GELUK INTERNATIONAL FOUNDATION,NEW DELHI V. ITO, WARD EXEMPTION , DELHI

ITA 809/DEL/2025

AI Insights

The case involves GELUK INTERNATIONAL, the appellant, contesting an adjustment made by the Income Tax Officer (ITO) under section 143(1) of the Income Tax Act, 1961, for the assessment year 2023-24. The adjustment of Rs. 7,91,846 was alleged to be due to non-utilization of accumulated funds within the stipulated period, which the appellant argued was a misinterpretation of law and not an arithmetic error. The appellant also claimed that the adjustment was made without a proper opportunity to be heard, violating the principles of natural justice. The Tribunal, after hearing the Departmental Representative and reviewing the records, decided to remit the matter back to the Assessing Officer for a fresh examination, ensuring that the appellant is given an adequate opportunity to present their case.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 669596 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2023-2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: SHYAM MANOHAR SINGH
• Keywords: Opportunity of being heard; Principle of natural justice

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “SMC’’ : NEW DELHI) BEFORE SHRI MAHAVIR SINGH, HON'BLE VICE PRESIDENT ITA No. 809/Del/2025 Asstt. Year: 2023-24 GELUK INTERNATIONAL VS. ITO, WARD EXEMPTION FOUNDATION, 1(2), CIVIC CENTRE, B-4, LADAKH BUDDHISH VIHARA NEW DELHI TARA DEVI COLONY, BELA ROAD, DELHI – 54 (PAN: AAAAG7959D) (Appellant) (Respondent) Appellant by : None Respondent by : Shri Shyam Manohar Singh, Sr. DR Date of Hearing 06.05.2025 Date of Pronouncement 25.06.2025 ORDER This appeal by the assessee is emanating from the order of the Ld. Addl/JCIT(A)-1, Chandigarh in Appeal No. Addl/JCIT(A)-1, Chandigarh/10053/2022-23 dated 04.02.2025 relating to assessment year 2023-24. 2. None appeared on behalf of the assessee, despite issue of notice for hearing, hence, I am proceeding exparte qua the assessee, after hearing the Ld. DR and perusing the records. 3. It was the contention of the assessee made in the grounds of appeal that the Intimation Order u/s. 143(1) of the Act has been passed without providing 2 | P a g e proper and reasonable opportunity of being heard and as such the adjustment made therein is in contravention to the principles of natural justice. It was the further contention that the adjustment of Rs. 7,91,846/- made on the alleged ground of non-utilization of accumulated funds within the stipulated period being not in the nature of any arithmetical error or any mistake apparent from record, the said adjustment is illegal and without jurisdiction and the Ld. CIT(A) also erred in upholding the adjustment of Rs. 7,91,846/- made in the Intimation order issued u/s. 143(1) of the Act, without properly appreciating the correct facts and the legal position prevailing at the relevant time. It was pleaded in that the provisions of section 11(3)(c) of the Act clearly stipulates that accumulated income should be utilized within the five year period of accumulation or in the year immediately following the expiry thereof, and as such the adjustment made by the lower authorities on account of misinterpretation of law is illegal and liable to be deleted. That even otherwise, the appellant Trust having properly utilizsed the funds accumulated in the AY 2017-18 within a period of six years i.e. A.Y. 2023-24 and the same being fully supported from the Audited books of accounts, the action of the lower authorities in making the adjustment is not sustainable under law. However, Ld. DR relied upon the orders of the orders of the authorities below. In view of the aforesaid facts and circumstances, I am of the considered view that the aforesaid plea of the assesee needs to be examined at the level of the Assessing Officer and thereafter the issues in dispute has to be decided afresh, in accordance with law. Hence, in the interest of natural justice, I remit back the issues to the file of the Assessing Officer for fresh adjudication, after giving adequate opportunity of being heard to the assessee, keeping in mind the aforesaid contentions of the assessee. Assessee is also directed to fully cooperate with the AO and canvass its case properly. 3 | P a g e 4. In the result, the Assessee’s appeal is allowed for statistical purposes. Order pronounced on 25.06.2025. Sd/- (MAHAVIR SINGH) VICE PRESIDENT SRBhatnagar Copy forwarded to: - 1. Appellant 2. Respondent 3. DIT 4. CIT (A) 5. DR, ITAT Assistant Registrar, ITAT, Delhi Bench "