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Facts
The assessee claimed a deduction under section 80P(2)(d) of the Income Tax Act. The CPC disallowed this deduction without providing an opportunity to the assessee, leading to a rectification application and a subsequent appeal. The initial appeal was dismissed by the Commissioner for being non-maintainable.
Held
The tribunal held that the adjustment made by the CPC disallowing the deduction under section 80P(2)(d) was unsustainable because no intimation was provided to the assessee as per the proviso to section 143(1) of the Act. Therefore, the addition of Rs.1,86,757/- was directed to be deleted.
Key Issues
Whether the disallowance of deduction under section 80P(2)(d) by the CPC was valid without issuing a proper intimation to the assessee.
Sections Cited
143(1), 143(3), 154, 250, 80P(2)(d)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI BENCH “SMC”, MUMBAI
Before: SHRI NARENDER KUMAR CHOUDHRY & SMT RENU JAUHRI
Per : Narender Kumar Choudhry, Judicial Member:
This appeal has been preferred by the assessee against the order dated 26.10.2023, impugned herein, passed by the National Faceless Appeal Center (NFAC)/ Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) under section 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y.
2020-21.
The Assessee has claimed that the CPC, while processing the return filed by the assessee and disallowing the deduction claimed under section 80P(2)(d) of the Act and before issuing the intimation under section 143(3) of the Act dated 25.11.2021, has not given any opportunity to the Assessee, as mandated in the proviso to section 143(1) of the Act and therefore the assessee preferred an rectification application before the CPC under section 154 of the Act, however, could not get suceeded, which resulted into challenging the order dated 13.07.2022 by filing first appeal before the Ld. Commissioner, who ultimately dismissed the same by holding that the appeal filed against the order under section 154 of the Act is not maintainable.
The Assessee, being aggrieved, is in appeal before us.
Heard the parties and perused the material available on record. Admittedly, no intimation as prescribed in proviso to section 143(1) of the Act, has been issued to the assessee before making the adjustments and issuing the intimation u/s 143(1) of the Act, therefore, the adjustment made/addition of Rs.1,86,757/- on account of disallowance under section 80P(2)(d) of the Act is unsustainable. Consequently, the same is directed to be deleted.
In the result, the appeal filed by the assessee stands
allowed.
Order pronounced in the open court on 26.06.2024.