ITAT | Intimation Under Section 143(1) Without 30 Days Invalid

Case Details: Rotary Charitable Trust vs. Income-tax Officer Exemption - [2025] 177 taxmann.com 158 (Bangalore - Trib.) 

Judiciary and Counsel Details

• Waseem Ahmed, Accountant Member
• Keshav Dubey, Judicial Member
• Tharun Kothari, A.R. for the Appellant.
• Subramanian, D.R. for the Respondent.

Facts of the Case

Assessee, a charitable trust, filed its updated return of income for the relevant year in which it claimed exemption under section 10(23C)(iiiac). The Deputy Director, CPC, Bengaluru, issued a notice seeking information/clarification on data in the updated return. However, without waiting for the mandatory period as provided in the second proviso to section 143(1)(a), he passed an intimation under section 143(1) by treating the entire gross receipts declared by the assessee as the assessee’s income.
The matter reached the Bangalore Tribunal.

Tribunal Held

The Tribunal held that the first Proviso to section 143(1)(a) mandates that no adjustments shall be made unless the assessee is given intimation of such adjustments either in writing or in electronic mode. This has been followed by the Deputy Director, CPC, Bengaluru, by issuing the notice seeking information/clarification from the assessee on the data in the updated return.
Further, in the said intimation, it was also clearly mentioned in the box that the assessee’s response should be provided within 30 days of receipt of this intimation. However, the Deputy Director, CPC, Bengaluru, without waiting for the mandatory period as provided in the second proviso to section 143(1)(a) and also mentioned in the above notice, passed an intimation under section 143(1) just after a gap of 2 days of issuing intimation by adding the entire school fee & RTE grants as income of the assessee without providing adequate opportunity to the assessee to clarify.
There was a clear violation of the principles of natural justice by providing an inadequate opportunity to the assessee. The minimum statutory requirement of 30 days to submit the response to the letter/intimation is not merely a procedural formality but an essential aspect of due process. It ensures the legal process remains fair & just. Therefore, the intimation passed under section 143(1) was illegal and the same was quashed.

List of Cases Referred to

• National Thermal Power Co. Ltd. v. CIT [1998] 97 Taxman 358/229 ITR 383 (SC) (para 4).