MUDIALI CLUB,KOLKATA V. I.T.O., WARD - 1(4), EXEMPTION, KOLKATA

ITA 2443/KOL/2025

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The case involves Mudiali Club, the appellant, contesting an intimation issued by the Income Tax Officer (ITO), Ward-1(4), Exemption, Kolkata, for the assessment year 2018-2019. The intimation disallowed all expenditures claimed by the club on the grounds that the audit report was not filed on time. The club argued that such a blanket disallowance was not permissible and that the intimation should be quashed. The tribunal agreed with the club's position, noting that the adjustments made in the intimation were not permissible under section 143(1) of the Income Tax Act, which allows only for arithmetical mistakes to be corrected in such intimations.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 824965 (ITAT-KOLKATA)
• Duration Of Justice: 2 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2018-2019
• Appeal Filed On: 29-10-2025
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANDEEP LAKRA
• Assessee Lawyers: R. PATODIA; SONAL AGARWAL

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, KOLKATA BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI RAKESH MISHRA, ACCOUNTANT MEMBER आयकर अपील सं/ITA No.2443/KOL/2025 (निर्धारण वर्ा / Assessment Year : 2018-2019) Mudiali Club, 3, Rajani Sen Road, Kalighat SO, Kolkata West Bengal-700026 Vs ITO Ward-1(4), Exemption, Kolkata PAN No. :AABAM 2960 M (अपीलधर्थी /Appellant) .. (प्रत्यर्थी / Respondent) निर्धाररती की ओर से /Assessee by Shri R. Patodia & Ms. Sonal Agarwal, ARs रधजस्व की ओर से /Revenue by : Shri Sandeep Lakra, Sr. DR सुनवाई की तारीख / Date of Hearing : 01/01/2026 घोषणा की तारीख/Date of Pronouncement : 01/01/2026 आदेश / O R D E R Per Bench : This is an appeal filed by the assessee against the order of the ld. Addl./JCIT(A)-4, Mumbai, dated 18.06.2024 for the assessment year 2018- 2019 2. The appeal of the assessee is filed belatedly by 59 days. In this regard, the assessee has filed condonation application stating sufficient reasons for condonation of delay, which are not found to be false. Ld.Sr. DR also did not raise any serious objection. Considering the prayer of the assessee, the delay of 59 days in filing the appeal is condoned and the appeal is admitted for hearing. Printed from counselvise.com ITA No.2443/KOL/2025 2 3. It was submitted by the Ld.AR that the return filed by the assessee for the impugned assessment year was processed and intimation u/s.143(1) of the Act had been issued wherein the expenditure claimed by the assessee has been disallowed on the ground that audit report has not been filed within time. It was submission that the adjustment as made in the intimation is not permissible, insofar as it is not an arithmetical mistake. It was the submission that the intimation is liable to be quashed. It was submitted by the Ld.AR that the assessee did not receive the notice and the assessee had specifically mentioned in the form 35 that the notices should not be sent by email but should be sent by post as the President Secretary and Treasurer of the club keeps on changing. It was submission that as the adjustment in the intimation is not permissible, the intimation is liable to be quashed. 4. In reply, Ld.Sr. DR vehemently supported the order of the Assessing Officer/CPC and the Ld. CIT(A). 5. We have considered the rival submissions. A perusal of the intimation issued u/s.143(1) of the Act shows that the expenditures claimed by the assessee has been disallowed in its entirety in the intimation. If the Assessing Officer/CPC purposes to make disallowance of the expenditure on account of the non-filing of the audit report within time, then the expenditure of the assessee would have to be redrafted and the income should have to be computed under the normal accountancy principle. There is no provision for blanket disallowance for all expenses and it would not fall in the category of an arithmetical mistake which is permissible in the Printed from counselvise.com ITA No.2443/KOL/2025 3 intimation u/s.143(1) of the Act. As the adjustment made in the intimation is not a permissible adjustment, the adjustment as made in the intimation u/s.143(1) of the Act stands deleted and the intimation issued u/s.143(1) of the Act stands quashed. 6. In the result, appeal of the assessee is allowed. Order dictated and pronounced in the open court on 01/01/2026. Sd/- (RAKESH MISHRA) Sd/- (GEORGE MATHAN) लेखा सदस्य/ ACCOUNTANT MEMBER न्यधनयक सदस्य / JUDICIAL MEMBER कोलकाता Kolkata; ददनाांक Dated 01/01/2026 Prakash Kumar Mishra, Sr.P.S. आदेश की प्रनतललपप अग्रेपर्त/Copy of the Order forwarded to : आदेशधिुसधर/ BY ORDER, (Assistant Registrar) Income Tax Appellate Tribunal, Kolkata 1. अपीलार्थी / The Appellant- 2. प्रत्यर्थी / The Respondent- 3. आयकर आयुक्त(अपील) / The CIT(A), 4. आयकर आयुक्त / CIT 5. विभागीय प्रविविवि, आयकर अपीलीय अविकरण, कोलकाता / DR, ITAT, Kolkata 6. गार्ड फाईल / Guard file. सत्यापपत प्रतत //True Copy// Printed from counselvise.com "