PRASANNMANI COLLEGE OF PHYSICAL EDUCATION &YOGA,TIGIRIA vs. ITO (EXEMPTION), CUTTACK

Shri S.K.Sarangi, ld AR appeared for the assessee and Shri Shri S.K.Sarangi, ld AR appeared for the assessee and Shri Shri S.K.Sarangi, ld AR appeared for the assessee and Shri S.C.Mohanty, ld SR DR appeared for the revenue. S.C.Mohanty, ld SR DR appeared for the revenue.

It was the submission by ld AR that the assesse is an educational It was the submission by ld AR that the assesse is an educational It was the submission by ld AR that the assesse is an educational institution, which has got registration u institution, which has got registration u/s.12AA of the Act. It was the /s.12AA of the Act. It was the P a g e 1 | 4 submission that in the impugned assessment year, the assessee has filed return of income on 23.12.2017 and the intimation came to be issued u/s.143(1) on 16.3.2019. It was the submission that in the intimation u/s.143(1) of the Act, the benefit of exemption u/s.11(2) of the Act had been denied to the assessee. It was the submission that subsequently, the assessment in the case of the assessee came to be taken up under scrutiny and assessment was completed u/s.143(3) of the Act on 17.12.2019, wherein, the Assessing Officer has granted the assessee benefit of the provisions of section 11(2) of the Act. Ld AR drew our attention to the assessment order passed u/s.143(3) of the Act placed at pages 13 & 14 of paper book. It was the submission that as the assessee has been granted the benefit of section 11(2) of the Act on account of the condonation of delay in filing of Form 10, it shows that the benefit of section 11(2) could not be denied to the assessee in an intimation u/s.143(1) of the Act.

In reply, ld Sr DR submitted that the benefit of section 11(2) in an intimation u/s.143(1) was denied on account of delay in filing of return as also on account of delay in filing of Form 10. It was submitted that the adjustment as done in the intimation is valid and it should be upheld. In regard to assessment order u/s.143(3) of the Act, it was the submission of ld Sr DR that in the said order all the issues had not examined properly and there was defect in the assessment order passed u/s.143(3) of the Act,

We have considered the rival submissions. At the outset, on perusal of provisions of section 11 shows that when the assessee has been granted registration u/s.12AA of the Act , if the total income of an assessee includes such income derived from the property held under section 12AA, it is not to be included in the total income of the previous year of the person in receipt of the income. A perusal of provisions of section 11(2) shows that the compliance of the same is to be done before filing of the return. However, the powers had been granted to the ld CIT(E) to condone the delay. This power has been granted to the ld CIT(E) under the provision of section 119(2)(b) of the Act. When there is provision for condoning the delay, obviously, such an issue cannot be considered as prima facie adjustment, which can be done u/s.143(1) of the Act. This is because where the delay can be condoned and whether there is reasonable cause for the delay, are debatable issue. This being so, we are of the view that the adjustment as done in the intimation u/s.143(1) of the Act is not permissible as this is a mistake apparent from record. This being so, the order of the ld CIT(A) confirming the intimation u/s.143(1) stands reversed and the adjustment made in the intimation u/s.143(1) stands cancelled.

In the result, appeal of the assessee is allowed.