IMA PG INDIA PRIVATE LIMITED,NAVI MUMBAI V. NAFAC, DELHI

ITA 4063/MUM/2024

AI Insights

IMA PD India Pvt. Ltd. filed an appeal against the order of the Commissioner of Income-tax (Appeals) - National Faceless Appeal Centre, which had dismissed their earlier appeal as infructuous. The original dispute arose from the adjustments made in the intimation under section 143(1) of the Income-tax Act, 1961, which were not contested by the assessee at that stage. Subsequently, the return was scrutinized under section 143(3), and the assessee contested the adjustments made in the earlier intimation. The Tribunal found that the issues raised were not directly related to the assessment order under section 143(3) but were linked to the earlier intimation under section 143(1), which the assessee failed to appeal against initially.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 32010 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2024
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 01-10-2024
• Assessment Year: 2018-2019
• Appeal Filed On: 13-08-2024
• Other Referred Cases: The South India Club v. ITO Ward Exemption (2)(3), New Delhi in ITA No. 354/Del/2024
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: KRISHNA KUMAR
• Assessee Lawyers: RAMAKRISHNA R. LINGSUR
• Keywords: Earning of tax free income
• Section: 143(3); 143(1); 43B

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “C” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI SANDEEP SINGH KARHAIL (JUDICIAL MEMBER) ITA No. 4063/MUM/2024 Assessment Year: 2018-19 IMA PD India Pvt. Ltd., R-677, TTC Industrial Area, MIDC Thane Belapur Road, Rabale, Maharashtra-400701. Vs. NAFAC, Delhi. PAN NO. AAACP 6442 Q Appellant Respondent Assessee by : Mr. Ramakrishna R. Lingsur Revenue by : Mr. Krishnakumar, Sr. DR Date of Hearing : 01/10/2024 Date of pronouncement : 22/10/2024 ORDER PER OM PRAKASH KANT, AM This appeal has been preferred by the assessee against order dated 09.07.2024 passed by the Ld. Commissioner of Income-tax (Appeals) – National Faceless Appeal Centre, Delhi [in short ‘the Ld. CIT(A)’] for assessment year 2018-19, raising following grounds: 1. The learned Commissioner of Income Tax erred dismissing all the grounds in appeal as infructuous. 2. The learned Commissioner of Income Tax erred in confirming in action of the Assessing Officer not granting deduction of Rs. 1,98,57,246/ disallowed in the past assessment period. 3. The learned Commissioner of Income Tax erred in confirming in action of the Assessing Officer in taxing th 7,43,211/ offered to tax under other heads 4. The learned Commissioner of Income Tax erred in confirming in action of the Assessing Officer in taxing exempt income of Rs. 1,69,944/ 2. Briefly stated, facts of the case are that the assessee filed return of income on 28.11.2018 declaring total income at Rs.15,69,25,560/- which was further revised to Rs.14,83,15,740/ on 30.03.2019. The return of income filed by the processed and intimation u/s 143(1) of the Income short ‘the Act’) was issued Subsequently, the return of income filed by the assessee was selected for scrutiny and assessment u/s 143(3 completed wherein the Assessing Officer noted that the assessee did not furnish any suo moto made by the Central Processing Centre (CPC) in the intimation u/s 143(1) of the Act and therefore, same was not altered and for the purpose of the computation the income assessed u/s 143(1) of the filed in the return of income. The assessee did not prefer any appeal against the order u/s 143(1) of the Act and filed appeal against the order u/s 143(3) of the Act before the Ld. CIT(A) and challenged the adjustment which were made u/s 143(1) of the Act. The Ld. CIT(A) however rejected the grounds raised by the assessee and dismissed The learned Commissioner of Income Tax erred in confirming in of the Assessing Officer not granting deduction of Rs. 1,98,57,246/- under sec. 43B of the Act even though disallowed in the past assessment period. The learned Commissioner of Income Tax erred in confirming in action of the Assessing Officer in taxing the income of Rs. 7,43,211/- under the head business profits even though offered to tax under other heads The learned Commissioner of Income Tax erred in confirming in action of the Assessing Officer in taxing exempt income of Rs. 1,69,944/- credited to profit and loss account. Briefly stated, facts of the case are that the assessee filed return of income on 28.11.2018 declaring total income at which was further revised to Rs.14,83,15,740/ on 30.03.2019. The return of income filed by the processed and intimation u/s 143(1) of the Income-tax Act, 1961 (in issued wherein certain adjustment Subsequently, the return of income filed by the assessee was selected for scrutiny and assessment u/s 143(3) of the Act was completed wherein the Assessing Officer noted that the assessee did suo moto submission with regard to adjustment made by the Central Processing Centre (CPC) in the intimation u/s 143(1) of the Act and therefore, same was not altered and for the purpose of the computation the income, the income assessed u/s 143(1) of the Act, was taken in place of the income filed in the return of income. The assessee did not prefer any appeal against the order u/s 143(1) of the Act and filed appeal against the order u/s 143(3) of the Act before the Ld. CIT(A) and challenged the t which were made u/s 143(1) of the Act. The Ld. CIT(A) however rejected the grounds raised by the assessee and dismissed IMA PD India Pvt. Ltd. 2 ITA No. 4063/MUM/2024 The learned Commissioner of Income Tax erred in confirming in of the Assessing Officer not granting deduction of Rs. under sec. 43B of the Act even though The learned Commissioner of Income Tax erred in confirming in e income of Rs. under the head business profits even though