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TMI Blog2017 (8) TMI 485X X X X Extracts X X X X X X X X Extracts X X X X ..... was processed u/s 143(1) of the Act and the adjustment made by the income tax department withdrawing the exemption claimed u/s 11 of the Act unilaterally without putting the assessee on notice. The Act permits the adjustments u/s 143(1) of the Act, which are apparent from record. Since the adjustment made by the AO is debatable, which requires verification from the assessment records and there was no evidence to show that the registration applied for was rejected or cancelled, we hold that the adjustment made by the revenue in the intimation u/s 143(1) is beyond the scope of section 143(1) of the Act and accordingly, we set aside the orders of the lower authorities and delete the addition made by the A.O. - Decided in favour of assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 86. The department has allowed the exemption u/s 11 claimed by the assessee right from the assessment year 1990-91. Since the society is registered u/s 12AA of the Act, the income of the assessee is exempt and the revenue cannot withdraw the exemption claimed in the intimation u/s 143(1) unilaterally. The Ld. A.R. submitted the copies of the returns of income filed for the earlier years i.e. 1988-89 wherein the status was declared as AOP and the income was allowed as exempt. For the assessment years 1990-91, 1991-92, 1993-94 1994-95, the assessee placed the acknowledgements, wherein the assessee claimed the status as AOP (Trust), which was processed u/s 143(1) of the Act and the exemption claimed was allowed. The assessee also placed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... additions to the returned income. Further, the Ld. A.R. argued that such adjustments are not permissible u/s 143(1) of the Act. 4. On the other hand, the Ld. D.R. vehemently argued that the assessee did not quote the registration certificate number in the return of income, therefore, the A.O. has rightly withdrawn the exemption u/s 11 of the Act and brought the entire receipts to tax. It is the duty of the assessee to furnish the registration number and merely because the earlier year the assessee was granted the registration or allowed exemption u/s 11 of the Act, it cannot ipso facto makes the assessee entitled for exemption u/s 11 of the Act. Therefore, the Ld. DR argued that there is no error in the intimation made u/s 143(1) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... istration subsequently. The return of income was processed u/s 143(1) of the Act and the adjustment made by the income tax department withdrawing the exemption claimed u/s 11 of the Act unilaterally without putting the assessee on notice. The Act permits the adjustments u/s 143(1) of the Act, which are apparent from record. For ready reference, we extract relevant part of section 143(1) of the Act: Where a return has been made under section 139, or in response to a notice under sub-section (1) of section 142, such return shall be processed in the following manner, namely:- ( a) the total income or loss shall be computed after making the following adjustments, namely:- i. any arithmetical error in the return; [or] i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sub-section,-- ( a) an incorrect claim apparent from any information in the return shall mean a claim, on the basis of an entry, in the return,-- ( i) of an item, which is inconsistent with another entry of the same or some other item in such return; ( ii) in respect of which the information required to be furnished under this Act to substantiate such entry has not been so furnished; or ( iii) in respect of a deduction, where such deduction exceeds specified statutory limit which may have been expressed as monetary amount or percentage or ratio or fraction; ( b) the acknowledgement of the return shall be deemed to be the intimation in a case where no such is payable by, or refundable to, the assessee und ..... X X X X Extracts X X X X X X X X Extracts X X X X
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