Adjustment denying exemption u/s 10(23C)(iiiad) deleted as there was no column / provision in ITR for showing computation of exemption u/s 10(23C)(iiiad)
ABCAUS Case Law Citation:
ABCAUS 3736 (2023) (05) ITAT
In the instant case, the assessee had challenged the order passed by the CIT(A) in confirming the adjustment made u/s 143(1) of the Income Tax Act, 1961 (the Act) denying the exemption u/s 10(23C)(iiiad).
The assessee filed his return of income for the relevant assessment year. The assessee was running an educational institution. The assessee has been claiming exemption u/s 10(23C)(iiiad) of the Act.
The assessee did not have registration u/s 12A, 12AA of the Act and had never claimed exemption u/s 11 or 12 of the Act.
The return was processed and an intimation was issued u/s 143(1) of the Act wherein the claim of application of income was disallowed on the ground that the assessee did not have registration u/s 12A & 12AA of the Act.
The CIT(A) did not entertain the contentions of the assessee.
Before the Tribunal, the assessee submitted that as there was no provision for showing the computation of the exemption claimed u/s 10(23C)(iiiad) of the Act, it cannot be said that there was any mistake apparent from the record or there was any incorrect claim apparent from the information in the return.
It was the submission that in the absence of any column showing computation of the exemption u/s 10(23C)(iiiad) of the Act, the assessee left with no other alternative but to fill columns which were in regard to the aggregate of income u/s 11, 12 and sections 10(23C)(iv), 10(23C)(v), 10(23C)(vi) & 10(23C)(via) of the Act.
It was contended that as the assessee was running a sch(ool and its turnover was below Rs. 1 crore, the assessee had rightly claimed its income to be exempted u/s 10(23C)(iiiad) of the Act.
The Tribunal observed that there was no provision in the return for showing the computation of the exemption u/s 10(23C)(iiiad) of the Act.
The Tribunal opined that in the absence of the provision for submitting the details in regard to the computation of the exemption u/s 10(23C)(iiiad) of the Act, it cannot be said that there is an incorrect claim in regard to the claim of expenditure made in the return.
The Tribunal further held that this was not an adjustment which is permissible in the intimation u/s 143(1) of the Act.
Accordingly, the adjustment made in the intimation was set aside and the AO was directed to accept the return of the assessee as filed.
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