MADHUSUDAN ACADEMY OF SCIENCE AND CHARITABLE TRUST,DHENKANAL vs. INCOME TAX OFFICER, EXEMPTION WARD, BHUBANESWAR, BHUBANESWAR
Facts
The assessee, a trust, filed its return showing gross income and net income. The CPC processed the return under Section 143(1) and treated the entire gross receipts as income, disallowing claimed expenses without verification. The assessee argued that this adjustment was not permissible under Section 143(1) and that expenses should not be disallowed without verification.
Held
The Tribunal held that treating the entire gross receipts as income without considering claimed expenses and without verification, as done by the CPC in the intimation under Section 143(1), is not permissible. The adjustment made was outside the preview of Section 143(1) of the Act.
Key Issues
Whether the CPC's action of treating gross receipts as income and disallowing expenses under Section 143(1) without verification is permissible.
Sections Cited
12A, 143(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC” BENCH CUTTACK
Before: SHRI GEORGE MATHAN
This is an appeal filed by the assessee against the order of the Ld. Addl/JCIT(A)-6, Delhi order dated 30/01/2025 in Appeal No.CIT(A),Bhubaneswar-1/14820/2019-20 for the assessment year 2018-
It was submitted by the Ld. AR that the assesee is a trust which has not got registration under section 12A of the Act. It was submission that the returned filed by the assesee for the impugned assessment year came to be processed and intimation u/s. 143(1) of the Act came to be issued where in the expenses claimed being the application has not been considered and the total gross receipt has been treated as the income of the assesee. It was submission that if I told the income of the assesee is to be assessed then income should have been assessed as business
2 income and the business income should have been computed this has not been done. It was submission that the expenses could not been disallowed as a prime facie adjustment without verification. It was submission that the adjustment has made did not fall within the preview of the provision of section 143(1) of the Act.
In reply, the Ld. Sr. DR vehemently supports the order of the CPC and the Ld. JCIT.
I have considered the rival submission. A perusal of the facts in the present case clearly shows that the assesee had shown the gross income at Rs.16,84,379/- and the net income at Rs.6,00,320/-. The CPC when processing the returned and issuing the intimation under 143(1) of the Act has not allowed the expenses claimed but has treated the entire gross receipts of Rs.16,84,379/- as income of the assessee. This admittedly is not permissible as per the provisions of section 143(1) of the Act as the adjustment made are not within preview of the provisions 143(1) of the Act, the intimation issued is found to be erroneous and same stands quashed.
In the result, appeal of the assesee is allowed. Order dictated and pronounced in the open court on 24/09/2025. (जाज" माथन) (GEORGE MATHAN) "याियक सद"य / JUDICIAL MEMBER
"दनांक Dated 24/09/2025 Prakash Kumar Mishra, Sr.P.S
3 आदेश क" "ितिलिप अ"ेिषत/Copy of the Order forwarded to : 1. अपीलाथ" / The Appellant- Madhusudan Academy Of Science And Charitable Trust, Kunjakanta, Dhenkanal, 759001. 2. ""थ" / The Respondent- ITO, Exemption Ward, Bhubaneswar 3. आयकर आयु"(अपील) / The CIT(A), 4. आयकर आयु" / CIT 5. िवभागीय "ितिनिध, आयकर अपीलीय अिधकरण, कटक / DR, ITAT, Cuttack आदेशानुसार/ BY ORDER, गाड" फाईल / Guard file. 6. स"यािपत "ित //// (
