SHREE SHREE MOHANANANDA SAMAJ SEVA SAMITY,KOLKATA vs. ITO(EXEMPTION)-WARD 1(3), KOLKATA, KOLKATA

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ITA 1188/KOL/2018Status: DisposedITAT Kolkata12 September 2018AY 2015-162 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that disallowance of Section 11(2) deduction cannot be made as a prima facie adjustment under Section 143(1). The entitlement to exemption and compliance with other sections require detailed adjudication, not machine processing.

What were the facts?

The assessee's claim for deduction under Section 11(2) was disallowed during the processing of their return under Section 143(1). The First Appellate Authority set aside the matter to the AO for further examination, which is beyond their power.

What were the issues?

Whether a claim for deduction under Section 11(2) can be disallowed as a prima facie adjustment under Section 143(1) and whether the First Appellate Authority has the power to set aside the matter to the AO.

Which sections of the Income-tax Act were involved?

Section 11(2),Section 143(1),Section 2(15),Section 11(1)(e)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BENCH ‘SMC’ KOLKATA

Before: Hon’ble Shri J.Sudhakar Reddy, AM]

These are appeals filed by the assessee directed against the order of the Commissioner of Income Tax-(A)-25, Kolkata dated 22.02.2018 passed u/s 250 of the Income Tax Act, 1961 (the ‘Act ‘) relating to A.Y. 2014-15 & 2015-16.

2.

In this case, the intimation u/s 143(1) of the Income Tax Act, 21961 was processed electronically by the Central Processing Centre of the Income Tax Department situated at Bangalore. While doing so, the claim of the assessee for deduction u/s 11(2) of the Act was disallowed. The assessee carried the matter in appeal, as the correspondence with the AO did not yield any result. The ld. First Appellate Authority set aside the matter to the file of the AO for examination and consideration of the claim of the assessee.

3.

Admittedly the ld. CIT(A) has no power of setting aside. He cannot remand the matter to the file of the AO. & 1188/Kol/2018 Shree Shree Mohanananda Samaj Seva Samity A.Y.2014-15 & 2015- 16 2

4.

Be as it may, disallowance in question cannot be made as a prima facie adjustment, while processing the return u/s 143 (1) of the Act. The issue whether the assessee is entitled for exemption u/s 11(2) of the Act and the issue whether the activities of the assessee confirm the provisions u/s 2(15) of the Act and the provision of section 11(1) (e) Act cannot be adjudicated while processing the return u/s 143(1), that too by a machine. Hence we delete the disallowance made and direct the AO to allow the claim of the assessee.

5.

In the result the appeal of the assessee is allowed. Order pronounced in the Court on 12.09.2018.

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