The learned Commissioner of Income Tax erred in confirming in action of the Assessing Officer in taxing exempt income of Rs. Briefly stated, facts of the case are that the assessee filed return of income on 28.11.2018 declaring total income at which was further revised to Rs.14,83,15,740/- on 30.03.2019. The return of income filed by the assessee was tax Act, 1961 (in wherein certain adjustments were made. Subsequently, the return of income filed by the assessee was ) of the Act was completed wherein the Assessing Officer noted that the assessee did submission with regard to adjustment made by the Central Processing Centre (CPC) in the intimation u/s 143(1) of the Act and therefore, same was not altered and for the , the income which was was taken in place of the income filed in the return of income. The assessee did not prefer any appeal against the order u/s 143(1) of the Act and filed appeal against the order u/s 143(3) of the Act before the Ld. CIT(A) and challenged the t which were made u/s 143(1) of the Act. The Ld. CIT(A) however rejected the grounds raised by the assessee and dismissed the appeal as infructuous holding that the addition does not emanate from the impugned the Act. 3. Before us, the Ld. counsel for the assessee submitted that when regular assessment was completed the relevant intimation issued u/s 143(1) of the Act got automatically merged with the assessment order passed u/s 143(3) of the Act and therefore, the intimation looses it is relevance once the regular assessment is processed as the intimation the information submitted by the assessee. The Ld. counsel submitted that validity of the intimation issued u/s 143(1) of the Act is limited to correctness declared in the return of income and accuracy based on the information submitted along with return of income and it does not carry the legitimacy of an assessment. The Ld. counsel relied on th decision of the Co-ordinate Bench of the Tribunal in the case of The South India Club v. ITO Ward Exemption (2)(3), New Delhi in ITA No. 354/Del/2024 pronounced on 22.05.2024. The Ld. counsel also alternatively submitted that if the assessee is advised t appeal against the intimation u/s 143(1) of the Act condonation for delay in filing appeal against said or liberally allowed, as the assessee was appeal did not lie against the order passed u/s 1 particularly, when the order u/s 143(3) of the Act is passed after the appeal as infructuous holding that the addition does not from the impugned assessment order passed u/s 143(3) of Before us, the Ld. counsel for the assessee submitted that when regular assessment was completed the relevant intimation issued u/s 143(1) of the Act got automatically merged with the assessment order passed u/s 143(3) of the Act and therefore, the imation looses it is relevance once the regular assessment is processed as the intimation is merely towards the accuracy of the of the information submitted by the assessee. The Ld. counsel submitted that validity of the intimation issued u/s 143(1) of the correctness of arithmetic accuracy of claims declared in the return of income and accuracy based on the information submitted along with return of income and it does not carry the legitimacy of an assessment. The Ld. counsel relied on th ordinate Bench of the Tribunal in the case of The South India Club v. ITO Ward Exemption (2)(3), New Delhi in ITA No. 354/Del/2024 pronounced on 22.05.2024. The Ld. counsel also alternatively submitted that if the assessee is advised t appeal against the intimation u/s 143(1) of the Act condonation for delay in filing appeal against said or s the assessee was under bona fide believe that appeal did not lie against the order passed u/s 143(1) of the Act when the order u/s 143(3) of the Act is passed after IMA PD India Pvt. Ltd. 3 ITA No. 4063/MUM/2024 the appeal as infructuous holding that the addition does not assessment order passed u/s 143(3) of Before us, the Ld. counsel for the assessee submitted that when regular assessment was completed the relevant intimation issued u/s 143(1) of the Act got automatically merged with the assessment order passed u/s 143(3) of the Act and therefore, the imation looses it is relevance once the regular assessment is accuracy of the of the information submitted by the assessee. The Ld. counsel submitted that validity of the intimation issued u/s 143(1) of the of arithmetic accuracy of claims declared in the return of income and accuracy based on the information submitted along with return of income and it does not carry the legitimacy of an assessment. The Ld. counsel relied on the ordinate Bench of the Tribunal in the case of The South India Club v. ITO Ward Exemption (2)(3), New Delhi in ITA No. 354/Del/2024 pronounced on 22.05.2024. The Ld. counsel also alternatively submitted that if the assessee is advised to file an appeal against the intimation u/s 143(1) of the Act, then any condonation for delay in filing appeal against said order might be bona fide believe that 43(1) of the Act, when the order u/s 143(3) of the Act is passed after making appropriate inquiry and after due discussion and adjudication of the issue of in the assessment proceedings. 