INSTITUTE MANAGEMENT COMMITTEE ITI JHALAWAR ,JHALAWAR vs. ITO WARD JHALAWAR, JHALAWAR

ITA 39/JPR/2025Status: DisposedITAT Jaipur05 May 2025AY 2013-1443 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the authorities below were not justified in treating the returns as invalid solely on the ground that they were not filed within the time prescribed under Section 139(1). The Tribunal noted that the third proviso to Section 148, which states that returns furnished beyond the period allowed shall not be deemed to be a return under Section 139, was inserted w.e.f. 01.04.2023 and was not in force during the relevant assessment years. Similarly, the time period of 3 months for furnishing a return under Section 148 was prescribed only w.e.f. 01.04.2023. Therefore, as per the law in force at the relevant time, the returns filed under Section 148 should have been treated as returns furnished under Section 139, making them valid. The Tribunal also found merit in the assessee's contention that it was not required to furnish a return under Section 139(1) or 139(4C) as the department had not brought to its notice that the total income (without giving effect to Section 10) exceeded the maximum amount not chargeable to tax. Consequently, the denial of exemption under Section 10 and the charging of interest under Section 234A, 234B, and 234C were also held to be erroneous. The Tribunal allowed both appeals, setting aside the impugned orders.

What were the facts?

The assessee, an AOP (Trust), is in appeal against the order of the CIT(A) dated 25/11/2024, which upheld the assessment order dated 21.03.2022 passed by the AO under Section 144 r.w.s. 147 of the Income Tax Act, 1961. The appeals pertain to Assessment Years 2013-14 and 2014-15. The AO initiated reassessment proceedings based on information that income chargeable to tax had escaped assessment. The assessee received interest income of Rs. 26,94,361/- (AY 2013-14) and Rs. 27,47,673/- (AY 2014-15) but had not filed a return of income. A notice under Section 148 was issued on 24/03/2021, and the assessee filed a return on 23.04.2021 declaring nil income after claiming exemption under Section 10. The AO denied the exemption because the return was not filed within the due date stipulated under Section 139(1) and the assessee's registration under Section 12AA was granted only on 19.02.2019.

What were the issues?

1. Whether the impugned order and action taken under Section 147/148 r.w.s. 144B are bad in law, illegal, invalid, and void-ab-initio for want of jurisdiction, without proper approval, and barred by limitation. 2. Whether the CIT(A) erred in confirming the addition of Rs. 28,50,637/- (AY 2013-14) and Rs. 27,47,673/- (AY 2014-15) by denying the claim/exemption under Section 10(23C)(iiiad). 3. Whether the AO erred in charging interest under Section 234A, 234B, and 234C. Assessee's Contentions: The assessee argued that it was eligible for exemption under Section 10(23C)(iiiad) as its income was utilized for the objects of the society, which was formed for the upgradation of an Industrial Training Institute under a Public Private Partnership scheme. The interest-free loan received from the Central Government was deposited, and the interest earned was used for the society's objects. The assessee contended that there was no fraudulent intention for not filing the return within the due date under Section 139(1) and that the return filed under Section 148 should be treated as a valid return filed under Section 139(1). The assessee also argued that it was not required to file a return under Section 139(1) or 139(4C) as its total income, without giving effect to Section 10, did not exceed the maximum amount not chargeable to tax. Furthermore, the assessee argued that the proviso to Section 148, which states that returns furnished beyond the allowed period are not deemed returns under Section 139, was inserted w.e.f. 01.04.2023 and was not applicable during the relevant assessment years. The time limit of 3 months for furnishing a return under Section 148 was also prescribed only w.e.f. 01.04.2023. Revenue's Contentions: The revenue argued that the assessee failed to abide by the time limit for filing returns in response to notices under Section 148, justifying the authorities below in declaring the returns invalid and declining exemptions under Section 10.

Which sections of the Income-tax Act were involved?

Section 144,Section 147,Section 148,Section 151,Section 139(1),Section 139(4C),Section 234A,Section 234B,Section 234C,Section 12AA

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Income Tax Appellate Tribunal, JAIPUR BENCHES,SMC JAIPUR

Before: SHRI RATHOD KAMLESH JAYANTBHAI, AM & SHRI NARINDER KUMAR, JM

For Appellant: Adv. राजस्व की ओर से /
Hearing: 19/03/2025Pronounced: 05/05/2025

PER: RATHOD KAMLESH JAYANTBHAI, AM On being aggrieved by the order of the National Faceless Appeal Centre, Delhi [ for short CIT(A) ] dated 25/11/2024 the above named assessee preferred the present appeal. The dispute relates to the assessment years 2013-14 & 2014-15. The said order of the Id. CIT(A) arises because the assessee has challenged the assessment order dated 21.03.2022 passed under Section 144

The order continues below.

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