SREE NARAYANA DHARMA PARIPALANA YOGAM,ERNAKULAM V. ITO(EXEMPTION), ERNAKULAM

ITA 870/COCH/2024

AI Insights

The case involves Sree Narayana Dharma Paripalana Yogam, a charitable society registered under section 12A of the Income Tax Act, 1961, which filed an appeal against the order of the National Faceless Appeal Centre (NFAC), Delhi, for the Assessment Year 2014-15. The society claimed an exemption of Rs. 60,16,479 for income from educational institutions whose aggregate receipts are below Rs. 1 crore, as per section 10(23C) of the Act. The CPC denied this exemption without notice during the processing of the return under section 143(1), leading to the appeal. The Tribunal's decision to remit the matter back to the CPC was based on the procedural error of not issuing a notice for the proposed adjustment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 474700 (ITAT-COCHIN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-03-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: LEENA LAL
• Assessee Lawyers: JAIKRISHNA
• Section: 143(1); 12A; 10(23C)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH BEFORE SHRI INTURI RAMA RAO, AM ITA No. 870/Coch/2024 Assessment Year: 2014-15 Sree Narayana Dharma Paripalana Yogam .......... Appellant Branch No. 1103, Poothotta Ernakulam 682037 [PAN: AAIAS9506N] vs. The Income Tax Officer .......... Respondent Exemption, Ernakulam Appellant by: Shri Jaikrishna, Advocate Respondent by: Smt. Leena Lal, Sr. D.R. Date of Hearing: 12.03.2025 Date of Pronouncement: 27.03.2025 O R D E R This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 27.06.2024 for Assessment Year (AY) 2014-15. 2. Brief facts of the case are that the appellant is a charitable society incorporated with the object of imparting education. It was duly registered u/s. 12A of the Income Tax Act, 1961 (the Act). The return of income for AY 2014-15 was filed on 19.11.2014 disclosing total income of Rs. 8,74,62,857/-. In the return of income the appellant claimed exemption of Rs.60,16,479/- being income of educational institutions 2 ITA No. 870/Coch/2024 Sree Narayana Dharma Paripalana Yogam whose aggregate receipts are below Rs. 1 crore as per section 10(23C) of the Act. The return of income was processed u/s. 143(1) of the Act by CPC vide intimation dated 28.02.2016 denying the exemption u/s. 10(23C) of the Act. 3. Being aggrieved, an appeal was filed before the CIT(A) contending that the CPC had failed to give any notice of the proposed adjustment in the intimation and the adjustment made is beyond the scope of provisions of section 143(1) of the Act. However, the CIT(A) dismissed the appeal. 4. Being aggrieved, the appellant is in appeal before the Tribunal in the present appeal. 5. The learned counsel for the assessee submitted that the CPC, without giving notice of the proposed adjustment, simply carried out the adjustment which is contrary to the provisions of section 143(1) of the Act. It is further submitted that the CPC ought not have made the adjustment by disallowing the claim for deduction u/s. 10(23C) of the Act, which is beyond the scope of section 143(1) of the Act. 6. On the other hand, the learned Sr. DR supporting the orders of the lower authorities submitted that no interference is required in the orders of the lower authorities. 7. I heard the rival contentions of both the parties and perused the material available on record. The CPC, while processing the return of income denied the claim for exemption u/s. 10(23C) of the Act in respect of the institutions whose gross receipts are below Rs. 1 crore. Undisputedly 3 ITA No. 870/Coch/2024 Sree Narayana Dharma Paripalana Yogam this adjustment was made by the CPC without giving any notice of proposed adjustment. This is contrary to the plain provisions of section 143(1) of the Act. Therefore, I remit the matter back to the file of the CPO to the stage of issue of notice on the proposed adjustment. 8. In the result, the appeal filed by the assessee stands partly allowed. 9. Order pronounced in the open court on 27th March, 2025. Sd/- (INTURI RAMA RAO) ACCOUNTANT MEMBER Cochin, Dated: 27th March, 2025 n.p. Copy to: 1. The Appellant 2. The Respondent 3. The Pr. CIT concerned 4. The Sr. DR, ITAT, Cochin 5. Guard File By Order Assistant Registrar ITAT, Cochin "