SUBHADRA CONSTRUCTION ,DHANBAD, JHARKHAND V. DCIT, CIRCLE (1), DHANBAD, DHANBAD, JHARKHAND

ITA 74/RAN/2025

AI Insights

The case involves Subhadra Construction, which appealed against the orders of the CIT(A), NFAC, Delhi, concerning the assessment years 2021-22 and 2022-23. The primary issue was the denial of exempt income in the form of partners' share of profit from the firm, which was claimed by the assessee. The Department's stance, represented by CIT-DR Shri Rajib Jain, was that the firm had not filed its return, and thus, the income could not be granted as exempt. The tribunal, after considering the submissions, concluded that the adjustment made in the intimation under Section 143(1) was not a permissible prima facie adjustment and thus quashed the intimation and the subsequent rectification.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 826217 (ITAT-RANCHI)
• Duration Of Justice: 9 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-01-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2022-2023
• Appeal Filed On: 27-03-2025
• Laws Referred To: Section 143(1), Section 154
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Earning of tax free income
• Section: 154

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI BENCH, RANCHI BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI RATNESH NANDAN SAHAY, ACCOUNTANT MEMBER ITA No. 73 & 74/Ran/2025 (Assessment Years-2021-22 & 2022-23) Subhadra Construction, Ranga Bandh, Aamkura, PO-Maithon, Dhanbad-828207 (Jharkhand) PAN No. ABMFS 7473 E Vs. D.C.I.T., Circle-(1), Dhanbad. Appellant/ Assessee Respondent/ Revenue Assessee represented by Adjournment Application Department represented by Shri Rajib Jain, CIT-DR Date of hearing 06/01/2026 Date of pronouncement 06/01/2026 O R D E R PER: BENCH 1. These are the appeals filed by the assessee against the orders of the ld. CIT(A), NFAC, Delhi both dated 27/01/2025 for the A.Y. 2021-22 and 2022- 23 respectively. 2. The assessee has sought adjournment. As it is noticed that the issue in these appeals are very small. The adjournment application filed by the assessee is rejected and the appeals disposed off. 3. It was put to the ld. CIT-DR that the adjustment as done in Section 143(1) and denied under Section 154 is in respect of the exempt income claimed by the assessee representing the partners' share of profit from the firm. It was put to the ld. CIT-DR that as to how the said denial of the said exempt income can be done in an intimation under Section 143(1) in so far as it does not fall within prima facie adjustment as specified in the provisions of Section 143(1). It was submitted by the ld. CIT-DR that non-filing of the form shows Printed from counselvise.com ITA No. 73 & 74/Ran/2025 Subhadra Construction Vs DCIT 2 that the firm has not filed the return and therefore, the income cannot be granted as exempt. It was a submission that the adjustment is permissible. 4. We have considered the submissions. The firm having not filed its return cannot make the claim of exemption in the hands of the partners, prima facie adjustment which can be done in an intimation under Section 143(1) as the adjustment as done in the intimation is found to be not falling within the parameters of prima facie adjustment as required under the provisions of Section 143(1), the intimation issued under Section 143(1) and the consequential rectification denied, stands quashed. 5. In the result, both the appeals of the assessee are allowed. Order announced in open court on 06/01/2026 Sd/- Sd/- (RATNESH NANDAN SAHAY) (GEORGE MATHAN) ACCOUNTANT MEMBER JUDICIAL MEMBER Ranchi, Dated: 06/01/2026 *Ranjan Copy to: 1. Assessee 2. Revenue 3. CIT 4. DR By order 5. Guard File Sr. Private Secretary, ITAT, Ranchi Printed from counselvise.com "