4. We have heard rival submission of the parties and p relevant material on record. In the case of the assessee the Assessing Officer has made adjustment to the returned income in the order u/s 143(1) of the Act which is appealable before the Ld. First Appellate Authority as per section period, but the assessee did not prefer any appeal against said intimation order. Subsequently, the return was selected for scrutiny and assessment u/s 143(3) of the Act was completed. The assessee preferred appeal against order u/s 143(3) of the adjustments, which were made in the order u/s 143(1) of the Act. Before us, the Ld. counsel for the assessee has relied on the decision of the Co-ordinate Bench of the Tribunal in the case South India Club (supra) u/s 143(1) of the Act exemption was disallowed for information in prescribed form. The return of income was subsequently selected for scrutiny 11 was examined on merit and thereafter the said case, the appeal against intimation was held to be infructuous as the issue of exemption was examined under the scrutiny proceedings and disallowed on merit. In our opinion facts of the said case are not applicable in the c the case the adjustment made u/s 143(1) of the Act have not been making appropriate inquiry and after due discussion and adjudication of the issue of in the assessment proceedings. We have heard rival submission of the parties and p relevant material on record. In the case of the assessee the Assessing Officer has made adjustment to the returned income in the order u/s 143(1) of the Act which is appealable before the Ld. First Appellate Authority as per section 246/246A dur but the assessee did not prefer any appeal against said intimation order. Subsequently, the return was selected for scrutiny and assessment u/s 143(3) of the Act was completed. The assessee preferred appeal against order u/s 143(3) of the Act and challenged which were made in the order u/s 143(1) of the Act. Before us, the Ld. counsel for the assessee has relied on the ordinate Bench of the Tribunal in the case South India Club (supra). In the said case under the intimation u/s 143(1) of the Act exemption was disallowed for prescribed form. The return of income was subsequently selected for scrutiny and the claim of exemption u/s 11 was examined on merit and thereafter same was disallowed. In the said case, the appeal against intimation was held to be infructuous as the issue of exemption was examined under the scrutiny proceedings and disallowed on merit. In our opinion facts of the said case are not applicable in the case of the assessee as in the case the adjustment made u/s 143(1) of the Act have not been IMA PD India Pvt. Ltd. 4 ITA No. 4063/MUM/2024 making appropriate inquiry and after due discussion and adjudication of the issue of in the assessment proceedings. We have heard rival submission of the parties and perused the relevant material on record. In the case of the assessee the Assessing Officer has made adjustment to the returned income in the order u/s 143(1) of the Act which is appealable before the Ld. /246A during relevant but the assessee did not prefer any appeal against said intimation order. Subsequently, the return was selected for scrutiny and assessment u/s 143(3) of the Act was completed. The assessee the Act and challenged which were made in the order u/s 143(1) of the Act. Before us, the Ld. counsel for the assessee has relied on the ordinate Bench of the Tribunal in the case of d case under the intimation u/s 143(1) of the Act exemption was disallowed for non filing of prescribed form. The return of income was and the claim of exemption u/s same was disallowed. In the said case, the appeal against intimation was held to be infructuous as the issue of exemption was examined under the scrutiny proceedings and disallowed on merit. In our opinion facts ase of the assessee as in the case the adjustment made u/s 143(1) of the Act have not been examined during the scrutiny proceedings u/s 143(3) of the Act by the Assessing Officer and therefore, the Ld. CIT(A) has rightly dismissed the grounds of appeal of addition disputed in the grounds raised are not emanating from the assessment order whic of appeal of the assessee is accordingly dismissed. 4.1 However, the assessee is it liberty to order u/s 143(1) of the Act before the Ld. First Appellate Authority. As far as the issue of the condonation for delay is concerned, the assessee may file its explanation for the delay in filing appeal which may be considered by accordance with law. 5. In the result, the appeal of the assessee is dismissed. Order pronounced in the open Court on Sd/- (SANDEEP SINGH KARHAIL JUDICIAL MEMBER Mumbai; Dated: 22/10/2024 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// examined during the scrutiny proceedings u/s 143(3) of the Act by the Assessing Officer and therefore, the Ld. CIT(A) has rightly dismissed the grounds of appeal of the assessee holding that the addition disputed in the grounds raised are not emanating from the assessment order which was challenged before him. Thu of appeal of the assessee is accordingly dismissed. However, the assessee is it liberty to file an appeal against the order u/s 143(1) of the Act before the Ld. First Appellate Authority. As far as the issue of the condonation for delay is concerned, the assessee may file its explanation for the delay in filing appeal which may be considered by the Ld. First Appellate Authority in accordance with law. In the result, the appeal of the assessee is dismissed. nounced in the open Court on 22/10/2024. Sd/ (SANDEEP SINGH KARHAIL) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : BY ORDER, (Assistant Registrar) ITAT, Mumbai IMA PD India Pvt. Ltd. 5 ITA No. 4063/MUM/2024 examined during the scrutiny proceedings u/s 143(3) of the Act by the Assessing Officer and therefore, the Ld. CIT(A) has rightly the assessee holding that the addition disputed in the grounds raised are not emanating from the h was challenged before him. Thus, ground file an appeal against the order u/s 143(1) of the Act before the Ld. First Appellate Authority. As far as the issue of the condonation for delay is concerned, the assessee may file its explanation for the delay in filing appeal, the Ld. First Appellate Authority in In the result, the appeal of the assessee is dismissed. Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER (Assistant Registrar) ITAT, Mumbai "