SHRUTI CHANDRASHEKHAR ANGOLKAR,DADAR EAST,MUMBAI V. ADDL-JCIT(A),BENGALURU, INCOME TAX DEPARTMENT,OFFICE OF THE CIT,APPEAL, ADDL/JCIT(A),BENGALURU

ITA 4409/MUM/2024

AI Insights

The case involves Mrs. Shruti Chandrashekhar Angolkar, who appealed against the order of the Addl/JCIT(A)-4, Bengaluru, which confirmed an addition of Rs.5,73,420 to her income for the assessment year 2021-22. The addition was initially made by the CPC during the processing of her income tax return, where she had claimed an exemption of Rs.8,73,423 on account of leave encashment. The CPC allowed only Rs.3,00,000 of this claim, disallowing the excess. The Assessee challenged this addition on the grounds that no prior notice or intimation was given before the adjustment was made. The Tribunal found that the CPC had not followed the mandatory procedural requirements, leading to the allowance of the Assessee's appeal.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 33817 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: J
• Next Hearing Date: 15-10-2024
• Assessment Year: 2021-2022
• Appeal Filed On: 26-08-2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASIF KAR MALI
• Assessee Lawyers: CHANDRASHEKHAR ANGOLKAR
• Section: 143(1); 139(1)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH “J (SMC)”, MUMBAI BEFORE SHRI NARENDER KUMAR CHOUDHRY, JUDICIAL MEMBER AND SHRI GAGAN GOYAL, ACCOUNTANT MEMBER ITA No.4409/M/2024 Assessment Year: 2021-22 Mrs. Shruti Chandrashekhar Angolkar, 6, Laxminarayan Sadan, 2nd Floor, Vikas Wadi, 168C, Dr. Ambedkar Road, Dadar East, Mumbai – 400014 PAN: AAIPA3478J Vs. Addl-JCIT(A), Bengaluru, Income Tax Department, Office of the CIT, Appeal, ADDL/JCIT(A), Bengaluru, Karnataka- 560001 (Appellant) (Respondent) Present for: Assessee by : Shri Chandrashekhar Angolkar, A.R. Revenue by : Shri Asif Karmali, Sr. D.R Date of Hearing : 15.10.2024 Date of Pronouncement : 30.10.2024 O R D E R Per : Narender Kumar Choudhry, Judicial Member: This appeal has been preferred by the Assessee against the order dated 29.06.2024, impugned herein, passed by the Ld. Addl/JCIT(A)-4, Bengaluru (in short “Ld. Addl./Joint Commissioner”) for the A.Y. 20213-22. ITA No.4409/M/2024 Mrs. Shruti Chandrashekhar Angolkar 2 2. In this case, the Assessee by filing return of income for the assessment year under consideration u/s 139(1) of the Act on 30.12.2021 within the extended due date had claimed the exemption of Rs.8,73,423/- on account of leave encashment. The return filed by the Assessee was processed by the CPC vide intimation/order dated 22.03.2022 u/s. 143(1) of the Act, whereby the addition of Rs.5,73,420/- on account of disallowance of exemption claimed u/s 10(AA) of the Act was levied. 3. The Assessee, being aggrieved, challenged the said addition before the Ld. Commissioner, who by holding affirmed the said addition by observing and holding as under: “That earlier the exemption limit on account of leave encashment received by private sector employees was Rs.3,00,000/- which is not increased to Rs.25,00,000/- as per budged 2023-24 and as the Assessee has received Rs.8,73,423/- on account of leave encashment and therefore as per the provisions of section 10(AA) of sub section 10A of the Act, Rs.3,00,000/- can be allowed as exempted. The AO, CPC while processing the return of income of the Assessee, the CPC has rightly disallowed the excess claimed by the Assessee”. 4. The Assessee, being aggrieved, is in appeal before us. 5. We have heard the parties and perused the material available on record. The Assessee has not challenged the addition on merit but in fact ITA No.4409/M/2024 Mrs. Shruti Chandrashekhar Angolkar 3 challenged the same on the legal ground to the effect that the CPC while processing the return filed by the Assessee or issuing the intimation/order 143(1) of the Act or before making the adjustment u/s 10(AA) of the Act, has not issued any notice/intimation to the Assessee and therefore the addition made on adjustment, is liable to be deleted. 6. The Ld. D.R. refuted the claim of the Assessee, but not the factual aspect qua not issuing any intimation/notice before making the adjustment. 7. Having heard the parties and given thoughtful consideration to the rival submission of the parties and material available on record, we observe that admittedly first proviso to section 143 of the Act, mandates that no adjustments as prescribed in sub clause (a) of section 143(1) of the Act shall be made, unless an intimation is given to the Assessee of such adjustments either in writing or in electronic mode. It appears from record and submission of the parties that in the instant case, the CPC has not followed such mandatory condition. Hence, we are constrained to allow the claim of the Assessee by deleting the adjustment/addition of Rs.5,73,420/-, however subject to verification by the jurisdictional AO whether any intimation/notice has ever been issued before processing the return or making the adjustment or issuing the intimation/order u/s 143(1) of the Act or not. ITA No.4409/M/2024 Mrs. Shruti Chandrashekhar Angolkar 4 8. In the result, the appeal filed by the Assessee stands allowed in the direction made above. Order pronounced in the open court on 30.10.2024. Sd/- Sd/- (GAGAN GOYAL) (NARENDER KUMAR CHOUDHRY) ACCOUNTANT MEMBER JUDICIAL MEMBER * Kishore, Sr. P.S. Copy to: The Appellant The Respondent The CIT, Concerned, Mumbai The DR Concerned Bench //True Copy// By Order Dy/Asstt. Registrar, ITAT, Mumbai. "