The preliminary assessment u/s 143(1) is limited to processing ...

Income Tax Preliminary Assessment Limited to Error Checks; Fresh Deduction Claims Must Follow Administrative Channels.

October 16, 2024

Case Laws     Income Tax     AT

The preliminary assessment u/s 143(1) is limited to processing the return for arithmetical errors, incorrect expense claims, verifying audit reports, deductions, and cross-checking income against Form 26AS/16A. The AO cannot go beyond this mandate. The assessee made a fresh claim for deduction of prior period expenses and CSR expenses, which was disallowed u/s 37(1) as it was not claimed in the original return. The assessee appealed, but the Tribunal observed that the case laws cited pertain to fresh claims in regular assessment, not preliminary assessment u/s 143(1). The assessee received an intimation u/s 143(1) accepting the return, and the time for revision had elapsed. The Tribunal held that the assessee filed the appeal without any grievance, as the AO accepted the return. Fresh claims can be genuine and traceable from the return or debatable issues requiring verification. The remedy for fresh claims lies with administrative officers or the Board, not appellate authorities. If the Board rejects the application, the remedy is through writ proceedings.

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