DRDO RANGE EDUCATIONAL SOCIETY CHANDIPUR,CHANDIPUR V. INCOME TAX OFFICER, EXEMPTION WARD, CUTTACK

ITA 772/CTK/2025

AI Insights

The case involves two appeals by the DRDO Range Educational Society against the orders of the CIT(A) for the assessment years 2015-2016 and 2017-2018. The primary issue was the denial of exemption under section 10(23C)(iiiad) of the Income Tax Act by the CPC, which taxed the entire gross receipts of the assessee as income under section 143(1). The Tribunal found that the CPC exceeded its authority by denying the exemption and taxing the gross receipts without a detailed assessment, which should have been conducted under section 143(3). Both appeals were allowed, quashing the CPC's intimation and the subsequent CIT(A) orders.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 837400 (ITAT-CUTTACK)
• Duration Of Justice: 1 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 24-12-2025
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIJAY SINGH
• Assessee Lawyers: NANAK FOGLA
• Keywords: Set aside; Benefit of exemption

Judgement Text

" आयकर अपीलȣय अͬधकरण, कटक Ûयायपीठ,कटक IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI MADHUSUDAN SAWDIA, ACCOUNTANT MEMBER आयकर अपील सं/ITA No.771&772/CTK/2025 (Ǔनधा[रण वष[ / Assessment Year : 2017-2018 & 2015-2016) DRDO Range Educational Society Chandipur Range School Chandipur Baleswar-756025 Vs ITO (Exemption), Cuttack PAN No. :AAALD 0864 F (अपीलाथȸ /Appellant) .. (Ĥ×यथȸ / Respondent) Ǔनधा[ǐरती कȧ ओर से /Assessee by : Shri Nanak Fogla, AR राजèव कȧ ओर से /Revenue by : Shri Vijay Singh, Sr. DR सुनवाई कȧ तारȣख / Date of Hearing : 18/02/2026 घोषणा कȧ तारȣख/Date of Pronouncement : 18/02/2026 आदेश / O R D E R Per Bench : These two appeals are filed by the assessee against the separate orders of the Ld.Addl./JCIT(A)-11, Delhi, dated 29.08.2024 and the order of the ld. Addl./JCIT(A) Faridabad, dated 20.03.2025 for the assessment years 2015-2016 & 2017-2018, respectively. 2. Both the appeals of the assessee have been filed belatedly. In this regard, the assessee has filed an affidavit stating therein sufficient reasons for delay in filing the appeal before the Tribunal, which are not found to be false. Ld. Sr. DR did not object to condone the delay. Accordingly, we condone the delay in filing both the appeals before the Tribunal and both appeals of the assessee are admitted for hearing. ITA No.772/CTK/2025 (AY : 2015-2016) 3. First, we shall take up the appeal of the assessee in ITA No.772/CTK/2025 filed for A.Y.2015-2016, wherein it was submitted by the Printed from counselvise.com ITA No.771&772/CTK/2025 2 ld. AR that the appeal against the order u/s.143(1) of the Act for the A.Y.2015-2016 issued by the CPC, which has been confirmed by the ld. CIT(A). It was the submission that the CPC has denied the exemption claimed by the assessee u/s.10(23C)(iiiad) of the Act and taxed the entire receipt of the assessee as the income in the hands of the assessee. The denial of exemption u/s.10(23C)(iiiad) of the Act and taxing the entire gross receipts of the assessee is beyond the power of CPC u/s.143(1) of the Act. Therefore, it is submitted that the intimation issued u/s.143(1) of the Act is liable to be quashed and in consequence thereof the order passed by the ld. CIT(A) deserves to be dismissed. 4. In reply, ld. Sr. DR vehemently supported the orders of the CPC and ld. CIT(A). 5. We have considered the rival submissions. A perusal of intimation u/s.143(1) of the Act shows that the CPC has denied the exemption claimed by the assessee u/s.10(23C)(iiiad) of the Act and taxed the entire receipt of the assessee as the income in the hands of the assessee. The denial of exemption u/s.10(23C)(iiiad) of the Act and taxing the entire gross receipts of the assessee is beyond the power of CPC u/s.143(1) of the Act. If the Revenue desires to deny the assessee the benefit of exemption, then the option available to the Revenue was to assess the real income of the assessee u/s.143(3) of the Act instead of treating the entire gross receipt as income in the hands of the assessee u/s.143(1) of the Act. As the intimation issued u/s.143(1) of the Act taxing the gross receipts is not in line with the provisions of section 143(1) of the Act, the intimation u/s.143(1) of Printed from counselvise.com ITA No.771&772/CTK/2025 3 the Act stands quashed. Accordingly, the order of the ld. CIT(A) is also set aside. ITA No.771/CTK/2025 (AY : 2017-2018) 6. In regard to appeal of the assessee i.e. ITA No.771/CTK/2025 filed for the assessment year 2017-2018, it was submitted by the ld. AR that the said appeal is against the order passed u/s.154 of the Act arising out of the intimation issued u/s.143(1) of the Act. In the said intimation, the CPC has denied the exemption claimed by the assessee u/s.10(23C)(iiiad) of the Act and taxed the entire receipt of the assessee as the income in the hands of the assessee. Under the identical facts, we have quashed the intimation of CPC issued u/s.143(1) of the Act in ITA No.772/CTK/2025 (AY:2015-2016). As the facts of the case in present appeal are identical to the facts of the case in ITA No.772/CTK/2025, our observation and findings in ITA No.772/CTK/2025 for the assessment year 2015-2016 shall apply mutatis mutandis to this appeal i.e. ITA No.771/CTK/2025 (AY: 2017-2018) also. Therefore, the intimation of CPC u/s.143(1) of the Act and consequential order of the ld. AO u/s.154 of the Act are hereby quashed. Accordingly, the order of the ld. CIT(A) is also set aside. 7. In the result, both appeals of the assessee are allowed. Order dictated and pronounced in the open court on 18/02/2026. Sd/- (MADHUSUDAN SAWDIA) Sd/- (GEORGE MATHAN) लेखा सदèय/ ACCOUNTANT MEMBER ÛयाǓयक सदèय / JUDICIAL MEMBER Ǒदनांक Dated 18/02/2026 Prakash Kumar Mishra, Sr.P.S. Printed from counselvise.com ITA No.771&772/CTK/2025 4 आदेश कȧ ĤǓतͧलͪप अĒेͪषत/Copy of the Order forwarded to : आदेशानुसार/BY ORDER, (Assistant Registrar) आयकर अपीलȣय अͬधकरण, कटक/ITAT, Cuttack 1. अपीलाथŎ / The Appellant - 2. ŮȑथŎ / The Respondent- 3. आयकर आयुƅ(अपील) / The CIT(A), 4. आयकर आयुÈत / CIT 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, कटक / DR, ITAT, Cuttack 6. गाड[ फाईल / Guard file. स×याͪपत ĤǓत //True Copy// Printed from counselvise.com "