relief be granted to the appellant in the case.

2. The appellant prays to be allowed to add, amend, modify, rectify, delete, and raise any grounds of appeal at the time of hearing.” Findings & Analysis :

2. We have heard both the parties and perused the record placed before us. In this case, in the Return of Income, Assessee had claimed Rs.8,87,962/- as exempt income u/s.10(2A) of the Act, being profit of firms. However, the Return of Income filed by the Assessee was processed by Centralized Processing Center(CPC) u/s.143(1) of the Act. CPC disallowed assessee’s claim of Rs.8,87,962/-. Aggrieved by the order of the CPC, Assessee filed appeal before the ld.CIT(A) who confirmed the disallowance. Ld.CIT(A) in paragraph 5.5 has mentioned that in the relevant Schedule of Income Tax Return, the Assessee has shown amount of share in the profit as “Zero(0)”. However, in the paragraph 5.6 of the order, ld.CIT(A) has observed that Assessee in Schedule-EL of the Return of Income had shown Rs.8,87,962/- as share of profit from Partnership Firm under the head “Exempt Income”. Ld.CIT(A) further noted that since there was contradiction between two schedules of the Return of Income, ld.CIT(A) confirmed the addition.

2.1 Ld.AR pleaded before us that Assessee had shown Rs.8,87,962/- as share of profit in the Return of Income. We have perused the Return of Income and observed that Assessee had shown Rs.8,87,962/- as share of profit from firms and claimed it as exempt income. There is no dispute that u/s.10(2A) of the Act, the share of profit from firms is exempt. During the year, assessee had shown following share of profit and claimed as exempt income : Sr.No. Name of the Partnership Firm/LLP Amount of Share of Profit (Rs.) 1 Tribute Landmarks LLP Rs.6,621/- 2 Tribute Landmarks Firm Rs.8,91,538/- 3 Mitribute Homes LLP (Rs.8,449/-) 4 Arihant Developers (Rs.1,748/-) TOTAL Rs.8,87,962/- 3. Assessee had filed copies of the Capital Accounts of the firms mentioned in the above table. All these documents were filed before the ld.CIT(A) also. Ld.DR has not raised any objections regarding the documents.

3.1 Since assessee has earned income of Rs.8,87,962/- as profit from various firms and u/s.10(2A) it is exempt. Names of the all firms and their PAN numbers are mentioned in Schedule-IF of the Return of Income. In these facts and circumstances of the case, we direct the Assessing Officer to allow exemption u/s.10(2A) of Rs.8,87,962/-. Accordingly, grounds of appeal raised by the assessee are allowed.

4.

In the result, appeal of the assessee is allowed. Order pronounced in the open Court on 22 July, 2025.

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