Section 143 of the Income Tax Act
Income-tax Act, 2025: s.270
Section 143 of the Income-tax Act, 1961 corresponds to section 270 (Assessment) of the Income-tax Act, 2025.
Read section 270 of the 2025 Act
Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.
The decision most relied on for Section 143 is CIT v. Shri Samson Perinchery (392 ITR 4), cited in 417 of the 703 judgments on BharatTax that turn on this section.
Leading authorities on Section 143
A penalty levied under section 271(1)(c) of the Income-tax Act is unsustainable if it is initiated on one limb (e.g., concealment of income) but ultimately levied on the other limb (e.g., furnishing inaccurate particulars). This also applies if the initial penalty notice is vague or ambiguous regarding the specific charge.
An assessment order is not erroneous or prejudicial under Section 263 merely because it is silent on a claim or lacks explicit reasons for its acceptance. Revision under Section 263 is impermissible if the Assessing Officer has taken a plausible view, even if the PCIT holds a different opinion.
For the applicability of Section 271(1)(c) penalty, the Assessing Officer must be satisfied that the assessee concealed income or furnished inaccurate particulars; however, this satisfaction is not required to be recorded in a particular manner or reduced to writing.
Journal entries for accepting or repaying loans and deposits, without any actual cash transaction, do not violate the provisions of Section 269SS or Section 269T of the Income Tax Act. Consequently, such transactions do not attract penalties under Section 271D or Section 271E.
An assessee company receiving share application money from identified alleged bogus shareholders cannot have this amount treated as its undisclosed income under Section 68, provided the company furnishes the shareholders' identity, creditworthiness, and genuineness of transactions. The tax authorities must instead proceed against the individual shareholders.
For the imposition of penalty under section 271(1)(c), the specific conditions laid down in the section must be demonstrably met. The assessee's filed return is the primary document for furnishing income particulars, and inaccuracies therein are crucial for penalty imposition.
For a valid assessment under Section 153C against an 'other person', the Assessing Officer's satisfaction note must explicitly identify seized documents or assets found during a search that specifically belong to that 'other person'. Mere association or relationship with the searched assessee, without specific findings of belonging documents or assets, is insufficient to assume jurisdiction.
Penalty orders under sections 271D and 271E passed beyond six months from the end of the month in which the assessment was completed are barred by limitation. Section 275(1)(c) is applicable to such cases, and the limitation period is not reckoned from the date of the show-cause notice.
Profits of non-residents from occasional shipping business are subject to a special levy and recovery of tax under Section 172 of the Income Tax Act. A time charter party is considered a letting of the ship when control over its working and navigation is transferred.
A tax demand subsists even if the assessment order is set aside, and the date of the original assessment remains the relevant date. This principle clarifies that tax payment methods do not alter the fundamental liability to pay tax based on an assessment order.
