SUBHADRA CONSTRUCTION ,DHANBAD, JHARKHAND vs. DCIT, CIRCLE (1), DHANBAD, DHANBAD, JHARKHAND

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ITA 74/RAN/2025Status: DisposedITAT Ranchi06 January 2026AY 2022-23Bench: SHRI GEORGE MATHAN (Judicial Member), SHRI RATNESH NANDAN SAHAY (Accountant Member)1 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 the denial of exempt income claimed by the assessee in the intimation under Section 143(1) was not a prima facie adjustment permissible under the said section. Therefore, the intimation and consequential rectification were quashed.

What were the facts?

The assessee filed appeals against orders of the CIT(A) for AY 2021-22 and 2022-23. The assessee sought an adjournment which was rejected. The issue pertained to the denial of exempt income claimed by the assessee representing partners' share of profit from a firm.

What were the issues?

Whether the denial of exempt income, claimed as partners' share of profit from a firm, in an intimation under Section 143(1) constitutes a valid prima facie adjustment.

Which sections of the Income-tax Act were involved?

Section 143(1),Section 154

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, RANCHI BENCH, RANCHI

Before: SHRI GEORGE MATHAN & SHRI RATNESH NANDAN SAHAY

For Respondent: Shri Rajib Jain, CIT-DR
Hearing: 06/01/2026Pronounced: 06/01/2026

Assessee represented by Adjournment Application Department represented by Shri Rajib Jain, CIT-DR Date of hearing 06/01/2026 Date of pronouncement 06/01/2026 O R D E R PER: BENCH 1. These are the appeals filed by the assessee against the orders of the ld. CIT(A), NFAC, Delhi both dated 27/01/2025 for the A.Y. 2021-22 and 2022- 23 respectively.

2.

The assessee has sought adjournment. As it is noticed that the issue in these appeals are very small. The adjournment application filed by the assessee is rejected and the appeals disposed off.

3.

It was put to the ld. CIT-DR that the adjustment as done in Section 143(1) and denied under Section 154 is in respect of the exempt income claimed by the assessee representing the partners' share of profit from the firm. It was put to the ld. CIT-DR that as to how the said denial of the said exempt income can be done in an intimation under Section 143(1) in so far as it does not fall within prima facie adjustment as specified in the provisions of Section 143(1). It was submitted by the ld. CIT-DR that non-filing of the form shows & 74/Ran/2025 Subhadra Construction Vs DCIT that the firm has not filed the return and therefore, the income cannot be granted as exempt. It was a submission that the adjustment is permissible.

4.

We have considered the submissions. The firm having not filed its return cannot make the claim of exemption in the hands of the partners, prima facie adjustment which can be done in an intimation under Section 143(1) as the adjustment as done in the intimation is found to be not falling within the parameters of prima facie adjustment as required under the provisions of Section 143(1), the intimation issued under Section 143(1) and the consequential rectification denied, stands quashed.

5.

In the result, both the appeals of the assessee are allowed. Order announced in open court on 06/01/2026

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