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Facts
The assessee, a partnership firm, filed its return of income for AY 2022-23. The CPC/AO issued a notice under Section 139(9) stating defects in the return, which the assessee claims were rectified. However, the AO declared the return invalid, leading to a first appeal where no solution was found.
Held
The Tribunal noted that the assessee's returns appeared to support their stand that no defect existed. Both parties agreed that restoring the matter to the Jurisdictional Assessing Officer (JAO) for fresh examination would be the most appropriate solution.
Key Issues
Whether the return of income declared invalid by the AO under Section 139(9) was indeed defective, and if not, whether the AO should be directed to process it.
Sections Cited
139(9), 139, 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI B.M. BIYANI & SHRI PARESH M. JOSHI
आदेश/ O R D E R
Per B.M. Biyani, A.M.:
Feeling aggrieved by order of first-appeal dated 19.08.2024 passed by learned Commissioner of Income-Tax (Appeals)-NFAC, Delhi [“CIT(A)”] u/s 250 of Income-tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2022-23, the assessee has filed this appeal on following grounds:
“1. The order passed by the Learned Assessing Officer/CPC & CIT (Appeal) is bad in law, arbitrary and is not enforceable under the law. 2. That the Learned Commissioner of Income Tax (Appeals) erred in treating the return of income filed by the appellant as invalid under Section 139(9) of the Income-tax Act, 1961, without duly considering all defects, identified by the department, were fully rectified by the appellant within the stipulated timeframe. Page 1 of 5
Sanatan Warehouse ITA No. 745/Ind/2024 – AY 2022-23 3. That the Learned CIT(A) further erred in holding that no valid appeal could be filed in this regard, overlooking the appellant's right to challenge the wrongful treatment of the return as invalid. This has deprived the appellant of the opportunity to be heard and to present the necessary facts to substantiate the validity of the return. 4. That the return of income filed by the appellant contains complete and accurate details of all sources of income, including, business income, and other relevant heads of income as required under the Income-tax Act. The return has been thoroughly reviewed by the appellant, and all income details have been properly disclosed and documented. 5. That the Learned Assessing Officer/CPC and subsequently the CIT(A), failed to appreciate that the appellant has acted in good faith and in compliance with all procedural requirements under the Income- tax Act, 1961. The reasons cited by CIT (Appeal) for treating the return as invalid are without merit, arbitrary, and unjustified. 6.That the Learned CIT(A) and Assessing Officer/CPC did not consider the specific explanations and clarifications provided by the appellant during the course of proceedings, leading to an incorrect conclusion regarding the alleged defect in the return. 7. That the appellant respectfully submits that the income details furnished in the return of income are complete, accurate, and have been reviewed before submission. The alleged defect, if any, is either non-existent or has already been rectified in accordance with the provisions of Section 139(9) of the Income-tax Act. 8. That the appellant prays for appropriate relief by setting aside the impugned order treating the return as invalid, and requests the Tribunal to direct the Learned Assessing Officer/CPC to accept the return as valid and process the same under the applicable provisions of the law.” 2. We have heard learned Representatives of both sides and perused the
case record carefully.
Ld. AR for assessee briefed the facts of case. The assessee is a
partnership firm. For AY 2022-23 under consideration, the assessee filed
return of income u/s 139 on 22.07.2022 (copy of return at Pages 1-75 of
Page 2 of 5
Sanatan Warehouse ITA No. 745/Ind/2024 – AY 2022-23 Paper-Book). The CPC, Bengaluru [“AO”] issued notice dated 14.12.2022
u/s 139(9) intimating a defect “No ‘Income details’ or ‘Tax computation’ are
provided in ITR but details regarding ‘Taxes Paid’ have been provided” and
requited the assessee to submit response by 29.12.2022 (copy of notice at
Page 154 of Paper-Book). On verification of return, although the assessee
found that those details were provided in the return and there was no defect,
yet the assessee complied to the notice issued by AO and therefore filed
another return on 20.12.2022 repeating the very same figures (copy of
return at Pages 76-149 of Paper-Book). However, the AO declared assessee’s
return as ‘invalid’. Aggrieved, the assessee carried matter in first-appeal but
did not get any solution.
Ld. AR for assessee carried us to both of returns filed by assessee, one
at Pages 1-75 of Paper-Book and other at Pages 76-149 of Paper-Book, and
demonstrated that the assessee has given figures of Balance-Sheet, P&L A/c,
Income derived under House Property head, Loss derived under Business
head, Computation of Income, Computation of Tax liability at all designated
places in both of the returns and there is no defect as alleged by AO. Ld. AR
submitted that there is no mistake or defect in the return and yet the AO
has declared assessee’s return as invalid. Therefore, the assessee had no
option except to approach CIT(A) and thereafter before ITAT. Ld. AR
submitted that in the situation, the bench may provide appropriate solution.
Page 3 of 5
Sanatan Warehouse ITA No. 745/Ind/2024 – AY 2022-23 5. The prima facie perusal of returns filed by assessee support the stand
taken by assessee. Therefore, after deliberations, Ld. DR for revenue suggested that the most appropriate solution in present case would be to restore matter at the level of Jurisdictional Assessing Officer [“JAO”] with
directions as thought fit. Ld. AR for assessee agreed to the suggestion made by Ld. DR. Taking into account submissions of learned Representatives, we restore this matter to the file of JAO for reconsideration afresh. We expect
the JAO to examine the returns filed by assessee carefully and judiciously and pass a needful order in accordance with law. We also direct the assessee to ensure participation in the hearings as may be fixed by JAO and
supply the necessary documents and information as required.
Resultantly, this appeal is allowed for statistical purpose.
Order pronounced in open court on 16/07/2025
Sd/- Sd/-
(PARESH M. JOSHI) (B.M. BIYANI) JUDICIAL MEMBER ACCOUNTANT MEMBER
Indore
िदनांक/Dated : 16/07/2025
Patel/Sr. PS
Page 4 of 5
Sanatan Warehouse ITA No. 745/Ind/2024 – AY 2022-23 Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order E COPYSr. Private Secretary Income Tax Appellate Tribunal Indore Bench, Indore
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