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Facts
The assessee filed an appeal against the CIT(A)'s order. The appeal pertains to the denial of the special tax rate under Section 115BAB by the CPC during the processing of the return under Section 143(1). The assessee had opted for this rate and filed Form 10-ID within the time limit.
Held
The Tribunal held that the CPC erred in denying the special tax rate without providing any reason or show cause notice, violating the principles of natural justice. The CIT(A) also failed to adjudicate this ground properly.
Key Issues
Whether the CPC can deny the special tax rate under Section 115BAB without assigning any reason or issuing a show cause notice during intimation processing under Section 143(1)?
Sections Cited
250, 1961, 115BAB, 143(1)
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Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD
Before: SMT. ANNAPURNA GUPTA & SHRI SIDDHARTHA NAUTIYAL
(िनधा�रण वष� / Assessment Year : 2023-24) बनाम/ D. C. Teletronics Private DCIT Limited Circle-1(1)(1), Vadodara Vs. Ls No.275/A/2, Lasundra Road, Lasundra, Savli, Vadodara, Gujarat – 391775 �थायी लेखा सं./जीआइआर सं./PAN/GIR No. : AAHCD7105P (Appellant) .. (Respondent) अपीलाथ� ओर से /Appellant by : Shri Prateek Jain, AR ��यथ� क� ओर से/Respondent by : Shri Nitin Kulkarni, Sr.DR 01/10/2025 Date of Hearing Date of Pronouncement 08/10/2025 (आदेश)/ORDER
PER ANNAPURNA GUPTA, AM:
The present appeal has been filed by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals), ADDL/JCIT(A)-1, Noida (hereinafter referred to as “CIT(A)”), dated 23.05.2025 passed under Section 250 of the Income Tax Act, 1961 (hereinafter referred to as the “Act”) and relates to Assessment Year (A.Y.) 2023-24.
The grounds of appeal
raised by the assessee are as under:
1. On the facts and circumstances of the case and in law, the CPC erred in denying the special tax rate u/s 115BAB despite the [D.C. Teletronics Private Limited vs. DCIT] A.Y. 2023-24 - 2 – fact that the Appellant has opted for section 115BAB by Fling Form 10-ID within the time limit prescribed by the Act.
2. That on the facts and circumstances of the case and in law, the CPC erred in denying the special tax rate u/s 115BAB without providing any reason and any show cause notice with respect to the same. Hence, the CPC has acted in violation of principle of natural justice.
That on the facts and circumstances of the case and in law, the CPC has acted without jurisdiction as the CPC does not have the power to deny the special tax rate while processing intimation u/s 143(1) of the Act.
Appellant craves leave to add, alter, modify or delete any of the grounds of appeal
.”
3. The solitary issue in the present appeal pertains to denial of claim of tax to be levied on the income of the assessee at the special tax rate as prescribed u/s.115BAB of the Act by the CPC on processing the return of income filed by the assessee u/s.143(1) of the Act.
4. Ld. Counsel for the assessee pointed out that the Ld. CIT(A) had failed to adjudicate this ground raised before it despite assessee pleading that the denial of the special tax rate u/s.115BAB of the Act was incorrect, since, the assessee had opted for it and filed the mandated Form 10-ID within the time prescribed by the Act and CPC had given no reason for denying the same.
The Ld. DR was unable to point out any infirmity in the arguments made by the Ld. Counsel for the assessee before us as the above.
[D.C. Teletronics Private Limited vs. DCIT] A.Y. 2023-24 - 3 – 6. We have also gone through the order of the Ld. CIT(A) and we find that he has not dealt with the ground specially raised by the assessee before it of denial of special rate of tax u/s.115BAB of the Act. Further, as rightly pointed out by the Ld.Counsel for the assessee, the intimation made u/s.143(1) of the Act in which, the special rate of tax claimed by the assessee was denied, does not mention any reason for the denial.
In the light of the same, we find that there is no case for denying the assessee benefit of special rate of tax u/s.115BAB of the Act. The CPC is directed to allow the same to the assessee.
In the result, appeal filed by the assessee is allowed.
This Order pronounced on 08/10/2025 Sd/- Sd/- (SIDDHARTHA NAUTIYAL) (ANNAPURNA GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad; Dated 08/10/2025 S. K. SINHA True Copy आदेश क� �ितिल�प अ�े�षत/Copy of the Order forwarded to : अपीलाथ� / The Appellant 1. ��यथ� / The Respondent. 2. संबंिधत आयकर आयु� / Concerned CIT 3. 4. आयकर आयु�(अपील) / The CIT(A)- �वभागीय �ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 5. 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER,