Form 16 controls salary adjustments where the record shows duplication, making denial of exemptions and rectification unsustainable.

Processing under section 143(1)(a) cannot sustain a double addition of perquisites, denial of house rent allowance exemption, or disallowance of Chapter VI-A deductions when the employer-issued Form 16 remains unrejected and supports the salary computation. An apparent mistake in the intimation may be corrected under section 154, and refusal to rectify is unsustainable where the record itself shows the duplication. On the stated facts, the CPC adjustments were deleted and the salary-related relief reflected in Form 16 was accepted.

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Issues: Whether the additions made in processing the return under section 143(1)(a) and the rejection of rectification under section 154 were justified, particularly in relation to double addition of perquisites, denial of house rent allowance exemption, and disallowance of deductions reflected in Form 16.

Analysis: The assessee had filed the return along with Form 16 issued by the employer, which reflected the salary details, perquisites, exemption for house rent allowance, and deductions under Chapter VI-A. The record showed that the same perquisite value had been considered twice in the processing, and the tax department had itself indicated in the rectification order that such intimation could be corrected under section 154. In the absence of rejection of the employer-issued Form 16, the entries therein were treated as the proper basis for the salary computation and related exemptions and deductions. The adjustment made by the CPC and the refusal to rectify were therefore found to be unsustainable.

Conclusion: The additions were deleted and the assessee succeeded on merits.

Final Conclusion: The assessment adjustments based on the intimation were set aside, and the claim for relief arising from the salary computation was accepted.

Ratio Decidendi: Where the employer-issued Form 16 is not rejected, salary-related exemptions and deductions reflected therein cannot be denied through an unsustainable adjustment or refusal of rectification, especially when the mistake is apparent from the record.

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